California Code of Regulations
Title 2 - Administration
Division 2 - Financial Operations
Chapter 2 - State Controller
Subchapter 3 - Accounting Procedures for Special Districts
Article 8 - Waste Disposal Districts
Section 1101.8 - Current and Long-Term Assets and Liabilities

Assets and liabilities are segregated in the chart of accounts between current and long-term. Current assets are those which are normally convertible to cash within a twelve-month period. Prepaid expenses have a cash-equivalent value and are included as current. Other assets fall into some category of long-term.

Similarly, liabilities which will become payable within twelve months are classed as current.

Status of the transaction at the time first recorded determines whether it is posted to a current or long-term account. It is unnecessary that transitions from long-term to current status be posted in the books. However, the proper segregation should be displayed on the balance sheet.