Which of the following groups has the responsibility for identifying and deciding the appropriate accounting treatment for recording or disclosing contingent liabilities?
A)Auditors
B)Legal counsel
C)Management
D)Management and the auditors

Question

Quizplus · Accepted Answer

The management has the primary responsibility for identifying and deciding the appropriate accounting treatment for recording or disclosing contingent liabilities. Legal counsel may provide input to management, but the ultimate decision lies with management. Auditors have a responsibility to evaluate the adequacy of the disclosure but do not have the primary responsibility of identifying and deciding the appropriate accounting treatment. Therefore, the best choice is C.

Which of the Following Groups Has the Responsibility for Identifying