International accounting standards require that a liability be recognized in the accounting records when (1) there is
Question:
Accounting standard setters are currently debating whether to remove the second criterion, on probability. That is, companies would recognize all present obligations that can be measured reliably.
Instructions
Write a memorandum to the standard setters stating whether you agree with this proposed approach or not. Include in your memo any advantages and disadvantages you can think of from the perspective of
(a) Management,
(b) The external users of the financial statements.
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Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118024492
5th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
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