Corporate Financial Statements And The Impact Of Health Care Costs Recognition

This paper empirically analyzes the economic consequences of a forthcoming rule on accounting for post-retirement obligations. This rule calls for the recognition of health care liabilities on the employers financial statements and prescribes that the cost associated with these obligations be accoun...

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Bibliographic Details
Published in:Journal of applied business research 2011-10, Vol.7 (3), p.45
Main Authors: Gopalakrishnan, V., Sugrue, Timothy F.
Format: Article
Language:English
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Summary:This paper empirically analyzes the economic consequences of a forthcoming rule on accounting for post-retirement obligations. This rule calls for the recognition of health care liabilities on the employers financial statements and prescribes that the cost associated with these obligations be accounted for on the accrual basis. Based on a sample of 103 firms, this study reports that compliance with this rule could have a dramatic impact on firms equity, leverage, income and key financial ratios.
ISSN:0892-7626
2157-8834
DOI:10.19030/jabr.v7i3.6226