Misconception · MIS:every-estimated-liability-is-a-contingency

Mistaken idea “Every estimated liability is a contingency”

Mistaken reasoning: This mistake confuses uncertainty about amount with uncertainty about whether a loss condition or obligation exists.

Updated Aug 21, 2026 Review due Nov 8, 2026

Why this is mistaken

Ask whether service was already received. If yes, measure the known obligation; do not manufacture an incurrence question merely because the invoice is late.

Where to watch

When this mistake may appear

  • A December utility bill must be estimated before the January invoice arrives.
Check your work

Your work may contain this mistake if:

  • This mistake routes a known service accrual through probable and reasonably possible labels.