The FASB and the IASB are reconsidering the role of uncertainty, or probability, in the definition, recognition, and measurement of liabilities.Existing recognition criteria include a probable future sacrifice of resources; one issue involves the minimum probability level to warrant recognition of an uncertain obligation as a liability.IFRS imply a minimum probability level of greater than _____ percent.
A)50
B)60
C)70
D)80
E)90

Question

Quizplus · Accepted Answer

IFRS imply a minimum probability level of greater than 50 percent for the recognition of an uncertain obligation as a liability. This is based on the principle that liabilities should only be recognized if it is more likely than not (i.e., greater than 50% probability) that a future sacrifice of resources will be required.

The FASB and the IASB Are Reconsidering the Role of Uncertainty