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Definition of 'Share Capital'

Funds raised by issuing shares in return for cash or other considerations. The amount of share capital a company has can change over time because each time a business sells new shares to the public in exchange for cash, the amount of share capital will increase. Share capital can be composed of both common and preferred shares. Also known as "equity financing". Read more: http://www.investopedia.com/terms/s/sharecapital.asp#ixzz1sHD0EYZz

Investopedia explains 'Share Capital'


The amount of share capital a company reports on its balance sheet only accounts for the initial amount for which the original shareholders purchased the shares from the issuing company. Any price differences arising from price appreciation/depreciation as a result of transactions in the secondary market are not included. For example, suppose ABC Inc. raised $2 billion from its initial public offering. Over the next year, the total value of its shares increases to $5 billion. In this case, the value of the share capital is still only $2 billion because ABC Inc. had received only $2 billion from the sale of its securities to the investing public. Read more: http://www.investopedia.com/terms/s/sharecapital.asp#ixzz1sHD2svMF

Definition of 'Paid-Up Capital'


The amount of a company's capital that has been funded by shareholders. Paid-up capital can be less than a company's total capital because a company may not issue all of the shares that it has been authorized to sell. Paid-up capital can also reflect how a company depends on equity financing. Read more: http://www.investopedia.com/terms/p/paidupcapital.asp#ixzz1sH7XOzmg

Investopedia explains 'Paid-Up Capital'


Paid-up capital is money that a company has received from the sale of its shares, and represents money that is not borrowed. A company that is fully paid-up has sold all available shares, and thus cannot increase its capital unless it borrows money through debt or is authorized to sell more shares. Read more: http://www.investopedia.com/terms/p/paidupcapital.asp#ixzz1sH7ZxQAR

Definition of 'Authorized Share Capital'


The number of stock units that a publicly traded company can issue as stated in its articles of incorporation, or as agreed upon by shareholder vote. Authorized share capital is often not fully used by management in order to leave room for future issuance of additional stock in case the company needs to raise capital quickly. Another reason to keep shares in the company treasury is to retain a controlling interest in the company. Also be called "authorized stock," "authorized shares" or "authorized capital stock." Read more: http://www.investopedia.com/terms/a/authorized-sharecapital.asp#ixzz1sHCVuJ4v

Investopedia explains 'Authorized Share Capital'


Stock exchanges may require companies to have a minimum amount of authorized share capital as a requirement of being listed on the exchange. For example, the London Stock Exchange requires that a public limited company have at least 50,000 of authorized share capital to be listed. Authorized share capital may be greater than the shares available for trading. The shares that have actually been issued to the public and to the company's employees are known as "outstanding shares." Read more: http://www.investopedia.com/terms/a/authorized-sharecapital.asp#ixzz1sHCb3FM3

Definition of Equity
1. A stock or any other security representing an ownership interest. 2. On a company's balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses). Also referred to as "shareholders' equity". 3. In the context of margin trading, the value of securities in a margin account minus what has been borrowed from the brokerage. 4. In the context of real estate, the difference between the current market value of the property and the amount the owner still owes on the mortgage. It is the amount that the owner would receive after selling a property and paying off the mortgage. 5. In terms of investment strategies, equity (stocks) is one of the principal asset classes. The other two are fixed-income (bonds) and cash/cash-equivalents. These are used in asset allocation planning to structure a desired risk and return profile for an investor's

portfolio.

Investopedia explains Equity


The term's meaning depends very much on the context. In finance, in general, you can think of equity as ownership in any asset after all debts associated with that asset are paid off. For example, a car or house with no outstanding debt is considered the owner's equity because he or she can readily sell the item for cash. Stocks are equity because they represent ownership in a company. Read more: http://www.investopedia.com/terms/e/equity.asp#ixzz1sHr44IYW

Definition of 'Tier 1 Capital'


A term used to describe the capital adequacy of a bank. Tier I capital is core capital, this includes equity capital and disclosed reserves. Read more: http://www.investopedia.com/terms/t/tier1capital.asp#ixzz1sMylhHZM

Investopedia explains 'Tier 1 Capital'


Equity capital includes instruments that can't be redeemed at the option of the holder. Read more: http://www.investopedia.com/terms/t/tier1capital.asp#ixzz1sMyo4EVd

Definition of 'Tier 2 Capital'


A term used to describe the capital adequacy of a bank. Tier II capital is secondary bank capital that includes items such as undisclosed reserves, general loss reserves, subordinated term debt, and more. Read more: http://www.investopedia.com/terms/t/tier2capital.asp#ixzz1sMywYObp

Investopedia explains 'Tier 2 Capital'


This is related to Tier 1 Capital. Read more: http://www.investopedia.com/terms/t/tier2capital.asp#ixzz1sMyyjjYo

Sundry debtors means the debtor to whom goods are sold on credit for various reason not merely goods sell on credit.

Definition of 'Debtor'
A company or individual who owes money. If the debt is in the form of a loan from a financial institution, the debtor is referred to as a borrower. If the debt is in the form of

securities, such as bonds, the debtor is referred to as an issuer.

Investopedia explains 'Debtor'


It is not a crime to fail to pay a debt. Except in certain bankruptcy situations, debtors can choose to pay debts in any priority they choose. But if you've failed to pay a debt, you have broken a contract or agreement between you and a creditor. Generally, most oral and written agreements for the repayment of consumer debt - debts for personal, family or household purposes secured primarily by a person's residence - are enforceable. However, most debts for business or commercial purposes must be in writing to be enforceable. If the agreement requires the debtor to pay a certain amount of money, then the creditor does not have to accept a lesser amount. Also, if there was no actual agreement but the creditor has loaned money, performed services or provided the debtor with a product, that debtor must pay the creditor. Read more: http://www.investopedia.com/terms/d/debtor.asp#ixzz1sOXdp0dx

Definition of 'Creditor'
An entity (person or institution) that extends credit by giving another entity permission to borrow money if it is paid back at a later date. Creditors can be classified as either "personal" or "real". Those people who loan money to friends or family are personal creditors. Real creditors (i.e. a bank or finance company) have legal contracts with the borrower granting the lender the right to claim any of the debtor's real assets (e.g. real

estate or car) if he or she fails to pay back the loan.

Investopedia explains 'Creditor'


When creditors are notified of bankruptcy proceedings, they have a couple of options with respect to their claim against the debtor: 1. They can share in any distribution from the bankruptcy estate according to the priority of their claim. Most unsecured, non-wage claims come low on the priority list. 2. They can take the debtor to court and challenge a debtor's discharge (the right not to pay back) due to bankruptcy protection. Read more: http://www.investopedia.com/terms/c/creditor.asp#ixzz1sOZo7mmI Deferred Tax expense:Money that an individual or company owes for taxes but has not yet paid. Deferred tax expenses are placed aside and kept until the company or individual pays taxes, either once per quarter or once per year. Deferred tax expenses are most common for corporations and independent contractors who do not have their taxes deducted from their cash inflows. Minimum Alternative Tax: Normally, a comapny is liable to pay tax on the income computed in accordance with the provisions of the income tax Act, but the profit and loss account of the company is prepared as per provisions of the Companies Act. There were large number of companies who had book profits as per their profit and loss account but were not paying any tax because income computed as per provisions of the income tax act was either nil or negative or insignificant. In such case, although the companies were showing book profits and declaring dividends to the shareholders, they were not paying any income tax. These companies are popularly known as Zero Tax companies. Inorder to bring such companies under the income tax act net, section 115JA was introduced w.e.f assessment year 1997-98. According to this section, if the taxable income of a company computed under this Act, in respect of previous year 1996-97 and onwards is less than 30 % of its book profits, the total income of such company is chargeable to tax for the relevant previous year shall be deemed to an amount equal to 30 % of such book profits. A new tax credit scheme is introduced by which MAT paid can be carried forward for set-off against regular tax payable during the subsequent five year period subject to certain conditions, as under:

When a company pays tax under MAT, the tax credit earned by it shall be an amount which is the difference between the amount payable under MAT and the regular tax. Tegular tax in this case means the tax payable on the basis of normal computation of total income of the company.

MAT credit will be allowed carry forward facility for a period of five assessment years immediately succeeding the assessment year in which MAT is paid. Unabsorbed MAT credit will be allowed to be accumulated subject to the five year carry forward limit. In the assessment year when regular tax becomes payable, the difference between the regular tax and the tax computed under MAT for that year will be set off against the MAT credit available. The credit allowed will not bear any interest.

The Finace Act 2005, introduced from FY 2006-07, Section 115JB that provides if the tax payable on the total income as computed under the Income-tax Act in respect of any previous year relevant to the assessment year commencing on or after April 1 2001, is less than 7.5% of its book profit, such book profit shall be deemed to be the total income of the assessee and the tax payable for the relevant previous year shall be 7.5% of such book profit. Budget 2010-11 MAT u/s 115JB has been increased to 18%

1. A distribution of a portion of a company's earnings, decided by the board of directors, to a class of its shareholders. The dividend is most often quoted in terms of the dollar amount each share receives (dividends per share). It can also be quoted in terms of a percent of the current market price, referred to as dividend yield. Also referred to as "Dividend Per Share (DPS)." 2. Mandatory distributions of income and realized capital gains made to mutual fund investors.

Investopedia explains 'Dividend'


1. Dividends may be in the form of cash, stock or property. Most secure and stable companies offer dividends to their stockholders. Their share prices might not move much, but the dividend attempts to make up for this. High-growth companies rarely offer dividends because all of their profits are reinvested to help sustain higher-than-average growth. 2. Mutual funds pay out interest and dividend income received from their portfolio holdings as dividends to fund shareholders. In addition, realized capital gains from the

portfolio's trading activities are generally paid out (capital gains distribution) as a yearend dividend. Read more: http://www.investopedia.com/terms/d/dividend.asp#ixzz1sOdwEwdH

Equity Capital Equity capital is capital raised from owners in the company. This is different from debt capital which is money raised by incurring debt through the issuance of debentures and other types of bonds. Owners can choose to sell equity in the company, in the form of stock, to investors. This is usually done through a direct offering to the public or through an underwriter like an investment bank. Equity capital is used to get companies off the ground.

Equity capital

Definition
Invested money that, in contrast to debt capital, is not repaid to the investors in the normal course of business. It represents the risk capital staked by the owners through purchase of a company's common stock (ordinary shares). The value of equity capital is computed by estimating the current market value of everything owned by the company from which the total of all liabilities is subtracted. On the balance sheet of the company, equity capital is listed as stockholders' equity or owners' equity. Also called equity financing or share capital.

Read more: http://www.businessdictionary.com/definition/equitycapital.html#ixzz1sOerLaSe

Definition of 'Undisclosed Reserves'


The unpublished or hidden reserves of a financial institution that may not appear on publicly available documents such as a balance sheet, but are nonetheless real assets,

which are accepted as such by most banking institutions.

Investopedia explains 'Undisclosed Reserves'


Undisclosed Reserves are generally described as such only in the banking industry as it applies to capital requirements and are designated as Tier 2 capital along with revaluation reserves and general provisions. Tier 1 or, core, capital is mainly composed of stockholders' equity in the company. Read more: http://www.investopedia.com/terms/u/undisclosedreserves.asp#ixzz1sOfHDKUt General Reserve General Reserve, in short is the part of reserve amount kept by the company out of its profits for future purpose. Example, if the company might not expect any contingencies or unforeseen happenings in the future. Usually, companies keep 20% aside the general reserves out of the total profit earned for a particular year or a certain period. Receipts: A receipt is a written acknowledgment that a specified article or sum of money has been received. A receipt records the purchase of goods or service obtained in an exchange. Payments: A payment is the transfer of money from one party (such as a person or company) to another. A payment is usually made in exchange for the provision of goods, services or both, or to fulfill a legal obligation. Security Premium Security premium in management accounting is the difference between the nominal value and the selling price of shares.