Accounts are usually approved months after the year end, and things happen in between. This note tells readers about significant events in that gap that are not reflected in the figures.
What this note shows
FRS 102 sorts events after the reporting date into two kinds:
- Adjusting events tell you more about a situation that already existed at the year end — for example a customer who owed money at the year end goes into liquidation. These are put through the accounts (here, by writing off the debt), so they do not normally need a note.
- Non-adjusting events reflect something new that happened after the year end — a dividend declared, a property bought or sold, a major loss from a fire, new borrowing. The figures are not changed, but if the event is material the notes should describe it and estimate its financial effect.
The Small Companies and Groups (Accounts and Directors' Report) Regulations 2008 (SI 2008/409) Schedule 1 requires small companies to disclose the nature and financial effect of material events arising after the balance sheet date that are not reflected in the accounts. If nothing significant has happened, you can leave the note switched off or use the “No post balance sheet events” template.
This note is part of the FRS 102 Section 1A notes; it is not one of the four notes available in FRS 105 micro-entity accounts.
Where the information comes from
This is a text note; nothing is taken from the trial balance. Ask the directors about anything significant since the year end: board minutes, dividend vouchers, new loan agreements, asset sales or purchases, and anything affecting whether the business can continue. Do this as close as possible to the date the accounts are approved.
A dividend declared after the year end is not a liability at the balance sheet date, so it must not be in the trial balance for this period. It is disclosed here instead, and booked in the following period.
Completing the note in Tax Optimiser
- Open the period, choose View Accounts, then Notes.
- Select Events after the reporting date and set Show this note in the accounts to Yes.
- Click Use Template and choose the wording, or type your own description. For more than one event, apply a template and type the further events below it.
- Click Save changes.
Wording templates
- Dividend declared after year end — a dividend declared after the reporting date and not recognised as a liability. Asks for {{DividendAmount}}.
- Material post year-end event — any other significant event with its estimated financial effect. Asks for {{EventDescription}} (written to follow “After the reporting date”, for example “the company purchased new premises for £250,000”) and {{FinancialEffect}}.
- No post balance sheet events — a statement that there have been no significant events since the end of the reporting period.
How it appears in the accounts
The note prints as text under the heading “Events after the reporting date”.
Frequently asked questions
What is the difference between an adjusting and a non-adjusting event?
An adjusting event gives more evidence about conditions at the year end and is put through the figures. A non-adjusting event reflects new conditions after the year end; the figures are not changed, but material ones are disclosed in this note.
Should a dividend declared after the year end be in the accounts?
Not as a liability. It was not owed at the balance sheet date. Disclose it in this note and record it in the next period.
Up to what date do post balance sheet events count?
Up to the date the directors approve the accounts for issue, which is the date the balance sheet is signed.
Do I need this note if nothing has happened?
No. You can leave it switched off, or include the “No post balance sheet events” wording if you prefer to say so.