# Convertible note

> Convertible note — Debt that converts into stock at a future financing, usually at a discount or a cap, accruing interest until it does — a liability until conversion, with any embedded conversion feature assessed for separate accounting.

Source: https://lopifi.com/glossary/convertible-note
Part of: Lopifi — US GAAP books on autopilot, checked by a CPA (https://lopifi.com)

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**What is convertible note?** In accounting, convertible note means debt that converts into stock at a future financing, usually at a discount or a cap, accruing interest until it does — a liability until conversion, with any embedded conversion feature assessed for separate accounting.

## Words this system refuses for it

- SAFE (not debt)
- equity

- **Category:** Equity & financing
- **Specified in:** [Lexicon](https://lopifi.com/md/docs/domain/11-lexicon)
- **Related:** liability