A contingent liability recognised in a business combination will be recorded:

A) in the subsidiary's accounts.
B) in the group accounts.
C) either A or B.
D) none of the above.

Contingent Liability

A potential financial obligation that may arise in the future, dependent on the outcome of a specific event.

Business Combination

A merger or acquisition in which separate companies come together to form a single entity, often to enjoy strategic advantages or to expand their market reach.

Group Accounts

Financial statements that combine the accounts of a parent company with those of its subsidiaries, presenting the financial position and results of operation of the group as a single economic entity.