An event, favorable or unfavorable, that takes place after the reporting period, specifically between the end of the period and the date on which financial statements of an entity are authorized for issue, providing indicative clues of conditions that occurred after the reporting period. As a result, such an event does not entail adjustment to the amounts recorded in an entity’s financial statements. In other words, an entity experiencing such an event is not required to make any adjustments to account for non-adjusting events after the end of its reporting period.

An example of non-adjusting events is when the fair value of an investment is impaired during the above-mentioned period. Any such declines in fair value do not relate to the state of affairs at the end of the reporting period, but do rather reflect subsequent circumstances.