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zulfi245
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1.what is accounting difference ( measurement specially ) between liabilty and provision.
2.does all other liabilites other than financial liabilities comes under ias 37.how to distinguish whether the liabilty is under ias 37 or ifrs9.
3.as provision is measured at expected value,how Contingent liability is disclosed (measurement?)
P2-D2
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A provision is accounting for uncertainty, so an uncertain obligation or amount. A liability has no uncertainty with regards to the obligation or amount, so think about payables and lease liabilities.
Provision are under IAS 37 and financial liabilities under IFRS 9. Other liabilities like finance lease payables are IAS 17, tax payable is unde IAS 12.
A provision is measured as the best estimate of the expenditure, of which expected values is one possible method where there are several possible outcomes. Contingent liabilities disclose the possible amounts that may be required to be paid, there is no specific detail on their measurement as it is only a disclosure rather than recognised in the financial statements.
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