Laws and Regulations for Setting up Business
9 Pages2815 Words164 Views
Added on 2020-01-07
Laws and Regulations for Setting up Business
Added on 2020-01-07
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COMPANY LAW
Table of ContentsINTRODUCTION................................................................................................................................3TASK....................................................................................................................................................3CONCLUSION....................................................................................................................................7REFERENCES.....................................................................................................................................8
INTRODUCTIONCorporate structure is that part which states all the functional, legal and regulatory pattern ofa particular corporation. Limited Liability Partnerships are a part of this corporate structures. AsLLPs are incorporated under the law and have separate identity from its members (Hannigan, 2012).In the report role of limited liability partnerships, their structure and functioning methods aredescribed. Along with this the structure of a company and its functional departments are alsodescribed in this study. The aim of the report is to analyses all the features of LLP and theirsignificance in carrying the business and operations. TASKLimited liability is a concept in which the liability of the partners is limited up to the ratio inwhich they have invested the capital. In it the liability of the members is limited by their shares orlimited by guarantee. Thus it is that corporate entity in which the partners of the businesscontributes their capital and then start the business. In it they make a partnership agreements andready to contribute the capital for the business (Ottley, 2013). In the agreement they enter all therelevant clauses and terms and conditions of doing the business. Thus all the works of the businessare completed as per mentioned in the partnership deed. LLP is a separate legal entity and it denotesthat when the company is incorporated then it has the separate legal identity from its owners. Bythis feature the entity can own, sell, purchase the property in its own name and have the authority towork in its name. The basic feature of the LLP is that shareholders of the firm are liable only up tothe limit of the capital they have invested. It clearly means that when the company is in the situationof unsustainable debt and ends up in the hands of their administrators then the personal assets of thepartners is not at risk, as they are not liable to pay the debts from their personal property. Only theircontribution can be used to pay the debts and all outside liabilities. Thus it can be said that the liability minimize the risk of its partners as they invest theirmoney in it and are just liable up to their monetary contribution (Roach, 2014). Generally most ofthe start ups are advised to incorporate the LLP to give their business a corporate form, as it is notmuch expensive and is easy as per the perspective of carrying the business operations. Along withit, Limited liability Partnerships are also not liable to consider the major legal and litigations, tocomply with the provisions of corporate law. As far as the incorporation of the LLP is considered itis to be registered form Companies House. It is advisable for it to take the advise of the corporateprofessionals for incorporating it, as they can better provide the assistance on this matters. ThusLLP is beneficial for carrying the small businesses. Generally the corporate structure consist of basically three major concerns shareholders,
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