Question

In a company’s Balance Sheet, Provision for Employees Benefits to be settled within 12 months is shown under ______.

Options

• Non-current Liabilities

• Current Liabilities

• Non-current Assets.

• Current Assets.

Answer 1

In a company’s Balance Sheet, Provision for Employees Benefits to be settled within 12 months is shown under current liabilities.

Explanation:

Any provision that must be settled within 12 months from the balance sheet date is a short-term obligation. Therefore, employee benefits due within a year are classified under Current Liabilities, specifically under the sub-head “Short-term Provisions”. If they were due after 12 months, they would be classified under Non-current Liabilities as Long-term Provisions.