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Likelihood of Occurrence : Inflow of Resource , Outflow of Resource
Virtually Certain : Asset , ProvisionThis is part of table on ACCA official Website IAS-37.
When we are virtually certain for a contingent liability so we record it as a provision (uncertain time and amount). When we are virtually certain about contingent asset so we record it as asset. Does this not violates prudence concept? We are recording contingent liability as provision so contingent asset should also be recorded at somewhere in between asset with uncertain time and amount (provision for reimbersement) or something like that?No it does not violate the prudence concept.
Hardly anything in life is 100% certain, but virtually certain is close enough!!
Tutor it means that if contingent liability is virtually certain so provide provision in statements. And if contingent asset is virtually certain recognise asset in statements.
Am I correct?
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