ASPE 3290 - Contingencies

Question 1

Contingencies (ASPE)

Answer 1

• Existing condition involving uncertainty as to a possible gain or loss
• Uncertainty will result in a range of probabilities
  o likely
  o unlikely
  o not determinable
• Contingent losses
  o must be accrued if the future event is likely and a reasonable estimate of the loss can be made
  o disclosed if the future event is likely but a reasonable estimate of the loss CANNOT be made
  o disclosed if the future event is not determinable
• Contingent gains
  o must NOT be accrued
  o disclosed if the future event is likely

Reference: ASPE 3290