An asset in which the possibility of an economic benefit depends solely upon future events that can't be controlled by the company. Due to the uncertainty of the future events, these assets are not placed on the balance sheet. However, they can be found in the company's financial statement notes.
The possibility of an obligation to pay certain sums dependent on future events. Due to the uncertainty of the future events, these liabilities are not shown in the balance sheet. However, they can be found in the company's financial statement notes. A good example of a contingent liability would be an outstanding lawsuit.
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