A contingent liability is a potential liability because it depends on a future event. If a possible obligation arises from past events but its existence can only be confirmed depending on the occurrence of one or more future events, the obligation under question is a contingent liability. Alternatively, if a present obligation exists but it is not probable that an outflow of economic benefits will be required or even if it is probable, the amount to settle the obligation cannot be measured reliably, the obligation is disclosed as contingent liability. The correct answer is B.