Also known as distributable reserves. A company's profits available for the purpose of a distribution (section 830(1), Companies Act 2006).

Profits available for distribution are a company's accumulated, realised profits (so far as not previously used by distribution or capitalisation) less its accumulated, realised losses (so far as not previously written off in a reduction or reorganisation of capital) (section 830(2), CA 2006).

Note that, in addition to having sufficient distributable profits under section 830, a public company can only make a distribution if its net assets are at least equal to the amount of its called-up share capital and non-distributable reserves (section 831, CA 2006).

For more information on distributable profits and distributions generally, see Practice note, Distributions. For guidance on realised and distributable profits published by the Institute of Chartered Accountants in England and Wales and the Institute of Chartered Accountants of Scotland, see Guidance on realised and distributable profits under the Companies Act 2006 (TECH 02/17BL).