California Code of Regulations
Title 2 - Administration
Division 2 - Financial Operations
Chapter 2 - State Controller
Subchapter 3 - Accounting Procedures for Special Districts
Article 5 - Transit Districts
Section 1071.4 - Current and Long-Term Accounts

Asset and liability accounts are grouped in current and long-term sections. A current asset is one normally convertible to cash, or a cash-equivalent benefit, within one year. Other assets are considered long-term. Similarly, current liabilities are those which will become due and payable within one year.

Status of the asset at the date of acquisition, or liability at time of incurrence, determines whether the item is posted to a current or long-term account. Changes in status due to the passage of time should be reflected on the balance sheet, but need not be posted to the accounts.