Contingent Liability refers to a liability that may arise in future on the

WHAT IS CONTINGENTI ASSESTS AND LIABILITIES?

Question Posted / h.r. sreepada bhagi

Answer Posted / h.r. sreepada bhagi

Contingent Liability refers to a liability that may arise in
future on the happening or otherwise of a contingent event.
For example guarantee given in favor of a third party. The
guarantor company has to pay it in the event of the
borrower's failure to pay it to the lender on due date as
per the terms of agreement. There needs to be note about it
in the Annual Financial Statements.

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