dividends in arrears investment & finance definition
Dividends on preferred stock that were not paid in
the year that they accumulated. Dividends in arrears must be satisfied before
common shareholders receive their dividends. However, dividends in arrears are
not recognized as a liability on the company’s books because no liability
exists until a dividend has been declared by the board.
See dividends in arrears in Wall Street Words
Dividend payments on cumulative preferred stock that have been passed by a firm's directors. These dividends must be brought up to date before any payments are made to common stockholders. Any payments of dividends in arrears go to the current holders of the preferred stock regardless of who held the stock when the dividend was passed. Also called accumulated dividend.
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