hi,

indeed, but what is about next:

      MOV  R7,#TIME_OUT   ; max.wait counter
LOOP: SETB FLG_WATCHDOG
      JB   P1.0,LOOP_END  ; event has been detected
      DJNZ R7,LOOP        ; try till timeout
      MOV  A,#NO_EVENT
      JMP  HARDWARE_FAILURE
LOOP_END:

Regards,
Oleg