Question

Discuss the following statement: There is really no need for a partnership agreement since all issues likely to arise among partners are adequately covered in the appropriate Partnership Act.

Answer 1

Partnership is formed amongst partner's by their mutual consent.Every partnership is unique in its own way. The partner's discuss everything among themselves before coming into business.The profit - sharing ratio, the contribution , the withdrawal systems , the commission if any , interest , and other day to day business activities . An agreement is formed and everything is specifically printed on papers so that no issue arises in futute . The arrangements of partnership is not particular in different partnerships. According to the comfort and understanding the partnership starts.The managerial responsibilities of every partner is before hand discussed and accordingly it is accepted .

The Partnership Act is graphed in a way that it serves the partnership and partner relationships like equal share of profits , interest on partner advances etc. Therefore , as per the concern of individual partner's a written agreement should be drawn covering items as they want.At last the Partnership Act will be needed only in case for items not specifically addressed in the partnership agreement