One factor to consider in determining whether a liability should be recorded with respect to threatened litigation is the effect such a liability will have on a reported financial condition.

Question

Quizplus · Accepted Answer

The primary factors in determining whether a liability should be recorded for threatened litigation are the likelihood of the litigation resulting in a loss and the ability to make a reasonable estimate of the amount of loss, not the effect on the reported financial condition.

One Factor to Consider in Determining Whether a Liability Should