An event provides additional information about conditions in existence as of the balance sheet date, including estimates used to prepare the financial statements for that period. Events that affect the realization of receivables due to conditions that existed at the balance sheet date. This may occur when trade accounts receivable becomes uncollectible due to a customer filing for bankruptcy after the balance sheet date but before the financial statements are issued. Answer C. Dual dating is used when a subsequent event occurs after the date of the report, but the report has not been issued. Under these circumstances, the company discloses the contingent liability in the footnotes of the financial statements.
Financial Reporting Manual
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Division of Corporation Finance. United States Securities and Exchange Commission. Washington, D. Jay Webb, Senior Accountant. Kevin Kuhar, Accounting Branch Chief.
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