PlanComptable.com
ACCOUNTS
II. Functioning of accounts
Class 5. Cash and financial instruments

50. Marketable securities

 

Account 502 " Own shares " is debited when a company buys back its own shares to increase or maintain their value or to allocate them to employees.

Shares assigned to a specific employee share ownership plan are recorded in account 5021 " Shares to be allocated to employees and assigned to a specific employee share ownership plan ". These shares are covered by a provision recorded on the liabilities side of the balance sheet. Own shares bought back to increase or maintain their value or allocated to employees but not covered by a provision are recorded in account 5022 " Shares bought back to increase or maintain their value or available for allocation to employees ".

The profit or loss on sale of repurchased shares is accounted on first-in first-out (FIFO) basis.

The difference between the sale price and the cost of the shares sold, accounted on a first-in first-out (FIFO) basis, is recorded either in a subdivision of account 778 entitled " Profit from buy-back of own shares and bonds " or in a subdivision of account 678 entitled " Losses from buy-back of own shares and bonds ".

The accounts 503 " Shares " and 504 " Other equity securities " are debited with the acquisition cost of the shares and other securities, by crediting an account of Class 4 " Accounts receivable and payable " or Class 5 " Cash and financial instruments ". When these shares or securities are resold, these accounts are credited with their book value, by debiting:

The acquisition cost of debt securities is recorded in accounts 505 " Own bonds and warrants bought back ", 506 " Bonds ", 507 " Treasury bills and short-term notes " and 508 " Other marketable securities and similar receivables ".

The accounting records relating to the acquisition, cancellation or sale of shares are applicable to similar transactions with bonds.

The purchaser or subscriber of warrants records the value of the warrants in account 50 " Marketable securities ".

Account 509 " Remaining payments on unpaid marketable securities " is credited with the remaining payments on unpaid marketable securities by debiting the relevant subdivisions of account 50.

 

 
Website not affiliated with the Accounting Standards Authority (Autorité des Normes Comptables, ANC)
© 2004-2022 PLANCOMPTABLE.COM
Main page - Summary of accounts - Chart of accounts - Accounts - Financial statements - Accounting terms
Unofficial translation - Legal notices