this is a presentation on the legal forms of ownership, which discusses the characteristics, advantages and disadvantages of each form of ownership

1. Forms of Business
Organizations
grade 10

2. acknowledgements
This presentation has been designed by N L
Kekana with the use of some sources found
in the last slide of this presentation.

3. My business or our
business.????

4. Different

5. SoleTraders
• The most common form
of business
organisation.
• Owned and operated by
one person
• Very few legal
requirements for setting
it up.

6. Advantages
• Easiest and least expensive
form of ownership to organize.
• Sole proprietors are in
complete control, and within
the parameters of the law, may
make decisions as they see fit
• Sole proprietors receive all income
generated by the business to keep
or reinvest.
• Profits from the business flow
directly to the owner's personal
tax return.
• The business is easy to dissolve, if
desired.

7. disadvantages
• Sole proprietors have unlimited
liability and are legally responsible
for all debts against the business.
Their business and personal assets
are at risk.
• May be at a disadvantage in
raising funds and are often limited
to using funds from personal
savings or consumer loans.
• May have a hard time attracting
high-caliber employees or those
that are motivated by the
opportunity to own a part of the
business.
• Some employee benefits such as
owner's medical insurance
premiums are not directly
deductible from business income
(only partially deductible as an
adjustment to income).

8. Partnership
What is partnership?
Partnership is a type of business where 2 or more
people agree to own, run and trade. Partnerships
require a high degree of trust and are very
common in fields such as medicine.

9. Partnership
When setting up a business a person has to decide
whether to set up a business on their own or with
others.
This will depend on:
• how much control they want over the business
• are they prepared to share the profit
• can they raise necessary capital to start up the
business by themselves

10. Partnership
• There is also a risk factor. Is this person prepared
to accept the risk of unlimited ability?

11. Partnership
The advantages of partnership are:
• easy to set up
• solicitors and accountants are not required to run the
business
• profits belong to the partners
• privacy. Only tax authorities need to be told how
much partners are earning and profit of the business

12. Partnership
• often good relations between partners
• raising capital for the business is easier than that of sole
proprietor
• different expertise for partners e.g. 1 specialises in
accountancy whilst the other in marketing
Some businesses have sleeping/silent partners. They play
a little role in running day to day basis of a business but
they provide the capital for the business.

13. Partnership
The disadvantages of partnership:
• Disagreements between partners, which can be
bad for business
• some partnerships don’t have a deed of
partnership, which can be bad for business
• most partnerships are relatively small businesses
e.g. Shops, farms

14. Partnership
Definitions:
• Ordinary Partnerships - there can be between 2 and
20 partners
• Deed of Partnership - is the legal contract, which sets
out following:
• who the partners are
• capital brought into business by each partner
• how profits should be shared

15. Partnership
• how many votes each partner has in any partnership
meeting
• what happens if there is a withdrawal of a partner
from the business

16. What Is a Corporation?
There are three types of
corporations:
•C-corporation
•Subchapter S corporation
•nonprofit corporation
corporation
a business that is registered by a
state and operates apart from its
owners; it issues shares of stock and
lives on after the owners have sold
their interest or passed away

17. In a corporation, the owners of the business are
protected from liability for the actions of the
company.
The Main Idea

18. C-Corporation
In smaller corporations,
the founders generally
are the major
shareholders.
shareholders
the owners of a corporation

19. TWOTYPES OF CORPORATIONS
1. PRIVATE COMPANY
• Closely held by a few people
• Minimum 2 and maximum 50
shareholders

20. partnership
• Stocks cannot be traded on exchanges and private
equity cannot be raised
• Less regulations as compared to Public Companies

21. 2. PUBLIC COMPANY
•Stocks are held by a
large number of people
•Minimum 7
shareholders and no
limit for maximum

22. Public company
• Can be listed on stock exchange and can go public
• Have to follow many laws with regards to the board
composition and AGM.

23. List of references
• JohnV.
Padua,http://www.slideshare.net/johnpadua/forms-of-
small-business-ownership
• legal6 , http://www.slideshare.net/legal6/the-legal-
forms-of-business-presentation-872138
• aureen-masuku , http://www.slideshare.net/aureen-
masuku/business-forms-15102218