Reserva Legal En Guatemala

The amendments approved by Congress, pending publication, correct certain inaccuracies regarding the legal reservation. Article 36 has not been amended and its interpretation leads to the use of two different values. It stipulates that at least five per cent of a company`s net profit must be set aside each year to build up such a reserve. When referring to the profit of the year, the interpretation is that profit before income tax or profit after tax can be used. In our opinion, it is possible to calculate it with both values as a basis. The legal reserve is one of the most commonly used economic instruments, as it allows companies to create and maintain economic support that meets all eventualities. The legal reserve in Guatemala must be calculated on the basis of the net profit of each financial year of each company. This leads us to the conclusion that it is not possible to calculate them over an interim period. I share the link of the publication: www.prensalibre.com/opinion/opinion/para-que-sirve-la-reserva-legal which refers to the following: The reservation system is legally structured in such a way that the company is obliged to strengthen the share capital, for which all shareholders and creditor shareholders are responsible. The resulting protection allows the company to carry out its activities without prejudice to third parties. This is why reserve funds can never be used to pay dividends to shareholders.

From a legal point of view, reserves represent a set of securities and assets that are excluded from distribution and dividends that receive shares to support economic activity. Therefore, these are sums of profit and are intended to increase net wealth. Article 37 of the K of C provides that such a reserve may not be distributed in any way until the dissolution of the company. It may be capitalized if it exceeds 15% of the capital at the end of the previous financial year. The shortcoming is that it does not indicate to what capital it relates, whether it has been paid or authorized. It has been interpreted that it is paid from an account such that once the reserve exceeds 15% of this capital, the entire accumulated value can be capitalized, since the wording of this article is interpreted as such. If, at that time, when the reforms have not yet entered into force, the shareholders of a company decide to capitalize the legal reserve, they can transfer the entire amount to the capital on the basis of the literal text of the law. The article goes on to say that, without prejudice to the additional capitalisation of 5% per annum, which can be interpreted as allowing it to be further capitalised after capitalisation in subsequent years, the company would no longer have built up legal reserves. This poor wording is corrected by the reforms and stipulates that the surplus of 5% per annum may be capitalised if the legal reserve exceeds 15% of the paid-up capital at the end of the previous financial year, without prejudice to the company`s obligation to continue to separate the 5% per annum corresponding to the legal reserve.

Now it is specified that paid-up capital is taken as a base, the surplus is capitalized and at least five per cent must remain in the reserve. The legal reserve may be capitalized annually up to the excess of five percent (5%) if the annual legal reserve exceeds fifteen percent (15 percent) of the paid-up capital at the end of the preceding fiscal year. “ARTICLE 36. At least five percent (5%) of a company`s net income for each fiscal year must be set aside annually for the establishment of the statutory reserve. If that company reaches the point where the annual legal reserve exceeds one fifth of the share capital available as part of its financial security, that statutory reserve becomes the investment currency available to the company; this is explained by the General Law on Commercial Companies (LGSM). Therefore, the statutory reserve is based on profits made over the years and is calculated after amortization of contributions for officers, directors, etc., social security contributions and other business costs, as well as©financial and business expenses and expenses. In this example, the accumulated reserve corresponds to 20% of the paid-up capital. What the trading code indicates is that this amount can be capitalized.

Secondly, the excess legal reserve is part of the paid-up capital. Perhaps one of the most practical examples is the observation of the behavior of the legal reserve within a company: with the above, the annual profit corresponds to 250.00, the supposed calculation of the reserve would be based on 250.00, which is false. That is, the legal reserve and social capital are instruments that companies use as a security barrier and thus respond more appropriately to the various economic emergencies that may arise. The legal reserve is a type of passive capital that serves as collateral for the activity of a company and represents a percentage of the total share capital. Although its value is deducted from profits not received by the partners, it does not increase the overall value of the business; The shareholder becomes a creditor of the reserves, because they are part of the value of the company`s equity. Since they do not constitute share capital as such, reserves are considered profits, which are included in the company`s own funds as passive capital, although they must have a counterpart in the assets. This means that they are part of the financing of the company as such and therefore cannot be sold for distribution as dividends, except in certain special cases. The reserves of this type of retained earnings of companies are calculated on the basis of a percentage of the profits made at the end of that financial year. The Board of Directors will be responsible for approving the balance sheet and reviewing the results, so that the corresponding ten percent will be set as the statutory reserve. Assuming that a given company has earned a total of $10,000 net in the last year, 10% of this amount is deducted from this annual amount, which is directed to the reserve, as it is calculated that this percentage can cover possible negative figures that this company may have the following year.

Initially, a legal reserve is the amount of assets that the company stores by removing a small percentage of its net capital and adding it to past values to generate registered capital that serves as support in case of financial problems during annual production. The reserves thus created may have several purposes. The main reason is the cost of losses, negative balance sheets and maturing© assets. They are generally used when the share capital is severely depreciated. This is because reserves can be used in future negative years to cover losses©or compensate for a decline in business performance. The allocation of reserves may result from such circumstances and their replenishment is subject to a profit warning. The concept of legal reserve refers to a type of mandate by which a commercial company reserves a certain amount of capital as collateral for its activity. As a general rule, this sum corresponds to twenty per cent of the value of the total share capital.