Managing and Disclosing Environmental Risks: A Tale of Two Utilities

This case introduces students to the topic of contingent liabilities by examining the actual management decisions of two energy companies facing increased regulatory scrutiny over the environmental risks associated with coal ash. The case learning objectives include: (1) researching and summarizing the guidance governing the recognition and disclosure of contingent liabilities; (2) critically assessing a company’s decisions regarding the recognition and disclosure of environmental liabilities; (3) accounting for asset retirement obligations; and (4) articulating the ethical implications of a company’s management and disclosure of environmental risks from the perspectives of various stakeholders. The case is designed for use in an intermediate accounting course at the undergraduate level. Students reported improvement in their knowledge and comprehension of contingent liabilities and their appreciation for the ethical implications of accounting decisions. Students also noted that they enjoyed discussing these issues in the context of real companies facing complex environmental challenges.

Non-Arbitrage Models of Financial Markets

In the first part of the paper, we construct the models of the complete non-arbitrage financial markets for a wide class of evolutions of risky assets.This construction is based on the observation that for a certain class of risky as set evolutions the martingale measure is invariant with respect to these evolutions. For such a financial market model the only martingale measure being equivalent to an initial measure is built. On such a financial market,formulas for the fair price of contingent liabilities are presented. A multi-parameter model of the financial market is proposed, the martingale measure of which does not depend on the parameters of the model of the evolution of risky assets and is the only one.

Contingent liabilities of public-private partnerships (PPPS) in Russia and BRICS countries: assessment and risk mitigation mechanisms

This article is devoted to the assessment of the conditional liabilities of public-private partnerships (PPPs) and measures to reduce the risks associated with them. First, a quantitative assessment of the contingent liabilities of PPP projects at the federal level is carried out. Contingent liabilities for public-private partnership projects are estimated to amount to 2.3 trillion roubles for the period 2021–52. Second, the experience of creating a system for managing the contingent liabilities of PPPs in Russia and the BRICS countries (Brazil, Russia, India, China and South Africa) is summarized. This analysis shows that each of the BRICS countries has a legislative and technical framework for managing fiscal liabilities, but does not use it to the fullest extent. Consequently, to improve functioning it is necessary to regularly update, fill in, and expand the number of available financial indicators for PPP projects. Of the BRICS countries, South Africa is characterized by the most complete and transparent system for managing PPP-related contingent liabilities, but Russia could use some of the measures implemented in other BRICS countries to improve its own system, including the creation of a guarantee fund (Brazil), a system for operational project evaluation (India) and the practice of project approval by the fiscal authority (China).

ZBYCIE AKCJI LUB UDZIAŁÓW W SPÓŁKACH BĘDĄCYCH WŁAŚCICIELAMI NIERUCHOMOŚCI ROLNYCH – WYBRANE PROBLEMY

Pursuant to Article 3a sec. 1 of the Act of 11th of April 2003 on Shaping the Agricultural System, the National Support Centre for Agriculture, acting on behalf of the State Treasury, has the right of pre-emption of shares in a commercial company within the meaning of the Act of 15th of September 2000, Code of Commercial Companies, if such a company is an owner or a perpetual usufructuary of either agricultural property with an area of at least 5 ha or agricultural properties with a total area of at least 5 ha. NSCA is not notified about its right of pre-emption by the shareholder but by the company whose shares are the subject of the conditional sale agreement. At the same time, the act imposes several obligations on the company’s management board related to the preparation of documents attached to the notification, the most far-reaching of which is the submission, under pain of criminal liability, of a statement on the amount of contingent liabilities of the company. The statutory regulation overburdens the company’s management board with the obligations related to the preparation of the notification and makes the trading of shares in commercial companies, owning or being perpetual usufructors of agricultural property, dependent on the actions of their management board. The management board may block the sale of shares. Such a concept is incomprehensible, illogical, and requires immediate modification.

Part VII Discharge and Breach, 25 Incomplete Performance

The ‘entire obligation rule’ concerns contingent liabilities, by way of counter-performance. The rule has the salutary self-help protective function that a performing party becomes entitled to payment or other performance by the other side only if the relevant task is completely and properly achieved. Only if the performer ‘crosses this line’ is the other required to pay. For example, a builder who is to be paid on completion of the work cannot demand payment without having finished the relevant job. However, the ‘substantial performance’ doctrine might render the performing party entitled to claim the agreed sum as a debt even if that party’s performance has not been perfect, subject to a deduction in respect of the cost of rectifying defective performance.

ACCOUNTING RECOGNITION OF ASSET ABANDONMENT AND SITE RESTORATION

<p><em>This research will discuss the recognition of asset abandonment and site restoration or commonly known as ARO (Asset Retirement Obligation) in oil and gas company. The purpose is to be able to provide an overview that can be used by companies in calculating ARO that must be paid at the end of the contract period. The formulation of the problem is which method is used to determining the amount of asset abandonment and site restoration or ARO that is appropriate to overcome the potential problems that arise at the end of the contract period. This research is carried out by using a mixed method in analyzing the findings, so it will find the in-depth findings which will be useful to assist the company's management in making decisions. Signal theory is a theory that will be chosen in this research. This research will use three stages of analysis, such as descriptive analysis, content analysis, and constant comparative analysis. Based on the results it might found that the recognition of asset abandonment and site restoration carried out according to regulations apply. While company uses the method of calculating liabilities based on future values that is continually calculate in present value.</em></p><p><em> </em></p><p><strong><em>Keywords:</em></strong><em> Contingent liabilities, provisions, liability for asset abandonment and site restoration</em></p>

Tunisia

The pandemic aggravated Tunisia’s long-standing vulnerabilities stemming from persistent fiscal and external imbalances, rising debt, and contingent liabilities from inefficient state-owned enterprises. The crisis is expected to induce the largest contraction in real GDP since independence. The authorities’ targeted response together with higher outlays on wages widened the fiscal deficit. A second Covid-19 wave is underway. The authorities are securing 500,000 doses to start a first campaign of vaccinations in February and are aiming to secure more doses to vaccinate half of the population starting in April–May. Staff expects GDP growth to rebound modestly in 2021, but it could take years before activity returns to pre-crisis levels, especially if large imbalances were not addressed and key reforms delayed. Downside risks dominate and recent protests highlight the level of social tensions, aggravated by Covid-19 restrictions, and particularly among the youth.

Review on Contingency and its Effects in Transmission Lines

A component failure in a power system is known as a contingency. The system must return to an acceptable state of equilibrium after the contingency. Post-contingency correction factors are important for maintaining reliability. Correction factors require analysis of contingent liabilities. Various methods are used to perform contingency analysis. Control of the transmission system has been described in this document. The pricing conditions and associated parameters for the different types of transmission lines have been described. The article focuses on all the parameters necessary for the analysis of transmission systems and their limits.