The term dividend refer to the part of the process of a company which is distributed longest it's shareholders it made therefore be defined as written that a shareholder get from the coming out of its profit on a share holding according to The Institute of Chartered Accountant of India dividend is a distribution to share would have a sore so Tor is available for this purpose the dividend decision of the sperm is a special importance for the finance manager since they determine the amount of profit to be distributed among the shareholder and the amount of profit to be required in the business popularly termed as it ain't earning of for science in its long term growth there is a reciprocal relationship between the cash dividend and retained earning larger dividend result in elasticity and earn less dividend result in largest retained earnings while taking dividend decision the management will obviously take into account the effect of the decision on the maximization of shareholder wealth in the case payment of dividend have the management in achieving this objective it will be advisable to pay dividend in case payment of dividend does not help in achieving this objective the management would be well advised to retain the profit and use them for financing Investment Program does a dividend decision is largely based on its impact on the value of the firm
