Final answer:
The four contingent liability treatments are disclose, ignore, recognize, and settle, and they govern how potential financial obligations dependent on future events are handled in accounting.
Step-by-step explanation:
The four contingent liability treatments are disclose, ignore, recognize, and settle. A contingent liability is a potential financial obligation that may arise depending on the outcome of a future event. When an event is likely to occur and the amount can be reasonably estimated, the liability should be recognized in the financial statements. If the event is likely but the amount cannot be reasonably estimated, or it is not likely to occur, the liability should be disclosed in the notes to financial statements. If the occurrence of the event is remote, the company might choose to ignore it. Lastly, a company might settle a contingent liability by paying the amount owed or reaching an agreement with the other party involved.