Which of the following statements is correct in the context of the share capital of a company?

Issued Capital can be more than or equal to Subscribed Capital.

The correct answer is option 4- Issued Capital can be more than or equal to Subscribed Capital.

* Subscribed Capital is always more than Issued Capital- THIS IS INCORRECT. Subscribed capital is that part of the issued capital which has been actually subscribed by the public. When the shares offered for public subscription are subscribed fully by the public the issued capital and subscribed capital would be the same. It may be noted that ultimately, the subscribed capital may be equal to or less than issued capital. Thus, it can be equal or less but not more.

* Issued Capital is always more than Subscribed Capital- THIS IS INCORRECT. Issued capital is that part of the authorised capital which is actually issued to the public for subscription. Issued capital can be more than subscribed capital if public applies for less shares. But it can be equal to subscribed capital. Thus we cannot say issued capital is always more than subscribed capital.

* Issued Capital and Subscribed Capital are always the same- THIS IS INCORRECT. Issued capital is that part of the authorised capital which is actually issued to the public for subscription. Issued capital can be more than subscribed capital if public applies for less shares or it can be equal to subscribed capital if public applies for the same issued shares. Thus we cannot say issued capital is always equal to subscribed capital. It can be more or equal to subscribed capital.

* Issued Capital can be more than or equal to Subscribed Capital- THIS IS CORRECT. Issued Capital is that part of the authorised capital which is actually issued to the public for subscription including the shares allotted to vendors and the signatories to the company’s memorandum whereas Subscribed Capital is that part of the issued capital which has been actually subscribed by the public. When the shares offered for public subscription are subscribed fully by the public the issued capital and subscribed capital would be the same. It may be noted that ultimately, the subscribed capital may be equal to or less than issued capital. In case the number of shares subscribed is less than what is offered, the company allots only the number of shares for which subscription has been received. In case it is higher than what is offered, the allotment will be equal to the offer.