Practicing Success
Point out the false statement from the following in respect of debentures. |
A company can buy its own debentures and shares A Company can issue convertible debentures A business can issue debentures with voting rights A company can issue redeemable debentures |
A business can issue debentures with voting rights |
Companies typically do not issue debentures with voting rights. Debentures are considered a form of debt financing, and their holders are creditors of the company, not equity shareholders. Voting rights are usually associated with ownership of common stock or equity shares in a company. Debenture holders are typically entitled to receive periodic interest payments and repayment of the principal amount at maturity. They do not have a direct say in the management or decision-making process of the company, such as voting in shareholder meetings. |