2. Meaning of company:Meaning of company:
Company is an
incorporated association of
person, whose existence is
separate from its member
and is permanent, whose
liability is limited and who
has a common seal.
3. Characteristics of company:
• Incorporated association
of person.
• Limited liability.
• Company is not a citizen.
• Perpetual succession.
• Common seal.
• Transferability of shares.
• Artificial legal person.
4. tion of company organisatio
ADVANTAGES
•Huge financial
resources
•Division of risk
•Limited liability
•Facility to get loan
•Public confidence
•Share transfer
facility
DISADVANTAGES
•Difficulty in
formation
•Delay in decision
•Lack of secrecy
•Oligarchic
management
•Encouragement to
monopoly
•Lack of motivation
5. Types of companies:
1. ClassifiCation on the Basis of Method of
inCorporation:
iii. Chartered company
ii. Registered companyi. Statutory company
6. 2. ClassifiCation on the Basis of liaBility of
MeMBers:
iii. Company limited by Guarantee
ii. Company with unlimited
liability
i. company with limited share
7. 3. ClassifiCation on the Basis of ownership:
iii. Subsidiary company
ii. Holding companyi. Government company
8. 4. ClassifiCation on the Basis of nationality:
ii. Foreign companyi. Indian company
9. 5. ClassifiCation on the Basis of transferBility of
shares :
ii.Public companyi. Private company
10. Privileges and exemptions
• Minimum number of members
• No restriction on allotment of shares.
• Number of directors
• Qualification of shares
• Commencement of business
• Appointment of directors
• Quorum for meetings
• Loan to directors