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In accounting, contingent liabilities are liabilities that may be incurred by an entity depending on the outcome of an uncertain future event [1] such as the outcome of a pending lawsuit. These liabilities are not recorded in a company's accounts and shown in the balance sheet when both probable and reasonably estimable as 'contingency' or ...
IAS 37 establishes the definition of a provision as a "liability of uncertain timing or amount", and requires that all the following conditions be fulfilled before a provision can be recognized: the entity currently has a liability as a result of a past event; an outflow of resources is likely to be needed to settle the liability; and
Current liabilities – these liabilities are reasonably expected to be liquidated within a year. They usually include payables such as wages , accounts , taxes , and accounts payable , unearned revenue when adjusting entries , portions of long-term bonds to be paid this year, and short-term obligations ( e.g. from purchase of equipment).
GAAP net loss and EPS were impacted by the change in fair value of contingent liabilities mentioned before. Non-GAAP net loss was $19 million, and non-GAAP net loss per share was $0.05 in the quarter.
Whilst the standard on provisions, IAS 37, prohibits the recognition of a provision for contingent liabilities, [23] this prohibition is not applicable to the accounting for contingent liabilities in a business combination. In that case the acquirer shall recognise a contingent liability even if it is not probable that an outflow of resources ...
Before you buy stock in LexinFintech, consider this: ... provision for contingent guarantee liability, and fair value change in our financial guarantee derivatives and fair value loans, decreased ...
Image source: The Motley Fool. Goosehead Insurance (NASDAQ: GSHD) Q4 2024 Earnings Call Feb 24, 2025, 4:30 p.m. ET. Contents: Prepared Remarks. Questions and Answers. Call Participants
The recording of the liability in the entity's balance sheet is matched to an appropriate expense account on the entity's income statement. In U.S. Generally Accepted Accounting Principles (U.S. GAAP), a provision is an expense. Thus, "Provision for Income Taxes" is an expense in U.S. GAAP but a liability in IFRS.