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It will be helpful, if you clarify .
Before Year -end :
1-Proposed Dividend (not declared)
2-Declared dividend
3-Bonus issueAfter Reporting year end date:
1-Proposed Dividend (not declared)
2-Declared dividend
3-Bonus issueProposed and declared are, for P2 purposes, apparently taken as synonymous
Technically, in law, the directors will propose a dividend based on the results for the year. But that proposal, again technically, requires the consent of the members of the company voting by ordinary resolution to accept the directors’ proposal to pay x cents per share.
Once again technically, the members could actually say “NO!” we don’t want x cents per share …. but they never do
In purely practical terms, an interim dividend would be PAID following the directors’ decision to pay a dividend as an advance against the year’s total dividend. But that total dividend will be based upon the year’s results which, by definition, are not known until after the accounting period end.
So, for an exam question to state that shortly before the end of the year the directors have declared a dividend is really an impractical scenario. But it happens in exams. And, when it happens, the examiner is expecting you to account for this dividend as a liability on CSoFP and an appropriation of profits within the SOCIETY
I think that answers your question
Concluded from your reply :
For P2 purposes
Before year end:
Proposed and Declared dividend will be recognized : give rise to liability.Question:
After year-end :
1-Proposed /declared dividend [ Not an adjusting event and disclosed ? ]
2-Bonus issue [ (read somewhere while doing a kit question) , its a major share transaction that should be disclosed but it is an exception so it will not be disclosed ] .
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