Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • October 2001
  • Exercise

Liability Problems

By: Robert S. Kaplan
  • Format:Print
  • | Pages:2
ShareBar

Abstract

This case provides three examples of the recognition and measurement of liabilities. The first focuses on recognizing when employees have rendered services for which future period benefits have been earned, that is, whether unused vacation, sick, and personal days at the end of a year lead to a future obligation for the company. The second focuses on accounting for debt issues at a discount and at a premium--distinguishing between coupon payments, paid in cash each period, and the recognition of interest expense for that period. The third involves an obligation incurred in the current payment for which payment will be delayed ten years. Although the problem is specifically one of deferred compensation, the principle may be generalized to involve recognition of pension and other post-employment benefit expenses.

Keywords

Cash; Annuities; Interest Rates; Compensation and Benefits; Employees; Wages; Problems and Challenges; Value

Citation

Kaplan, Robert S. "Liability Problems." Harvard Business School Exercise 102-035, October 2001.
  • Find it at Harvard

About The Author

Robert S. Kaplan

Accounting and Management
→More Publications

More from the Author

    • May 2022
    • Issues in Accounting Education

    Variance Analysis: New Insights from Health Care Applications

    By: Robert S. Kaplan and Susanna Gallani
    • Harvard Business Review Digital Articles

    We Need Better Carbon Accounting. Here's How to Get There.

    By: Robert S. Kaplan and Karthik Ramanna
    • Journal of Occupational and Environmental Medicine

    A Career Life-Cycle Perspective on Women's Health and Safety

    By: Robert S. Kaplan, Chizoba L. Chukwura, Gregory H. Gorman, Vivian S. Lee, Chester B. Good, Kathleen L. Martin, Gregory A. Ator and Michael D. Parkinson
More from the Author
  • Variance Analysis: New Insights from Health Care Applications By: Robert S. Kaplan and Susanna Gallani
  • We Need Better Carbon Accounting. Here's How to Get There. By: Robert S. Kaplan and Karthik Ramanna
  • A Career Life-Cycle Perspective on Women's Health and Safety By: Robert S. Kaplan, Chizoba L. Chukwura, Gregory H. Gorman, Vivian S. Lee, Chester B. Good, Kathleen L. Martin, Gregory A. Ator and Michael D. Parkinson
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Accessibility
  • Digital Accessibility
Copyright © President & Fellows of Harvard College