MFRS 137

Objective The objective of this Standard is to ensure that appropriate recognition criteria and measurement bases are applied to provisions, contingent liabilities and contingent assets and that sufficient information is disclosed in the notes to enable users to understand their nature, timing and amount.

Contingent Assets A contingent assets is a possible asset that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. In this case, the company does not recognise contingent assets but discloses its existence where inflows of economic benefits are probable, but not virtually certain.

Contingent Liabilities A contigent liabilities is a possible obligation that arises from past events and whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity or a present obligation that arises from past events but is not recognised because it is not probable that an outflow of resources embodying economic benefits will be required to settle the obligation. A

contingent liability also arises in the extremely rare case when there is a liability that cannot be recognised because it cannot be measured reliably. Based on the situation in the note 29 annual report for Shell Refining Company, ( The Company is a member of an oil spill fund, namely the International Oil Pollution Compensation ( IOPC ) 1992 Fund. The purposes of the Funds are to help compensate parties that suffer financial loss as a result of oil spill from tankers. The members make contributions to the Funds depending on specific global oil spill incidents, which give rise to payments of compensation by the Funds. As at the date of this report, there are no material claims outstanding ). Its comply to the MFRS 137 paragraph 48 that have been stated in the Future Event, ( Future events that may affect the amount required to settle an obligation shall be reflected in the amount of a provision where there is sufficient

objective evidence that they will occur ). Its also comply with MFRS 137 paraghraph 27 that have been stated An entity shall not recognise a contingent liability. Provision A provision is a liability of uncertain timing or amount. Based on annual report of Shell Refining Company, note 19 Trade Receivables its shown that no new provisions made for impairment of receivables for the year 2011.