Are litigation expenses always considered non-recurring?

Litigation expenses are not universally classified as non-recurring because their occurrence can vary significantly depending on the specific circumstances of each business and the industry in which it operates. In certain industries, litigation might be more common and could be expected as part of doing business, which suggests that these costs could recur.

For example, companies in highly regulated environments or those in industries susceptible to frequent lawsuits may see litigation expenses arise regularly, indicating a more predictable and recurring nature. In contrast, businesses in less litigious fields might face litigation costs only sporadically. Thus, the classification of litigation expenses as recurring or non-recurring is context-dependent, aligning with the idea that these expenses are influenced by industry standards and the nature of the company’s operations.