liability


liability
1) In the broad legal sense, responsibility or obligation. For example, a person is liable to pay his debts, under the law;
2) In accounting, any debt owed by an individual or organization. Current, or short-term, liabilities are those to be paid in less than one year (wages, taxes, accounts payable, etc.). Long-term, or fixed, liabilities are those that run for one year or more (mortgages, bonds, etc.);
3) In futures, traders deposit margin as earnest money, but they are liable for the entire value of the contract;
4) In futures options, purchasers of options have their liability limited to the premium they pay; option writers are subject to the liability associated with the underlying deliverable futures contract. The CENTER ONLINE Futures Glossary
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A financial obligation, or the cash outlay that must be made at a specific time to satisfy the contractual terms of such an obligation. Bloomberg Financial Dictionary

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liability li‧a‧bil‧i‧ty [ˌlaɪəˈbɪlti] noun liabilities PLURALFORM
1. [countable usually plural] ACCOUNTING FINANCE an amount of money owed by a business to a supplier, lender etc:

• In its bankruptcy filing, the company listed liabilities of $363.7 million and assets of $141.3 million.

• The business has a liability as it owes money to the mortgage provider.

asˌsumed liaˈbilities [plural] ACCOUNTING FINANCE
the debts that a company agrees to be responsible for paying when it buys another company:

• It sold its gas operations for $46 million, $39 million in cash and $7 million in assumed liabilities.

conˌtingent liaˈbilities also conˌtingency liaˈbilities [plural] ACCOUNTING FINANCE
debts that may have to be paid later, and that are included in a report on a company's financial situation:

• As a result of the legal settlement over royalty rights, it will remove $3.4 million in contingent liabilities from its balance sheet.

ˌcurrent liaˈbilities [plural] ACCOUNTING FINANCE
debts that must be paid within one year, for example to suppliers and the tax authorities:

• The company had long-term debt of $1.71 billion and current liabilities of $1.38 billion.

deˌferred liaˈbilities [plural] ACCOUNTING FINANCE
debts relating to activity in one period of time that will or may be paid in a later period of time:

• The company's reserves included $756 million for unspecified deferred liabilities.

deˌposit liaˈbilities [plural] BANKING FINANCE
money that people and companies have put into banks, and that the banks will have to pay back at some time in the future:

• Banks should ensure that their assets are worth enough to meet their deposit liabilities.

exˌternal liaˈbilities [plural] ACCOUNTING FINANCE
debts to lenders and suppliers, as compared to money owed to shareholders:

• The balance sheet should summarize the sources of finance which are the external liabilities of the business.

ˌfixed liaˈbilities also ˌlong-term liaˈbilities [plural] ACCOUNTING FINANCE
debts to be paid in more than one year, for example to lenders such as banks, rather than to suppliers:

• The company had long-term debts of $626 million, plus $311 million of other long-term liabilities, such as pension obligations.

seˌcured liaˈbilities [plural] ACCOUNTING FINANCE
debts to lenders, for example in the form of bonds, that are secured on particular assets of the company. These assets can be sold if necessary to pay the debts:

• The thrift's liabilities included about $2.5 billion in deposits in 184,000 accounts and $803 million in secured liabilities.

ˈtax liaˌbility [countable] ACCOUNTING TAX
an amount of tax that a person or organization must pay:

• No debts remained outstanding, apart from a tax liability in excess of £500,000.

2. [uncountable] LAW the responsibility that a person or organization has for loss, damage, or injury caused to others, or for payment of debts:
tax liability for

• The new law would double airlines' liability for lost luggage to $2,500.

• The company admitted liability for its negligence from the start.

• The firm has denied liability, and isn't discussing settlement terms.

— see also admission of liability, limitation of liability
ˌcivil liaˈbility [uncountable] LAW
responsibility for injury or damage that is not serious enough to be covered by criminal law:

• The laboratories were subject to civil liability for side effects of any drugs they might approve.

ˌcriminal liaˈbility [uncountable] LAW
responsibility for injury or damage that is serious enough to be covered by criminal law:

• The proposed legislation would remove the threat of criminal liability for some copyright violations of software.

emˈployer liaˌbility also employer's liability [uncountable] LAW
responsibility by employers for their employees' actions while working or at work:

• Employer liability for a worker's driving could reach far.

ˌjoint and ˈseveral liaˌbility
[uncountable] LAW when a number of different people or organizations are responsible both as a group and individually for harm or injury they have caused:

• Under joint and several liability, the auditors could be found liable for the entire amount sought from all defendants.

ˌlegal liaˈbility [uncountable] LAW
responsibility for an action covered by the law:

• The airline should bear all legal liability for the crash.

ˌlimited liaˈbility [uncountable] LAW FINANCE
when the owners of a limited liability company are only responsible for their company's debts up to a certain amount if it goes out of business, and do not have to sell their personal assets to repay these debts:

• When he founded the company, he chose limited liability status because of the personal protection it gave him.

ˌpersonal liaˈbility [uncountable] LAW FINANCE
when someone's personal assets must be sold to pay the debts of the company they own:

• He could be left not only with a collapsed empire but with a huge personal liability.

ˈproduct liaˌbility [uncountable] LAW COMMERCE
when the maker of a product is responsible for any damage or injury that the product causes:

• She is suing the company for negligence and product liability, alleging that a defect in her car caused the accident.

proˌfessional liaˈbility [uncountable] LAW
the responsibility of a professional person such as a doctor or lawyer for damage or loss caused by the services or advice that they give
seˌquential liaˈbility [uncountable] LAW
a rule stating that a company only has to pay money it owes after it has received payment from its customers:

• The board is recommending that members oppose sequential liability.

ˌstrict liaˈbility [uncountable] LAW
when an organization is not directly responsible for damage or injury to someone, but must still pay Damages (= money for the damage or injury caused):

• Recognizing how difficult it is to prove fault in an air accident, airlines agreed to strict liability — automatic compensation of passengers or their relatives.

ˈtax liaˌbility [uncountable] LAW TAX
the state of having to pay an amount of tax:

• The current system bases tax liability on the form of income rather than the amount.

unˌlimited liaˈbility [uncountable] LAW
when a person or organization is considered responsible for paying the complete cost of any damage or injury they cause, or for paying all of their debts, with no upper limit:

• Individual states are free to set unlimited liability for shippers responsible for oil pollution.

viˌcarious liaˈbility [uncountable] LAW
when someone is considered legally responsible for damage or injury caused by someone else:

• gun manufacturers' vicarious liability for injuries caused by their guns

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liability UK US /ˌlaɪəˈbɪləti/ noun (plural liabilities)
[C] ACCOUNTING, FINANCE the amount of money that a person or organization owes: »

He listed liabilities of more than $3 million.

»

The company will also have to show that it has a liability of $600.

[U] LAW legal responsibility for something: liability for sth »

Warning notices may not be enough to absolve a property owner of liability for visitors' injuries.

»

They still haven't admitted liability for the crash which ruined so many lives.

»

The army denied liability but agreed to make an out-of-court settlement.

See also ADMISSION OF LIABILITY(Cf. ↑admission of liability), ASSUMED LIABILITIES(Cf. ↑assumed liabilities), CIVIL LIABILITY(Cf. ↑civil liability), CONTINGENT LIABILITY(Cf. ↑contingent liability), CRIMINAL LIABILITY(Cf. ↑criminal liability), CURRENT LIABILITY(Cf. ↑current liability), DEFERRED LIABILITY(Cf. ↑deferred liability), DEPOSIT LIABILITIES(Cf. ↑deposit liabilities), EMPLOYER LIABILITY(Cf. ↑employer liability), EXTERNAL LIABILITY(Cf. ↑external liability), JOINT AND SEVERAL LIABILITY(Cf. ↑joint and several liability), LEGAL LIABILITY(Cf. ↑legal liability), LIMITATION OF LIABILITY(Cf. ↑limitation of liability), LIMITED LIABILITY(Cf. ↑limited liability), LONG-TERM LIABILITY(Cf. ↑long-term liability), PERSONAL LIABILITY(Cf. ↑personal liability), PRODUCT LIABILITY(Cf. ↑product liability), PROFESSIONAL LIABILITY(Cf. ↑professional liability), SECURED DEBT(Cf. ↑secured debt), SEQUENTIAL LIABILITY(Cf. ↑sequential liability), STRICT LIABILITY(Cf. ↑strict liability), TAX LIABILITY(Cf. ↑tax liability), UNLIMITED LIABILITY(Cf. ↑unlimited liability), VICARIOUS LIABILITY(Cf. ↑vicarious liability)

Financial and business terms. 2012.

Synonyms:

Look at other dictionaries:

  • liability — li·a·bil·i·ty /ˌlī ə bi lə tē/ n pl ties 1: the quality or state of being liable 2: something for which one is liable: as a: a financial obligation: debt tax liability the bonds …   Law dictionary

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  • liability — [n1] answerability, responsibility accountability, accountableness, amenability, amenableness, arrearage, blame, burden, compulsion, culpability, debt, duty, indebtedness, obligation, onus, owing, subjection, susceptibility; concept 645 Ant.… …   New thesaurus

  • liability — liability. См. подверженность. (Источник: «Англо русский толковый словарь генетических терминов». Арефьев В.А., Лисовенко Л.А., Москва: Изд во ВНИРО, 1995 г.) …   Молекулярная биология и генетика. Толковый словарь.

  • liability — Any legal obligation for which a person is responsible. (Dictionary of Canadian Bankruptcy Terms) United Glossary of Bankruptcy Terms 2012 …   Glossary of Bankruptcy

  • liability — 1790, originally a term in law; condition of being legally liable; see LIABLE (Cf. liable) + ITY (Cf. ity). General sense is from 1809; meaning thing for which one is liable is first attested 1842. Related: Liabilities …   Etymology dictionary

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  • liability — *debt, indebtedness, obligation, debit, arrear Antonyms: asset (or plural assets) …   New Dictionary of Synonyms

  • liability — ► NOUN (pl. liabilities) 1) the state of being liable. 2) a thing for which someone is liable, especially a financial obligation. 3) a person or thing likely to cause one embarrassment or put one at a disadvantage …   English terms dictionary