Readr (Accountant) (29 Points)
12 May 2014What is the diifference between Authorized capital and Paid up capital of a pvt ltd co?
Can Paid up capital be 10 crores and authorized capital 2.5 crores? what does that mean about the financial condition of that company?
Are Authorized and paid up capitals on MCA website accurate? are these latest figures?
Niral Gangar
(Management Consulting Investment Advisory CA Practice)
(100 Points)
Replied 13 May 2014
Authorised capital is the maximum capital that can be issued to shareholders. then shareholders subscribe to these and pay money for issue of shares. This is paid-up capital. Paid-up capital will always be less than or equal to authorised capital but not more. You can increase the authorised capital. Sometimes on MCA website an increase in authorised capital is shown late and hence there can be a discrepancy
Readr
(Accountant)
(29 Points)
Replied 13 May 2014
Niral Gangar
(Management Consulting Investment Advisory CA Practice)
(100 Points)
Replied 13 May 2014
Normally in a private company shares are allotted on Face value of Rs. 10/- at the time of incorporation But big companies after incorporation issue further shares and the value could be anything (Rs. 1 to 1000+ also) based on its calculated share value. Payment of exps has nothing to do with its paid-up capital. I may have capital of 1 lakh but have income/ revenues of Rs. 1 Cr out of which I could pay entire 1 Cr for exps. Hope this clarifies
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