SHARE CAPITAL

SHARE CAPITAL

- It is the shares to be subscribed and paid

in or secured to be paid in by the
shareholders, either in money, property or
services, at the time of organization of the
corporation or afterwards, and upon which
it is to conduct its operations.
 LEGAL CAPITAL

SHARE
AND
CAPITAL
divided into:

SHARE PREMIUM
 - Capital contributed by shareholders comes
from the sales of shares of stock. The shares
of stock issued are generally referred to as
share capital. Legal capital is that portion of
LEGAL the contributed capital or the minimum
CAPITAL amount of paid-in capital, which must
remain in the corporation for the protection
of corporate creditors.
 SHARE PREMIUM

• It is the portion of the paid-in

capital representing amounts
paid by shareholders in excess
of par. It may also result from
transactions involving treasury
stocks, retirement of shares,
donated capital, share dividends
and any other “gain” on the
corporations own stock
transactions.
  ORDINARY SHARE
TWO BASIC
TYPES OF
SHARES  PREFERENCE
SHARE
 This shares
represents the basic
ownership class of
the corporation.
ORDINARY when only one
class of share is
SHARE issued, it must be
ordinary share.
ordinary shares are
the entity’s
residual equity .
 This share gives its owners certain
advantages over ordinary
shareholders. These special benefits
relate either to the receipt of
PREFERENCE dividends when declared before the
SHARE ordinary shareholders (preferred as to
dividends) or to priority claims on
assets in the event of corporate
liquidation (preferred as to assets)
 TERMS RELATED TO
SHARE CAPITAL

- Authorized Share Capital

- Issued Share Capital
- Subscribed Share Capital
- Outstanding Share Capital
- Treasury Stock
 AUTHORIZED
SHARE CAPITAL

-The number of authorized shares indicates the

maximum number of shares the corporation
can issue as specified in the article of
incorporation. This maximum number of
shares when multiplied by the par value of the
share will yield the authorized share capital.

-Note: any increase or decrease in the

authorized share capital requires prior
approval of the SEC and formal amendment to
the articles of incorporation.
 -These are shares which have been sold and
paid for in full. Issued shares may include
treasury shares. Share Capital, either
Ordinary Shares account or Preference
Shares account is credit for the total par
ISSUED SHARE value of fully collected subscriptions or in
CAPITAL the case of no-par value shares, for the total
consideration received in relation to the
issue. Share capital is debited only when the
issued shares are retired, redeemed or
canceled by the corporation.
 It is the portion of the authorized share
capital that has been subscribes but not yet
fully paid. This shareholder’s equity
SUBSCRIBED account is credited for the total par value
SHARE CAPITAL of the shares subscribed and debited for
the total par value of the fully collected
subscriptions.

These are issued shares, which are in

the hands of the shareholders. The
OUSTANDING number of outstanding shares will equal
SHARE CAPITAL the difference between the issued share
and treasury shares.
 These are issued shares
acquired by the corporation
TREASURY
but not retired and are
STOCK therefore, awaiting to be
reissued at a later date.
 THANK YOU
FOR
WATCHING
AND
LISTENING!
PRESENTED BY: CHRISTINE JEANIEL A.
DAEL