What are Dividends in Arrears?
Until then, they remain on the company’s balance sheet as dividends in arrears. If a company cannot make its dividend payments, they don’t simply disappear. The expectation is that the company will resume making dividend payments when it’s able. For example, companies issue a prospectus to shareholders that gives information about dividend payments. However, companies can’t always issue the dividends they promise, even to preferred shareholders. These dividends accumulate over time and must be paid out before any dividends can [...]