1. Are the funds supplied by Investors (or any other form of capital raised) adds to the "networth"?
2. If yes, can that money be kept in the bank in the form of a Fixed Deposit ? Does Fixed deposits add to the "networth"?
AK (Manager) 30 October 2017
1. Are the funds supplied by Investors (or any other form of capital raised) adds to the "networth"?
2. If yes, can that money be kept in the bank in the form of a Fixed Deposit ? Does Fixed deposits add to the "networth"?
G.L.N. Prasad (Retired employee.) 31 October 2017
That amount has to be repaid to-day or to morrow to outsiders and it is a liability to the company that has borrowed the amount from depositors to wards fixed deposit or any other investment. Even if the promotors contribute equity of their own money, it should be shown as liability towards balance sheet.
Net worth is Assets minus liabilities = Net worth.
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