20 November 2009
Hi Ann, Debentures are securities issued by the co. it may be convertible in which case, upon maturity, it will get converted into equity shares of the co. in case it is non convertible, it will get redeemed after specified period of time. u get fixed rate on interest on it n d same appears as a liability in the books of the co. and as an asset in the books of investor. Fixed deposits, on the other hand, are made with bank, post offices etc. you get fixed rate of interest on it. upon maturity you will get the principal also. u can go for pre-mature return of money in which case banks normally charge some penalty in the form of allowing lower rate of interest. Thanks and regards, CA Shakuntala Chhangani
CAclubindia
