The key difference between provisions and liabilities is:

Question

Quizplus · Accepted Answer

The key difference between provisions and liabilities is that provisions are recognized for uncertain future events or situations that may require the outflow of economic resources, whereas liabilities are obligations arising from past transactions or events that are expected to result in the outflow of economic resources. Liabilities are recognized when the amount and timing of the outflows are reasonably certain, while provisions are recognized when there is uncertainty regarding the amount or timing of the future sacrifice of economic resources.

The Key Difference Between Provisions and Liabilities Is