Some theorists contend that companies that create pollution should report the social cost of that pollution in income statements. They argue that such companies are indirectly subsidized as the cost of pollution is borne by society while only production costs (and perhaps minimal pollution fines) are shown in the income statement. Thus, the product sells for less than would be necessary if all costs were included.
Assume that the FASB is considering a standard to include the social costs of pollution in the income statement. The process would require considering both relevance and faithful representation of the information produced by the new standard. Your instructor will divide the class into two to six groups depending on the size of the class. The mission of your group is to explain how the concepts of relevance and faithful representation relate to this issue.

Required:
Each group member should consider the question independently and draft a tentative answer prior to the class session for which the case is assigned.
In class, each group will meet for 10 to 15 minutes in different areas of the classroom. During that meeting, group members will take turns sharing their suggestions for the purpose of arriving at a single group treatment.
After the allotted time, a spokesperson for each group (selected during the group meetings) will share the group’s solution with the class. The goal of the class is to incorporate the views of each group into a consensus answer to the question.