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Contingencies Define What a Contingency Is,describe the Auditor's Main Concerns

question 44

Essay

Contingencies Define what a contingency is,describe the auditor's main concerns about them,and indicate how contingencies should be dealt with by management and the auditor.Besides litigation,claims,and assessments,what are some other types of contingencies?


Definitions:

Unrecognized Net Loss

A loss that has occurred but has not been reported in the financial statements because it has not yet been realized through a transaction.

Projected Benefit Obligation

A measurement of the present value of future pension benefits owed to employees, based on factors like salary history and years of service.

Plan Assets

Resources set aside by a company in a dedicated fund to meet future pension benefits or other long-term employee benefits.

Vested Benefits

Employee benefits, such as pension funds or stock options, that are fully granted and cannot be forfeited even if the employment is terminated.

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