Topics in Long-Term Liabilities and Equity

Non-current liabilities arise from different sources of financing and different types of creditors. While the financial reporting of bonds and loans is straightforward and is covered in the prerequisite materials, the reporting of leases and postemployment liabilities is more complex. Leases are an alternative to asset ownership and have become a common means of financing real estate and capital equipment. Postretirement and stock-based compensation are a large and growing share of employee compensation and operating expenses. Given their importance, this learning module introduces the reporting of leases, pension plans, and stock-based compensation under International Financial Reporting Standards (IFRS) and US GAAP. It concludes by reviewing the presentation and disclosure requirements for these items.