Dear friends
Why FInancial charges will not added to stock valuation ?
1 Replies
Vidya
(Student)
(789 Points)
Replied 24 August 2008
Financial charges are incurred on generaton of capital funds for running the business and are to be treated at par with dividends when it comes to valuaing stocks. Including financial charges will result in a situation where stocks are overvalued in companies struggling for equity and largely depends on debt funds, compared to companies which are equity rich. This hinders inter firm comparision and results in undue advantage in the presented financials of debt based companies.
Recent Topics
- SECTION 148 PROCEEDING
- GST AUDIT 01 - NOTICE
- Capital gain purchase date
- Transmission of deceased's shares in physical form
- Income tax notice but unable to file updated retur
- Income tax depreciation deductions
- GST Notice (Under Section 73)
- Asset Declaration in ITR2 for flat purchased in jo
- Active pan but invalid
- SECTION 128A For those who filed appeal and order
Related Threads
Trending Online Classes
-
PF & ESI Course - Labour Code 2019 Along with Examples and Case Studies
Mr.Balamurugan Ranganathan13 March 2025
CAclubindia
