formation of a private limited company
DESCRIPTION
Formation of a Private Limited Company. Objectives. At the end of this lesson, students should be able to…. Complete a Memorandum of association List private limited companies within their locality Talk about Articles of Association and form A1. Robertinos LTD. Wexford transport LTD. - PowerPoint PPT PresentationTRANSCRIPT
Formation of a Private Limited
Company
Objectives At the end of this lesson,
students should be able to…. Complete a Memorandum of
association List private limited companies
within their locality Talk about Articles of Association
and form A1
Robertinos LTD. Wexford transport LTD
Form A1 Includes; Company name,
address, and sectary Details about
directors including their occupations
Signature of each director to show that they will run company properly ( Declaration of Compliance
Memorandum of Association
External Rules of the company
Name of the company Objectives : What the co.
does Statement of Limited Liability Statement of Authorised
Share Capital (Number of shares they can sell)
Signatures of directors Sent to Companies
Registration Office
Articles of Association Internal Rules of co. Name of company Rules for meetings Voting rights of
shareholders Rules for election of
directors Borrowing power of the
company Sent to registrar of
companies
Certificate of Incorporation Birth Certificate of the
company Include company
registration number Means that company is a
separate legal entity Company can sue and be
sued in it’s own name Received from registrar of
companies
Summary of Company DocumentsMemorandu
m of Association
Articles of Association
Form A1
RegistrarOf
Companies
CertificateOf
Incorporation
Recording the Share Capital in the Accounts
Debit Bank A/C
Credit Share Capital A/C
Record €100,000 Share Issuein the Books of First Entry
BANK A/C
Date Details F Total Date Details F Total1/1/08 SHARES GL 100,00
0
SHARE CAPITAL
A/C
Date Details F Total Date Details F Total1/1/08 BANK CB 100,00
0
What is Share Capital? When you need money to start
your company you can sell shares to people.
A shareholder is willing to invest money in the business to obtain part ownership of the business and also to share profits (dividends)
Distinguish between
Authorised Share Capital
Maximum amount of shares you are allowed to issue/sell
Issued Share Capital
Actual amount of shares you have issued/sold
AGM Annual General Meeting. By law every company
should hold one All shareholders must be
invited to attend the meeting.
AGM’s give shareholders an opportunity to hear how company is performing
At this meeting the directors will decide how much of the profits are paid to be shareholders(Dividened)
Recap of Key Terms Mem of Assoc. Articles of Assoc. Cert. of Incorporation Shares Dividends Authorised Share Capital Issued Share Capital
Co-operatives
Forms of Business Ownership
What is a co-operative? A co-operative is a business owned and
run by its members who have a common bond
To become a member a person must buy at least one share
Each member has one vote The profit is distributed among the
members Members have limited liability Co-ops are managed by a management
committee
Formation of Co-ops Seven people are required Apply to the Registrar of Friendly
Societies Certificate of Incorporation is
issued The co-op must report annually to
the Registrar of Friendly Societies
Types of Co-ops Producer Co-ops – mainly agricultural
co-ops. They collect the raw material from the farmers, e.g. milk, process it and sell the finished product, e.g. cheese
Types of Co-ops Retailer Co-ops – these co-ops buy
directly from the manufacturer and sell to members
Types of Co-ops Worker Co-ops – are set up where
businesses close down and the workers decide to pool their money and set up a co-op, e.g. Carrigdhoun Pottery, Greencaps (Dublin Airport)
Types of Co-ops Financial Co-ops, e.g. credit unions –
set up by people sharing a common interest, e.g. live/work in the same area. They encourage saving and provide loans
Advantages of Co-ops Members have limited liability One vote per member The members own the co-op,
which is a big incentive to do business with the co-op
Profits are distributed among the members
Disadvantages of Co-ops Lack of finance No incentive to buy more shares The management committee may
not have the business expertise to run a modern business
Summary What is a co-op? How is a co-op formed? What are the advantages and
disadvantages of a co-op as a form of business ownership?
Outline the different types of co-ops in existence in Ireland