Question：In accordance with IAS 37, which of the following criteria need to be met if a provision is to be recognised in the financial statements?

A.It must be probable that the liability will crystallise.

B.It must be possible that the liability will crystallise.

C.The reporting entity must have a present obligation to transfer economic benefit as a result of a past event.

D.The obligation can be measured with sufficient reliability.

The correct answers are:

The reporting entity must have a present obligation to transfer economic benefit as a result of a past event.

It must be probable that the liability will crystallise.

The obligation must be measurable with sufficient reliability.

An ‘obligating event’ must have occurred.

Occurrence must be at least probable (i.e. more likely than unlikely).