DEFINITION of Capital Reserve
#1. Capital Reserve is
financial resource created by the accumulated capital surplus of a corporation
coming from the increased market value of its assets. The assets are
re-valuated to reflect current market conditions.
#2. Capital Reserve is a type
of account that is reserved for future long-term capital investment projects or
other large and anticipated expenses to ensure funding of the project or
expense. These amounts can only
be spent on the project for which they were intended. The funds are accumulated
from the company's regular operations that can be extended with contributions
from government subsidies or donated funds.