Y2K Reporting for FASB

INTRODUCTION I have reviewed an article and financial disclosures by Chevron, Inc. pertaining to Y2K disclosure reporting. The article, “SEC Interpretative Release on Disclosure of Year 2000 Issues” by Gary Illiano and Joseph Bentz addresses the issue of reporting Y2K losses. Reporting Y2K losses is a contingency issue and should not be ignored or reported ambiguously. The SEC has made this a mandatory disclosure for material losses due to the Y2K issue …

…future litigation. It does not, however, discuss what pending litigation there is at this point. CONCLUSION The SEC requires year 2000 disclosure of historical and future losses. Companies must report all information affecting them with regards to state of readiness, costs (past and future), risks of the company, and any contingency plans currently in place. These disclosures are necessary to provide investors with the information they are entitled to and to minimize the possibility of litigation.