Which of the following is an example of a provision falling within the scope of IAS 37?

Question

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IAS 37 specifically deals with provisions, contingent liabilities and contingent assets. Onerous contracts are examples of provisions as they involve a liability for which the expected cost of meeting the obligation is greater than the economic benefits that will be derived from it. Accruals may be recognized as provisions, but not all accruals fall under the scope of IAS 37. Employee benefits may be recognized under a different accounting standard (IAS 19), and future operating losses are not specifically mentioned under IAS 37.

Which of the Following Is an Example of a Provision