Module 1 PARTNERSHIP: FORMATION, OPERATION,

AND CHANGES IN MEMBERSHIP MODULE 2 PARTNERSHIP OPERATION

 Partnership  Partnership law
 A person  In case of profit or loss
 Common features of partnership  Formula of ff. features technique
 Requirements for partnership  Equally, arbitrary, ratio of partnership
 Content articles of partnership capital acc.
 Partnership pros and cons  Original capital
 Partnership form org.: income tax reporting  Average capital partnership agreement
 Non-taxability of gpps  Approach average capital balance (simple
 Provisions on the civil code for law on partnership average and weighted average)
 Regulation:article 1767-1867 of the civil code  Interest on capital balances
 Type of partnership  Interest on capital acc. With resultant net
 Nature contribution loss
 Capitalist partner  Personal services rendered in net income
 Industrial partner and loss sharing agreement
 Capital-industrial partner  Salary allowances
 Liabilities to third person  Salary allowances with resultant net loss
 General partner  Bonuses
 Limited partner  Basis of computation for bonus
 Types of partner interest in or obligations to  Bonus with resultant net loss
business (managing, secret, silent, dormant,  Special problems in allocation of profit and
ostensible) loss-salaries and interest as an expense
 Types of partnership as liability of partners  Correction of partnership net income of
 Limited partnership prior period
 General partnership  Subsequent changes in methods to allocate
 Types of partnership as to object net income or loss
 Universal partnership of all present property
 Universal partnership of profits
 Particular partnership
 Types of partnership as duration
 Partnership at will
 Partnership with a fixed term
 Types of partnership as purpose
 Commercial or trading partnership
 Professional partnership
 Recording capital contribution
 Cash investment
 Non-ash investment
 Liabilities
 Admission of an industrial partner
 Partners account
 Each partner can have: (capital account, drawing
account, loan account)
 Numerous ways to form a partnership
 Valuation problem
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MODULE 3 PARTNERSHIP DISSOLUTION
 Partnership dissolution
 Partners cspital interest
 Partners interest in p/l
 Partnership liquidation
 Partner dissolution comes in many
forms:
 Civil code a partnership is dissolved
through:
 Assignment of an interest does not
dissolve partnership
 Basis of partnership
 Partnership commonly deviate in gaap
through the following:
 Revaluation approach
 Bonus approach
 Admission of new partner
 Before dissolving the partnership
 Admission by purchase of interest
 Total agreed captl=book value of
MODULE 3 RETIREMENT/WITHDRAWAL OF
PARTNERSHIP AND INCORPORATION OF
PARTNERSHIP
 Before acctg. For partnership
withdrawal or retirement, some
considerations shall include:
 Death of partner
 Incorporation of partnership
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MODULE 3 PARTNERSHIP DISSOLUTION:
CHANGES IN OWNERSHIP
 Admission by investment
 No bonus or revaluation (goodwill)
 Bonus (absence of revaluation)
approach
previous partnership less any write down or
impairment
 Revaluation (goodwill)approach
Total agreed captl=book value of
previous partnership plus unrecognized
appreciation/less unrecognized dept
traceable to prev. partnership plus
 2 step in the process of analyzing
admission by investment