Post-balance-sheet events;

              Post-Balance-Sheet Events
By ROBERT E. WHYTE Principal, Los Angeles Office Presented before the Advanced Study Conference sponsored by the Society of California Accountants, Santa Barbara, California — August 1958
As each one of us here today is well aware, accounting is an ever-changing art, and likewise so is the role of the public accountant. Over a relatively short span of years the public accountant has emerged from the embryonic role of a bookkeeper, with little tech­nical
literature to guide him, to the role of a highly-trained technician skilled in complicated accounting, auditing, tax, and management advisory matters vital to everyday business operations. In this present-day role, the public accountant operates within a wealth of technical literature produced by learned educators, experienced accountants, regulatory bodies such as the Securities and Exchange Commission, and technical committees of professional societies. The literature relating to accounting and auditing matters is perhaps best exemplified by the Accounting Research Bulletins and State­ments
on Auditing Procedure issued by committees of the American Institute of Certified Public Accountants. These bulletins and state­ments
represent the considered opinions of leaders in the accounting profession and cover a wide range of subjects, almost all of which can be traced to problem areas arising out of the complexities of modern business operations. Some of the problem areas discussed in the bulletins and statements include inventory pricing, renego­tiation,
income taxes, accelerated depreciation, business combinations, stock dividends, post-balance-sheet events, and innumerable other subjects. The statement on post-balance-sheet events (technically known as Statement on Auditing Procedure No. 25—Events Sub­sequent
to the Date of Financial Statements) is among the more recent pronouncements, and being relatively recent, has perhaps not been explored by practicing accountants as extensively as some of the other pronouncements. Accordingly, post-balance-sheet events has been selected as the subject for today's meeting with the thought that it affords fertile ground for discussion and exploration.
BASIC CONCEPTS
Before undertaking this exploration of post-balance-sheet or subsequent events, which terms are used interchangeably, let us first review certain basic concepts applied in accounting and in the financial statements resulting from such accounting. To borrow an
177