Effective management of liabilities involves several strategies:
Debt Restructuring: Renegotiating the terms of debt can help in reducing interest rates or extending payment terms. Cash Flow Management: Maintaining a healthy cash flow ensures that the company can meet its short-term obligations. Hedging: Using financial instruments to hedge against interest rate risks or currency fluctuations can stabilize liability costs. Leverage Ratios: Monitoring key financial ratios like the debt-to-equity ratio helps in maintaining a balanced capital structure.