omitted dividend

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Omitted dividend

A dividend that was scheduled to be declared, but that is not voted by the Board of Directors probably because the company is experiencing financial difficulties.

Omitted Dividend

A dividend that a company would have ordinarily declared and paid but decided against doing so. For example, if a company ordinarily pays a dividend each March but decides not to do so in March 2010, that dividend is said to be omitted. A company usually omits a dividend when it is experiencing financial difficulties and wishes to keep the cash that would have gone to pay the dividend to maintain its operations. An omitted dividend is also called a passed dividend.

omitted dividend

References in periodicals archive ?
Analyzing data from 1,923 firms before and after the introduction of JGTRRA, the researchers find that 145 companies initiated dividends after JGTRRA, while only 30 firms omitted dividends. More than 200 firms began repurchasing shares after enactment of JGTRRA, while 370 companies stopped repurchasing shares.