How Do You Spell AUTHORIZED SHARE CAPITAL?
Pronunciation: [ˈɔːθəɹˌa͡ɪzd ʃˈe͡ə kˈapɪtə͡l] (IPA) 
Pronunciation: [ˈɔːθəɹˌa͡ɪzd ʃˈe͡ə kˈapɪtə͡l] (IPA)
Authorized share capital, also known as authorized capital or registered capital, refers to the maximum amount of shares that a company is legally permitted to issue and sell to shareholders. It represents the total value of shares that a company can allocate among its shareholders and is determined during the process of company formation.
The authorized share capital is defined in a company's memorandum of association, one of the documents required for company incorporation. This document outlines the company’s purpose, structure, and capital details. The authorized share capital sets an upper limit or ceiling on the number of shares that a company can offer to investors.
It is important to note that authorized share capital does not represent the actual number of shares issued or outstanding. The actual number of shares may be less than the authorized share capital. The company may choose to issue only a portion of the authorized share capital based on its financial requirements and future plans.
Modifying the authorized share capital generally requires the approval of shareholders through a resolution during a general meeting. This process may involve increasing or decreasing the authorized share capital, which impacts the company's ability to raise additional funds or make share issuances to new shareholders.
