{"id":4416,"date":"2019-02-16T10:51:11","date_gmt":"2019-02-16T05:21:11","guid":{"rendered":"http:\/\/astan.lk\/al_virtualclassroom\/?p=4416"},"modified":"2019-02-16T12:30:16","modified_gmt":"2019-02-16T07:00:16","slug":"incorporated-companies","status":"publish","type":"post","link":"https:\/\/astan.lk\/al_virtualclassroom\/incorporated-companies\/","title":{"rendered":"Incorporated companies"},"content":{"rendered":"

A company is a group of individuals incorporated under the company act.<\/strong>
\n\u00a0Several common characteristics of incoporated companies are given below.<\/em><\/strong>
\n\u2022 An institution incorporated under the company act.
\n\u2022 It is a legal entity separate from its membership.
\n\u2022 There is continuous existence.
\n\u2022 Owners have limited liability
\n\u2022 Management is done by the board of directors
\n\u00a0Several advantages of companies are given below<\/em><\/strong>
\n\u2022 A large amount of capital can be collected
\n\u2022 Large scale businesses can be started
\n\u2022 Business activities can be carried by enrolling skilled managers
\n\u2022 Investors can be recruited because of limited liability.
\n\u2022 Death or resignation of a shareholder will not affect the existence of the business
\n\u2022 Shares are transferrable.
\n\u2022 Human resources at a high level can be recruited
\n\u00a0Several disadvantages of companies are given below<\/strong><\/em>
\n\u2022 Numerous rules and regulations
\n\u2022 Have to follow a complex procedure to start the business and a cost is involved in it.
\n\u2022 Minor shareholders have little power since the voting power depends on the number of
\nshares.
\n\u2022 Taxes should be paid on the profits of the company and also on the dividends received by
\nthe shareholders.
\n.
\n\u00a0Companies should be registered under the company act of the relevant country.<\/strong>
\nCompanies in Sri Lanka should be incorporated under the Company Act No. 7 of 2007<\/strong>
\n51<\/strong>
\nDocuments to be forwarded to the registrar of companies for the incorporation of a<\/em>
\ncompany<\/em>
\n\u2022 Application for registration
\n\u2022 Articles of Association
\n\u2022 Declaration from each of the initial directors giving their consent to act as a director.
\n\u2022 Declaration from the initial secretary to act as the secretary, to the company.<\/p>\n

The following companies can be incorporated according to the Company Act No.7 of 2007<\/strong>
\n\u2022 Limited companies
\n\u2022 Private limited companies
\n\u2022 Public limited companies
\n\u2022 Listed companies
\n\u2022 Non-listed companies
\n\u2022 Off shore companies
\n\u2022 Unlimited companies
\n\u2022 Companies limited by guarantee
\n\u2022 Foreign companies
\nThe following criteria are used to compare the companies<\/em>
\n\u2022 Number of members
\n\u2022 Liability
\n\u2022 Supplying of capital
\n\u2022 Shares
\n\u2022 Debentures
\n\u2022 Management<\/p>\n

Limited companies are companies in which the liability of the shareholders are<\/strong>
\nlimited to the amount of money they paid as agreed to pay, for their shares.` These are also\u00a0<\/strong>known as the companies limited by shares.<\/strong>
\n\u00a0Several characteristics of a private limited company are given below.<\/em>
\n\u2022 Minimum number of members is one and the maximum is fifty. The shareholders
\nemployed in the company are not included in the above maximum number.
\n\u2022 Minimum number of directors is 01 and the maximum is unlimited
\n\u2022 Issuing of shares to the public in not allowed.
\n\u2022 Dividends can be distributed with the consent of all the shareholders without a
\nsolvency test.<\/p>\n","protected":false},"excerpt":{"rendered":"

A company is a group of individuals incorporated under the company act. \u00a0Several common characteristics of incoporated companies are given below. \u2022 An institution incorporated under the company act. \u2022 It is a legal entity separate from its membership. \u2022 There is continuous existence. \u2022 Owners have limited liability \u2022 Management is done by the […]<\/p>\n","protected":false},"author":842,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[10,86],"tags":[],"class_list":["post-4416","post","type-post","status-publish","format-standard","hentry","category-business-studies","category-unit-5"],"acf":[],"yoast_head":"\nIncorporated companies - Learning & Education Portal<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/astan.lk\/al_virtualclassroom\/incorporated-companies\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Incorporated companies - 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