All of the following are criteria that financial reporting requires before recognizing an obligation as a liability
Question:
All of the following are criteria that financial reporting requires before recognizing an obligation as a liability except:
a. | The transaction or event that gave rise to the obligation has already occurred. |
b. | The firm has a present obligation and little or no discretion to avoid the transfer. |
c. | The firm must know the precise amount of the obligation before recording it. |
d. | The obligation involves a probable future sacrifice of economic benefits—a future transfer of cash, goods, or services; the forgoing of a future cash receipt; or the transfer of equity shares—at a specified or determinable date. The firm can measure with reasonable precision the cash-equivalent value of the resources needed to satisfy the obligation. |
Auditing a business risk appraoch
ISBN: 978-0324375589
6th Edition
Authors: larry e. rittenberg, bradley j. schwieger, karla m. johnston