What is it?
A Liability, in accounting terms, is a claim on the University’s resources, or more simply put, it is what we owe to a third party. This would include accounts payable, loans or mortgages, and deferred or unearned revenue.
Why is it important?
The University’s liabilities are managed by Financial Services. As a departmental administrator, you may encounter entries in the accounts payable liability account in the balance sheet of your special purpose fund, or in a research fund. These entries are recorded just prior to the actual payment being issued to the third party, and will clear once the cheque or electronic payment has been distributed.