Stated Value

A value that, instead of being par value, is assigned to a corporation's stock for accounting purposes. Stated value has no relation to market price.



Taobiz explains Stated Value
For example, if stated value is $1 per share and the company issues 1 million shares, the stated value of its stock is $1 million. This amount is credited to the company's capital stock account, and is considered the legal capital of a corporation. Because it is generally illegal for a company to pay dividends or repurchase shares if doing so impairs the legal capital, stated value does help to provide shareholders with some protection.

Par value stock has a stated value on its face representing the minimum amount contributed by the shareholder. Stock without a par value has no stated value, allowing the corporation to issue it for any amount per share that the board of directors determines to be appropriate.