cumulative preference share
1. Cumulative Preference Shares: The holders of cumulative preference share
are entitled to receive a fixed percentage of dividend before anything isgiven,
tot other classes of shareholders.
Apart from this right, in the case ofthese shares, if the
company has no profits or inadequate profits in any yearto declare dividend, the
arrears of dividend would accumulate and becomepayable out of the
future profits before anything is given to other classes ofshareholders.