Public Limited Company (PLC) Flashcards
1
Q
Who is a public limited company owned by?
A
no maximum amount of shareholders.
2
Q
Who is a public limited company controlled by?
A
A board of directors.
3
Q
What is a public limited company financed by?
A
Share equity through shares that have been sold on the stock market or can apply for a grant or bank loan.
4
Q
What are the advantages of a public limited company?
A
- Shareholders have limited liability
- Large amounts of finance can be raised through the public sales of shares.
- It is easy to borrow finance due to PLC’s size and reputation, so less risk for banks.
- PLCs can easily dominate the market.
5
Q
What are the disadvantages of a public limited company?
A
- Dividends are shared with many shareholders.
- Control of the business can be lost as anyone can buy shares on the stock market.
- Annual accounts have to be published.
- Setting up a PLCs is costly and complicated.
