INTRODUCTION
As financial accountant of zafer plc I have been asked to advise the board of directors on certain matters listed below?.
1. Differences between preference shares and redeemable shares.
2. Purposes for which share premium a/c and the revaluation reserve can be used.
3. Procedure, which must be satisfied before the shares, can be used.
And conditions, which must be satisfied before the premium to be paid.
4. Can the entire premium be written off to the share premium a/c?
5. Also the revised balance sheet extract after the shares are redeemed.
And the appropriate premium to be paid for share premium a/c.
I have done enough research on the company law books and also online
So I'm glad to say that I could provide you the best resources that I have gathered all these days.
Before we move on to the main topics I would like to give you a brief idea about the shares and the shareholders. So what is a share? A share is the interest of the shareholder in the company measured by a sum of money, for the purpose of liability in the first place and of interest in the second, but also consisting of a series of mutual covenants as provided by S14 companies act 1985.
A share does not make the holder an owner of the company's assets (Macaura v. Northern Assurance (1925)) but is gives you certain rights like dividends and voting rights. A company can issue the following types of shares?
? Ordinary/equity shares
? Preference shares
? Redeemable shares
? Deferred/founders' shares
? Non-voting shares
So therefore the person who owns these types of shares is called a shareholder.
Now we'll move to the listed matters that we should discuss about.
Question (a)
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