Starting Your Own Business ? Hints & Tips Entrepreneurial Advice Suzie's Blogs ...

Non Current Liabilities and Your Business Balance Sheet Non-current liabilities are those obligations that will not become due and payable in the coming year. There are three types of non-current liabilities, only two of which are listed on the balance sheet: ** Non-current Portion of Long Term Debt (LTD) ** Subordinated Officer Loans (Sub-Off) ** Contingent Liabilities Non current portion of long term debt is the principal portion of a term loan not payable in the coming year. Subordinated officer loans are treated as an item that lies between debt and equity. Contingent liabilities listed in the footnotes are potential liabilities, which hopefully never become due. Non-Current Portion of Long Term Debt (LTD) is the portion of a term loan that is not due within the next 12 months. It is listed below the current liability section to demonstrate that the loan does not have to be fully liquidated in the coming year. Long-term debt (LTD) provides cash to be used for a long-term asset purchase, either permanent working capital or fixed assets. Shareholder/Owner Loans (Subordinated). See you here tomorrow. Suzie Posted: Thursday 27th January 2005, 12:25 AM

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