AASB 137/IAS 37 requires provisions to be recognised when:I there has been a past event.II an entity has a present obligation.III the amount of the obligation can be reliably estimated.IV it is possible that an outflow of resources will be required to settle the obligation. Reading required            Learning objective 9.4 on page 255Group of answer choicesI, II and IV.I, III and IV.I, II and III.II, III and IV.

Provisions are recognized if it is probable that an outflow of resources will be required to settle the obligation.Group of answer choicesTrueFalse

An event that gives rise to a present obligation but which cannot be measured with sufficient reliability is an example of a: Reading required            Learning objective 9.3 on page 254Group of answer choicesprovision.accrual.contingent liability.liability.

IAS 32 focuses on the contractual rights and obligations arising from the terms of an instrument, rather than on the probability of those rights and obligations leading to an outflow of cash or other resources from the entity, as would be the case for a provision accounted for under IAS _____________ – Provisions, Contingent Liabilities and Contingent Assets.

Liabilities which do not meet the recognition criteria and where the possibility of an outflow of economic resources is remote should: Reading required            Learning objective 9.4 on page 256.Group of answer choicesnot be recognised/disclosed in the financial statement at all.be recognised as an accrual.be recognised as a provision.be disclosed as a contingent liability.

If an entity does not expect to recover the carrying amount of an asset, the entity has incurred a/an: Reading required            Learning objective 8.1 on page 220Group of answer choicesdepreciation expense.loss on disposal.amortisation cost.impairment loss.