Distribution to owners

A distribution to owners is a payment of the retained earnings of a business to its owners. This distribution may be made in a smaller company because there is no other way for the owners to gain value from the enterprise, as would normally be achieved through the sale of stock or sale of the business. This distribution results in a reduction of the equity and assets of the business. The distribution is usually made in cash, though it can also be made using any other asset of the business.