A nonmonetary liability is a nonmonetary item that an entity has on its financial statements and that is not a monetary item– that is, it cannot be quickly transferred against cash or cash equivalents, and its value is subject to changes due to external factors beyond the control of an entity. It a liability that is not a monetary liability. In other words, the value of such a liability is not a fixed exchange cash amount.

Examples of nonmonetary liabilities include warranties payable (warranty service on products) and other obligations that need to be extinguished or met using no monetary amounts. Instead, such liabilities are payable in services and other non-monetary means. Other forms of nonmonetary liabilities are those that by nature adjust an expense (such as deferred income tax credit). In general, they arise from the payment or receipt of advance consideration (e.g., liability for rent collected in advance).

Nonmonetary liabilities may also be in the form of deposits and guarantees received, advances received, profit reserves (legal reserves, statutory reserves, special funds), paid-in capital, etc.