Long-term Liabilities
Accounting glossary · Understand, connect, apply
Long-term, or noncurrent, liabilities are obligations not classified as current under the applicable financial-reporting requirements.
Example
Of a five-year loan, the installment due within the next 12 months may be current while the qualifying remaining balance is noncurrent.
Remember the difference
Long-term does not mean due in one year. Loan terms, covenants and rights existing at the reporting date can affect classification.
Examples are simplified for learning. Where a term depends on US law, IFRS, US GAAP or a historical rule, check the context explained above and the requirements relevant to your course.
Study references: OpenStax financial accounting and managerial accounting. For reporting requirements, consult the applicable IFRS Standards or FASB guidance. US tax terms should be checked against the relevant tax-year IRS instructions.
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