Advantages And Disadvantages Of Different Business Structures — страница 3

  • Просмотров 166
  • Скачиваний 12
  • Размер файла 16

and industry, the courts and the registrar of companies certain accounts records to be submitted to ROC less of confidentiality. Audit and account costs high, full audit costs if sales exceed an upper limit. Shareholders personally taxed on dividends. Double tax when company pays corporation tax on profits and capital gains. Higher national insurance contribution. Limited liability initially as creditors and banks request personal guarantees from directors. Private Limited Company (LTD company) Has no minimum value required for the allotted share capital. Can on receipt of its certificate of incorporation limited can borrow and commence business. A LTD company needs only one director and one shareholder. There is less legislation than PLC to comply with. A member can appoint only

one proxy who can vote and address the meeting. Can provide financial assistance to a person to help them purchase the companies shares. It is optional for a LTD to pay dividends. A LTD company can not sell shares or debentures to the public. Has to publish accounts but gets partial exemption from publishing the full accounts, if they are bellow an upper limit. The company secretary is not required to be qualified or experienced, so there may be a lack of knowledge. Share holders can not easily sell shares due to the lack of a market and Articles of association restrictions on transfer. The Public Limited Company (PLC company) Raise capital by selling shares and debentures to the public. Needs 2 directors and 2 share holders (unless registered before 1st Nov 1929). A member can

appoint more than 1 proxy who can vote but can not address meetings. The secretary must be qualified and posses the requisite knowledge and experience. Public scrutiny over accounts aids performance and efficiency. Large market for shares. No restriction on share transfer on stock exchange, USM and AIM but must keep track of who has shares. Encourages investment into company by share ownership by paying dividends. Can be exempt from the statutory requirement to have its year end accounts audited. Has legal requirement concerning allotted share capital must be equal or greater than fifty thousand pounds. Can not exercise its borrowing powers or enter business transactions until the registrar has granted it a section 117 certificate. High degree of legislation, rule and formalities

it must conform to, e.g. directors retiring at 70 years of age, minimum of 2 directors, voting for directors individually at a general meeting, share allotment. Must publish its accounts in full. Can not give financial assistance to a person to enable him to purchase the companies shares.