A company has incorrectly classified a short term bond as a non-current liability. However, the company will reclassify and correct this classify as a current liability in the next period. Therefore the current liabilities will increase due to reclassification. Justify whether the reclassification has an impact on below requirements of the funding covenants.

Impact on the dividend payout ratio

Impact on the working capital ratio

Impact on the leverage ratios

Restriction of the borrowing of higher priority debts