IndigoLearn

General Reserve

Sir, in the video for reserves and surplus, you mentioned that if a company wants to move back amount from general reserves to P&L for payment of dividend, there are certain restrictions. But why will a company move back the amount from reserve to P&L? it can distribute dividend directly from profit after transferring to reserves.


Aman Mahajan

Aman Mahajan

CA Inter

18K+

11-Jan-21 08:04

20

Answers (1)

To declare dividends from General Reserve, there are conditions prescribed in Companies Act.


Suraj Lakhotia

Suraj Lakhotia

Admin

11-Jan-21 08:54