Under IAS 37, a contingent liability relates either to a possible obligation whose existence will be confirmed by uncertain future events, or to a present obligation that does not meet the recognition conditions. It is not recognized in the balance sheet, but is disclosed when the circumstances specified by the standard apply. Source: **curr-stat-ias37**, About, Contingent liabilities.
Reading the risk
For example, a dispute may have an uncertain outcome and require a meaningful explanation. The absence of a recognized amount does not prove that there is no risk; nor is the maximum claim amount automatically the most likely payment.
Do not add a disclosed amount and a recognized provision for the same event without checking. First establish whether one uncertainty is being described twice. An analytical stress scenario must be marked separately from reporting recognition and must not be presented as an accounting or legal assessment.
General educational concepts under IFRS; not an individual recommendation or a statement of current Russian rules.
Source reference retained: **curr-stat-ias37**, About, Contingent liabilities; IAS 37 recognition, disclosure, uncertain-outcome, maximum-claim, duplicate-counting, stress-scenario, accounting and legal-assessment caveats preserved.
Educational material is not individual investment, legal or tax advice.
