Limited Companies - Advantages and disadvantages table in A Level and IB Accounting

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Created by: Laura Evans
Created on: 10-05-13 20:51

Limited Companies

Advantages

Shareholders have a limited liability.
Can raise large amounts of finance from selling shares.
Can have as many shareholders that have invested into the company as they like.
Have a share of ideas and management.
The company will continue after the retirement or death of the owner but they will always be the founder.

Disadvantages

Subject to many legal requirements so there is a lot of paperwork and have to report financial accounts as a legal requirement and share them.
Control over the company can change over time depending on the shares.
It takes time and money to start a limited company.

Evaluation

With starting a limited company it depends on the finances of the business as it takes money to become a limited company. Also it depends on the owner/s as they could lose control of the business.

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