Duties of Auditor regarding the distribution of dividends The auditor should perform the following duties regarding the distribution of dividend: 1. The auditor should examine the Memorandum of
Issue of Bonus Shares The issue of bonus shares refers to a good method of capitalizing huge profits or reserves with the company, However, the company may capitalize
Auditor duty in verification of Outstanding Liabilities At the close of the year, there may be some outstanding liabilities for expenses, which must bring into accounts to arrive
What are Calls in Arrears? When one or more shareholders fail to pay the amount due from them towards allotment and/or calls, such dues are called calls-in-arrears. If
What is a General Reserve? A general reserve is a reserve, which is created by appropriation of profits. It is created without any specific or particular purpose. The
What are Capital Reserve? The term capital reserve does not include any amount regarded as free for distribution through the Profit and Loss Account. A capital reserve is
What is Specific Reserve? A specific reserve is one, which is created for some specific purpose by debiting Profit and Loss Appropriation Account. Normally, it is available for
What are Secret Reserves The term secret reserve refers to a reserve the existence of which is not disclosed in the Balance Sheet. Secret reserves are also called
What are Reserve funds? The word “Fund” in relation to any reserve can be used only where such a reserve is specifically represented by earmarked investments. In other
