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Fall in value of an investment between the reporting date and the date the financial statements are finalised.I have some duubts why this item is a non-adjusting events?I think it has existed at the reporting date,so it should be adjusted for in the financial statements.
The financial statements should show the value of assets as at the date of the statements.
If the fall is material then it will be disclosed as a note to the accounts.
But why evidence of a permanent diminution in the value of a long-term investment prior to the year end is an adjusting event?
If it was before the year end, then the value at the year end was lower. The statements are supposed to show the position as at the year end.
I do suggest that you watch the free lecture on events after the reporting period – our lectures are a complete course for Paper F3 and cover everything needed to be able to pass the exam well.
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