when do i need to be aware of contingent liability 
if you run a business or oversee the accounts of one you need to be aware of the contingent liabilities that you have taken on you ll also need to record them both gaap generally accepted accounting principles and ifrs international financial reporting standards require companies to record contingent liabilities in accordance with the three accounting principles full disclosure materiality and prudence 12a contingent liability has to be recorded if the contingency is likely and the amount of the liability can be reasonably estimated gaap recognizes three categories of contingent liabilities probable possible and remote 