Features of a Private Limited Liability Company is a topic that educareguide’ considers it worth discussing.
Additionally, a lot of people research this topic, especially students who are writing various kinds of examination across the world, which includes WASSCE candidates).
Now what are the features of a private limited company, and how does it differ from a public limited company?
Definitely, you will find all the answers you seek just below.
The Characteristics Of A Private Company
As a matter of fact, Private Limited Liability Company possesses the following features:
Number of Owners:
First, a minimum membership of two (2) and a maximum of fifty (50) shareholders can form a Private Limited Liability Company.
Transferability of Shares:
Furthermore, there is a restriction on the rights of members to transfer their shares. Thus, the members cannot transfer shares to themselves, without the consent of all the other members (shareholders).
Issuance of Shares:
Also, the company law prohibits a private limited liability company from issuing its shares to the general public.
As a result, it has no right to advertise its shares for public purchase. Likewise, it cannot invite the public through the stock exchange to buy shares from the business.
Publishing of Annual Account:
Definitely, the requires a public company to publish its annual final account to the public.
Thus, the annual final account of a company is a public document. For this reason, the document cannot be classified.
Furthermore, a private limited liability Company requires better documentation to set it up, in comparison to a sole proprietorship.
What Are The Features Of A Private Sector Company?
First, a company is an association of two or more persons. Indeed, these persons come together to contribute shares to carry out a business with the aim of prfit-making.
Secondly, the owners’ liability is up to only the amount of money they contribute as shares.
Furthermore, a Limited Liability Company is a Company Limited by Shares. As a result, the liquidator will use only the capital the owners contribute to pay the debts of the company.
The liquidator will not use the private properties and funds of the owners to pay the debts of the company. A liquidator is a person that a government appoints to see to the end of the life of a company.
Moreover, several examining bodies, including WAEC ask questions on this sub-topic many times. For example, is the Business Management WASSCE examination.
Therefore, Educareguide is here to assist you in to fully understand this topic.
Frequently Asked Questions On Private Company
- What is the nature of a Private Limited liability Company?
- Also, state and explain the features of a Private Limited Liability company.
- Alternatively, what are the characteristics of a private limited liability company? Etc.
Furthermore, the sub-topic is an integral part of the Business Management for Senior High School Students across the West African sub-region. Obviously, these countries include Nigeria, Ghana, Sierra Leone, The Gambia, and Liberia.
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Finally, I will say that the Features of a Private Liability Company must be learned well. As a result of that information, your will know your rights and responsibilities as an owner of a company.
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