The Case of the Exxon Valdez: Reporting Contingent Liabilities for Potential Damage Awards

Authors

  • Steven C Hall University of Nebraska at Kearney
  • Larry G. Carstenson University of Nebraska at Kearney
  • William W. Stammerjohan Louisiana Tech University

Abstract

ABSTRACT: In March of 1989 the oil tanker Exxon Valdez ran aground and ruptured spilling thousands of barrels of oil into Prince William Sound. That oil spill created a large contingent liability for Exxon. The final adjudication of lawsuits relative to the oil spill did not happen until 2008. Thus, Exxon had a contingent liability relative to the Exxon Valdez incident for nineteen reporting years. You will read about the spill, Exxon’s attempts to contain it, fines, settlements, court cases, damage awards, and the changing nature of the law regarding punitive damages. You will be asked at key points over the nineteen years of the story to comment on the proper reporting and disclosure of the contingent liability. Making these judgments and discussing them in class will deepen your understanding of contingent liabilities and punitive damage awards, will enhance your critical thinking skills, and if you participate in the discussion, enhance your oral communication skills.

Author Biographies

  • Steven C Hall, University of Nebraska at Kearney
    Chair and Professor of Accounting Department of Accounting and Finance
  • Larry G. Carstenson, University of Nebraska at Kearney
    Professor of Business Law Department of Accounting and Finance
  • William W. Stammerjohan, Louisiana Tech University
    George E. Breazeal Family Professorship in Accounting, School of Accountancy

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Published

2014-01-20

Issue

Vol. 23 (2013)

Section

Articles

License

The copyright for articles in this journal are retained by the aithor(s), with first publication rights granted to the journal. By virtue of their appearance in this open access journal, articles are free to use with proper attribution in educational and other non-commerical settings.

How to Cite

The Case of the Exxon Valdez: Reporting Contingent Liabilities for Potential Damage Awards. (2014). The Accounting Educators’ Journal, 23. https://www.aejournal.com/ojs/index.php/aej/article/view/230