Secured Loan

This query is : Resolved

hari krishna desu (Querist)
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27 May 2008
Dear All,

X company had taken loan from financial institution for Rs.200 Crore. X company had not given any security from its assets.

Instead of X, Holding Company of X had given the X Ltd shares as security by way of pledge.

Can X Ltd show the loan in its financials as Secured Loan? Or else is it required to be shown as Un Secured Loan.

Requesting all of you to please clarify at the earliest

Regards,

Hari Krishna Desu

CA. Yayati Tyagi

CA. Yayati Tyagi (Expert)
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27 May 2008 secured loan only, as loan is secured in any way

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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27 May 2008 In my opinion this can not be shown as secured loan because, at best the Institution in the case of default will be able to take over the shareholding of the borrower, which will not obviously secure its loan.

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