Branches of Commercial Law: Everything You Need to Know

Running head: COMMERCIAL LAW
COMMERCIAL LAW
Name of the Student
Name of the University
Author Note

COMMERCIAL LAW1
Introduction
Organizational structure is considered to provide direction and guidance to several
employees by providing a layout which would assist in governing or regulating the relationships
and the workflow in a corporation or a company. The outline of the structure in a corporation
would help in the growth and flexibility of the business. There are numerous factors that
differentiate the operations of the small businesses from the large ones and these are considered
to help in the implementation of the formal organizational structure. The structure is considered
to be important or significant as it helps in providing guidance as well as clarity on particular
resources and increases the managerial authority. A business structure is considered to be a
category of an organization which would help in giving legal recognition in a given jurisdiction
and such is considered to be characterized through a legal definition of a specific category (Boer,
et al. 2017).
This particular paper would discuss the various forms of business structure and along
with such provide the advantages and disadvantages of the business structures. In addition to
such it would also discuss the best structure, which would be suitable for the individuals,
mentioned in the case scenario. In conclusion, it would summarize the points that have been
discussed in the paper.
Discussion
From
(NAME)
To

COMMERCIAL LAW2
(ADDRESS)
Dear Mr. Sunny and Mr. Michael,
I am writing to you to let you know the different forms of business structures and its advantages
along with the disadvantages. There are four main business structures, which prevail in
Australia, which comprises of Sole Trader, Partnership, Company and Trust.
The Sole Trader is considered to be the simplest form of business structure which provides with
full control. An individual having this kind of business structure is considered to be the sole
proprietor of the business. In this business structure, the business entity is similar to the sole
proprietor of the business and does not enjoy a distinct legal entity (Mules 2015). The business
assets along with the liabilities are not separate from the personal assets or the liabilities. The
sole proprietorships are for low-risk businesses and the owners who want to try and test their
idea for businesses before forming a business which would be more formal. The proprietorship
would be advantageous while starting out with a business structure as there would be low costs
involved for start-ups and the privacy would also be maintained. The profits would not be shared
and this form of business structure is considered to be simple. However, there would be
unlimited liability of debts and there would be no separate distinction between the private assets
and the business assets. The life of the business is also considered to be limited and the business
capital would be difficult to raise (Boccabella and Freudenberg 2017).
The Partnership form of business structure is considered to be for two or more people who would
want to start a business together. There are two kinds of partners, which are widely popular in a
partnership form of business structure. First would be the general partners who are liable to get
profits as well as suffer losses and the second would be the limited partners where the partners