Based on the background provided in Question 2, after 2027, Oilers was supposed to dismantle the structure and remove the underground storage tanks. Even though the company spent a considerable amount of money on restoration, it was sued by the province of Alberta for not observing the environmental requirements. On February 3, 2029, the Provincial Court of Alberta rendered a judgement against Oilers for $1,000,000. The company claims that because the language in the contract was misleading regarding the removal of the underground storage tanks, it plans to appeal the judgement to the Superior Court of Alberta and expects the ruling to be reduced to anywhere between $300,000 and $500,000, with $450,000 being the probable amount. Oilers has not yet released its 2029 financial statements. Adopt the role of the Controller of Oilers, report this contingency issue to the V. P. Finance. Organize your report in the following sections:

a) Overview - Given the industry Oilers is in and the constrain of the accounting rules, discuss the financial reporting issues confronting Oilers. (3 marks)

b) Analysis Analyze the nature and status of the court case. Quantify the options available to Oilers. If applicable, justify the amount of accrual, liability and disclosure Oilers should include in its December 31, 2029, financial statement. (4 marks)

c) Conclusion Based on the Overview and Analysis performed above, provide the most feasible recommendation to the V. P. Finance. (3 marks)