At 31 December 2019 LUMS is pursuing a claim against an insurance company through legal processes. The court is expected to rule in late December 2020. At the reporting date (31 December 2019) the outcome of the case is uncertain. LUMS' lawyers believe there is a 60 per cent chance that LUMS will win the case. Furthermore, they believe that there is a 30 per cent chance that LUMS will be awarded $300,000 (the amount sought by them) and an 70 per cent chance that they will be awarded $100,000 (the amount that was recently awarded by the same judge in a similar case). Other outcomes are unlikely. How should this item be recognised in the financial statements of LUMS as at 31 December 2019? Explain the reason behind your