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What are the typical items reported as current liabilities?

Harold Averkamp, CPA, MBA

Here are the typical items that are reported as current liabilities on a corporation's balance sheet:

1. Accounts payable. These are the amounts that are due to vendors who have supplied goods or services. The accounts payable are supported by the vendor invoices that have been approved and processed, but have not yet been paid.

2. Deferred revenues. This reports the amounts that a customer has prepaid and will be earned by the company within one year of the balance sheet date. An example is a retailer's unredeemed gift cards.

3. Accrued compensation. Included in this are payroll related items such as the amounts due to employees and the amounts to be remitted for payroll taxes.

4. Other accrued expenses or liabilities. This reports the amounts that the company owes for items not recorded in accounts payable or accrued compensation. Examples include the interest expense that the company has incurred (but has not yet paid) and repairs that took place but the vendor's invoice has not been fully processed.


Accrued income taxes and perhaps some deferred income taxes.

6. Short-term notes. These include the loans from banks that will become due within one year of the balance sheet date.

7. The current portion of long-term debt. The principal payments of a mortgage loan or an equipment loan that must be paid within one year of the date of the balance sheet are reported in this item.

To be reported as a current liability the item must be due within one year of the balance sheet date (unless the company's operating cycle is longer). However, there is no requirement that the current liabilities be presented in the order in which they will be paid. Hence, the current portion of long-term debt might be listed last, but the principal payment might be due within several days of the balance sheet date.

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Category: Forex

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