Deferred financing costs

Okay kiddo, let's talk about something called deferred financing costs. When a company needs to borrow money, they often have to pay extra fees to the bank or lender. These fees are called financing costs.

Now, sometimes the company can't afford to pay all of these financing costs upfront, so they spread out the payments over the life of the loan. This is where deferred financing costs come in.

Think of it like buying a toy with your allowance. You want a toy that costs 10 dollars, but you only have 5 dollars right now. So, you ask your mom if you can pay her back the rest of the money over the next few weeks. This is how a company might pay their financing costs over time.

But, because the company is technically borrowing this money to pay for those fees, they have to report it on their financial statements. That's why you might see "deferred financing costs" listed under a company's liabilities. It's like a reminder to the company that they still owe that money to the bank or lender.

Overall, deferred financing costs are just extra fees that companies have to pay when they borrow money, and sometimes they spread out the payments over time instead of paying everything upfront.