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    Omparative Table: Basis Shares Debentures Structure

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    Shalini Singh IPSA
    This document provides a comparative table that summarizes the key differences between shares and debentures. Shares represent ownership in a company, provide voting rights, and have residual claim to assets during liquidation. Debentures represent debt owed by a company, do not provide voting rights, but give holders a lien on company assets and fixed interest payments. While shares are mandatory for companies, debentures are optional debt instruments that provide leverage benefits but also higher risk than debt claims on assets.

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    Omparative Table: Basis Shares Debentures Structure

    Uploaded by

    Shalini Singh IPSA
    16 views2 pages
    This document provides a comparative table that summarizes the key differences between shares and debentures. Shares represent ownership in a company, provide voting rights, and have residual claim to assets during liquidation. Debentures represent debt owed by a company, do not provide voting rights, but give holders a lien on company assets and fixed interest payments. While shares are mandatory for companies, debentures are optional debt instruments that provide leverage benefits but also higher risk than debt claims on assets.

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    Comparative Table

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    This document provides a comparative table that summarizes the key differences between shares and debentures. Shares represent ownership in a company, provide voting rights, and have residual claim to assets during liquidation. Debentures represent debt owed by a company, do not provide voting rights, but give holders a lien on company assets and fixed interest payments. While shares are mandatory for companies, debentures are optional debt instruments that provide leverage benefits but also higher risk than debt claims on assets.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    16 views2 pages

    Omparative Table: Basis Shares Debentures Structure

    Uploaded by

    Shalini Singh IPSA
    This document provides a comparative table that summarizes the key differences between shares and debentures. Shares represent ownership in a company, provide voting rights, and have residual claim to assets during liquidation. Debentures represent debt owed by a company, do not provide voting rights, but give holders a lien on company assets and fixed interest payments. While shares are mandatory for companies, debentures are optional debt instruments that provide leverage benefits but also higher risk than debt claims on assets.

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    © All Rights Reserved
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    of 2

    omparative Table

    Basis Shares Debentures

    Shares are the ownership capital of the


    Structure Debentures are the debt for
    company

    Debenture holders are havin


    Shares have, by default, dividend-right in
    Dividend Right receive interest against the d
    the profit of the company
    by them

    Shareholders have voting right in the Debenture holders do not ha


    Voting Right
    annual general meeting of the company vote in the general meeting

    Shares are not convertible to debt or Debentures can be issued wi


    Conversion
    such other structure of the capital getting converted into share

    From an investors point of view, From an investors point of vi


    Risk holder Shareholders are the highest risk owner in debentures is one of the m
    of the company instruments of investment

    In general, debenture holder


    Shareholders do not have any lien on the
    Lien lien in favor of them against
    assets of the company
    of the company

    Shareholders are the Owners of the Debenture holders are the cr


    Owner/Creditor
    company company

    Debenture holders have the


    Right at the time of Shareholders have the residual right at the asset of the company aft
    liquidation the time of liquidation. the statutory dues and empl
    payments.

    Shares do not give any leverage benefit Debentures give the leverage
    Leverage
    to the company company

    For every company, to issue share capital


    is mandatory and needed to be It is not mandatory for every
    Compulsion to issue
    maintained throughout the life of the issue debenture for issue
    company

    For the company, it is manda


    For the company, it is not mandatory to
    Compulsion of return company for payment and re
    declare a dividend
    interest and debt
    Examples are non-convertibl
    Example is equity share capital and
    Example debentures, convertible deb
    preference share capital
    2nd charge debentures etc.

    Debentures are to be disclos


    The share capital is to be disclosed under
    Disclosure in financial term borrowings under Non-
    “ Shareholders funds “ on equity
    statement Liabilities in equity and liabil
    and liabilities side in the balance sheet
    balance sheet

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