Accounts Payable” or “AP” is a financial term that refers to a company’s outstanding payables, Short-Term Debt and other payment obligations for goods or services that it has received, but not yet paid for.  In addition to being an important Due Diligence item for prospective Investors and Acquirers, Accounts Payable is an essential component of a company’s Working Capital, and it is important for Buyers and Sellers in M&A transactions to negotiate how Accounts Payable will be handled as part of the overall transaction.

AP is often entered under the column heading Current Liabilities on a Balance Sheet. See also Accounts Receivable.