Hnc Bus Law Outcome 3 Assessment

| A general partnership is comprised of a group of two or more individuals who enter into an agreement to start a business. The partners and the business are legally the same. The partners enter into an agreement called the articles of partnership and are typically equally active in the business and the business’s management, unless otherwise stated in the partnership agreement. All profits and losses are shared by the partners in a joint business venture.

Convenience/Burden: Limited Partnerships have extra requirements placed upon them to comply with state regulatory requirements. They must maintain a registered agent to represent them in the state in which they were formed. They are also required to file an informational report with the IRS of the profits passed to the general partners.

Sole Proprietorship: A type of business that is owned by and run by one person with no legal difference between the business and the owner. It is easy to form with no cost or time to initiate. It gives the owner the ability to self-govern the business. There are drawbacks; only one owner can be established not allowing a partner. Also, unlimited liability puts the owner’s personal assets in jeopardy with the creditors.

Sole trader Structure- A Sole trader has complete control over the company and Is usually only made up of one person, they decide what decisions are being made about partnerships, quantities and products being ordered etc.

An advantage of being a public limited company is having limited liability because of only being responsible to amount invested into Tesco PLC. Another advantage of a public limited company is being able to liquidate. This is when shares are bought or sold to shareholders if on the stock exchange it’s quoted. An additional advantage of a public limited company is the share value as Tesco PLC’s value will be shown by the market capitalisation from being the share price being what it’s based on. An extra advantage of a public limited company is having better access to capital because of the existing and new investor are raising share capital.

When limited liability is easily and cheaply available can be explained as removing unnecessary legal bars which can be an inhibition to progress of economic activity

There are also disadvantages to inverting into a partnership company, all the profits that the business has made has to be shared out amongst all of the partners, all of the decision making is split between all of the partners, that may cause arguments between the partners because one may say something should be don’t and another could say something else should be done. There are two types of limited company, there is private limited company and public limited company. A private limited company can have one or more members (shareholders), the finances for the business come from shareholders, borrowing and retained profits, and also raising finance to start a private limited company is easier because the success rate for them is also quite high. There are also disadvantages to having a private limited company, they can not offer shares to the public (on the stock exchange) only people within the business can buy shares in the business, all the accounts from a years trading in a private limited company has to be published every year, doing this gives there competitors access to the companies personal information, profit is shared out between all of the shareholders.

Partnership- the partnership established as a legal business entity a group of two or more persons goes in into a legal contract by which the partners agree to operate a business and share the profits from that business. There are limitations on the life span of a partnership; it ends with

being a general partner, shall be held liable unlimitedly and jointly and severally with the general

Another characteristic that belongs to partnership is the division of profits or losses. It is not essential that all the partners must share the losses also. There may be a provision in the partnership deed that a particular partner or partners shall not bear losses. The profit is arrived at after providing for salaries to the partners and interest on capital, if agreed and stated in the agreement. That last but not least feature of partnership is about the business management. Firstly, it is specified that all general partners are entitled to act as legal representative of the partnership in carrying out business activities. Any restriction applicable to general partners in relation to conducting day-to-day business activities of the partnership will be effective to the third party if this party is informed. Secondly, general partners will agree on division of their duties in relation to management and running of the company. If a business activity is carried out by several partners, the decision will be adopted on the principle of majority. Additionally, the partnership will not be liable to any activity that is conducted by general partner and outside the scope of business activities of the partnership, unless otherwise agreed by the partners. Thirdly, the partnership can open one or several accounts with a bank. The partners’ council will appoint one partner who is required to deposit and withdraw money from those accounts. Lastly,

The minimum requirements for setting up a private limited company is that you must have one director, registered in the United Kingdom, and have at least one

2. Partnerships are set up by a Deed of Partnership which is a document made out by the partners and witnessed by a solicitor. This Deed sets out the legal relationship between partners e.g. how profits will be shared out, responsibilities of partners etc. In traditional partnerships the partners had unlimited liability i.e. they were jointly responsible for the debts of their partnership. In

This report aims to provide guidance and advice on setting up a new company and also considers the mechanisms for doing so. The report encompasses a range of key areas which are considered in order to provide an understanding of how to incorporate a business entity of suitable type and structure whilst also covering the registration process together with legal requirements.

Sole trader business is an individual who sets up his/her own business. This business is self controlled and also responsible for all assets and liabilities of business. sole trader ship is a business entity owned by one person. The business and the sole trader are one legal entity. A sole trader business is the easiest business structure to form due to the legal number of formalities

A successful business is business that has good entrepreneurial skills which enables them to unite production to the complex matters of demand. It also encourages them to improve on what they produce such as the quality and how they produce the product to meet the demand in the future. For example Apple, not only did they improve on the software they use but also the quality of the phone. However a firm lacking in entrepreneurship skills would risk being forgotten if they fail to make the right assumption of the market conditions and also produce goods and services where there is less demand. Firms are distinguished by their form of ownership. There are three types of businesses; sole trader, partnership and limited companies (public and