Types of Businesses Flashcards
What type of businesses goal is: To make a profit/return?
Profit-seeking
What type of businesses goal is: To provide a service?
Charitable
What type of businesses goal is: To make a surplus to invest in the business?
Not-for-profit and public sector
Value for money - Economy objective?
Resource acquisition, Measure of inputs
Value for money - Efficiency objective?
Resource usage, converting inputs into outputs
Value for money - Effectiveness objective?
Meeting objectives, effective output
Features of a simultaneous organization?
Production and consumption happen at the same time
Features of a Heterogenous organization?
Service is variable - tailored to the needs of individual customers
Features of a Intangible organization?
No physical product is produced
Features of a Perishableorganization?
Unable to store and sell at a later stage
Features of an Unincorporated business
- Created without any forms being submitted to Companies House - Owners and the business are the same - Owners are liable for the assets and liabilities in the business
Features of an Incorporated business
- Follow a legal process to form a corporate entity with Companies House - Owners and the business are separate - Separate legal company created liable for its own assets and liabilities in the business
Features of Private Limited companies?
- Name ends with LTD
- At least one director
- No minimum shares
- File accounts 9 months after Y/E
- No need for a company secretary
Features of Public Limited companies?
- Name ends with PLC
- At least 2 directors
- £50,000 minimum share issue
- File accounts 6 months after Y/E
- MUST have a company secretary
Fiduciary duties (imposed on those acting on behalf of others)
- Avoid conflict of interest
- Disclose interests in transactions
Statutory duties (imposed by Companies Act 2006)
- Exercise reasonable skill, care & judgement
- Exercise independent judgement
- Avoid bribes
- Avoid conflicts of interest
- Declare interests in transactions
LLPs similarities with companies
- Separate legal entity
- Agreed limited liability per year
- Company secretary designated
LLPS similarities with partnerships
- Partners pay tax on profits
- All partners manage the partnership
- Partnership agreement drawn up
Financing: what is Debt?
- Bank loans
- Overdrafts
Financing: what is Equity?
- Share issues
- Retained profits
