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SFAS (Statement of Financial Accounting Standards) 5 defines probable events are those "more likely than not" to occur, suggesting that a probability of more than 50% requires recognition of a loss. However, in practice, firms generally report contingencies as losses only when the probability of loss is significantly higher.

Translation: Firms generally report contingencies as losses when irrefutable evidence of a loss has made its way into the public domain and can no longer be obfuscated by contrary pronouncements and obsfuscation -- if then.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Apr 21st, 2011 at 08:34:17 PM EST
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