Cambridge 0452 and 0985 · Sub-topic 5.3
Limited companies
The 4 skills the syllabus asks for, the slips that cost marks, and how our teachers explain it.
What students must be able to do
- Explain the advantages and disadvantages of operating as a limited company, and limited liability.
- Explain equity and the capital structure of a company.
- Distinguish issued, called-up and paid-up share capital, and share capital from loan capital (debentures).
- Prepare income statements, statements of changes in equity and statements of financial position.
Official wording: Cambridge IGCSE Accounting 0452: syllabus for 2027-2029 (Version 1), page 16; Cambridge IGCSE Accounting 0452: syllabus for examination in 2026 (Version 2, December 2025), page 15. See all sources.
How our teachers teach it
The step up from partnerships is mostly vocabulary: share capital, reserves, debentures and the statement of changes in equity. Our teachers keep the layouts consistent with the sole trader statements so students see a familiar structure with a richer equity section. The statement of changes in equity is best learned as a reconciliation of opening to closing equity.
If any of these slips sound familiar, we can help. A teacher can mark your child's answers on limited companies line by line and show where the marks go. Book a trial class.
How the wording changed for 2027
The 2026 syllabus describes preference and ordinary shares and says redeemable and non-redeemable preference shares should be distinguished. It excludes cumulative preference shares, rights issues, share premium and capital redemption reserve. The 2027-2029 syllabus describes the features of ordinary share capital and loan capital (debentures) and does not repeat the preference-share exclusions.
Where it is examined
Limited companies can appear in either paper, as a short question or as part of a longer task. Cambridge bases both papers on the whole syllabus. See the guides to Paper 1 and Paper 2 for the format.
Sources: Cambridge IGCSE Accounting 0452: syllabus for 2027-2029 (Version 1), pages 9, 22. See all sources.
Practise it
- Key terms: Limited company, Ordinary shares, Debenture, Retained earnings, General reserve, Dividend, Capital employed
- Skills: How to prepare a limited company appropriation, How to record a share issue
- Layouts: Income statement (limited company) format, Statement of financial position (limited company) format
- Worked examples: limited company accounts
- Practice questions: limited company accounts
- One-to-one Cambridge 0452 tuition
Other sub-topics in topic 5
Limited companies: questions
Is the 2026 treatment of preference shares different from 2027?
Does the 0985 (9 to 1) syllabus cover limited companies too?
Which syllabus numbering should I use?
Get help with limited companies
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