Preference share holders have the highest preference of

getting their investment bank when the company goes

bankrupt. The company has fulfill its obligation by selling
its assets. Here the preference first comes to preference
share holders and then debenture holders and then equity
holders.

Debentures are debt security issued by companies, having a

certain MATURITY and bearing a stated COUPON RATE.
Debentures may be unsecured or secured by ASSETS such as
land and building of the issuing company. Debenture holders
have a prior claim on the earnings (coupon) and ASSETS in
the event of liquidation, as compared to PREFERENCE and
equity shareholders.

preference shares represent partial ownership in a company,

although preferred stock shareholders do not enjoy any of
the voting rights of common stockholders.The main benefit
to owning preference shares are that the investor has a
greater claim on the company's assets than common
stockholders Preferred shareholders always receive their
dividends first and, in the event the company goes bankrupt.

Debenture are long-term loans. They carry fixed INTEREST.

Payment of interest is not under the control of directors
of a company.Debenture holders are creditors of a company.

Preference Shares are part of capital of a company. They

carry fixed DIVIDEND. Payment of dividend is under the
control of directors of a company. Preference Shareholders
are the owners of a company.

ntrerest on Debenture carries Tax Benefit Whereas

Preference Divident does not caary Tax Benefit on it.
the company should pay amount first to the debenture holder
than preference share holder when company is in insolvency
stage -------

Preference share is a hybrid form of equity shares &

debenture.
Debentuer is a borrowed capital,but preference is owned
capital.
Interest on debenture paid before tax payment & dividend on
prefrence share paid after payment of tax.
Debenture hloder doesnot have the right to vote, whereas in
special case prefrence shareholder have right to vote
Debentuer carry less risk & give regular certain income but
prefrence share is risky as compared to debenture & didn't
give certanity of income