Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
Showing 16 terms
Everything the company owes to someone other than its shareholders, split into current — due within twelve months — and non-current.
Sort them by when they fall due, not only by size. A profitable company still fails if the obligations arrive before the cash does.
An obligation that may arise depending on a future event — tax disputes, guarantees, litigation.
Not on the balance sheet. If the total exceeds net worth, a material risk is hiding in a footnote.
A balance-sheet classification for assets and liabilities whose value is expected to be recovered principally through a sale rather than through continuing use.
Made before the sale completes, and it pulls the division out of its usual lines into one block. Depreciation on those assets stops from the date of classification.
A statement of assets, liabilities and equity at a single point in time.
A photograph, not a film. Where fragility shows up before it reaches profits.
Total assets minus total liabilities — the accounting net worth attributable to shareholders.
Meaningful for banks, nearly useless for a software company.
The liquidity-risk disclosure bucketing financial liabilities by when they fall contractually due, stated on undiscounted cash flows including future interest.
The one place a company sets out, in its own words, what the next twelve months demand in cash. Because it is undiscounted it will not tie to the balance sheet, and that is the design rather than an error.
The portion of a long-term loan falling due within twelve months of the reporting date, stripped out of non-current borrowings and presented among current liabilities.
It is why the line labelled long-term debt gets smaller as a large repayment gets closer. A screener column built on that line ranks a company with an imminent bullet as the safer of two.
Current assets divided by current liabilities.
Below 1 means more is due within a year than is available within a year.
The profit and loss account line containing interest on borrowings together with interest on lease liabilities, unwinding of discount on provisions and amortisation of transaction costs.
A container rather than a single item, and it excludes interest capitalised into an asset under construction. Dividing it by borrowings without reading its note gives a rate the company was never offered.
Net Asset Value — a mutual fund’s holdings minus liabilities, divided by units outstanding.
A low NAV is not cheap. It reflects how long the fund has existed, not what it is worth.
The method used for a common-control combination: assets and liabilities carried across at existing book values, with the difference taken to a capital reserve.
No goodwill arises, which is the fingerprint. A capital reserve moving instead of goodwill appearing tells you a group reshuffle happened rather than a purchase.
Current assets excluding inventory, divided by current liabilities.
The stricter liquidity test — because unsold stock in a downturn is exactly what you cannot convert to cash.
A statutory scheme under which a failing bank’s assets and liabilities are taken over by a stronger institution.
The route that has generally protected depositors above the insured limit, because deposits are liabilities the acquirer assumes. Shareholders in the same transaction are frequently written down to nothing.
Borrowings presented as current liabilities — cash credit and overdraft, working capital demand loans, commercial paper, and the current maturities of long-term loans sitting alongside them.
Two very different things share this caption: money that was always meant to be rolled, and a long loan whose date has arrived. Read them as one number and you misread both.
Current assets minus current liabilities — the capital tied up in day-to-day operations.
Negative working capital is often excellent: customers pay you before you pay suppliers.
An order by a tax officer determining the income or liability of an assessee for a period, and raising a demand where the officer disagrees with the return.
The first rung of a long ladder. First-authority demands are frequently reduced on appeal, which is why large ones sit in contingent liabilities rather than as provisions.