preference share capital

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*Share capital consisting of preference shares. Under Financial Reporting Standard (FRS) 4, Capital Instruments, preference share capital was classified as non-equity share capital. However, FRS 4 has now been replaced by FRS 25 (International Accounting Standard 32), Financial Instruments: Disclosure and Presentation, which states that from 1 January 2005 preference shares should be classified as liabilities rather than shareholders’ equity.

Subjects: Financial Institutions and Services — Accounting.

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