Which of the following is the proper way to report a probable contingent asset?
A) as a disclosure only
B) as a deferred revenue
C) as an accrued revenue
D) as an increase to receivables
When a company can estimate a range for the loss, but cannot identify a single most-likely outcome within that range, IFRS requires that it accrue the midpoint of the range while U.S. GAAP requires that it accrue the minimum value of the range.
Under IFRS, provisions for contingent losses are accrued when the likelihood of an unfavorable outcome is ________.
A) virtually certain
B) more likely than not
C) reasonably possible
D) more than remote
Under GAAP, a provision for a contingent loss is considered to be probable if the probability of its occurrence is ________.
B) likely to occur
C) virtually certain
D) reasonably possible