The additional liability was considered an error correction. OI mentions in disclosure Note 1 that “the Company determined that it had incorrectly applied the provisions of ASC 450, Contingencies.” The audit report also mentions that the financial statements were “restated to correct an error related to the Company's determination of liabilities related to probable losses for unasserted asbestos claims.”

Because the change was an error correction, the journal entry that OI made was a prior period adjustment (PPA). With a PPA, changes in income statement amounts from prior years are recorded as an adjustment to retained earnings or loss.

To record the restatement, OI debited Retained Loss for $295 million (all amounts are expressed in millions) and credited Asbestos-Related Liabilities for the same amount. This was disclosed in Note 1 of OI's restated 10-K for 2015. OI's summary of the effect of the restatement on the balance sheet also reflects...

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