Would a company be more likely to report a contingent liability under U.S.GAAP or IFRS?
A)U.S.GAAP.
B)IFRS.
C)Equally likely.
D)Contingent liabilities are not reported under IFRS.

Question

Quizplus · Accepted Answer

Under IFRS, a contingent liability is more likely to be reported because IFRS requires the recognition of a provision when it is probable that an outflow of resources will be required and the amount can be reliably estimated. U.S. GAAP is more conservative and requires a higher threshold of certainty before recognizing a liability.

Would a Company Be More Likely to Report a Contingent