Final answer:
Financial statement note disclosure is required when there are potential losses that are at least reasonably possible. This helps provide transparency and allows users of the financial statements to make informed decisions.
Step-by-step explanation:
Financial statement note disclosure is required when there are potential losses that are at least reasonably possible. This means that if there is a chance of material losses occurring, the company must provide a note in their financial statements to inform investors and stakeholders about the potential risks. These notes are important for transparency and to help users of the financial statements make informed decisions.