Both frameworks recognize a liability for a probable, estimable loss — but “probable” means different things, and the measurement and discounting rules differ, so IFRS generally recognizes provisions earlier and at a different amount.
| Area | US GAAP (ASC 450) | IFRS (IAS 37) |
|---|---|---|
| Recognition threshold | ”Probable” = a high likelihood (~likely) | “Probable” = more likely than not (> 50%) |
| Measurement (range) | Accrue the low end if no amount in the range is better | Best estimate — expected value (large populations) or most-likely (single items) |
| Discounting | Limited | Required when the time-value effect is material |
| Onerous contracts | Largely no general model | Recognized under IAS 37 |
The lower IFRS threshold plus best-estimate measurement means provisions appear sooner and often at a higher amount than under US GAAP.
An educational reference and original synthesis — not investment advice, and not a substitute for the standard or for professional accounting guidance. For authoritative measurement detail, consult ASC 450 / IAS 37 directly.