A Quick Walk through Public Ltd Companies
There are different types of companies out there. If you are not from the business world, then you might take up any and every company as alike. But the reality is that there are different kinds of companies out there that have their different ways of working.
Even the Public limited company registration process is different from that of other types of companies. If you are planning to start up a business or company; it is better to know about the types of options you have and then make a choice. Certainly, there are different types of companies and amidst them, the most popular are Private Ltd. and Public Ltd. Both private and public limited companies enjoy the sets of perks. If you are an entrepreneur then you have to pick the type based on your funding plans.
What really a public company?
A public company is a company that owns permission to deliver or issue registered securities to the usual public through an initial public offering (IPO) and it is dealt on at least one stock exchange market. A public company will not be authorized to begin its business operations just on the basis of the grant of the certificate of incorporation. So as to be eligible to run as a public company, it must obtain another document known as a trading certificate.
Are there advantages of public Ltd. Company?
There are many advantages and some of these are like:
In order for a company to get public, it has to have a minimum of seven members and as far as maximum is concerned, that can be unlimited.
The liability of a public company is always going to be limited. No shareholder is separately liable for the payment. The public limited company is a distinct legal entity, and every single shareholder is a part of it.
Private limited companies are severely regulated and are needed by law to publish their complete financial statements in an annual manner to ensure the true financial position of the company is made clear to the owners they have (shareholders) and possible investors. It also helps to decide the market value of its shares. But things are different in the realm of public company.
Board of Directors
A public company is always headed by a board of directors. These fellows are elected from amidst the shareholders by the stockholders of the company in annual general meetings. The elected directors work as representatives of the shareholders in taking care of the company and taking decisions. Having a huger board of directors therefore advantages all shareholders in the shape of transparency as well as developing a democratic management procedure.
A public company can raise capital from public by delivering shares through stock markets. These can even raise capital by delivering bonds and debentures that are leaky debts issued to a company on the grounds of financial performance and honesty of the company.
So, you just need to find out the public limited company requirements and if you fulfil them; you can get started with such type of company.