Lys City reports a compensated absences liability in its government-wide financial statements. The salary rate used to calculate the liability should normally be the rate in effect:

Options :-

a.) When the unpaid compensated absences were earned.

b.) When the compensated absences are to be paid.

c.) At the balance sheet date. - Correct Answer

d.) When the compensated absences were earned or are to be paid, or at the balance sheet date, whichever results in the lowest amount.