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Reserve capital

Rajesh (student) (76 Points)

17 December 2010

what is the differance b\w reserve capital and capital reserve

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Krishna Teja (Chartered Accountant) (1007 Points)
Replied 17 December 2010

RESERVE CAPIAL(sec 99)-it is the portion of uncalled share capital which shall not be capable of being called up except in the event of winding up of company

SR is required for its creation(it is not compulsory)

CAPITAL RESERVE-it refers to those amounts which are not regarded as free for distribution by way of dividend through profit and loss account

it is mandatory in some circumstances (like profit on forfeited shares)

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Madhusudan Kabra (knowledge seeker) (1779 Points)
Replied 17 December 2010

Originally posted by : krishna teja
	RESERVE CAPIAL(sec 99)-it is the portion of uncalled share capital which shall not be capable of being called up except in the event of winding up of company SR is required for its creation(it is not compulsory) CAPITAL RESERVE-it refers to those amounts which are not regarded as free for distribution by way of dividend through profit and loss account it is mandatory in some circumstances (like profit on forfeited shares)

AGREED

Resham (Carpe Diem !!!) (6535 Points)
Replied 17 December 2010

Reserve Capital --

1. It refers to that portion of uncalled capital which is not called up except in the event of winding up of the company.

2. It is not mandatory to create reserve Capital.

3. It s not shown in the company's balance sheet.

4. A special resolution needs to be passed for its creation.

5. Can be used only at the time of winding up of company.

Capital Reserve --

1. it refers to those amounts which are not free for distribution as dividend.

2. It is mandatory to create Capital reserve in case of profit on forfeited shares.

3. It is shown in balance sheet.

4. No special resolution required.

5. Can be used to write off capital losses at any time during the life of a company.

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(Guest)

Originally posted by : Resham
	Reserve Capital -- 1. It refers to that portion of uncalled capital which is not called up except in the event of winding up of the company. 2. It is not mandatory to create reserve Capital. 3. It s not shown in the company's balance sheet. 4. A special resolution needs to be passed for its creation. 5. Can be used only at the time of winding up of company. Capital Reserve -- 1. it refers to those amounts which are not free for distribution as dividend. 2. It is mandatory to create Capital reserve in case of profit on forfeited shares. 3. It is shown in balance sheet. 4. No special resolution required. 5. Can be used to write off capital losses at any time during the life of a company.

yup ryt and agreed

Kashish Grover ( CA-FINAL, CS-FINAL) (1671 Points)
Replied 17 December 2010

Originally posted by : Resham
	Reserve Capital -- 1. It refers to that portion of uncalled capital which is not called up except in the event of winding up of the company. 2. It is not mandatory to create reserve Capital. 3. It s not shown in the company's balance sheet. 4. A special resolution needs to be passed for its creation. 5. Can be used only at the time of winding up of company. Capital Reserve -- 1. it refers to those amounts which are not free for distribution as dividend. 2. It is mandatory to create Capital reserve in case of profit on forfeited shares. 3. It is shown in balance sheet. 4. No special resolution required. 5. Can be used to write off capital losses at any time during the life of a company.

100% agreed

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CA Deepesh Ruhela (Keen to Learn) (3271 Points)
Replied 19 December 2010

Originally posted by : Resham
	Reserve Capital -- 1. It refers to that portion of uncalled capital which is not called up except in the event of winding up of the company. 2. It is not mandatory to create reserve Capital. 3. It s not shown in the company's balance sheet. 4. A special resolution needs to be passed for its creation. 5. Can be used only at the time of winding up of company. Capital Reserve -- 1. it refers to those amounts which are not free for distribution as dividend. 2. It is mandatory to create Capital reserve in case of profit on forfeited shares. 3. It is shown in balance sheet. 4. No special resolution required. 5. Can be used to write off capital losses at any time during the life of a company.