Which of the following statements best describes 39 Sweat Equity Issue 39 ........

Economic Affairs Financial Markets

Which of the following statements best describes 'Sweat Equity Issue'?

It is issued to the construction workers who had built the physical infrastructure of the company.

It is the offer given to unemployed youth to attract them towards share market.

It is the offer of shares to existing shareholders as a distribution of profits.

It is one of the modes of making share based payments to employees of the company as a reward towards for their services.

छोटे Courses बड़े Results

Master Financial Markets

Prepare through Micro-courses

Try Now

Explanation:

‘Sweat equity shares’ are such equity shares, which are issued by a Company to its directors or employees at a discount or for consideration, other than cash, for providing their know-how or making available rights in the nature of intellectual property rights or value additions, by whatever name called.
Sweat equity shares is one of the modes of making share based payments to employees of the company. The issue of sweat equity shares allows the company to retain the employees by rewarding them for their services. Sweat equity shares rewards the beneficiaries by giving them incentives in lieu of their contribution towards the development of the company.

Report error

Submit Error