The Business Framework

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What is a stakeholder and give examples of internal and external stakeholders:
A stakeholder is a person or organisation that has an interest in the business. Internal stakeholders include employees, managers and owners/shareholders. External stakeholders are customers, pressure groups, the government, suppliers.
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What is the private sector?
The part of business activity owned by private individuals. Sole traders, partnerships, private and public limited companies.
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What is the public sector?
The public sector is the part of business activity that is controlled by local and central government. They are businesses such as the NHS, education, fire service, police, the post office.
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What does incorporated mean?
A business organisation which has a separate legal entity. It has limited liability and is owned by shareholders. If the business is involved in any legal action the shareholders are unaffected.
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What does unincorporated mean?
A type of business organisation which has unlimited liability. Incorporation is a lengthy legal process of becoming an limited liability company.
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What is Unlimited liability?
The owners of the business are liable for its debts.
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What is Limited liability?
The owner of the business doesnt risk losing personal possessions in order to pay off the debts of the business - not liable for the debts in the business.
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What is insolvency?
A limited liability company is considered insolvent when the value of their liabilities is greater than their assets. (Debt is larger than the value of machinery, equipment, possessions etc.)
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What is a registrar of companies?
A person responsible for maintaining records relating to the activities of private and public limited companies.
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What is a certificate of incorporation?
It is a legal document issued by the Registrar of companies that allows businesses to trade as a limited liability company.
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What is a sole trader?
A sole trader is one person who owns the business - sole proprietor. (unincorporated)
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What is a partnership?
A form of unincorporated business organisation that is owned by 2-20 people. Specialization, deed of partnership, silent or sleeping partners.
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What is a deed of partnership?
A deed of partnership is a legal agreement drawn up between the partners of the business stating the responsibilities of partners, how the business will be operated and what is to happen if there is lack of continuity. No conflicts :)
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What is a sleeping partner?
A sleeping or silent partner is a person who has invested capital into a business but who does not take an active part in running the business.
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Other cards in this set

Card 2

Front

The part of business activity owned by private individuals. Sole traders, partnerships, private and public limited companies.

Back

What is the private sector?

Card 3

Front

The public sector is the part of business activity that is controlled by local and central government. They are businesses such as the NHS, education, fire service, police, the post office.

Back

Preview of the back of card 3

Card 4

Front

A business organisation which has a separate legal entity. It has limited liability and is owned by shareholders. If the business is involved in any legal action the shareholders are unaffected.

Back

Preview of the back of card 4

Card 5

Front

A type of business organisation which has unlimited liability. Incorporation is a lengthy legal process of becoming an limited liability company.

Back

Preview of the back of card 5
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