• A liability (generally speaking) is something that is owed to someone else.

  • Liability can also mean legal or regulatory risk or obligation.
  • In accounting, companies take into account liabilities in relation to assets.
  • Current liabilities are short-term financial liabilities of a company that are payable within one year or the normal operating cycle (for example, accounts payable).
  • Long-term (long-term) liabilities are liabilities on the balance sheet, the maturity of which has expired for more than a year.