Types Of Organizations

Question 1

Sole Trader

Answer 1

-1 owner

• owner has unlimited liability (personal assets and property at risk) responsible for debt
• Can take all profits (owner)
• very few regulations. (Easy to run)
• easy to set up

Question 2

Partnership

Answer 2

Two or more partners (trade, occupation or profession) to make profit

• conventional partnership unlimited liability
• not allowed to own property in own name
• governed by (partnership act 1980)
• each partnertaxed individually like sole trader

Question 3

Limited liability partnership (LLP)

Answer 3

• taxed like partnership (each partner taxed like a sole trader)
• registered at companies house
• liability is limited
• governed by regulations limited liability act 2000

Question 4

Limited partnership

Answer 4

• formed and regulated under limited partnership act (2000)
• one on more partners has unlimited liability
• one or more partner has limited liability
• limited partner cannot take park in management of the business.
• needs to be registered at companies house

Question 5

limited company

Answer 5

• Ownership and management can be split.
• Both company and its owners taxed separately

Question 6

Public limited company (PLC)

Answer 6

• formed under companies act 2006
• 2+ directors requirement
• 2+ shareholders requirement
• must have qualified company secretary
• owners liabilities limited to amount of shares

Question 7

Private limited company (LTD)

Answer 7

• formed under companies act (2006)
• 1+ directors
• shareholders liability is limited to the amount of their shares

Question 8

Not for profit organisations (NPO)

• no external shareholders
• don’t issue dividends
• social, environmental or charitable objective

Profits are called surplus

Answer 8

Private sector

• Charities community organisations, voluntary
• sports and housing associations
• raise funds donations, grants and fundraising activities

public sector

Public services

• emergency services
• healthcare
• education
• housing
• refuse collection
• social care

Raise money through taxes

Question 9

Type of organisation will depend on

Answer 9

• limited or unlimited
• how governance
• how raises funding

Question 10

Liability

Answer 10

• Unlimited liability owners liability for debts unlimited. Property the owners own or assets at risk if business can’t pay debts
• Limited liability owners liability for debts is limited to how much they invested