On 22 August 2018, the management of Holloways Ltd completed a draft set of financial

statements for the year ended 30 June 2018. The board of directors signed a declaration

that the financial statements were prepared in accordance with the Corporations Act and

accounting standards on 14 September 2018, but Holloways did not publicly release its

profit and other selected financial information until 19 September 2018. The financial

statements were submitted to its shareholders for approval on 21 September 2018 and

approval was given on the same day.

The following events occurred after the end of the reporting period ended 30 June 2018.

Assuming that all amounts are material, explain how these events would be accounted for in

accordance with AASB 110 ‘Events after the Reporting Period’.

(a) The Commonwealth Treasurer announced a 3% increase in corporate tax rates on