• A financial obligation, or the cash outlay that must be made at a specific time to satisfy the contractual terms of such an obligation.

• Amounts owed by an individual or other entity.

 Embedded terms in definition
 Referenced Terms
 Accumulated benefit obligation: Abbreviated ABO. An approximate measure of the Liability of a plan in the event of a termination at the date the calculation is performed. Related: projected benefit obligation.

 Alco: is the acronym for Asset and Liability Committee. Term used frequently in banking industry.

 Alm: See Asset and Liability Management.

 Alternative minimum tax: Abbreviated AMT. An alternative tax computation that adds certain tax preference items back into Adjusted Gross Income. If the AMT is higher than the regular tax Liability for the year, then the regular tax and the amount by which the AMT exceeds the regular tax are paid.

 Amortization: The systematic expensing of a portion of the cost of a fixed asset against sales revenue.(1) The paying off of debt in regular installments over a period of time. (2) The deduction of certain capital expenses over a specific period of time.The repayment of a loan by installments.Is the periodic pay down of principal. This is a common feature of most mortgages. Amortize also refers to the accounting write down or reduction in an intangible asset. This creates a charge against income. Amortization can also refer to the reduction in the cost basis of a bond purchased at a premium to par. Sometimes, amortization is used as a synonym for depreciation or other write down of an asset or Liability. In the later capacity it tends to apply to intangible assets. See Interest Impact on Installment to Amortize or Amortization.The process of reducing a debt through installment payments of principal and interest.

 Related Terms
 Asset and liability management
Contingent pension liability
Liability funding strategies
Liability swap
Limited liability
Limited liability instrument
Unlimited liability

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