Preference Shares
Book a Trial Class
One-hour paid trial · Same-day reply · from RM50/hr
Accounting for Companies Limited by Shares
MS: Syer Keutamaan · EN: Preference Shares · ZH: 优先股
Meaning
Preference shares are shares that give their holders priority to receive dividends at a fixed rate before ordinary shareholders. Preference shareholders also have priority to have their capital returned when the company is wound up. However, they usually do not carry voting rights at the general meeting.
Example
For example, Sinar Baru Berhad issues 50,000 6% preference shares of RM1 each. Each year the holders receive a fixed dividend of 6 sen per share, so the total preference dividend is RM3,000 and is paid before any ordinary dividend.
Source: DSKP KSSM Prinsip Perakaunan Tingkatan 5