I will start with the definition of “contingent liabilities”, and after that I will provide some examples.
Contingent liabilities are possible obligations that may result in the future sacrifice of economic benefits arising from existing conditions or situations involving uncertainty. The uncertainty will ultimately be resolved when one or more future events not wholly within the government's control occurs or fails to occur. Contingent liabilities are distant from liabilities in that there is a degree of uncertainty as to whether a present obligation to sacrifice economic benefit exists at the financial statement date of March 31, 2024.
There are two basic characteristics of contingent liabilities. There must be an existing condition or situation, as I was explaining earlier, and there must be an expected future event that will resolve the uncertainty regarding whether a present obligation exists. For a contingent liability to be present, there must be an existing condition or situation, at the financial statement date, that indicates the government may have a liability. The existing condition or situation could be, for example, a legal case—