Litigation should be accrued

Viewing 1 post (of 1 total)
  • Author
  • #3304003

    I have question about litigation ?

    If client settled litigation for xxx amount related to last year end but it will be covered by the insurance, should we accrue for the amount in last year end in the financial statements ?

    Because Becker says : yes , because even though the entire litigation loss will be covered by insurance , client still needs to accrue for the loss and disclose the litigation in a footnote. Note: insurance recoveries are not recorded until received.

    Wiley says : due to the intended coverage of the amount due by the insurance company, an accrual in the financial statements will NOT be made however, disclosure of the amount will appear in the notes.

    Who is right Becker or Wiley ???

    AUD - 74
    BEC - NINJA in Training
    FAR - 76
    REG - NINJA in Training
    تجري الرياح كما تجري سفينتنا
    FAR - 76
    AUD - 74,73,70,74
    REG - TBD
    BEC- TBD
Viewing 1 post (of 1 total)
  • You must be logged in to reply to this topic.