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ACCA Applied Knowledge · Financial Accounting · Statement of financial position

Under IAS 1, which of the following items would be presented within current liabilities in a company's statement of financial position at 31 December 20X5?

A bank overdraft repayable on demand is a current liability because it is due within twelve months of the reporting date. The loan due in 20X8, the long-term deferred tax and the provision settled in 20X9 fall due later, so they are non-current liabilities.

  1. AA loan of $200,000 repayable in full on 30 June 20X8
  2. BA bank overdraft that is repayable on demandCorrect
  3. CDeferred tax liability due to reverse in several years
  4. DA provision for a legal claim expected to be settled in 20X9

Explanation

A bank overdraft repayable on demand is due for settlement within twelve months (immediately), so it is current. The loan due in 20X8, the deferred tax and the provision expected to be settled in 20X9 are all due after more than twelve months, so they are non-current.

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