No Disclosure Is Required Because an EPA Claim Is as Yet

question 77

Essay

No disclosure is required because an EPA claim is as yet unasserted, and an assessment is not probable. Even if an unfavorable outcome is thought to be probable in the event of an assessment and the amount is estimable, disclosure is not required at this time unless an unasserted claim is probable.
2. This is a gain contingency. Gain contingencies are not accrued even if the gain is probable and reasonably estimable. The gain should be recognized only when realized.
If the amount is deemed material, Barone will disclose information in notes to the financial statements and ensure the wording is not misleading as to the eventual outcome.

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Definitions:

Cheerleaders

Individuals or a group who provide vocal, and sometimes physical, support and encouragement for a team or event.

Tuckman's Model

A theory of group development outlining stages: forming, storming, norming, performing, and adjourning, through which groups tend to progress.

Storming

A stage in group development characterized by conflict and competition as group members adjust to their roles and relationships.

Group Dynamics

The study of the psychological and behavioral processes within a social group or between social groups.