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LIMITED LIABILITY PARTNERSHIP (Private LLP (Advantages (capital (the issue…
LIMITED LIABILITY PARTNERSHIP
Private LLP
Definitions
business entity; held by private owners
limits the owner's liability; to their ownership stake
restricts shareholders; from publicly trading shares
Advantages
capital
the issue shared; must > £50,000
a plc (private limited company) may; smaller share capital
members
can start with; minimum= 2, maximum=200
liability
for each shareholder/member ; limited
no. of directors
minimum=2
director&shareholders; can be same people
advertisements
do not have to
public is not invited to subscribe; for the shares
perpetual succession
company continues its existence
Disadvantages
shares cannot be sold/transfer; unless being agree
public cannot subscribe the shares
mandatory to mention; Pvt. Ltd [at the end of company name]
Public LLP
Definitions
company that has permission to issue registered securities
traded on atleast one stock exchange market
not authorised to begin its business operation
should obtain another document
Advantages
capital
can raise from public
can raise by issuing bonds
members
minimum of 7 and maximum of unlimited
transferable share
purchased and sold on market
liability
limited
no shareholders individually liable for payment
separate legal entity, each shareholders is a part of it
board of directors
minimum of 3 and maximum of 15
elected directors acts as representative of shareholders
transparency
strictly regulated and require by law
Disadvantages
prospectus is mandatory
expensive and time consuming
equity dilution
loss of management control
increase regulatory oversight
enhance reporting requirement
increase liability