A subsequent event is an event or transaction occurring after the balance sheet date, but before the financial statements are either issued or available to be issued. Subsequent events fall into two categories:
- Events or transactions that provide additional evidence about conditions that existed as of the balance sheet date. In particular, they may lead to improved estimates that were incorporated into the financial statements.
- Events that provide evidence about conditions that did not exist as of the balance sheet date; instead, they arose subsequent to that date.