Liability

A liability is a something for which one is obligated. Most often, in financial accounting, a liability is debt or de facto debt.

According to U.S. GAAP:

"[A Liability is] probable future sacrifices of economic benefits, arising from present obligations of a particular entity, to transfer assets or provide services to other entities in the future."

Under International Financial Reporting Standards or IFRS, a liability is:

"...a present obligation of the entity arising from past events, the settlement of which is expected to result in an outflow from the entity of resources embodying economic benefits."