Provident fund is the funds accumulated in the company for specific purposes with net assets exceeding paid-in share capital. The function of public accumulation fund is to increase the company's capital, consolidate the company's property foundation and improve the company's credit.

Provident fund does not constitute the company's share capital, but its function is similar to the share capital, so it is called "additional share capital", which together with the share capital constitutes the company's own capital. Provident funds can be divided into statutory provident funds and arbitrary provident funds according to whether their accumulation is compulsory by law; According to different sources of accumulation, it can be divided into surplus reserve fund and capital reserve fund.