Which of the following will satisfy the definition of a 'constructive liability',as outlined in the IASB Conceptual Framework?
A) A decision by management to carry out maintenance over the next two years
B) A public offer to repair a defective good, even if it is out of warranty
C) A parent company's guarantee to meet the debts of a subsidiary entity if the subsidiary itself cannot pay them
D) All of the given options are correct.

Question

Quizplus · Accepted Answer

A constructive liability arises when an entity has created a valid expectation in other parties that it will accept certain responsibilities, such as a public offer to repair defective goods.

Which of the Following Will Satisfy the Definition of a 'Constructive