According to the law, a joint-stock company has the right to distribute dividends based on the results of the first quarter, six months, nine months of the financial year and (or) at the end of the entire financial year. Dividends are paid out of the net profit of the joint stock company. To pay them, the shareholders of the company decide to pay dividends. Dividends for different categories of shares can be paid in different orders.
Instructions
Step 1
Payment of dividends on shares is the responsibility of the joint stock company. Dividends are paid at specific periods (quarter, half year, nine months, fiscal year). The source of payment of dividends is the net profit of the joint-stock company - according to the financial statements.
Step 2
The process of distribution and payment of dividends begins with the adoption by the joint stock company (general meeting of shareholders) of the appropriate decision. The general meeting of shareholders determines the amount of dividends and the form of their payment on shares of all categories and types. Before that, the board of directors of the joint-stock company recommends to the general meeting of shareholders the approximate amount of dividends, and the general meeting is not entitled to pay dividends in a larger amount than the recommended one.
Step 3
At the general meeting of shareholders, the time and procedure for the payment of dividends are also determined, if they are not determined by the charter of the joint-stock company. Dividends must be paid no later than 60 days from the date of the decision by the general meeting on their payment. Payment of dividends on one category of shares is carried out simultaneously to all shareholders who own shares of this category.
Step 4
The legislation provides for cases when joint stock companies are not entitled to make a decision on the distribution of dividends and, accordingly, distribute them. These cases include:
1.incomplete payment of the authorized capital;
2. whether the joint-stock company has signs of bankruptcy or their possible appearance after the distribution of dividends;
3. the value of the net assets of the joint-stock company is less than its authorized capital and reserve fund.
Step 5
If the decision on the full payment of dividends on preferred shares, the amount of dividends for which is established by the charter, has not been taken by the joint-stock company, then the company is not entitled to make a decision on the payment of dividends on ordinary shares and on those preferred shares for which the amount of dividends has not been established. Also, a joint-stock company is not entitled to pay dividends on preferred shares for which the amount of dividends is established by the charter, unless a decision has been made to pay dividends on those preferred shares that give their owners an advantage in the order in which they receive dividends.
