Under ASPE, a contingent liability is recorded in the accounting records

A) if it is likely that a future event will confirm that a liability has been incurred and the amount of the related loss can be estimated.
B) if the contingency has not already been disclosed in the notes to the financial statements.
C) if the amount can be estimated, but the possibility of occurrence is remote.
D) under no circumstances.

Contingent Liability

A potential financial obligation that depends on a future event that is not certain to happen.

ASPE

Accounting Standards for Private Enterprises; a set of accounting principles and guidelines designed specifically for private companies in Canada.

Accounting Records

Documents and books that systematically capture all financial transactions of a business, serving as the foundation for its financial statements.