Net debt and Net interest: Difference between pages

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''Credit risk - liquidity - loan documentation.''
1.  


An organisation's net debt is generally defined as its total debt LESS its cash and cash equivalents.
''Tax.''


Interest stated after offsetting tax effects, if any.


However, definitions may vary in their detail, in different contexts.
In this sense, ''net interest receivable'' means interest receivable stated after deducting any tax payable thereon.


Financial covenants, and complying with them, is one very important context.
In this context, ''net interest payable'' means interest payable stated after offsetting any tax relief enjoyed on the interest expense.




Here as elsewhere, it is important to spell out assumptions and definitions explicitly, and to reconcile net debt figures reported to other reported figures.
2.
 
Interest (usually) payable, stated after deducting other offsetting interest (usually) receivable in the same period.




== See also ==
== See also ==
* [[Capital]]
* [[Gross interest]]
* [[Cash and cash equivalents]]
* [[Compliance]]
* [[Covenant]]
* [[Credit risk]]
* [[Debt]]
* [[Debt ceiling]]
* [[Debt for equity swap]]
* [[Debt service ratio]]
* [[Financial covenant]]
* [[Liquidity]]
* [[Loan agreement]]
* [[Net]]
* [[Reconciliation]]
* [[Working capital]]
 
[[Category:Accounting,_tax_and_regulation]]
[[Category:Investment]]
[[Category:Long_term_funding]]
[[Category:Identify_and_assess_risks]]
[[Category:Manage_risks]]
[[Category:Risk_frameworks]]
[[Category:Risk_reporting]]
[[Category:Cash_management]]
[[Category:Financial_products_and_markets]]
[[Category:Liquidity_management]]

Revision as of 15:41, 21 August 2013

1.

Tax.

Interest stated after offsetting tax effects, if any.

In this sense, net interest receivable means interest receivable stated after deducting any tax payable thereon.

In this context, net interest payable means interest payable stated after offsetting any tax relief enjoyed on the interest expense.


2.

Interest (usually) payable, stated after deducting other offsetting interest (usually) receivable in the same period.


See also

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