Explain the Difference Between "Probable," "Possible," and "Remote" Under IFRS

question 58

Essay

Explain the difference between "probable," "possible," and "remote" under IFRS.

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Definitions:

Non-bankruptcy Compromises

Agreements made to resolve debt without resorting to bankruptcy proceedings, often involving negotiation between debtor and creditors.

Compositions

Agreements between a debtor and their creditors where the creditors agree to accept a portion of what's owed in full satisfaction of their claims.

Receiverships

A legal process in which a court-appointed custodian administers the property, finances, or operations of a company for the benefit of creditors or other stakeholders.

Pro Rata

A term used to describe a proportionate allocation or distribution of something, like costs or income, among participants based on a specific formula.