What Are Trade & Other Liabilities?

These represent trade creditors and other liabilities arising from normal business activities of the Company and generally include liabilities against the following:

Trade creditors Represent the amounts payable to creditors/ business partners against normal business transactions (e.g. against purchase of goods or receipt of services)
Accrued liabilities Represent amounts accrued as provisions/ payable in accordance with accrual concepts. Usually these include such expenses which have been incurred but have not yet been invoiced to the company.
Advances from customers These represent amounts received in advancefrom customersin accordance with termsof sale agreementfor purchase of goods/services. Such amount are booked as liability and are adjusted against the sale proceeds receivable at the time of actual delivery of goods/ services.
Unclaimed dividends When a company announces dividend, it is booked as dividend payable to the shareholders and is then paid off to the shareholders. Due to various circumstances, there are always cases where some shareholders may still not have claimed their dividend. Such amounts remain a liability of the company until it is claimed by the shareholder.
Regulatory dues Represent payments to regulatory authorities (Government, taxation office etc.). In most cases, these are classified separately from accrued liabilities and trade creditors due to its nature and/or disclosure requirements.

One thought on “What Are Trade & Other Liabilities?”

  1. rxoc mining says:

    Nice article, i like it!

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