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Net worth

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This query is : Resolved

ANJALI NEGI (Querist)
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29 October 2012 Greetings of the day to all Experts!!
Can anyone tell me whether Share application money pending towards allotment included in the net worth of the company? IF yes/no then Why...

Arun Biyani

Arun Biyani (Expert)
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29 October 2012 Hi Share Application money is generally do not form part of Net worth as if share are not actully issued the money will be refund. Net worth is generally taken as owners equity which mostly includes capital and reserves and surplus. However in private limited companies or sometimes in limited companies as well share application money is also generally paid by promoter only and is never return back. therefore sometimes it is taken into the account while computing net worth. some banks also accept it while others do not. it is a mix. therefore u can decided according to your requirement and if you have to give any ca certificate then you can discuss the ca if he is ready to consider the same..

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