Under IAS 37, Inflows of Resources That Are "Virtually Certain

question 33

Multiple Choice

Under IAS 37, inflows of resources that are "virtually certain" to be received should be:

• A) disclosed as contingent assets in the notes to the financial statements.
• B) recognized as assets.
• C) undisclosed until management is absolutely certain that resources will be received.
• D) reported only in the cash flow statement.

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Definitions:

Future Value

The value of a current asset at a specified date in the future based on an assumed rate of growth over time.

Present Value

The current evaluation of a forthcoming cash amount or cash flow series, considering a specific rate of financial return.

Land Rent

Land rent is the payment made for the use of a piece of land, representing the value derived from its use.

Interest Payments

The payments made periodically by a borrower to a lender as compensation for the use of borrowed funds.