1.2b Limited Companies Flashcards Preview

Business Studies AS > 1.2b Limited Companies > Flashcards

Flashcards in 1.2b Limited Companies Deck (13):
1

Do limited companies have limited or unlimited liabilities?

Limited

2

Who owns limited companies?

The shareholders

3

Who can Ltd companies sell shares to?

Family members and acquantances

4

Who can Plc companies sell shares to?

Anybody

5

Advantages of Ltd company

- Limited liability
- Can raise finance through shares
- More privacy than Plc

6

Disadvantages of Ltd company

- Public disclosure of information
- Shareholders have to be paid a dividend
- Can only sell shares to certain group of people

7

Advantages of Plc

- Limited liability
- Easier to raise finance from stock exchange
-Suppliers are more willing to offer credit

8

Disadvantages of Plc

- Financial information has to be published
- Greater scrutiny of activities
- Could lose control if over 50% of shares owned by others

9

Advantages of switching from Ltd to Plc

- Larger pool of potential owners and capital
- Higher profile

10

Disadvantages of switching from Ltd to Plc

- Answerable to shareholders
- Plc shareholders tend to be in it for short-term profits

11

Advantages of switching from Plc to Ltd

- More privacy
- No pressure of varying share prices

12

Disadvantages of switching from Plc to Ltd

- Long and expensive process of buying out all existing shareholders

13

Requirements for a PLC

- Must have at least two shareholders, two directors and a company secretary
- Share capital of over £50,000 must be raised when selling shares

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