Liabilities Liabilities are probable future sacrifices of economic benefits arising from present obligations of a particular entity to transfer assets or provide services to other entities in the future as a result of past transactions or events. A liability has three essentials characteristics: (1) it embodies a present duty or responsibility to one or more other entities that entail settlement by probable future transfer or use of assets at a specified or determinable date, on occurrence of a specified event, or on demand; (2) the duty or responsibility obliges a particular enterprise, leaving it little or no discretion to avoid the future sacrifice; and (3) the transaction or other event obligate the enterprise has already happened.