provision

Have you watched my free lecture on IAS 37 ??? A contingent liability is where there might be a liability but there might not - it depends on something else ( in this case it depends on the outcome of the course case ). Here, because the chance of us having to pay is only 40%, it is regarded as possible, and therefore according to IAS 37 we do not make a provision, but instead we disclose by way of a note to the accounts. (Had the chance been (say) 70%, then it would be regarded as probable and then we would have made a provision)