A capital redemption reserve is a statutory reserve created when a company repurchases its own shares, leading to a reduction in share capital. This non-distributable reserve ensures the maintenance of the company's capital base and protects creditors' interests.
The purchase or redemption of its own shares by a company; permitted subject to certain legal restrictions.
Redeemable shares are equity or preference shares in a company that the issuing entity has the right to buy back, under predetermined terms specified at the time of issue.
Undistributable reserves, often termed capital reserves, refer to specific reserves that cannot be distributed to shareholders as per the stipulations of the Companies Act, various statutes, or a company's constitutional documents. These reserves ensure the financial stability and compliance of a company.
