CONTEMPORARY Business Management

Business ownership

	Sole trader	Partnership	Private limited	Public limited
Number	1	2-20	2-50	unlimited
Setting up	very easy	easy	must register with ROC (Register of Company)	must register with ROC
Liability	unlimited	unlimited- one must bear the liability or credits of others	limited by amount of share invested	limited
Profit	individual	sharing	dividen, share price, investment	dividen, share price, investment
Continuity	lack of continuity	lack of continuity - dissolve upon death of partner	continuity - company still exist because can transfer shareholder share	continuity
Ownership and control	together	together	separated - shareholder might own the company, but control by appointed managers Veil of corporation - company will be sued instead of shareholder or board of directors	separated
Capital expansion	less	less	wide	huge
Transfer of ownership	none	upon agreement	selling of shared to nearby friends, relatives ONLY	share transaction in he public
Decision making process	easy	easy	hard	very difficult - existence of layers of management
Submission of audited financial statement to Registry	none	none	need	need
Taxation	income tax	income tax	double taxation - corporate tax and tax on dividens	double taxation
Administrative cost	none	none	needed because hire manager to run the company	higher
Advantages	Easy setting up and decision making. Earn all profit. No corporate tax, administrative cost	Easy setting up, more ideas due to partnership, share capital, no corporate tax	Capital expansion, continuity, liability limited	Capital expansion, continuity, liability limited
Disadvantages	Liability unlimited, no continuity, less capital expansion	Profit sharing, less capital expansion compared to company	corporate tax, administrative cost, difficult to set up, harder decision making	corporate tax, administrative cost, difficult to set up, harder decision making
Miscellaneous			Differs from public company maximum 50 members only selling of shares to private people ONLY (relatives, close friends)	Public corporation (SESCO,TNB) a public company %share owned by government