The full disclosure principle requires the reporting of contingent liabilities that are reasonably possible.

Question

Quizplus · Accepted Answer

The full disclosure principle requires the reporting of contingent liabilities when they are probable or reasonably estimable. However, even if the likelihood of occurrence is less than probable, but it is reasonably possible, then it should still be disclosed in the notes to the financial statements.

The Full Disclosure Principle Requires the Reporting of Contingent Liabilities