DIVIDENDS &

PAYOUT POLICY
CHAPTER 17
 01 Arjun Wahyudi
2006538081

02 Chrusty Nuril Fitriana

2006538144

03 Nur Hidayati
Kelompok 5 2006538415

04 Sebastian Felipe Abraham

2006538516

05 Siti Dhaifina Fitria

2006538541

06
CASH DIVIDENDS &
DIVIDEND PAYMENT
DIVIDEND :
A payment made out of a firm’s earnings to its owners,
in the form of either cash or stock.
DISTRIBUTION :
A payment made by a firm to its owners from sources
other than current or accumulated Retained Earning.
The basic types of cash dividends are :
• Regular Cash Dividends
• Extra Dividends
• Special Dividends
• Liquidating Dividends

3
CASH DIVIDENDS
REGULAR CASH
DIVIDENDS
• A cash Payment made by a firm
to its owners in the normal
course of business.
• Management sees nothing
unusual about the dividend and
no reason why it won’t be
continued..
• An extra dividend is a dividend that
“may or may not” be repeated in
the future. 
• By calling part of the payment
“extra” management indicating that
the payment is non recurring like
regular cash dividend.
EXTRA CASH DIVIDENDS
4
 CASH DIVIDENDS
• A liquidating dividend is a
distribution of cash or other
SPECIAL DIVIDENDS assets to shareholders, with the
intent of shutting down the
• A special dividend is a non-recurring
business.
distribution of company assets to
shareholders. A special dividend • This dividend is paid out after
often tied to a specific event like an all creditor and lender
asset sale or other windfall event. obligations have been settled.
• Special dividends are typically
announced with little-to-no LIQUIDATING DIVIDENDS
warning; are usually for significantly
larger amounts; one-time event; and
probably won’t be repeated. 5
 DIVIDEND PAYMENT :
A CHRONOLOGY

Declaration Ex- Dividend Record Payment

Date Date Date Date

The date on which The date two business days The date by which a The date on which
the board of before the date of record, holder must the dividend
directors passes a establishing those individuals be on record to be checks are mailed.
resolution to entitled to a dividend. designated
pay a dividend. to receive a dividend.
EXAMPLE
 PRICE BEHAVIOR:
Around the Ex- Dividend Date
• The value of share stock will
go down by about the
dividend amount when the
stock goes ex- dividend.
• Because dividend are taxed,
the actual price drop might
be closer to some measure of
the aftertax value of the
dividend.
PRICE BEHAVIOR:
Around the Ex- Dividend Date
DOES DIVIDEND
POLICY MATTER ?
• Dividend policy is the time
pattern of dividend payout.
• Dividend Policy Question :
Should the firm pay out a large
% of its earning now or a small
(or even zero) % ?

10
11
 SECTION DIVIDER
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 COMPARISON 01
TOPIC 01
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TOPIC 02
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CHART

Statistics here Sales

6

0
Category 1 Category 2 Category 3 Category 4

Series 1 Series 2 Series 3 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

14
TABLE

TOPIC 01 TOPIC 02 TOPIC 03 TOPIC 04 TOPIC 05

Item 01 Text Text Text Text

Item 02 Text Text Text Text
Item 03 Text Text Text Text
Item 04 Text Text Text Text
Item 05 Text Text Text Text
Item 06 Text Text Text Text
Item 07 Text Text Text Text
Item 08 Text Text Text Text
TOTAL Text Text Text Text

9
TEAM
ALEXANDER MARTENSSON
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VICTORIA LINDQVIST
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MIRJAM NILSSON
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ANGELICA ASTROM
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