Termination of Benefits Liability Policy

Subscriber Content
Screenshot of the first page of Termination of Benefits Liability Policy

This policy establishes guidelines and set forth the appropriate accounting policies relating to the recognition of a liability relating to certain employee termination benefits and other costs to exit an activity.

According to this policy, in the case of involuntary termination benefits, a liability should be recognized in the period that management approves the "plan of termination" and the following exist: Prior to the date of the financial statements, the appropriate level of management approves and commits the enterprise to the "plan of termination”, and the benefit arrangement must be communicated to the employees in sufficient detail.

Free Trial

Sign up for a free, no-obligation trial to start exploring our timesaving, valuable resources.