For a small population, the best estimate for the amount of a provision that must be recognized is the expected value of the possible outcomes.

Question

Quizplus · Accepted Answer

For a small population, the best estimate might not be the expected value of the possible outcomes because the variability and distribution of outcomes can significantly impact the risk assessment and thus the provision amount. Instead, the most likely outcome or a more conservative approach might be used.

For a Small Population, the Best Estimate for the Amount