Term:LIABILITY

An accounting term, which records monies owed by the company to outsiders. The most common forms of liabilities are share capital and reserves (which are money “owed” to the shareholders), long-term loans such as debentures, and short-term loans (normally called creditors). These amounts are added to the liabilities side of the balance side. They are credit balances in the ledger, and essentially they show the source of the company’s finance.

Disclaimer - All information and data contained within the PDSnet Glossary terms is for informational and educational purposes only. PDSnet makes no representations as to the accuracy, completeness, suitability, or validity, of any information, and shall not be liable for any errors, omissions, or any losses, injuries, or damages arising from its display or use. Information in the PDSnet glossary terms is based on the author’s opinion and experience and should not be considered professional financial investment advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional. Thoughts and opinions will also change from time to time as more information is accumulated. PDSnet reserves the right to delete any glossary term for any reason.« Back to Glossary Index