Interim Dividend and Final Dividend
|S.R.||INTERIM DIVIDEND||FINAL DIVIDEND|
The interim dividend is the dividend which is declared between two annual general meetings of a company.
|Final dividend is the dividend which is declared at the annual general meeting of the company.|
|The final dividend is declared at the completion of the financial year in Annual General Meeting of the company.|
The interim dividend is declared by the Board by passing a resolution if they are authorized by articles.
|Final dividend is recommended by the Board and declared by the shareholders by passing ordinary resolution (decision) at Annual General Meeting.|
|4.||Rate of Dividend
The rate of interim dividend is less than the final dividend.
|The rate of final dividend is generally more than interim dividend.|
Declaration of interim dividend becomes risky and illegal if company incurs loss at the end of the year...
|Declaration of final dividend is always legal, as it is declared only after ascertaining (discover) the correct profit on the basis of the audited accounts.|
|6.||Authorization of Articles
Authorization of Articles is necessary for the declaration of interim dividend.
Authorisation (approval) of Articles is not necessary for the declaration of final dividend.
|7.||Sources for declaration
An interim dividend is declared on the basis of the better financial prospective results may it be quarterly, half-yearly, etc.
|There is a number of sources available for declaring the final dividend. It can be declared out of current profits or profits of the previous years or out of reserves or out of capital profits out of the financial assistance specifically provided by the Government for the dividend.|