Question #$1$: Explain the three components of the $$32\mathrm{.}2$ billion pre$-$tax charge in second quarter $2010?$ Which components create a liability?

Question #$2$: In the absence of the trust, could BP make an arguement to not recognize any contingent liability in the second quarter of $2010$ when applying IAS $37?$

Question #$3$: Measurement of these liabilities requires significant judgment. What are the advantages and disadvantages of underestimating versus overestimating the amount?

Question #$4$:What incentives do BP$\text{'}$s auditors have in the decision to recognize versus disclose contingent liability? What incentives do BP$\text{'}$s lawyers have in the decision?