Before you begin this assignment, it will be helpful if you review UnitedHealth

Question

Before you begin this assignment, it will be helpful if you review UnitedHealth Group Incorporated's 2015 annual report (http://www unitedhealtharoup comlimediaUHG/PDF/2015/UNH-04-2015-Form-10-Kashxlazen) UnitedHealth Group Incorporated is a diversified health and well-being company dedicated to helping people live healthier lives. The company operates under two distinct platforms: health benefits (UnitedHealthcare) and health services (Optum Read the requirements. Requirement 2. Review Note 13 (Commitments and Contingencies), specifically the section labeled Legal Matters. Does UnitedHealth Group Incorporated report any contingencies? If so, provide a summary OA. According to Note 13 (Committments and Contingencies), UnitedHealth Group Incorporated does not report any contingent liabilities, including any that are not reported because they cannot be estimated. O B. According to Note 13 (Committments and Contingencies), UnitedHealth Group Incorporated is frequently made party to a variety of legal actions, however, the company cannot reasonably estimate the range of loss, if any, that may result from such matters given the procedural status of the dispute, the wide range of possible outcomes, the legal issues presented (including the legal basis for the majority of the alleged violations), the inherent difficulty in predicting a regulatory fine in the event of a remand, and the various remedies and levels of judicial review that remain available to the Company. As such, the company does not include an estimate or the probable costs resulting from these matters as contingent liabilities. C. According to Note 13 (Commitments and Contingencies), UnitedHealth Group Incorporated is frequently made party to a variety of legal actions indluding medical malpractice and unemployment claims. The company estimates the probable costs resulting from these matters as contingent liabilities. O D. According to Note 13 (Committments and Contingencies), UnitedHealth Group Incorporated is a participant in several legal and regulatory actions, which result from various U.S. and other federal, state and local environmental protection legislation as well as agreements with third-parties. The Company records accruals for environmental matters based on its estimated share of costs in the accounting period in which responsibility is established and costs can be reasonably estimated. Environmental liabilities are recorded based on the most probable cost, if known, or on the estimated minimum cost, determined on a site by site basis. Revisions to the accruals are made in the period the estimated costs of remediation change. Click to select your answer and then click Check Answer.

Explanation / Answer

Since the company is often involved in legal suits due to the nature of business and it is often difficult to quantify the extent of liability that the company faces because of the nature of legal action, the stage of dispute etc., it does not record these events as contingent liabilities.

The correct answer is : Option 2

According to Note 13 (Commitment and Contingencies ), United Health Group Incorporated is frequently made party to legal actions, however the company cannot reasonably estimate the range of loss if any that may result from such matters given the procedural status of the dispute, the wide range of possible outcomes, the legal issues presented (including the legal basis for the majority of alleged violations), the inherent difficulty in predicting a regulatory fine in the event of a remand and the various remedies and levels of judicial review that remain available to the company. As such the company does not include an estimate or the probable costs resulting from these matters as contigent liabilities.

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