The essential difference between a fixed charge and a floating charge relates to:

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The essential difference between a fixed charge and a floating charge is the time when the particular assets that will be subject to the charge become known. A fixed charge is attached to specific, identifiable assets from the outset, while a floating charge covers assets that are present or future, which may change over time (e.g., inventory). The floating charge "crystallizes" into a fixed charge upon the occurrence of certain events, such as the company going into liquidation or defaulting on the loan.

The Essential Difference Between a Fixed Charge and a Floating