FINAL DIVIDEND Meaning and
Definition
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Final dividend refers to the last installment of dividend declared by a company for a particular financial year. It is the portion of profits earmarked for distribution among shareholders after all expenses and taxes have been accounted for, and any interim dividends have already been paid.
The final dividend is usually declared at the end of the financial year, subsequent to the company's annual general meeting (AGM), where shareholders approve the decision to distribute profits as dividends. It represents the residual amount of profits that the management believes can be safely distributed to shareholders as a reward for investing in the company.
This type of dividend is considered "final" because it signifies the end of the annual dividend distribution process, where a company's financial year is closed, and the new financial year begins. The final dividend amount is determined by the company's board of directors, who consider various factors such as the company's profitability, cash flow, future investment requirements, and the overall financial health of the business.
Final dividends are typically paid in cash, although companies may choose to offer them in the form of additional shares or other financial instruments. Shareholders receive the final dividend based on the number of shares they hold in the company, with each share entitling them to a proportional amount of the declared dividend.
In summary, final dividends are the last portion of profits distributed to shareholders at the end of the financial year, representing the total amount available for distribution after meeting all obligations and previous dividend payments.
Common Misspellings for FINAL DIVIDEND
- dinal dividend
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Etymology of FINAL DIVIDEND
The etymology of the term "final dividend" can be traced back to the Latin word "finalis", meaning "last" or "end". The word "dividend" itself comes from the Latin word "dividendum", which is the gerund form of the verb "dividere", meaning "to divide". In the context of finance and business, a dividend refers to a payment made to shareholders of a company out of its profits or reserves.
The term "final dividend" specifically indicates the last payment made to shareholders in a particular financial period, usually at the end of the company's financial year. It signifies that no further dividends will be issued for that period, and any remaining profits will be retained or allocated for other purposes.
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