An omitted dividend refers to a dividend that was scheduled to be declared by a corporation but was not voted for the time being by the board of directors. This situation often arises when a company faces financial difficulty and decides it is more important to conserve cash than to pay a dividend to shareholders.
A dividend customarily paid on common shares that the board of directors fails to declare, usually due to financial difficulties at the company; also referred to as an omitted dividend. It differs in implications when associated with cumulative preferred stocks, where the passed dividends accrue until paid.
