Legal Liability

(1) monies owed, shown on a balance sheet. (2) individual's or company's obligation to act responsibly or face compensatory penalties. See also Liability.

1. Obligation with specified terms and conditions by which a defined payment amount in money, goods, or services is to be paid within a defined time period in return for a current benefit.

2. Responsibility of the accountant to the client and third parties relying on the accountant's work. Accountants can be sued for fraud and negligence in performance of duties.