Contingent liabilities are not reported in the financial statements but may be disclosed in the notes to the financial statements if the likelihood of an unfavorable outcome is possible.

Question

Quizplus · Accepted Answer

Contingent liabilities are only disclosed in the notes if they are reasonably possible and their amount can be reasonably estimated. If the likelihood of an unfavorable outcome is remote, then they are not disclosed at all.

Contingent Liabilities Are Not Reported in the Financial Statements but May