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Com Sec Exam Essay

2846 words - 12 pages

|Q1a) |Advantages / Disadvantages of Sole Trader, Partnership, Limited Company |
| | |
|Ans.: | |

|Advantages Partnership or sole proprietorship |Disadvantages of Limited Company |
|A company has to be formed and registered pursuant to the |A company has to be formed and registered pursuant to the |
|provisions of the Companies Ordinance (Cap32), ...view middle of the document...

|
|companies have to be filed with the Companies Registry and are | |
|open to public inspection. | |

|Advantages of Limited Company |Disadvantages of Partnership or sole proprietorship |
|A registered company is separate legal entity. The company is |Every partner is jointly and severally liable with the other |
|itself responsible for its debts. |partners for the firms’s debts and obligations incurred while |
| |he/she is a partner; similarly, a sole trader is responsible |
| |for his/her own debts. |
|The existence of a registered company is not affected by the |The existence of a partnership is affected by the death, |
|death, bankruptcy, mental disorder or retirement of any of its |bankruptcy, mental disorder or retirement of any if its |
|members. |partners. The partnership may be dissolved under such |
| |circumstances. |
|The liability of a member of a company limited by shares is | |
|limited to the nominal amount unpaid on his/her shares. | |
|A registered company may create a floating charge as a security|A sole trader or a partnership cannot create a floating charge |
|for a loan. |as a security for a loan. |

|Q1b). |Meaning of limited liability |
| | |
|Ans.: |The liability of members /shareholders of the company is limited to the amount (if any) unpaid on their |
| |shares. |
| | |

|Q1c). |Requirement of a proposed name of a company. |
| | |
|Ans.: |Every company name must be incorporate with a name, either in English or...

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