A patient who smokes cigarettes sued the Red Tobacco Company to demand payment of $3,000,000 as compensation for the respiratory damage he sustained. And after the tobacco company returned to its lawyer, who stated that it is unlikely that this case will succeed; Because there is no confirmed evidence to prove this, the court will reject the case. 

A woman filed a lawsuit claiming $700,000 in compensation to the World Food Company as a result of selling expired products that are unfit for human use, and after the company returned to its lawyer, he stated that the company is responsible and that the courts are likely to award compensation for the damage caused to the customer, but it is not likely to rule in full. The amount is $700,000, and the normal settlement for this type ranges between $20,000. to $ 30,000 has been confirmed by the attorney to the extent. 

The Modern Technology Company has used the patent rights of Al-Manarat Technology Company, and the latter company has sued the company, which demanded compensation of approximately 2 million riyals. As a result of the damage caused to it and by virtue of the nature of the process, the judgment depends on the testimony of the specialists and experience. The lawyers of the Modern Technology Company consider that the result is uncertain, but they estimate the probability of the plaintiff’s success in that at about 30%. 

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What are the required accounting treatments in light of the IAS38 Contingent Liabilities Standard?

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