This ratio measures what proportion of a company's current liabilities is made up of accrued expenses — obligations that have been incurred but not yet paid, such as accrued wages, accrued interest, accrued taxes, and other short-term obligations. A high ratio indicates that a significant portion of the company's near-term obligations are accruals rather than trade payables or short-term debt.
Accrued to Current Liabilities = Accrued Expenses / Current Liabilities
GeminIQ divides Accrued Liabilities (as reported) by Current Liabilities from the balance sheet as filed.
A: A high accrued-to-current-liabilities ratio indicates the company has significant obligations that have been recognized but not yet paid in cash. This is normal for large employers (accrued wages) and companies with quarterly tax payments. Unusually high ratios may warrant investigation into whether accruals are building up faster than they are being settled.
A: It is neither inherently good nor bad — it reflects the composition of short-term obligations. The ratio is most useful when tracked over time. A rising ratio may indicate the company is deferring payments, which could signal cash flow pressure.
A: Accrued expenses can be classified differently by different companies and aggregators. Some companies report accrued liabilities as a single line; others break them into multiple sub-categories. GeminIQ uses the as-filed accrued liabilities figure.