What is authorized stock?

Authorized stock, or authorized shares, refers to the maximum number of shares that a corporation is legally permitted to issue, as specified in its articles of incorporation in the U.S., or in the company's charter in other parts of the world. It is also usually listed in the capital accounts section of the balance sheet.

What are authorized shares?

Authorized shares are defined as the maximum number of shares that a company is legally allowed to issue to investors, as established in its corporate organization documents, such as its articles of incorporation. Authorized shares are also referred to as authorized stock or authorized capital stock.

What is authorized share capital?

Authorized share capital is a broad term. It is used to describe every stock share a company could issue. Typically, this is divided into three categories. Paid-up Capital – these are shares issued in return for payment received from shareholders. Subscribed Capital – shares a company has a commitment from shareholders to purchase in the future.