music promoter has had an offer to bring a famous musical group from England to Australia, as part of its world tour to promote its new album. The music promoter has done smaller tours previously, but nothing on the scale proposed by the manager of this famous group, the tour will cost several million dollars, but is likely to have revenue which will result in substantial profits for those involved.The promoter has some contacts at a national radio station which can promote the tour, and there is at least one financier who is interested in financing the tour in return of course for a share of the revenue from the tour.The promoter is calling for a meeting of the different interested parties, he is not sure what business organisation would be best to manage and conduct the proposed tour, particularly as it is going to involve various diverse entities, each with their own separate business interests.Explain:• The options open to the different parties in what business structure they might use topromote the tour• The dangers of each type of business structure• Whether there is any means of limiting risks by each party check_circle Expert Answer thumb_up thumb_down Step 1 Sole Proprietory rights: In such type of organisation the individual is solely liable for risk and reward earned from event. There is single owner in the organization thus, he enter into an independent agreement with other parties whose role, reward and responsibilities are stated in agreement. Event partnership management: Here partnership takes place, two or more people come together to complete the event. Here, the risk reward responsibilities are shared between them. The collaboration of the people will be jointly and severally responsible for risk and reward. Event Sponsorship agreement: In such type of agreement, the promoters sales his right to other for to promote his event on various platform and also financial sponsorship with financier is done. The termination clause of revenues is clearly stated in such agreements. Step 2 The promoters can have following options for organizing the event, there are these three parties with valid interest: Sole Proprietory right Event partnership management Event sponsorship agreement Step 3 The business risk in each type of business structure are: Sole Proprietory right Risk: Liability is unlimited and There are multiple roles and responsibilities. Event partnership agreement: Risk: Partners are jointly and severally liable. Hence the liability among them is unlimited. Chance of interest conflict is higher. The one partner action can lead to damage of firm’s image. Sponsorship: Risk: The sponsor can be demanding and can ask for high rights and returns. There can be conflict of interest. Step 4 The possible mitigation of each business structure are as follows: Sole Proprietory right Mitigation: Enter into agreement where financial terms and effectively managing financial and business risk which can reduce liability. The roles and responsibilities can be defined in agreement. Event partnership agreement: Mitigation: They can enter in LLP agreements which can help easing liability to certain limits. Can create awareness and sufficient disclosures with personal interest can be aligned with partnership. The proper background check can be done and proper control and encouragement from partners damage of reputation can be reduced. Sponsorship: Mitigation: The agreement for sponsorship can be prepared and the rights and responsibilities of sponsors can be specified in in. The termination clause must be clearly mentioned. Explore similar questions Was this solution helpful? thumb_up thumb_down Q & A Stuck on your homework? Ask a question and get an expertly curated answer in as

music promoter has had an offer to bring a famous musical group from England to Australia, as part of its world tour to promote its new album. The music promoter has done smaller tours previously, but nothing on the scale proposed by the manager of this famous group, the tour will cost several million dollars, but is likely to have revenue which will result in substantial profits for those involved.The promoter has some contacts at a national radio station which can promote the tour, and there is at least one financier who is interested in financing the tour in return of course for a share of the revenue from the tour.The promoter is calling for a meeting of the different interested parties, he is not sure what business organisation would be best to manage and conduct the proposed tour, particularly as it is going to involve various diverse entities, each with their own separate business interests.Explain:• The options open to the different parties in what business structure they might use topromote the tour• The dangers of each type of business structure• Whether there is any means of limiting risks by each party check_circle Expert Answer thumb_up thumb_down Step 1 Sole Proprietory rights: In such type of organisation the individual is solely liable for risk and reward earned from event. There is single owner in the organization thus, he enter into an independent agreement with other parties whose role, reward and responsibilities are stated in agreement. Event partnership management: Here partnership takes place, two or more people come together to complete the event. Here, the risk reward responsibilities are shared between them. The collaboration of the people will be jointly and severally responsible for risk and reward. Event Sponsorship agreement: In such type of agreement, the promoters sales his right to other for to promote his event on various platform and also financial sponsorship with financier is done. The termination clause of revenues is clearly stated in such agreements. Step 2 The promoters can have following options for organizing the event, there are these three parties with valid interest: Sole Proprietory right Event partnership management Event sponsorship agreement Step 3 The business risk in each type of business structure are: Sole Proprietory right Risk: Liability is unlimited and There are multiple roles and responsibilities. Event partnership agreement: Risk: Partners are jointly and severally liable. Hence the liability among them is unlimited. Chance of interest conflict is higher. The one partner action can lead to damage of firm’s image. Sponsorship: Risk: The sponsor can be demanding and can ask for high rights and returns. There can be conflict of interest. Step 4 The possible mitigation of each business structure are as follows: Sole Proprietory right Mitigation: Enter into agreement where financial terms and effectively managing financial and business risk which can reduce liability. The roles and responsibilities can be defined in agreement. Event partnership agreement: Mitigation: They can enter in LLP agreements which can help easing liability to certain limits. Can create awareness and sufficient disclosures with personal interest can be aligned with partnership. The proper background check can be done and proper control and encouragement from partners damage of reputation can be reduced. Sponsorship: Mitigation: The agreement for sponsorship can be prepared and the rights and responsibilities of sponsors can be specified in in. The termination clause must be clearly mentioned. Explore similar questions Was this solution helpful? thumb_up thumb_down Q & A Stuck on your homework? Ask a question and get an expertly curated answer in as

International Financial Management

14th Edition

ISBN:9780357130698

Author:Madura

Publisher:Madura

Chapter9: Forecasting Exchange Rates

Section: Chapter Questions

Problem 6ST

See similar textbooks

Expert Answer

thumb_up

thumb_down

Step 1

Sole Proprietory rights:

In such type of organisation the individual is solely liable for risk and reward earned from event. There is single owner in the organization thus, he enter into an independent agreement with other parties whose role, reward and responsibilities are stated in agreement.

Event partnership management:

Here partnership takes place, two or more people come together to complete the event. Here, the risk reward responsibilities are shared between them. The collaboration of the people will be jointly and severally responsible for risk and reward.

Event Sponsorship agreement:

In such type of agreement, the promoters sales his right to other for to promote his event on various platform and also financial sponsorship with financier is done. The termination clause of revenues is clearly stated in such agreements.

Step 2

The promoters can have following options for organizing the event, there are these three parties with valid interest:

Sole Proprietory right
Event partnership management
Event sponsorship agreement

Step 3

The business risk in each type of business structure are:

Sole Proprietory right

Risk: Liability is unlimited and There are multiple roles and responsibilities.

Event partnership agreement:

Risk: Partners are jointly and severally liable. Hence the liability among them is unlimited. Chance of interest conflict is higher. The one partner action can lead to damage of firm’s image.

Sponsorship:

Risk: The sponsor can be demanding and can ask for high rights and returns. There can be conflict of interest.

Step 4

The possible mitigation of each business structure are as follows:

Sole Proprietory right

Mitigation: Enter into agreement where financial terms and effectively managing financial and business risk which can reduce liability. The roles and responsibilities can be defined in agreement.

Event partnership agreement:

Mitigation: They can enter in LLP agreements which can help easing liability to certain limits. Can create awareness and sufficient disclosures with personal interest can be aligned with partnership. The proper background check can be done and proper control and encouragement from partners damage of reputation can be reduced.

Sponsorship:

Mitigation: The agreement for sponsorship can be prepared and the rights and responsibilities of sponsors can be specified in in. The termination clause must be clearly mentioned.

Explore similar questions

Was this solution helpful?

thumb_up

thumb_down

Q & A

Stuck on your homework?

Ask a question and get an expertly curated answer in as

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

Expert Solution

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.