Question
Using the requirements set out in HKAS 10 Events after the Reporting Period, which of the following would be classified as an adjusting event after
Using the requirements set out in HKAS 10 Events after the Reporting Period, which of the following would be classified as an adjusting event after the reporting period in financial statements ended 31 March 2021 that were approved by the directors on 31 August 2021?
1. | The entity had made large export sales to the United States during the year. The year-end receivables included $2 million for amounts outstanding that were due to be paid in US dollars between 1 April 2021 and 1 July 2021. By the time these amounts were received, the exchange rate had moved in favour of the entity. | |
2. | None of them. | |
3. | A reorganisation of the entity, proposed by a director on 31 January 2021 and agreed by the board on 10 July 2021. | |
4. | A strike by the workforce which started on 1 May 2021 and stopped all production for 10 weeks before being settled. | |
5. | The receipt of cash from a claim on an insurance policy for damage caused by a fire in a warehouse on 1 January 2021. The claim was made in January 2021 and the amount of the claim had not been recognised at 31 March 2021 as it was uncertain that any money would be paid. The insurance entity settled with a payment of $1.5 million on 1 June 2021. |
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