Obligation and Off-balance sheet finance: Difference between pages

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1.  
Any form of finance that does not result in a corresponding liability appearing on the entity's published balance sheet. 
On double-entry principles the asset being financed cannot appear either.
The effect of such financing and accounting methods is to show the company's borrowings and financial risk at a lower level than they really are.


Any financial commitment undertaken, most commonly in relation to repaying money. 
== See also ==
 
* [[Balance sheet]]
For example the obligation to repay a bond - together with related interest - or the obligation to repay other borrowings or other debt.
* [[Double entry]]
 
* [[ED 2010/9]]
This type of obligation is sometimes known as a 'debt obligation'.
* [[Finance lease]]
 
* [[Gearing]]
 
* [[IAS 17]]
2.
* [[Liabilities]]
 
* [[Off balance sheet]]
More generally, any legally binding financial or non-financial commitment.
 
These may be contractual obligations, or other legally binding obligations.
 
 
3.
 
More broadly still, any type of commitment, whether or not it is legally binding.


== See also ==
* [[Aval]]
* [[Bond]]
* [[Debt]]
* [[Obligor]]

Revision as of 14:20, 23 October 2012

Any form of finance that does not result in a corresponding liability appearing on the entity's published balance sheet. On double-entry principles the asset being financed cannot appear either.

The effect of such financing and accounting methods is to show the company's borrowings and financial risk at a lower level than they really are.

See also


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