Provisions L4 T3 S2 - €Nil which is incurred jointly with other investors of the associate • it has guaranteed its interest in its share of the

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28. Commitments and contingencies  (continued) Legal claim An overseas customer has commenced an action against the Group in respect of equipment claimed to be  defective. It has been estimated that the liability is €850,000 should the action be successful. A trial date  has not yet been set and therefore it is not practicable to state the timing of any payment. The Group has been advised by its counsel that it is possible, but not probable, that the action will succeed  and accordingly no provision for any liability has been made in these financial statements. Guarantees Good Group (International) Limited had the following contingent liabilities at 31 December 2005: it has guaranteed part of the bank overdraft of the associate to a maximum amount of €500,000 (2004: 
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Unformatted text preview: €Nil), which is incurred jointly with other investors of the associate; • it has guaranteed its interest in its share of the joint venture loan of €510,000 (see Note 24) (2004: €500,000) over certain land and buildings; • it has guaranteed to an unrelated party the performance of a contract for the joint venture entity. No liability is expected to arise; and • it has guaranteed its share of €20,000 (2004: €15,000) of the associate’s contingent liabilities which have been incurred jointly with other investors. IAS 37.86 IAS 37.86 IAS 31.54(a) IAS 31.54(b) IAS 24.12...
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This note was uploaded on 01/08/2011 for the course ACC. C-090786 taught by Professor Prof.bantua during the Spring '10 term at Xavier - Ateneo de Cagayan.

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