Obligating event

Financial reporting - provisions - contingent liabilities - International Accounting Standards - IAS 37.

IAS 37 deals with provisions, contingent liabilities and contingent assets.

Under IAS 37, an obligating event is an event that creates a legal or constructive obligation and, therefore, results in an entity having no realistic alternative but to settle the obligation.

In turn, an obligating event can give rise to the need to recognise an accounting provision under IAS 37.

See also

• Constructive obligation
• Contingent assets
• Contingent liabilities
• FRS 102
• IAS 37
• International Financial Reporting Standards
• Provision