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    babykingdom's Avatar
    babykingdom Posts: 1, Reputation: 1
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    #1

    Aug 23, 2012, 08:55 PM
    Forfeited cash dividend
    Wondering the accounting treatment on forfeited cash dividend,

    Before forfeiture the dividend are
    Dr: Dividend Payable
    Cr: Bank
    However the are cheques to many shareholders, if the shareholders didn't cash in the cheque and the dividend been in the dividend payable account for years. Based on some company's M&A, they have the rights to forfeit the dividend for their company used.

    Wondering where will the unclaimed dividend goes. Thank you!
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 173
    Ultra Member
    		  
    #2

    Aug 24, 2012, 03:46 AM
    I expect it is a current liability, "unclaimed dividends" the failure of the company to maintain sufficient financial resources does not disposses the shareholders from their dividend
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