These are important because there are several events which may occur in a business in which the shareholders need to be informed of, as financial statements are often released on a lag period from the time in which they are dated.
If subsequent events were not reported, a company could release financial statements in March, that were dated December 31 stating the company was healthy. However, if an unfavorable lawsuit ruling came back in February, then this would undoubtedly taint the report and should be disclosed.
IAS are principles based standards, rather than strict rules based standards that govern international accounting. IAS standards differ from IFRS standards in that they were introduced prior to 2001, whereas IFRS were produced after this date by the IASB, or the International Accounting Standards Board. When determining the hierarchy of these, the IAS is considered to be the building blocks in which the newer and more relevant IFRS are founded and therefore IFRS is more authoritative when these conflict.
Accounting made easy, for FREE!
Access the contact form and send us your feedback, questions, etc. We are always welcome to help someone out. You can also contact us if you wish to submit your writing, cartoons, jokes, etc. and we will consider posting them to share with the world! The Facebook and LinkedIn groups are also good areas to find people interested in accounting like yourself, don’t hesitate to join as everyone of all levels are welcome to become part of the community.