Legal Question in Credit and Debt Law in California

Accounts Payables

I know that accounts payables are listed as current in the current liability section of the balance sheet. How long can a company (knowing that a payable will not be paid) should a company keep a payable on the books or should all payables be written off at the end of 365 calendar(fiscal) days? We've been told that we have to keep them up to four years on our books. If so, then our current ratios are screwed. However, if true, I believe that anything over 365 days should be reclassified to long term. Please advise.


Asked on 10/12/04, 7:44 pm

1 Answer from Attorneys
Michael Stone Law Offices of Michael B. Stone Toll Free 1-855-USE-MIKE

Re: Accounts Payables

Ask an accountant.

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Answered on 10/13/04, 12:02 pm


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