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Declared dividends in group

  • 12-05-2019 03:20PM
    #1
    ClaptonBay
    Registered Users, Registered Users 2 Posts: 190 ✭✭


    Struggling a bit to fully understand this concept. Company C declares a dividend to company B, who then declares the divendend to company A. Company A will use the funds to be received to fund D which is on another side of the group compared to A and B.

    The dividend will not be paid by C, it will only be paid as required. However, company A has provided funding to company D based on the dividend that is to be received.

    Can anyone do the journals how this should be booked?

    Company C
    Dr reserves
    Cr declared dividend or is it intercompany(company B)

    Company B

    Company A

    Company D

    I'm a bit confused as they say a debt is created by doing these transactions?


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