Accounting for Contingencies

Title

Accounting for Contingencies

Role

Co-authors: Dawn Massey, Cheri Mazza, Allen Schiff, Jonathan Schiff, Joan Lee (Van Hise)

Files

Document Type

Book

Description/Summary

Accounting for Contingencies examines accounting for contingencies under both U.S. Generally Accepted Accounting Principles (U.S. GAAP) and International Financial Reporting Standards (IFRS). This Portfolio also distinguishes contingencies from other similar items not properly accounted for as contingencies. Its subject matter commands widespread interest given the litigious nature of the business world and the need for entities to disclose significant risks to their future operations, cash flows, and net worth. Accounting for Contingencies includes reporting of potential losses from litigation in process, environmental damage, and expenses related to uncollectible accounts receivable and product warranty costs. The primary source accounting rules for contingencies under U.S. GAAP is FASB Statement No. 5, Accounting for Contingencies (FAS 5), which is principally codified in FASB Accounting Standards Codification Topic 450 (ASC). Its principal international counterpart is IASC International Accounting Standard 37, Provisions, Contingent Liabilities and Contingent Assets (IAS 37). Guarantees made by guarantors are special types of contingencies subject to their own set of rules in addition to those provided in the codified rules from FAS 5.

Publication Date

2010

Publication Information

Dawn Massey, Dawn, Cheri Mazza, Allen Schiff, Jonathan Schiff, Joan Van Hise. 2010. Accounting for Contingencies. BNA Tax and Accounting Portfolio 5165: Accounting Policy & Practice Series, Arlington, VA: Bureau of National Affairs

Comments

Copyright 2010 Bureau of National Affairs