Debt classification can significantly affect liquidity metrics, covenant compliance, and how stakeholders view a company’s financial position. This episode discusses the accounting guidance for classifying debt as current or noncurrent, including key judgments related to covenant violations, subjective acceleration clauses, refinancing arrangements, revolving credit facilities, and going concern.

For more, see chapter 12 of our Financial statement presentation guide.

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About our guests

Suzanne Stephani is a director in PwC’s National Office specializing in the statement of cash flows as well as the application and interpretation of the accounting guidance related to financing, leasing, and foreign currency transactions.

Christopher Gerdau is a partner in PwC’s National Office specializing in accounting for financial instruments and banking-related topics. Chris also conducts technical reviews of SEC filings and provides technical support to PwC’s practice offices. Chris’s client service expertise includes the banking, capital markets, and insurance industries.

About our guest host

Diana Stoltzfus is a partner in PwC’s National Office who helps to shape PwC’s perspectives on regulatory matters, responses to rulemakings and policy development, and implementation related to significant new rules and regulations. Prior to rejoining PwC, Diana was the Deputy Chief Accountant in the Office of the Chief Accountant (OCA) at the SEC where she led the activities of the OCA’s Professional Practices Group.

Transcripts available upon request for individuals who may need a disability-related accommodation. Please send requests to [email protected]. 

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