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Contingent Liabilities; Issues and Practice

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  • Aliona Cebotari

Abstract

Contingent liabilities have gained prominence in the analysis of public finance. Indeed, history is full of episodes in which the financial position of the public sector is substantially altered-or its true nature uncovered-as a result of government bailouts of financial or nonfinancial entities, in both the private and the public sector. The paper discusses theoretical and practical issues raised by contingent liabilities, including the rationale for taking them on, how to safeguard against the fiscal risks associated with them, how to account and budget for them, and how to disclose them. Country experiences are used to illustrate ways these issues are addressed in practice and challenges faced. The paper also points to good practices related to the mitigation, management and disclosure of risks from contingent liabilities.

Suggested Citation

  • Aliona Cebotari, 2008. "Contingent Liabilities; Issues and Practice," IMF Working Papers 08/245, International Monetary Fund.
  • Handle: RePEc:imf:imfwpa:08/245
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    References listed on IDEAS

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    Cited by:

    1. Elsie Addo Awadzi, 2015. "Designing Legal Frameworks for Public Debt Management," IMF Working Papers 15/147, International Monetary Fund.
    2. Debra Bloch & Falilou Fall, 2016. "Government Debt Indicators:Understanding the Data," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 7(01), pages 1-28, February.
    3. Agnès Bénassy-Quéré & Guillaume Roussellet, 2014. "Fiscal sustainability in the presence of systemic banks: the case of EU countries," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 21(3), pages 436-467, June.
    4. Emek, Uğur, 2015. "Turkish experience with public private partnerships in infrastructure: Opportunities and challenges," Utilities Policy, Elsevier, vol. 37(C), pages 120-129.
    5. Marc Dobler & Simon T Gray & Diarmuid Murphy & Bozena Radzewicz-Bak, 2016. "The Lender of Last Resort Function after the Global Financial Crisis," IMF Working Papers 16/10, International Monetary Fund.

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