The discount rate Movements during the period

Chapter 17 – Employee Benefits Page 243 13. The Tuarua Company operates a defined benefit post-employment plan and recognises actuarial gainslosses in profit or loss under the corridor approach. At 1 January 20X7 the plan assets were CU800,000, the defined benefit obligation was CU900,000 and the unrecognised actuarial losses were CU120,000. During the year ended 31 December 20X7 actuarial gains of CU15,000 arose. The average remaining working lives of participating employees was 20 years at both 1 January and 31 December 20X7. What are the actuarial losses to be recognised in profit or loss by Tuarua for the year ended 31 December 20X7, according to IAS19 Employee benefits? A CU1,500 B CU1,250 C CU2,000 D CU750 14. At its year end, The Parlour Company has the following balances in relation to a defined benefit post-employment plan: Plan assets CU115,000 Plan liability CU190,000 Unrecognised actuarial loss CU20,000 Under IAS19 Employee benefits, what figure should be shown on Parlours statement of financial position for the plan deficit? A CU75,000 B CU190,000 C CU95,000 D CU55,000 15. The Makarangu Company operates a defined benefit post-employment plan. At 31 December 20X7 the present value of the defined benefit obligation was CU40 million, the fair value of the plan assets was CU10 million, the unrecognised actuarial gains were CU8 million and the past service cost not recognised was CU6 million. What is the defined benefit liability to be recognised by Makarangu at 31 December 20X7, according to IAS19 Employee benefits? A CU16 million B CU28 million C CU44 million D CU32 million Chapter 18 – Events After the Reporting Period Page 245

Chapter 18 EVENTS AFTER THE REPORTING PERIOD

1 Business Context In assessing business performance, pertinent information sometimes arises following the cut- off date for which financial statements are prepared that may have important implications on the financial position and performance in the year just ended. The end of the reporting period is the cut-off date, and events that happen after this point in time should not generally be recognised in the financial statements of the period just ended. However, information that comes to light after the end of the reporting period may provide additional information about events that actually occurred before the end of the reporting period, and it is then appropriate to take it into account. Financial statements should reflect the most up to date facts about events that had occurred by the end of the reporting period. It is sometimes difficult to establish whether an event happening after the end of the reporting period is new information about an existing event or a new event. Users should be informed of significant events occurring after the end of the reporting period, such as acquisitions. The provision of such information will help users to understand the impact on future results. 2 Chapter Objectives This chapter deals with the treatment of events that occur between the end of the reporting period and the date when the financial statements are authorised for issue. On completion of this chapter you should be able to:  understand the objectives and scope of IAS 10 Events after the reporting period;  demonstrate a knowledge of the important terminology and definitions which relate to the treatment of events after the reporting period;  distinguish between adjusting and non-adjusting events after the reporting period;  demonstrate a knowledge of the principal disclosure requirements of IAS 10; and  apply knowledge and understanding of IAS 10 in particular circumstances through basic calculations. 3 Objectives, Scope and Definitions of IAS 10 The objective of IAS 10 is to provide guidance as to how to deal with events that occur after the end of the reporting period but before the date on which the financial statements are authorised for issue by the directors. These are described as “events after the end of the reporting period”. IAS 10 makes a distinction between events that occur during this period which should be adjusted for in the financial statements and those that should instead only be disclosed. The process of authorising financial statements for issue is not defined, as this will depend on the management structure of the entity and the legal requirements of the jurisdiction in which it operates.