The incident is an observation where your actual functionality/behavior of an application is different from the expected/required functionality. But, it does not really stop your application from working.
Example, (This is a very simple example, others can come up with better ones)
Say, in one of a settings page, you were expected to see the checkbox, but your developer implemented the on/off button. It does not stop your application from working. But, it's incident and deviates from the requirement.
