Business Structure and Company Formation

This assignment delves into the complexities of establishing a business, comparing various structures like sole proprietorships and companies. It provides a detailed walkthrough of the steps involved in forming a company, including choosing a name, appointing directors and secretaries, drafting Memorandums and Articles of Association, and registering with relevant authorities. The document also clarifies the roles and responsibilities of shareholders within a company.

LAW RESEARCH

Contents
INTRODUCTION...........................................................................................................................1
(1).....................................................................................................................................................1
Setting up of a business corporation............................................................................................1
(2).....................................................................................................................................................2
Elements and Process of registration of a company....................................................................2
(3).....................................................................................................................................................4
Advantages and Disadvantages of conducting a business as a company....................................4
(4).....................................................................................................................................................5
Arrangements for Jack and other friends in a business...............................................................5
(5).....................................................................................................................................................5
How Peter can save their personal assets....................................................................................5
(6).....................................................................................................................................................6
Reporting obligations of business................................................................................................6
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
In this modern era, law is considered as a significant part for smooth and effective
functioning of different aspects in a country. Also, law is also required to establish a company or
a partnership firm with adherences of all compliances. In accordance with the provisions of
Partnership act 1963, there are various adherences and regulations which are required to form a
partnership firm (Bryson, 2016). Also, in addition to this, this report will be discussing about
various aspects and contexts of Partnerships form. In addition to this, elements and process of
company will also be discussed in this report.
(1)
Setting up of a business corporation
With reference to the given case scenario of Peter, who wishes to start his own business,
namely Peter’s Property management services. Peter and his wife, Susan, do not have clear mind
about business structure. Also, they are desirous of obtaining knowledge in regard to different
options and advantages and disadvantages as well as of various business structure.
In relation with the cited case scenario, Peter can register his business as Partnership firm.
In accordance with the provisions and regulations as laid down in Partnership act, 1963, a
partnership firm is an association of two more like kind people which have a same purpose and
objective. In other words, it is a connection and relationship in between two or more partners,
with a common perspective of making profits and gains. It includes a limited partnership. The
nature of liability of partners is unlimited nature (Jarvis, 2011). Also, it is a notable fact that
partnership cannot be clarified as a separate legal entity. That is why, all partners of business
firm are held liable for debts obligations of operating business. In accordance with the decided
case law of F.C.T. v. Everett (1980) 143 CLR 440, it was held by court that any individual
partner is not liable to any assets of a partnership firm.
Also, Peter can run his business in their own name. also, at the time of registration of
business, it can be stated that if name of the company is of the owner’s name, then he is required
to provide all necessary details and information of all its partners. It includes an E-mail address
of partners too. In addition to this, partners of a company can be characterised as an individual,
corporations, registered body and other incorporated body as well.
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On the other hand, it can be said that Susan cannot be included as co- owner of the business of
Peter. This is due to reason that if Susan would have been a partner of the firm, liability of
sharing margin of firm would be created upon her. So, in order to save her personal liability at
time of risk of insolvency, she could not be entered as a co-owner of partnership firm of Peter
(Soehnlein and Lindbom, 2010).
(2)
Elements and Process of registration of a company
A company is a voluntary association which is formed for a common objective, in which
capital is distributed into various smaller parts which is known as shares (Curran and Jilg, Go
Daddy Operating Company, LLC, 2012). Also, it is established with a limited liability. In
addition to this, it can be said that there is a set procedure of setting up of business organization,
which can be elaborated as:
 Setting up: This is the first step which involves establishing a business corporation. So,
in this regard, in order to set up a business establishment, registration with companies’
house should be done. This phase can also be called as “Incorporation of companies”. For
this, following aspects are required:
 Appropriate name of the company.
 Address for the company to be incorporated.
 Directors and a secretary.
 Approval of shareholders for the purpose of creation of Memorandum and Articles of
Association.
 Name of company: In this step, name of the proposed company is chosen. It is a notable
fact that there are several restrictions which are required to be considered while adaption
of a name. Promoters are required to send 6 chosen names to registrar in accordance with
priority. Also, name should not be similar with any other company already established.
 Address of company: Then, registration office of proposed company is chosen is to be
declared. Registered office of a business institution is a place wherein all
communications in official terms will be communicated.
 Appointment of company secretary and directors is done, so that all legal compliances
can be adhered with.
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 Shares and Shareholders: It can be noted that most of the business organizations which
are of private nature are limited by shares. In other words, it can be said that shareholders
are the owner of company.
 Memorandum and Articles of Association: Afterwards, it can be said that there is a
requirement to prepare MOA and AOA. MOA is a legal document or a fundamental
document of a company which defines powers of a company. On the other hand, AOA is
a statement of written rules and regulations agreed by its stake owners.
 Registration of Company: It can be done in two ways, which can be either online or by
post.
 In the end, company is required to be for the purpose of corporation tax. Each and every
organization is required to pay tax, in accordance with their slab rate.
In this light Susan can be a part owner of the company.
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