Several organizations are criticizing a proposed standard on accounting for loss contingencies, saying it could lead to possible abuses, including a flurry of spurious lawsuits.
The proposed amendments to FASB Statements 5 and 141(R) would increase the amount of information that publicly traded companies are required to disclose about pending or threatened litigation. The U.S. Chamber of Commerce sent a letter to the Financial Accounting Standards Board outlining its opposition to the proposed rule change, saying it would open the door to "abusive" lawsuits by trial lawyers. The Chamber of Commerce claims the additional requirements would force companies to release immaterial or confidential information and could lead to excessive and harassing lawsuits.
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