What do you mean by reducing capital?

Question 1: What do you mean by capital reduction in public institutions? Capital reduction, referred to as capital reduction, refers to reducing the total amount of unit capital according to certain circumstances or needs and legal conditions and procedures.

Question 2: What are the reasons for enterprises to reduce their capital? Share: There are two types of capital reduction: formal capital reduction and substantial capital reduction. The formal capital reduction means that the capital is reduced only on the books, but the company's property is not reduced. So what are the reasons for the company's capital reduction? What are the conditions for the company to reduce its capital? There are four main reasons for the company's capital reduction: 1, one-time excessive repayment of debts. Pay off the accumulated debts at one time, and the company suffered serious losses. The company's meager profit can't make up for the loss. By reducing capital, accumulated losses can be made up. 2. Extra funds. A company needs a lot of money in its early days. After the company is gradually improved, there may be excess funds. Too much capital in the original company usually leads to the idleness and waste of the company's capital, which also increases the burden of dividends. Therefore, it is also necessary to adjust excessive capital by reducing capital. 3. Extra dividends. Dividends are distributed according to the amount of capital profits, and dividends can be increased by reducing capital. 4. Company merger or reorganization. This is usually done when the company's assets are balanced. After the merger, capital needs to be adjusted. According to the principle of constant capital, the company's capital is not allowed to be reduced. However, the above conditions are also stipulated by relevant laws. Going uptown can help you learn more about finance and taxation.

Question 3: Excuse me, under what circumstances does a limited company need to reduce its capital? Capital reduction refers to the act of reducing registered capital according to the company's capital surplus or serious losses and the actual business situation. From the actual situation, one of the following conditions should be met: (1) The original company has too much capital and too much formal capital. If the capital remains unchanged, it will lead to idle and waste of capital in the company, which is not conducive to the efficiency of capital use and also increases the dividend burden. (2) The company suffered serious losses, and the gap between the total capital and the actual assets was too large. The company's capital has lost its due legal significance to prove the company's credit status, and shareholders have not been rewarded due to the company's losses for years. The capital reduction shall not be lower than the minimum starting point stipulated in the Company Law. In addition, shareholders' resolutions will be issued to explain the reasons for capital reduction and changes in share capital. , with the business license and organization certificate to the industrial and commercial departments for change. And some forms given to you by the industry and commerce department. General limited companies need to reduce their capital to make up for the loss of profits in that year. Materials required for capital reduction of limited company: 1, resolution of the shareholders' meeting of the company, amendment of the articles of association, statement of the proportion of shares reduced by the original shareholders (completed as required by the local industrial and commercial bureau). Original and copy of business license. First, the shareholders' meeting will discuss and form a written resolution, and then the articles of association will be amended according to the written resolution. The company shall register the industrial and commercial change according to the written resolution and the revised articles of association (the required materials can be provided according to the local industrial and commercial requirements) and make an announcement of capital reduction (this work varies from place to place, and some require an announcement before the change). Some will change, and no announcement is needed. However, this change must be announced. There are two ways to reduce capital: 1. Reduce the total capital contribution and change the original capital contribution ratio. 2. Reduce the capital contribution of each shareholder without changing the proportion of capital contribution. After the capital reduction, the contribution ratio of each shareholder remains unchanged. There are two ways: return, return a part of the paid-in capital contribution to shareholders; At the time of merger, when the company loses money, the capital contribution of each shareholder shall be reduced in proportion to make up for the capital loss that should be made up. Capital reduction refers to the behavior of enterprises to reduce capital in order to make up losses and adjust capital. A company generally needs to go through the following procedures to reduce its registered capital: 1. Resolution. The company's capital reduction is made by the board of directors (executive director) and submitted to the shareholders' meeting for resolution, which is a special resolution in limited liability companies and joint stock limited companies and requires more than two-thirds majority. The registered capital after capital reduction shall not be lower than the statutory minimum. 2, the preparation of assets and liabilities and property list. 3. Notice and announcement: The company shall notify the creditors within 10 days from the date of making the capital reduction resolution, and make an announcement in the newspaper within 30 days. 4. Liquidation and guarantee: The creditor has the right to ask the company to pay off its debts or provide guarantee within 30 days from the date of receiving the notice, or within 45 days from the date of announcement if it has not received the notice. 5. Go through the change registration. Where a company reduces its registered capital, it shall fulfill its obligations of notifying creditors and handling creditor's rights and debts in accordance with the Company Law after a resolution is made by the shareholders' meeting, and then apply for registration of change and submit the following documents and certificates: 1 An application for company change registration signed by the legal representative of the company; 2. The resolution of the previous shareholders' meeting (mainly explaining the capital reduction, the amount of capital reduction, the way of capital reduction, the latest capital structure after capital reduction, etc.). ); 3. A newspaper that has published the announcement of the company's reduction of registered capital for at least three times; 4. Description of the company's debt settlement or debt guarantee confirmed by the company's shareholders' meeting; 5. Resolutions of the new general meeting of shareholders (mainly including amendments to the articles of association and other changes); If the original shareholders remain unchanged after the capital reduction, it is only necessary to convene a shareholders' meeting and make a shareholders' meeting resolution (that is, the new shareholders' meeting resolution and the previous shareholders' meeting resolution can be merged into one shareholders' meeting resolution); 6 amendments to the articles of association (mainly showing the comparison table of changes in the articles of association) or new articles of association; 7. Letter of confirmation issued by all shareholders; 8. capital verification certificate of capital reduction (the registered capital of the company shall not be lower than the legal minimum after capital reduction); 9. Directory of shareholders (promoters) of the company (A: legal person) and directory of shareholders (promoters) of the company (B: natural person); 10, the original business license and a copy of the articles of association of the company with the special seal for the archives of the Administration for Industry and Commerce provided by the archives of the Administration for Industry and Commerce. Provisions on legal procedures to be observed: (1) Resolution of the shareholders' meeting. The contents of the resolution include: ① the registered capital of the company after capital reduction; ② Arrangement of shareholders' interests and creditors' interests after capital reduction; ③ Matters related to the revision of the Articles of Association; (4) Changes in the capital contribution of shareholders and their proportions, etc. When making a resolution on capital reduction, the company should pay attention to the fact that the registered capital of the company after capital reduction shall not be lower than the statutory minimum; ......& gt& gt

Question 4: What are repurchase and capital reduction? Look at this!

Definition of stock repurchase

Definition 1:

Stock repurchase means that listed companies voluntarily buy back their own shares in countries and corporate shareholders with their own funds, but they are required not to sell or transfer them within a certain period of time. After the specified time, the number of shares to be sold should be announced in advance, and it is generally not allowed to sell at one time.

Origin: Discussion on the Reduction of State-owned Shares Gansu Agriculture was published in 2004.

As an important measure to adjust the state-owned economic strategy, establish a modern enterprise system, standardize the securities market and raise social security funds, the reduction of state-owned shares should be welcomed and put into practice. However, there are deviations in the objectives, implementation methods and price mechanism of this policy, which leads to the failure of the attempt and the shock of the securities market. Therefore, we need to think about the goal, implementation mode and price mechanism of reducing state-owned shares.

Definition 2:

Stock repurchase means that the shares held by venture capitalists are repurchased by the invested enterprises. Statistics show that general acquisition accounts for 23%, second-phase acquisition accounts for 9%, and stock repurchase accounts for 6%.

Originated from: the present situation of venture capital in China and the conception of exit mode "Journal of Changsha University of Electric Power (Social Science Edition)" Liu Jianjiang in 2000.

Abstract: Venture capital has begun to take shape in China, but it is still in its infancy. The healthy development of venture capital must realize the effective withdrawal of venture capital. Drawing lessons from the successful experience of foreign venture capital and combining with China's national conditions, it is a better choice to implement diversified exit methods such as IPO, sale, liquidation or bankruptcy in the near future.

Definition 3:

Stock repurchase refers to a capital operation mode in which listed companies buy back their issued shares at a certain price for cancellation or as treasury shares. The practice of industrialized countries represented by the United States has proved that venture capital is an accelerant for high-tech progress and industrial development (Mohan? Sonet, 2002)

Source: Analysis of Share Repurchase Mode and Its Impact on Listed Companies Journal of Liaoning University of Finance Zhou Feng, 2004.

Abstract: Stock repurchase refers to a capital operation mode in which listed companies buy back their issued shares at a certain price for cancellation or as treasury shares. In western countries, there are four common ways of stock repurchase: open market repurchase, cash offer repurchase, agreement repurchase and transferable sale right. This paper analyzes the ways of stock repurchase and its positive and negative effects on listed companies, and holds that stock repurchase can not only save taxes for listed companies, but also increase the flexibility of investment. At the same time, it is considered that stock repurchase is a financing behavior aimed at adjusting capital structure or dividend policy, rather than a simple investment behavior.

Definition 4:

Top-down means that after the company determines the overall production and operation target, the comprehensive budget management department makes a target decomposition plan according to the overall production and operation target, and decomposes this target layer by layer to the responsible units of each budget. The so-called stock repurchase refers to the behavior of listed companies to repurchase their circulating shares from the stock market.

Originated from: Building an Enterprise Management Center with the Goal of Maximizing Value Metallurgical Accounting 2002 Li Peilin, Chen Ying and Wang Mingdong.

In the process of economic transformation and rapid development of enterprises, baoshan iron & steel (hereinafter referred to as Baosteel) followed the pace of the times, closely combined with the actual production and operation of enterprises, persisted in taking financial management as the center, taking financial management as the center and maximizing enterprise value as the ultimate goal, constantly strengthened and improved financial management, and gradually established and improved a set of financial management system with Baosteel characteristics to meet the needs of modern enterprise development, which promoted enterprise development. In 200 1 year, Baosteel produced 86 1 10,000 tons of commodity blanks, achieving a sales income of 2,965,438+7110,000 yuan, a profit of 5.689 billion yuan and a profit of 3.71100 million yuan. In addition, the return on net assets, sales profit rate and other indicators have also maintained a high level. Up to now, Baosteel's annual output of steel110.5 million tons and wood10.5 million tons has been kept at full capacity. In the first four months of this year, under the double pressure of low steel prices and sharp price increases of upstream products, we still achieved excellent results, achieving profits and taxes and most technical and economic indicators among the best in the whole industry.

Definition 5:

Stock repurchase means that a joint-stock company repurchases its issued shares from shareholders to reduce ...

Question 5: What does it mean for listed companies to announce capital reduction? The announcement of capital reduction by listed companies means that reducing registered capital is not conducive to stabilizing investor confidence and has a certain impact on stock prices.

Question 6: What does it mean for enterprises to reduce capital? What are the subjects of accounting entries? Borrow: share capital

Loans: monetary funds/other receivables/other payables.

Capital reduction is to reduce the share capital, either to return the money to shareholders-monetary funds, or to offset accounts-other receivables, or to return it to shareholders-other payables later.

Question 7: How to pay taxes on capital reduction? Tax treatment of withdrawal or reduction of investment by investment enterprises.

When an investment enterprise withdraws or reduces its investment in the invested enterprise, the part of its assets equivalent to the initial investment is recognized as investment recovery; The part equivalent to the accumulated undistributed profits and accumulated surplus reserves of the invested enterprise, which reduces the proportion of paid-in capital, is recognized as dividend income; The rest is recognized as investment asset transfer income.

The operating loss of the invested enterprise shall be carried forward by the invested enterprise to make up for it; An investment enterprise shall not adjust or reduce the investment cost, nor shall it be recognized as an investment loss.

Interpretation: This clause requires taxpayers to grasp the following four aspects.

1. Three modes to reduce long-term equity investment of enterprises.

First, transfer equity. According to the provisions of Document No.79 of Guoshuihan [2010] and Document No.698 of Guoshuihan [2009], the transfer price shall not be deducted from the accumulated undistributed profits and accumulated surplus reserve share of the invested enterprise.

Second, the invested enterprise is liquidated and the equity of the enterprise dies. According to article 1 1 of the Regulations and document Caishui [2009] No.60, the invested enterprise is allowed to deduct the corresponding undistributed profits and surplus reserves from its remaining assets during liquidation.

Third, the distribution of capital reduction. Before Announcement No.34, the tax law did not clearly stipulate whether undistributed profits and surplus reserves can be deducted, but Announcement No.34 explicitly mentioned enterprise liquidation.

For example, in 2008, Company A registered Company M with RMB 6,543.8+million, accounting for 30% of the shares of Company M. In 2065.438+00,654.38+0, the shareholders' meeting decided to allow Company A to withdraw its shares, and Company A received RMB 25 million in cash. By the end of 2009, the undistributed profit and surplus reserve of M Company was RMB 30 million. According to the proportion of registered capital, a company should enjoy 9 million yuan.

Therefore, a company's equity withdrawal income =2500- 1000-900=600 (ten thousand yuan).

2. The undistributed profits and surplus reserves can only be deducted according to the proportion of registered capital, but not according to the dividend proportion agreed in the articles of association.

Although the new "Company Law" stipulates that the articles of association can stipulate that investors do not pay dividends according to the proportion of their capital contribution, in order to make the policy more rigid, Announcement No.34 makes it clear that undistributed profits and surplus reserves must be deducted according to the proportion of registered capital.

3. Deduct accumulated undistributed profits and surplus reserve shares, regardless of whether the retained earnings have been paid enterprise income tax.

Although the starting point of the policy is that the retained earnings of enterprises are after-tax earnings that have already paid enterprise income tax, in order to avoid double taxation, enterprises are allowed to deduct them from the returned assets. But in fact, due to the existence of three major reasons, the retained earnings of enterprises may not completely correspond to the taxes paid. The first is to increase taxes. This will lead to an increase in tax revenue, but the retained earnings will decrease, and enterprises will be affected. The second is tax cuts. This will reduce taxes and retained earnings. The third is to approve the collection. The accounting profit of the approved enterprise is completely out of proportion to the tax paid. For example, the retained income of the enterprise is 6,543,800 yuan. In fact, the approved enterprises only collect taxes according to the income of 3 million yuan. At this time, the retained earnings are still deducted by 6,543,800 yuan. Obviously, enterprises have taken a big advantage!

Announcement No.34 did not consider the approval of the collection, and of course Caishui [2009] No.60 did not consider this situation. At present, according to the provisions of the tax law, only retained earnings can be deducted from the liquidated or partially divested assets in accounting. At present, only Shanghai requires a profit distribution table, taking this difference into account.

4. If the divested assets are non-monetary assets, the income must be recognized at fair value.

For example, when Company A invests in Company M, the investment cost is 6,543,800,000 yuan, accounting for 30% of the shares of Company M. By the time of divestment, Company M has accumulated retained income of 30,000,000 yuan, of which Company A enjoys 9,000,000 yuan according to its share in the registered capital.

Company A withdrew its capital and got a property with a book value of 20 million yuan and a market valuation of 25 million yuan.

At this point, this part of the property must be treated as sales first, and the profit is confirmed to be 5 million yuan, and then processed according to Announcement No.34, and the calculation is as follows:

The first step is to confirm the sales income of 5 million yuan and increase the profit of 5 million yuan at the same time. A company enjoys 35 million ×30%= 1050 (ten thousand yuan).

The second step is to confirm the divestiture income. 2500-1000-1050 = 450 (ten thousand yuan)

The wrong way is: ... >>

Question 8: Conditions for capital reduction The company's capital reduction, regardless of whether the surplus capital is lower than the statutory standard, must comply with the law. In order to effectively implement the principle of capital determination and ensure the safety of transactions, capital reduction should be strictly controlled by law. According to the principle of constant capital, the company's capital is not allowed to be reduced in principle. Considering some specific circumstances, China's laws allow capital reduction, but certain conditions must be met. From the actual situation, one of the following conditions should be met: the company has suffered serious losses, the gap between the total capital and the actual assets is too large, the company's capital has lost its due legal significance to prove the company's credit status, and shareholders have not been rewarded because of the company's losses for years.

Question 9: There are several ways for a joint stock limited company to reduce its capital. Specific operations can be divided into eliminating shares and merging shares. The former refers to the cancellation of some shares or specific shares, and the latter refers to the merger of two or more shares into one share;

2. Reducing the amount of shares, that is, reducing the amount of each share without changing the total number of shares, can be divided into three ways: exemption refers to exempting part or all of the unpaid shares; Repayment refers to returning part of the shares paid in full to the shareholders themselves; Cancellation means that when the company loses money, it offsets the responsibility of shareholders to make up the capital by reducing the amount per share;

3. Reduce both the number of shares and the number of shares.

Question 10: What materials should a limited liability company provide to the Industrial and Commercial Bureau for capital reduction? In addition, when a company reduces its registered capital, it must prepare a balance sheet and a list of assets.

If there are no changes in shareholders, directors and supervisors, that's all.