Dividend to shareholders

This query is : Resolved

Share Report Follow Query Ask a Query

sapna gupta

sapna gupta (Querist)
Follow

05 January 2015 can dividend be declared even if a company suffers a loss in that particular year??

CS Mitesh Mehta

CS Mitesh Mehta (Expert)
Follow

06 January 2015 In the event of inadequacy or absence of profits in any year, a company may declare dividend out of surplus reserves subject to the fulfillment of the following conditions,

a. The rate of dividend declared shall not exceed the average of the rates at which dividend was declared by it in the three
years immediately preceding that year. However, this condition shall not apply to a company, which has not declared any dividend in each of the three preceding financial year.
b. The total amount to be drawn from such accumulated profits shall not exceed one-tenth of the paid-up share capital and free reserves as appearing in the latest audited
financial statement.
c. The amount so drawn shall first be utilised to set off the losses incurred in the financial year in which dividend is
declared before any dividend in respect of equity shares is declared.
d. The balance of reserves after such withdrawal shall not fall below 15% of its paid up share capital as appearing in the
latest audited financial statement

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

Rajat Khandelwal

Rajesh Surapaneni

Shailesh Prajapati

Santosh Behera

Michael & Co.

Subscribe Now

Dividend to shareholders

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

GST CONSULTANCY

Accountant

Senior Executive

CA Final

GST CONSULTANT

Manager- Finance and Compliance