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The financial controller of Happy Limited, (a technology company) has asked you, a trainee financial accountant within the company, for advice on how to account for various transactions that occurred after the financial year end date of 31 December 2016

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The financial controller of Happy Limited, (a technology company) has asked you, a trainee financial accountant within the company, for advice on how to account for various transactions that occurred after the financial year end date of 31 December 2016.

 

REQUIREMENT:

Happy Limited has asked you to prepare report which addresses the following:

 

Part A:

(a) Outline the possible reasons why a company would not prepare its financial statements on a going concern basis.

 

(b) In accordance with MFRS 110 - Events after the Reporting Period, describe what is meant by 'event after the reporting period'.

 

(c) If a company receives information after the reporting period about conditions that existed at the end of the reporting period, explain how this information should be dealt with in the financial statements.