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Why is a final ordinary dividend of 3c per share “declared” on 30/10/X2 “recognised” in the financial statements for the year ended 31/10/X2?
Because final dividend is just proposed at the end of the year but not paid until next year and dividends are only recorded when actually paid.
I am confused with “recording” and “recognising” dividend in financial statements.
Please help! Thank you in advance.
“Declared” means that the dividend has been announced and is certain.
Because it is certain it will appear in the financial statements for the year ended 31 October X2. (It has not been paid and so it will show as an accrual).“Recognised” means ‘appears in the financial statements’.
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