What Is No Par Value Share

What is par value of share.

What is no par value share. Once the no par value regime comes into effect a company will no longer be required to maintain a share premium account and a capital redemption reserve. In other words it is the share nominal amount 1 0 1 or 0 001 mentioned on the stock certificate at the time. A no par value stock is issued without the specification of a par value indicated in the company s articles of incorporation or on the stock certificate itself. There is a theoretical liability by a company to its shareholders if the market price of its stock falls below the par value for the difference between the market price of the stock and the.

No par value stocks are printed with no face value designation while low par value stocks may show an amount lower than 0 01 or up to a few dollars. No par value npv share. Low par value stock. The objectives of its issuance include 1 avoidance of taxes levied according to the share s face value 2 avoidance of the issuer firm s liability to shareholders in the event the shares have to.

Any amount standing to the credit of a company s share premium account and capital redemption reserve shall become part of the company s share capital clause 618 2 of the bill.