A Certain Contingent Liability Was Evaluated at Year-End, and Considered

question 67

True/False

A certain contingent liability was evaluated at year-end, and considered to have a reasonable possibility of becoming an actual liability. If the accountant decided not to report it on the balance sheet or in the notes to the financial statements, this could be considered a violation of generally accepted accounting principles.

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Definitions:

Pay Penalties

Financial sanctions imposed on individuals or organizations for not adhering to contracts, laws, or regulations.

Unethical Practices

Actions or behaviors that do not conform to the accepted standards of moral or ethical principles in the conduct of business or individual activity.

Work Behavior

The actions and activities of employees or organizational members while at work, which can be influenced by various factors including corporate culture and individual ethics.

Charismatic Leaders

Individuals who inspire, motivate, and potentially exert a strong personal influence on their followers through their personal vision, eloquence, or personal example.