- 20 Marks
PSAF – L2 – Q9.4 – Provisions and Contingent Liabilities
Account for contract cancellation, court ruling, and revised contract costs under IPSAS 19, including provisions and disclosures.
Question
Under IPSAS 19: Provisions, Contingent Liabilities and Contingent Assets, the authority needs to account for the cancellation of contracts, the legal case, the court’s decision, and the potential revision of the contract amount.
Required:
Determine whether provisions should be made for the court award and contract revision, calculate the expected value of the revised contract amount, and outline the disclosures required under IPSAS 19.
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