john a client who filed a lawsuit against Semicorp Ltd in September $2025$ for negligence when providing its services. The amount claimed was $$13$ million. Semicorp lawyers have advised that the amount claimed is extortionate and Semicorp has a good chance of winning the case. However, the company$$s lawyers have also advised that expected costs and damages would be about $$2$ million in the event that Semicorp is unsuccessful in defending the case.

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How should Semicorp record and disclose this event in its financial statements as at $30$ June $2026?$