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In: Accounting

Examples of public entities, nonpublic entities and private companies

Examples of public entities, nonpublic entities and private companies

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Expert Solution

Public entities:

Public entities issued securities through an initial public offering (IPO) or further public offer and their securities are traded in public market. It simply means that public entities are authorised to go into public for procurement or raising of capital. The securities of public entity are listed on stock exchanges such as NASDAQ, DOWJONES etc. and they are traded on such stock exchanges. Example of public entities are Facebook, Microsoft etc. whose securities are traded on stock exchanges.Public entities are required to follow a lot compliances set up by legal body governing public entites in the country such as SEC (Securities Exchange Commission) in US.

Non public entities:

Non public entities are those entities who are not authorised to go into public for procurement or raising of capital. It inclused private companies and not for profit organisation. All private companies and Not for profit company such as Greenpeace, human Rights campaign etc. are examples of non public entities.

Private Companies:

As the name suggests,shares of private company are privately placed. Private company are those companies whose shares may not be offered to the public for sale and which operates under legal requirements less strict than those for a public company. Shares of private company are issued to the director of private company and their relatives. Definition of relatives to whom the shares of private company can be issued is definied in the law.Examples of private company are Koch Industries Inc.,Liberty Mutual Holding Co.Inc. etc.


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