- This topic has 1 reply, 2 voices, and was last updated 3 years ago by
.
- Posts
Liability of uncertain amount or time is called provision. It also has probable chances.
Do Assets has provision? Like if an asset with uncertain amount or time is called what?The nearest to this is a contingent asset, defined as “a possible asset that arises from past events, and. whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity.”
Such assets are not recognised on the SOFP:
“Contingent assets should not be recognised – but should be disclosed where an inflow of economic benefits is probable. When the realisation of income is virtually certain, then the related asset is not a contingent asset and its recognition is appropriate”.
Rather beyond FA1 requirements.
- You must be logged in to reply to this topic.