What is considered while auditing Authorised share capital?
An auditor can verify the Issued capital from balance sheet of the previous year. If there is any increase in the number of shares due to loans or conversion of debentures, the same has to be verified whether all the formalities were as per law.
What is not included in share capital?
Share capital is only generated by the initial sale of shares by the company to investors. It does not include shares being sold in a secondary market after they’ve been issued.
What is mean by audit of share capital?
“Reconciliation of Share Capital Audit Report” is understood as to issuance of an Audit report to the issuer Company, auditing the reconciliation of total Share Capital held in DMAT form with NSDL & CDSL and in physical form by the shareholders with the total capital admitted, issued and listed, if any.
How can the auditor audit the share capital?
SEBI authorises practising Company Secretaries to undertake Reconciliation of Share Capital Audit to certify reconciliation of total shares of a company held in NSDL, CDSL and in physical form by the shareholders with the total admitted, issued and listed capital.
Is the one part of share capital?
Share means a share in the share capital of a company and includes stock. It can also be said that share is just part of securities.
What are the types of share capital?
7 Main Types of Share Capital | Company Accounts
- Read this article to learn about:- 1. Authorised/Nominal/Registered Capital 2. Issued Capital 3. Subscribed Capital 4. …
- Authorised/Nominal/Registered Capital:
- Issued Capital:
- Subscribed Capital:
- Called-Up Capital:
- Uncalled Capital:
- Paid Up Capital:
- Reserve Capital:
What is the share capital of a company?
A company’s share capital is the money it raises from selling common or preferred stock. Authorized share capital is the maximum amount a company has been approved to raise in a public offering. A company may opt for a new offer of stock in order to increase the share capital on its balance sheet.
How is share capital calculated?
Share Capital Formula
- Formula 1: Share capital equals the issue price per share times the number of outstanding shares.
- Formula 2: Share capital equals the number of shares times the par value of stock plus the paid in capital in excess of par value.
What are the disadvantages of share capital?
Disadvantages of share capital include:
- It dilutes control for the founders – The more shares that are issued, the more shareholders there are who own part of the business. …
- The business is vulnerable to takeover – As a business grows and sells more shares, it becomes vulnerable to the threat of a takeover.
Is audit of share capital compulsory?
The share capital of the company is of two kinds, namely, Equity share capital and Preference share capital. Share capital means capital raised by the company by issue of shares. This issue of share capital should be audited to verify the compliance of requirements and provisions of Companies Act.
What do you mean by EDP audit?
Browse Encyclopedia. A. E. An analysis of an organization’s computer and information systems in order to evaluate the integrity of its production systems as well as potential security cracks. See EDP auditor.