A lawsuit has been filed against your client. If, in the opinion of legal counsel, the likelihood your client will lose the lawsuit is remote, no financial statement accrual or disclosure of the potential loss would generally be required.

Question

Quizplus · Accepted Answer

If the likelihood of loss is remote, no financial statement accrual or disclosure of potential loss is required as per GAAP (Generally Accepted Accounting Principles).

A Lawsuit Has Been Filed Against Your Client