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Apropos Dec 2010 paper Q3a, would the company need to create a provision/disclose a contingent liability even if the insurance covers the entire claim?
Thanks a lot for your help Mike. : )
You’d make a provision for the loss and, depending upon the likelihood of the insurance company coughing up (they seem to me always to have a wriggle-out clause where they can avoid having to pay) , you would record (acknowledge) a contingent asset
This is answered without the benefit of having the question in front of me! I hope it fits the facts as given!
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