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Debt Capital
I have recently came across the unaudited results of several co's of March10 qtr where they have indicate the amount of Debt Capital or Dr Capital. In some cases they have indicated it to comprise of Debenture where as in some cases the entire loan fund.
I wish to know what is the actual definition of debt capital and what is the statutory disclosure requirement.
Thanks & regards
Shankar Banerjee
Replies (2)
Debt Capital refers to the funds borrowed by the company, with an obligation to repay the same within the agreed period with interest, of course. It can be in the form of debentures, loans from banks and financial institutions, fixed deposits etc. The parties providing the money are not shareholders/owners, but are mere creditors/lenders.
As per Schedule VI of the Companies Act, you'll have to show them in the balance sheet on the Liabilities side as:-
1. Secured Loans 2. Unsecured Loans.
I have also checked result for one of the listed company and debt capital refers to Secured as well as unsecured Loans....
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