Question

1.What are the 3 main types of business ownership. Please define the

differences between the different types of business ownership            

2. If you were designing a financial management team. What attributes would you look

for and or require?   

Answer 1

1. Three main types of business ownership-

(A) sole proprietorship-it will mean that the entire control of the company is in the hand of one person, and liability of this person will also be unlimited in the nature, and all the risk and the benefits which will accrue to this business will lie to the same individual.

(B) PARTNERSHIPS-these are another form of business ownership in which control is shared between various partners through a partnership deed and this will help sharing profits according to partnership deeds and the liability of the partners are always unlimited in nature but only in case of limited liability partnership the liability of partners are limited.

(C) Corporations-these will have their own existence and those members who are the owners of the company are in the form of equity shareholders and they will be having voting rights. dividend payments are not mandatory to them and the liability of the shareholders will always be Limited in nature.

The difference between all these form of organisations are listed above and the main difference is in form of liability as liability of partnership and sole proprietorship are always of unlimited in nature whereas liabilities of owners in Corporation are limited in nature.

2. If I were designing a financial management team I would look for-

A. Specialisation of different people in finance

B.I would also be looking for management of risk by the different persons and their past experience as well

C. I would also be looking for their personal portfolios and personal financing techniques

D . Uniqueness in management of finance will always be preferred