Definitions for "Cumulative Preference Shares"
A type of preference shares on which dividend accumulates, if not paid. All arrears of preference dividend have to be paid out before paying dividend on equity shares.
Preference shares on which any unpaid dividend is added to what is due in subsequent years.... more on: Cumulative preference shares
the dividend on these shares is fixed and guaranteed. Where the company is unable to pay in any one year, the dividend accumulates. All cumulative preference shareholders must be paid before any other shareholder.