Borrowed capital


Borrowed capital means funds made temporarily available to the company from an external source (external investors) or an internal source (owners). All liability items, which don't represent equity are considered borrowed capital. Therefore, accruals, commitments, as well as deferred income (see accruals) are all borrowed capital. Borrowed capital is differentiated according to the duration of the availability of funds into short-term, middle-term and long-term borrowed capital.


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