Short Term Liabilities Concept

Is understood by short term liability the liabilities (or debts) of an entity which chargeability deadline (or maturity) be inferior to one year. The significance of the liabilities separation in short term liabilities and long term liabilities lies on its different implication at the liquidity and cash level. While the short term liability has a direct implication at the entities liquidity levels, long term liability will have implications over liquidity but only on a horizon of longer time.

 

 

Translated from Portuguese by Susana Saraiva, Portuguese-English and English-Portuguese translation specialist. Contact: spams@sapo.pt.