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Chapter 9 Company Accounts—Accounting for Share Capital 9.3
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16. Subscribed but not It is the amount of share capital issued by a company that is
Fully Paid-up subscribed but the company has not received entire nominal (face) value
of the share.
17. Reserve Capital It is that part of the subscribed capital that a company resolves to
call in the event of its winding-up.
18. Capital Reserve It is a reserve created out of capital profits.

19. Issue of Shares for Cash It means the consideration for shares is received by way of cheque
or any other banking instrument.

20. Issue of Shares for It means consideration for shares is not received by way of
Consideration Other cheque or any other banking instrument but they have been issued
than Cash for assets purchased or services taken.
21. Par Value Par value means the Nominal or Face value of a share.

22. Issue of Shares at Par It means the issue price and nominal (face) value of the share is same.

23. Issue of Shares at It means the issue price of the share is higher than its nominal
Premium (face) value.

24. Shares Payable in It means that shares are issued for a consideration payable in
Lump sum Lump sum, i.e., full issue price is payable along with the application.

25. Shares Payable in It means that shares are issued for a consideration not payable in
Instalments Lump sum but in parts.

26. Undersubscription The shares are said to be undersubscribed if the number of shares
of Shares applied for is less than the number of shares issued for subscription.
27. Oversubscription When the company receives applications for more shares than
of Shares issued, it is known as ‘Oversubscription’.
28. Pro rata Allotment Pro rata allotment means allotment in proportion of shares applied for.

29. Calls-in-Arrears It is that part of the calls money that has been called-up by the company
but has not been received by the company.

30. Calls-in-Advance It is that amount which has not been called-up by the company but has
been received by the company.

31. Forfeiture of Shares Forfeiture of shares means cancellation of allotted shares.

32. Reissue of Shares Reissue of shares means sale of forfeited shares.
33. Private Placement It refers to issue and allotment of shares to a selected group of persons.
of Shares
34. Employees Stock Option It means the option granted to the employee directors and employees of a
company which gives such employee directors and employees, the right
to purchase, or to subscribe for, the shares of the company at a future date
at a predetermined price.