How does FASB define probable?
How does FASB define probable?
Probable. The future event or events are likely to occur. b. Reasonably possible. The chance of the future event or events occurring is more than remote but less than likely.
What does probable mean under US GAAP?
likely
Probable is generally interpreted as likely and is not defined by reference to a single percentage threshold. Probable is interpreted as more likely than not (i.e., a probability of greater than 50 percent).
What is probable under IFRS?
Probable in this context means ‘likely to occur’, which is a higher threshold than IFRS. In many cases, this difference will not change the practical outcome and the threshold will be met under both frameworks. Like IFRS the amount can be estimated reasonably.
What is the definition of probable under IFRS under GAAP which would result in a liability being recorded earlier?
For instance, a difference exists in the interpretation of the term “probable.” IFRS defines probable as “more likely than not,” but US GAAP defines probable as “likely to occur.” Because both frameworks reference probable within the liability recognition criteria, this difference could lead companies to record …
What is the meaning of probable as used in the definitions of assets and liabilities?
a. When a word probable is included in the definition, it indicates that there’s a contingency in the assets or liabilities i.e. there’s a doubt on occurring of an event. This happens when the company is involved in any lawsuits or doubts about receiving the payment from the customers or other parties, etc.
Is FAS 5 still applicable?
FAS 5 is an underlying source of accounting guidance factoring into the calculation of the allowance for loan and lease losses (ALLL), and it applies to entities not yet subject to CECL. Institutions using FAS 5 and FAS 114 need to implement CECL for 2023 or earlier, unless they are large SEC filers.
What is probable under Aspe?
Probable means more likely than not. Therefore, there is a lower threshold for recognizing such obligations under IFRS than under ASPE. If it is not probable that an obligation will result in an outflow of resources, it should be disclosed as a contingent liability if a reliable estimate of the amount can be made.
