Reserve and surplus

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imran khan

imran khan (Querist)
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20 January 2021 If the Reserves and surplus comes as negative figure what it means

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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21 January 2021 It means loss incurred......

CA Rashmi Gandhi

CA Rashmi Gandhi (Expert)
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22 January 2021 You are suffering from loss and your liabilities are more than your assets

Aashok Kumar Sharma online

Aashok Kumar Sharma online

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26 January 2021 Besides all this, if a firm decides to pay dividend far higher than the outstanding balance in its reserves and surplus account, it may lead to a negative or deficit networth.

If you are an equity investor, it is pertinent to keep a tab on your company’s networth. It will tell you if there are any assets left for you as a shareholder, should the company’s operations become unviable and warrant closure. If the company’s networth is negative or deficit and the entity makes losses, it may be a warning signal for you as an investor to exit your investment.

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