Entrepreneurship Management

ASSIGNMENTS:-
TOPICS :- PARTNERSHIP FIRM , CORPORATIONS, LLP
(LIMITED LIABILITY PARTNERSHIP)
NAME :- GAURAV S. KADAM
ROLL NO:- 8115

TREY 1
research
 Partnership Firm
A partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners
in a partnership may be individuals, businesses, interest-based organizations, schools, governments or combinations.

MERITS :-
1. Easy to Start :-
Partnership firms are one of the easiest to start. The
only requirement for starting a partnership firm in
most cases is a partnership deed. Hence, a partnership
can be started same day
2. Decision Making :-
Decision making is the crux of any organization.
Decision making in a partnership firm could be faster
as there is no concept of the passing of resolutions.  The maximum number of members a partnership firm can
3. Raising of Funds :-
When compared to a proprietorship firm, a
partnership firm can easily raise funds. Multiple
partners make for more feasible contribution among
the partners. Moreover, banks also view a partnership
more favorably while sanctioning credit facilities
instead of a proprietorship firm.
-: LIMITATIONS
1. Unlimited Liability :-
Every partner is liable personally for the losses of a
partnership firm. The liability created by a partner in the
partnership firm will also make each of the
partner personally liable. To limit the liability of partners in a
partnership firm, the LLP structure was created by the
Government.
2. Number of Members :-
have is restricted to 20. In case of an LLP, there is no
restriction on the maximum number of partners.
3. Trust of the General Public :-
A partnership firm is easy to start and does require any
registration. A partnership firm can also operates without
much of a structure or regulations. Hence, it often leads to
distrust amongst the general public.
 Corporations
Corporation is a legal entity that is separate and distinct from its owners. Under the law, corporations possess many of the
same rights and responsibilities as individuals.

MERITS :-
1. Business security and perpetuity :-
Corporation ownership is based on percentage of
stock ownership, which offers much more flexibility
than other entity types in terms of transferring
ownership and perpetuating the business for the long
term.
-: LIMITATIONS
1. Lengthy application process :-
Filing your articles of incorporation with your secretary of
state can be quick, but the overall process of incorporating
is often a long one. You will likely have to go through
extensive paperwork to properly determine and document
the details of the organization and its ownership.

2. Access to capital :- 2. Expensive :-

Since most corporations sell ownership through
publicly traded stock, they can easily raise funds by
selling stock. This access to funding is a luxury that
other entity types don't have.
3. Tax benefits :-
Although some corporations (C corporations) are
subject to double taxation, other corporation
structures (S corporations) have tax benefits,
depending on how their income is distributed.  state can be quick, but the overall process of incorporating
Corporations are expensive to form and operate. It might be
easy for established corporations to raise capital by selling
shares, but forming and maintaining a corporation can be
costly. You will likely need a lot of startup capital to get a
corporation running, in addition to paying the filing charges,
ongoing fees and larger taxes.
3. Lengthy application process :-
Filing your articles of incorporation with your secretary of
is often a long one.
 LLP (limited liability partnership)
A limited liability partnership (LLP) is a partnership in which some or all partners (depending on the jurisdiction) have
limited liabilities. It therefore can exhibit elements of partnerships and corporations. 

MERITS :-
1. No requirement of minimum contribution :-
There is no minimum capital requirement in LLP. An
LLP can be formed with the least possible capital.
Moreover, the contribution of a partner can consist of
tangible, movable or immovable or intangible property
or other benefits to the LLP.
2. No limit on owners of the business :-
An LLP requires a minimum of 2 partners while there is
no limit on the maximum number of partners. This is in
contrast to a private limited company wherein there is
a restriction of not having more than 200 members.
-: LIMITATIONS
1. Higher Income Tax Rate :-
The income tax rate for a company with a turnover of upto
Rs.250 cores is 25%. (Further reduced in 2019 for new
companies involved in manufacturing). However, LLPs are
taxed at a 30% rate irrespective of the turnover.
2. Inability to Have Equity Investment :-
An LLP does not have the concept of equity or
shareholding like a company. Hence, angel investors, HNIs,
venture capital and private equity funds cannot invest in an
LLP as shareholders. Thus, most LLPs would have to rely on
funding from promoters and debt funding.

3. Lower registration cost :- 3. Penalty for Non-Compliance :-

The cost of registering LLP is low as compared to the
cost of incorporating a private limited or a public
limited company. However, the difference in the cost
of registering an LLP vs Private Limited Company has
come down in recent days.
Even if an LLP does not have any activity, it is required to
file an income tax return and MCA annual return each year.
In case an LLP fails to file Form 8 or Form 11 (LLP Annual
Filing), a penalty of Rs.100 per day, per form is applicable. 
ThankYou
EM ASSIGNMENT
ROLL NO:- 8115

TREY 5
research