Volume : IV, Issue : II, February - 2014

Accounting for the issue of Bonus Debentures

Dr. Poonam Gupta

Abstract :

When companies accumulate large amounts of reserves and surplus over the years of operations, they are likely to reward their shareholders. The most popular form of rewarding shareholders is through issue of bonus shares. However, in the recent past, many Indian companies have adopted to the innovative instrument of bonus debenture to restructure reserves, manage cash and reward shareholders. The Indian Companies Act does not contain any specific provision regarding the issue of bonus debentures. These debentures are issued under Section 391 as scheme of ‘arrangement’. The present article attempts to identify the accounting and tax implications of the issue of bonus debentures and elaborate how the issue of bonus debentures may be recorded in the Books of Accounts.

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Article: Download PDF   DOI : 10.36106/ijar  

Cite This Article:

Dr. Poonam Gupta Accounting for the issue of Bonus Debentures Indian Journal of Applied Research, Vol.IV, Issue. II

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