Liability Recognition at Ansell and Barrick Limited Companies

Advanced Financial Reporting 1
ADVANCED FINANCIAL REPORTING
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Advanced Financial Reporting 2
Liability Recognition at Ansell Company
At Ansell Company, the liabilities are recognised immediately they arise and this is done
at a cost, for example, the interest-bearing liabilities are typically recognized at their fair value
and this less of the attributable transaction costs. Before the liabilities are recognised, they are
often states at their amortised costs (Hougaz, 2015 p.140). The effective interest method is then
used in recognition of the difference in the redemption value and the cost of the liability in the
income statement.
According to Roberts (2015 p.37), the trade and other payables of the company are
usually recognised ad settled within a period of 30 to 60 days. Such recognition is done from the
date of the invoice, and it could also be based on the agreed terms of the transactions with a
variety of suppliers of the company. The contingent liabilities are recognised in the company
when the amount can be estimated reasonably and hence they are recorded in the various books
of accounts.
Liability Recognition at Barrick Limited Company
According to Owen and Kemp (2014 p.15), the liabilities of the mining company are
recognised based on the key definition of liability which is an obligation of the company which
is typically due to the past events, and the settlement of such liabilities are from the resources of
the company which embodies economic benefits. Additionally, there are several tests which the
liability has to pass. For instance, the company acknowledges that it is its obligation to settle the
liability when it arises. The company also uses the various factors such as nature of obligation,
potential offsets of the liability, methods and amount of the liability and those factors which
determines the timing of the various expenditures especially where there is uncertainty (Dobele,
Westberg, Steel and Flowers, 2014 p.150).