Equity: Difference between revisions

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imported>Doug Williamson
(Add banking definition. Source: linked pages.)
imported>Doug Williamson
(Expand 2nd definition.)
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Securities representing the rights of the risk capital investors in 2. above.
Securities representing the rights of the risk capital investors in 2. above.


For example, ordinary share certificates.
For example, ordinary shares, also known as common stock.




Revision as of 16:32, 1 March 2020

1. Law

A legal system that resolves disputes between persons by resort to principles of fairness and justness.


2.

The capital of a firm invested by those accepting the greatest degree of risk, for example the holders of ordinary shares (also known as common stock or common equity) in a company.


3.

Securities representing the rights of the risk capital investors in 2. above.

For example, ordinary shares, also known as common stock.


4. Financial reporting.

Amounts in the financial report of a company representing the book value of the interests of the shareholders in 2. above.

It includes share capital, cumulative retained profits, and other reserves.

It is also known as 'total equity' or 'shareholders' funds'.

The book value of total equity is equal to the book value of the company's net assets.


5. Financial reporting.

Comparable amounts for financial reporting entities that are not companies.


6. Banking and bank regulation.

Abbreviation for common equity.


7.

The net value of an asset, after deducting any debt relating to it or secured on it.

For example, the value of a residential property, after deducting the amount of a mortgage borrowing secured on it.

If the value of the borrowing exceeds the value of the asset, the situation can be described as 'negative equity'.


See also

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