types of businesses Flashcards
(18 cards)
sole trader
a self employed person who owns their business as an individual.
characteristics of a sole trader
gives owner full control of assets/decisions, fewer reporting requirements as it a generally low cost structure, unlimited liability
unlimited liability
the business owners are personally liable for the debt of the company.
partnerships
a business structure that involves 2-20 individuals who own a business together, governed by the ‘partnerships Act 1958’
characteristics of a partnerships
requires separate tax file numbers, not a separate entity, both partners are personally responsible for debts, shared control/assets, unlimited liability, each person responsible for own superannuation
private limited companies
an incorporated business that has a minimum of one shareholder and a maximum of 50 non employee shareholders. and whose shares are offered only to those people whom the business wishes to have as part owners, shares not traded on the stock exchange
incorporated
has its own legal identity ad can sue or own assets in its own rights
incorporation
process that a business goes through to become a registered company and a separate legal entity from the owner/shareholder
characteristics of private limited company
. often small business such as independent retailers, legal firms or accountants. . limited to 50 shareholders
. more complex to start and run
.required to comply with the corporations act 2001
.annual company tax return lodged with ATO
.operations controlled by directors, owned by shareholders
. separate legal entity
. limited liability
limited liability
having its own legal identity, owners will not be personally liable for the debts of the company.
public listed company
an incorporated business with a minimum of one shareholder and no maximum, whose shares are openly traded on the Australian Securities Exchange
characteristics of public listed company
separate legal entities with limited liability, examples , Commbank, Westpac, Coles, Quanta’s, money earned belongs to the company business operation controlled by directors and owned by shareholders.
Nationalize
to transfer a business from private to state ownership or control
privatize
to transfer a business from state to private ownership or control
social enterprise
a business with the objective of fulfilling a social need, not a charity, led by an economic, social cultural or environmental mission consistent with a public benefit.
social enterprise characteristics
trades to fulfill a mission , trades include revenue from memberships, sponsorships, sales of products and services.
government business enterprise
a business that is owned by the government but unlike government departments such as schools or hospitals they aim to act under general business principles and to make a profit e.g. Aus post or NBN
