Liabilities (TALC 5)
Liabilities (TALC 5) consists of the obligations of one unit (the debtor) to provide funds or other resources to another unit (the creditor), under specific circumstances. Liabilities are normally established through a legally binding contract that specifies the terms and conditions of the payment to be made and payment according to the contract is unconditional. Liabilities can also be created by the force of law and by events that require future transfer payments. Whenever a liability exists, the creditor has a corresponding financial claim on the debtor. A financial claim is an asset that typically entitles the owner of the asset (the creditor) to receive funds or other resources from another unit, under the terms of a liability. This category is further classified into:
- currency and deposits (TALC 51);
- securities and related liabilities (TALC 52);
- loans and placements (TALC 53);
- insurance, superannuation and standardised guarantee schemes (TALC 54); and
- other liabilities (TALC 55).