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Examples of Noncurrent Liabilities Noncurrent liabilities include debentures, long-term loans, bonds payable, deferred tax liabilities, long-term lease obligations, and pension benefit obligations. The portion of a bond liability that will not be paid within the upcoming year is classified as a noncurrent liability.

A debenture pays a regular interest rate or coupon rate return to investors. Convertible debentures can be converted to equity shares after a specified period, making them more appealing to investors. In the event of a corporation's bankruptcy, the debenture is paid before common stock shareholders.

A debenture is a type of debt instrument that is not backed by any collateral and usually has a term greater than 10 years. Debentures are backed only by the creditworthiness and reputation of the issuer. Both corporations and governments frequently issue debentures to raise capital or funds.

Debentures. Debentures generally have a more specific purpose than other bonds. While both are used to raise capital, debentures typically are issued to raise capital to meet the expenses of an upcoming project or to pay for a planned expansion in business.

If the Company has issued the Debentures and they are to be redeemed after one year, then they are shown under Non-Current Liabilities in the Balance Sheet. If the Company has issued the Debentures and they are to be redeemed within one year, then they are shown under Current Liabilities in the Balance Sheet.

A debenture is a loan agreement in writing between a borrower and a lender that is registered at Companies House. It gives the lender security over the borrower's assets. Typically, a debenture is used by a bank, factoring company or invoice discounter to take security for their loans.

US vs UK debentures In the US, a debenture is a medium to long-term loan, issued to a company by an investor. Think of it as an unsecured loan that is supplied in good faith unlike UK debentures, the loan is not backed up by physical assets; only by the company's good reputation in the eyes of the investor.