Final Dividends

Final Dividends

Didn't find your answer?

My understanding of the difference between a final dividend and an interim dividend is that an interim dividend is not approved by the shareholders only by the directors.

A final dividend being approved in a general meeting.

My question is can more than one general meeting be called to declare more than one final dividend within one accounting year?

Your thoughts are greatly appreciated. 

Robbie

Replies (4)

Please login or register to join the discussion.

avatar
By HUGH W DUNLOP
06th Apr 2012 16:49

dividends

The declaration of a dividend may, and often does, rely on the Articles.

However dividends must be paid out of profits, or may be regarded as directors loans.

Interim dividends no longer require a Board Meeting to approve, but directors may declare one (subject to the Articles).

Final dividends are payable only when an ordinary resolution is passed by company shareholders in a general meeting.

As with all company business, decisions to pay interim and final dividends must be recorded.

Final is generally taken to mean 'Final' therefore this becomes a question of semantics, and the Articles. The most straightforward method would be to declare an interim dividend as soon as possible in the next financial year.

 

 

Thanks (0)
Jennifer Adams
By Jennifer Adams
08th Apr 2012 15:35

Covered in my article dated 4 Jan 2011

 

https://www.accountingweb.co.uk/topic/tax/dividends-checklist-get-details-right/470525 

You might like to read my article on this subject as per the link above.... if only to add to the 21,410 hits already made!

Declaration of dividends/payment legalities etc are covered in detail in an easy to follow 'checklist' format.

Jennifer Adams FCIS TEP ATT (Fellow)

Assistant Editor Accountingweb

Thanks (1)
Replying to Chintan:
avatar
By HUGH W DUNLOP
08th Apr 2012 19:35

dividends

As a mere ACIS, I have read your article which goes into more detail than I have done, and is very well written. Although I have retained my membership of ICSA, this is more for a personal, rather than business, satisfaction. I felt that this was an under-valued degree, especially in Scotland. For example, one of my colleagues, some years ago, attended an interview at a local branch of a large recruitment agency, whose name I cannot mention but rhymes with maize, and on stating that she was a member of the Institute of Chartered Secretaries and Administrators , was asked how many words a minute she could type.

However, I am pleased that I have almost withdrawn from company secretarial work, as I feel I am not as knowledgeable as the 'man in the pub' who gives advice on all matters.

I still run my small accountancy business which most, if not all, my clients appreciate.

Thanks (0)
avatar
By MBK
09th Apr 2012 12:45

So the answer to the original question is,,,,

... as often as you like.

Provided you observe the formalities properly a final dividend can be declared every 5 minutes if the shareholders so desire!

Thanks (0)