a-company-is-facing-a-lawsuit-with-a-probable-chance-of-losing-but-cannot-estima

Question

A company is facing a lawsuit with a probable chance of losing but cannot estimate the loss amount. What should the company do?

Accepted Answer

Disclose in footnotes but do not accrue a liability.

Answer

Do nothing until the lawsuit is resolved.

Answer

Accrue a liability and disclose in footnotes.

Answer

Accrue a liability but do not disclose in footnotes.