Shares Capital Presentation
Meaning if a shareholder fails to pay allotment money and / or calls money on his shares as called upon by the company his shares may be forfeited by giving due notice and following the procedure specified in the articles of association on this behalf. This is known as forfeiture of shares in simple words to forfeit a share means to cancel the allotment to defaulting share holders.
Procedure the usual procedure as per table A is that the defaulting shareholder must be given a minimum 14days motive requiring him to pay the amount due on this shares along with interest on it stating that if he fails to pay the amount and the interest on it the shares will be forfeited in spite of this notice the shareholder does not pay the unpaid amount, the company can forfeit the shares by passing a resolution and giving a notice of the resolution to the defaulting shareholders. 
Effect the name of the shareholder is removed from the register of members and amount already received on these shares as forfeited to the company the forfeited amount should be transferred to newly opened share forfeiture account it means that he is no more shareholder of the company. 

(i) Forfeiture of shares which were issued at par
Share capital A/c Dr. (amount called up so far)
To share allotment A/c (amount not received on allotment)
To share call / calls A/c (amount not received on calls)
(For shares forfeited)
(ii) Forfeiture of shares which were issued at premium
(a) If premium has been paid by the shareholders
Share capital A/c Dr. (amount called up – premium)
To share call / calls A/c (amount not received on allotment)
To share forfeiture A/C (amount not received on calls)
(For shares forfeited) (Amount received so far)
(b) If premium has not been paid by the shareholders
Share capital A/c Dr. (amount called up so far less premium)
Securities premium A/c Dr. (premium amount called up)
To share allotment A/c (amount not received on allotment)
To shares forfeiture A/c (amount received so far)
(iii) Forfeiture of shares which were issued at a discount:
Share capital A/c Dr. (amount called up so far plus discount)
To discount on issue of shares A/C (amount of share discount) To share allotment A/c (amount not received on allotment)
To share called / calls A/c (amount not received on calls)
(For shares forfeited)   
Presentation: the balance of share forfeiture account is shown on the liabilities side of the balance sheet under the heading share capital till the forfeited shares are reissued.
Note:
(i) When the securities premium has not been paid by the shareholder the securities premium account is debited so as to bring done the securities premium account at an amount equal to the actual premium received from the shareholders. Whereas as per section 78 of act premium once received can be used for specific purposes. Therefore securities premium account will not be debited.
(ii) Discount on issue of shares account is credited while making the forfeiture entry so as to bring down the discount on issue of shares A/c to an amount equal to the actual amount of share discount on existing shares.
(iii) If calls in arrears A/c is maintained it would be credited in place of share allotment A/c and call A/c in the above entries.
Reissue of forfeited shares 
Meaning the directors of a company has an authority to re-issue the shares once forfeited by them on such terms as they think. In other words they can reissue the forfeited shares at par at premium or at discount however if the forfeited shares are reissued at a discount the amount of the discount does not exceed the amount paid on such shares by the original shareholder but in case of shares originally issued at a discount the maximum permissible discount will be the amount paid on such shares by the original shareholder plus the amount of original discount.
Accounting treatment the following entries will be passed under different circumstances
(i) For forfeited shares reissued at par
Bank A/c Dr.
To share capital A/c 
(ii) For forfeited shares reissued at premium
Bank A/c Dr.
To share capital A/c
To securities premium A/c
(iii) For forfeited shares reissued at discount
Bank A/c Dr.
Share forfeiture A/c (discount allowed) Dr.
To share capital A/c 
Transfer:
When all forfeited shares have been reissued the credit balance left in the share forfeiture account being capital profits is transferred to capital reserve account. Entry will be 
Share forfeiture A/c Dr.
To capital reserve A/c
Note:
If all forfeited shares are not reissued only that proportion of share forfeiture account which belongs to the reissued shares should be transferred to capital reserve account and the remaining balance of the share forfeiture account relating to shares not reissued is carried forward.