Applying financial reporting standards can be quite complex. The BDO team can help you assess your situation and prepare for the opportunities and challenges involved.
Contingent liabilities are distinct from liabilities since there is a degree of uncertainty as to whether a present obligation to sacrifice economic benefits exists at the financial statement date.
Contingent liabilities have two basic characteristics:
- There must be an existing condition or situation; and
- There must be an expected future event that will resolve the uncertainty as to whether a present obligation to sacrifice economic benefits exists. This event cannot be wholly within the control of the reporting government.