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What would be your answer if probability of occurence of event is less than non occurence?
Contingent liability is not a payable liablility till its an actual obligation as per accounting definition.
This is not recorded in the books of accounts, its disclosed as a note.
As per IFRS, you don't account for contingent liability in the books, instead you just disclose the same as part of notes to the accounts.
Do not record contingent liability in books of accounts untill it becomes payable. this is off balance sheet item. Can be recorded separately for reference.
Contingent liability is not an incurred one. Its incurrence will be dependent (contingent) on the happening of certain event.So it is not incorporated in the books of accounts. It is disclosed as a footnote in the accounts or as a disclosure item in the Accounts .eg.liability disputed in the court.
