Financial Statement Presentation

Learning Outcomes

  • Demonstrate receivables as current and noncurrent assets

You should classify a note receivable in the balance sheet as a current asset if it is due within 12 months or as non-current (i.e., long-term) if it is due in more than 12 months.

Here is an excerpt from the balance sheet (here called the statement of Financial Position) of Caterpillar, Inc. (Annual Report for 2019 Download PDF page 54):

Statement 3 – Caterpillar, Inc.
Consolidated Financial Position at December 31,
(dollars in millions)
Description 2019 2018
Subcategory, Assets
Current Assets
Cash and Short Term Investments $8,284 $7,857
Receivables – Trade and other 8,568 8,802
Receivables – Finance 9,336 8,650
Prepaid expenses and other current assets 1,739 1,765
Inventories 11,266 11,529
Total Current Assets Single Line39,193 Single Line38,603
Property, Plant and Equipment, net 12,904 13,574
Long-term receivables – trade and other 1,193 1,161
Long-term receivables – finance 12,651 13,286
Noncurrent deferred and refundable income taxes 1,411 1,439
Intangible assets 1,565 1,897
Goodwill 6,196 6,217
Other assets 3,340 2,332
Single Line$78,453Double Line Single Line$78,509Double Line


Caterpillar separates receivables into both current and long-term, depending on when they are going to be collected, and also into trade receivables and finance receivables, since the company offers dealers financing.

The term trade receivables refers to any receivable generated by selling a product or providing a service to a customer. For Caterpillar, Inc., according to the notes, trade receivables refers to “any receivable generated by selling a product or providing a service to a customer.”

A non-trade receivable would arise when someone owes the company money not related to providing a service or selling a product. For example, the company loans an employee money for a travel advance or a company borrows money from another company.

As you will see in the next section, the notes that accompany the financial statements include details in addition to the numbers on the balance sheet and income statement.