Long-Term Liabilities In Accounting

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Long term liabilities in accounting practices refer to the lists of duties & obligations that become due more than one year in the future. These expenses are very essential in accounting. Long-term liabilities include but not limited to the following items:
• Debentures
• Loans
• Deferred tax liabilities
• Pension obligations.
Other long-term liabilities that will come due within the current 12 months are listed and labeled under current liabilities, such as the current portion of long-term debt expected to be paid in the present year.
Long-term liabilities are a tactic that allows analysts to gain a more accurate view of a company's current liquidity position & assets. In general, an accountant or analyst job is to make sure that a company
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As discussed earlier, long term liabilities are labeled as the obligations that a company or an organization endures for a time period that exceeds past the current operating cycle or current year are considered long-term liabilities expenses.
Long-term liabilities are divided into two groups: they can either be financing-related Long-term liabilities or operational Long-term liabilities.
• Financing liabilities: are all of the debt obligations formed when a company tries to raise cash. They contain notes, payable, convertible bonds, and bonds payable.
• Operating liabilities: are the general obligations a company experiences during the course of everyday normal business practices. Operating liabilities include capital lease obligations and post-retirement benefit obligations to employees.
According to an article in Investopedia, "Both types of liabilities represent financial obligations a company must meet in the future, though it is advisable for investors to look at the two separately. Financing liabilities result from deliberate funding choices, providing insight into the company’s capital structure and clues to future earning potential." (Investopedia,
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They are comprised of four main components, of which the balance sheet and the income statement are essential. The first item to consider when looking at a set of financial statements is whether these are external financial statements or internal financial statements.

INTERNAL FINANCIAL STATEMENTS
Internal financial statements are more flexible than external financial statements and have a higher analytical component. They may report by division, have more detail or be produced on a more frequent basis (weekly, monthly or quarterly).
A set of financial statements includes two essential statements: the balance sheet and the income statement
A set of financial statements is comprised of several statements, some of which are optional. If the statements are prepared or reported by an external accountant, they will begin with a report from the accountant. This will be followed by the two essential financial statements:
According to an article on Mars Website "Generally, external financial statements are prepared on the accrual basis of accounting, which means that assets and liabilities are recorded when they are committed to, and revenue and expenses are recorded when they are incurred (rather than when they are actually paid)". (MARSDD,
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