Those retained earnings (RE)- i.e., retained profits– of an entity that have not been set aside (appropriated) for a specific use or purpose. In other words, an entity reporting retained earnings may not have decided (through its board of directors) as to the intended use of such amount, whether funding the acquisition of fixed assets, increases in working capital, or simply paying out dividends to its shareholders. Unappropriated retained earnings are the amounts that remain the account of unrestricted retained earnings (with the restricted portion is set aside). Typically, the credit balance is either distributed to owners/ shareholders as dividends or held as a reserve (for future deployment). Therefore and by nature (as opposed to other types: appropriated retained earnings and restricted retained earnings), unappropriated retained earnings are unrestricted retained earnings: they are available for distribution to shareholders/ equity holders, as dividends, without any restrictions such as those imposed by regulators or covenants (creditor protection covenants), or contractual obligations, etc.
Accounting
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