effective Capita

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Vinayak Ketkar (Querist)
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23 April 2011 While calculating effective capital as per Sch.xIII,can we considered preference share Capital which is already due for redumption and also can we consider capital reserve for calculating effective capital

Pravin Gupta CS

Pravin Gupta CS (Expert)
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23 April 2011 effective capital means aggregate of paid-up share capital (excluding share application money), share premium account, reserves & Surpluses (excluding revaluation reserve), long-term loan and deposits repayable after one year minus investments, accumulated losses & preliminary exp. not written off.

So as per interpretation of the definition given under companies act, it 's clearly indiacate that capital reserve can be included while calculating effective capital (except revaluavation reserve) but u can not conside the ammount of prefrence share Capital which is already due for redumption because thats become liability after due....