Share application money

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This query is : Resolved

Viren Gandhi (Querist)

16 November 2011 Hi,
I want to know that If share application money is kept with the company. Whether share application money is considered as Share Capital while Calculationg Retrun on Capital Employed Ratio.

Capital employed=(Share Capital+Res and Surplus+Long Term Loan-Ficticiou Assets).

Pls suggest

CA SUMiT PATWARi

CA SUMiT PATWARi (Expert)

16 November 2011 It may not be considered unless allotment of shares is made to the shareholders.
Share application money received in excess of allotment size will never be considred for calculating capital employed.

Yogesh Agarwal

Yogesh Agarwal (Expert)

16 November 2011 Share Application which is pending for allotment is a current liability and same is not be considered as share capital or part of it for any purpose untill the allotment takes place...And I think in revised schedule-VI the same is kept under the head of "CURRENT LIABILITY"..

So it should not be taken for the calculation for ROCE...

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