Equity (shareholders' equity) is the residual interest in a company's assets after all liabilities are deducted. It represents the ownership stake held by founders and investors. The accounting equation: Assets = Liabilities + Equity.
Share capital (amounts paid by shareholders), retained earnings (accumulated undistributed profits), and any reserves. For UAE LLCs, minimum share capital varies by emirate and activity type.
Capital refers to funds contributed by the owner. Equity is broader — it includes retained earnings too. Both appear on the balance sheet.
Equity is scrutinised by banks when assessing loans, by investors during due diligence, and by the FTA during audits. Growing equity through profitable operations is the fundamental goal of a sustainable business.
Finanshels prepares monthly management accounts and profit and loss statements showing your equity position. Explore our CFO services for deeper financial analysis.
