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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF SOLE TRADING CONCERN?
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Meaning: Sole trading concern is the oldest form of commercial organisation. Sole means one person, so a sole trading concern is an organization where all the business activities are controlled and managed by one man. And he is also solely responsible for the all the debts and risk of the firm. Definition: A sole trader is a person who trades on his own account rather than in partnership or as a member of a company. Defined by (Michael Greener) The following are some of the features of a sole trading concern.
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Single ownership Unlimited liability Limited government control Business secrecy Flexibility No sharing of profit and losses Absence of Legal status
THE ABOVE IMPORTANT FEATURES ARE EXPLAINED BRIEFLY DETAIL IN UNDER
1. Single ownership: The sole trader is a single owner of the organization. The sole trader owns all the assets and property of the business. The sole trading concern is often referred (said) as one man show 2. Unlimited liability: The liability of the sole trader is unlimited. This means he is alone responsible for all the risks and debts of the firm. 3. Minimum government control: Sole trading concern is less affected by government control. This is because, there are almost no legal formalities are required to start or close down a business.
4. Business secrecy: The sole trader can maintain complete business secrecy. He needs not to publish any accounts and reports to any body. Competitors cannot easily get business secrets and information of the sole traders activities.
5. Flexibility: Sole trader enjoys maximum flexibility. He can take right decision at the right time depending upon the situation. At any time, he need not have to consult with anyone because he is a single owner of his business. 6. No sharing of profit and losses: There is a direct relationship between efforts and rewards. This results in best possible efforts on the part of sole trader. Therefore, he can enjoy all the profits of his business. 7. Absence of Legal status: - Legally, the sole trader and his business concern are one and the same in the eyes of law. The sole trader and his business cannot be separated from each other. So the sole trader lacks legal status.
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FEATURES OF JOINT HINDU FAMILY BUSINESS?
Meaning: -The joint Hindu family business firm is a distinct form of business organization existing only in India. It comes into existence by the operation of Hindu law, via Hindu Succession Act, 1956. The business of joint Hindu family is controlled and managed by the eldest male member of the family who is known as Karta and other members of the family are called as co-parcener. Following is the features of Joint Hindu Family business 1. 2. 3. 4. 5. 6. 7. Joint ownership Limited liability of co-parceners Unlimited liability of karta Minimum government control Business secrecy Flexibility Quick Decision Making
The above Import features are briefly explained as under. 1. Joint Ownership: - The business is jointly owned by all the members of a joint Hindu family. Three successive generations inherit the business by reason of their birth in the family. 2. Limited Liability of Co-parceners: - The joint owners i.e. the co-parceners liability is limited to the extent of their share in the family business. 3. Unlimited Liability of Karta: -The liability of the karta is Unlimited. This is because, He is total authority to take decisions. He is the leader or head of the joint Hindu family. (OMTEX CLASSES) He is liable to pay the dues out of his personal assets, so, the Liability of the karta is unlimited. 4. Minimum Government Control: - This type of business is subject to less government control. This is because there is less legal formalities are required .Hence; the karta can start a new business or close down the existing one without much legal formalities. 5. Business Secrecy: - There is a great deal of business secrecy. This is because the joint Hindu family business need not have to publish accounts and other data to any outside persons. 6. Flexibility: - This type of business offers a good deal of flexibility in business operations. The karta can expand the business, change the line of the business, or even close down the business if the situation so demand. 7. Quick Decision Making: - -In this type of business, there can be quick decision making. This is because the karta can take quick decisions with or without consultation with the co-parceners. 8. Absence of Legal Status: -The joint Hindu family business does not have any legal status. The members of the joint Hindu family are also not treated as separate entities. The business activities of this organisation are monitored by the Hindu Law, 1956.
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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF PARTNERSHIP FIRM?
Meaning: - Partnership firm is a voluntary association of two or more who contribute their capital and services, and share the profits and losses in an agreed proportion. Definition: - Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. (Section 4 of the Indian Partnership Act, 1932.) Following is the features of Partnership firm
1. 2. 3. 4. 5. 6. 7.
Joint ownership Agreement Lawful business Unlimited liability Business secrecy Sharing of profit and losses Number of partners
The above Import features are briefly explained as under 1. Joint Ownership: The partnership firm is jointly owned by the partners. The partners have to use the partnership property only for business purpose and not for personal purpose.
2. Agreement: - Partnership is an outcome of an agreement between two or more persons to conduct a business with a view to earn profit. The agreement may be oral or written. It is always advisable to have written agreement.
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3. Lawful business: - The partnership firm must undertake only that business is which permitted by law. They must conduct lawful business only and they cannot undertake unlawful business .for ex, sale of illegal arms. Or indulge in smuggling business. 4. Unlimited Liability: -The liability of each partner is joint several and unlimited as per the Indian partnership Act 1932. all the partners is jointly liable along with other partner for the debt of the firm 5. Business Secrecy: -unlike sole trading concern, a partnership firm lacks complete business secrecy. This is because there are several partners and some partners may leak out the business information to outsiders. 6. Sharing of Profit and Losses: - The partners agree to share the profits among themselves in a certain proportion. The agreed proportion depends upon the amounts of capital contributed. 7. Number of Partners: - A partnership must have a Minimum of two Persons. The maximum persons in the case of banking business is Ten and in the case of ordinary partnership (other than banking business), the Maximum number of partner is Twenty.
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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF JOINT STOCK COMPANY?
Meaning: -A Joint stock is an incorporated association, which is an artificial person, having independent legal status with a perpetual succession, a common seal, a common capital of transferable shares carrying limited capital. In other words, Joint Stock Company is a business organization organized and owned by shareholders but managed by directors. But the directors must have to purchase the Qualification shares with in two months form the date of his admission. Definition: - PROF. (H.L.Haney) A joint stock company is a voluntary association of individual for profit, having its capital divided into transferable shares, the ownership of which is the condition of membership. Following is the features of Joint Stock Company 1) Artificial person 2) Incorporated association 3) Perpetual succession 4) Common seal 5) Limited liability 6) Large membership 7) Voluntary Association
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The above important features are explained briefly as under: 1. Artificial Person: - A company is an artificial person created by a law, it has non-physical existence, but it has legal existence. Like human being, it can acquire property, enter into a contract, and sign documents, take legal action, etc, 2. Incorporated Association: - Every company in India has to be registered under the Indian companies Act, 1956. Registration or incorporation gives birth to a company. On registration, it gets a separate identity. 3. Perpetual Succession: A company has a perpetual succession. It means that the company has a long and stable life. Its existence is not affected by death, insolvency or insanity of its members. 4. Common Seal: - A company is an artificial person, and as such, it has to sign documents and other papers. However, it cannot sign as a human being and, therefore, the common seal serves as its signature. The common seal remain in the custody of the Board of Directors 5. Limited Liability: -The liability of the members of the joint stock company is limited to the extent of the Shares Purchased by them. If the shares are fully paid, the member is not liable for any debts of the company. 6. Large Membership: - A joint stock company enjoys large membership. This is because, in a private company, the minimum members are two maximum members can be fifty. In a Public company, the minimum members are Seven and there is no Maximum limit.
7. Voluntary Association: - A company is a voluntary association of persons. Any person competent
to enter into a contract can become its member. To be a member, a person should buy or own the shares of the company. A person can terminate is membership form the company by transferring his
shares.
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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF CO-OPERATIVE SOCIETY?
Meaning: -A Co-operative society is a voluntary association of people who come together on the basis of unity and equality to protect and promote their common economic interest.
Definition: -It is an association of the weak who gather together for a common economic need and try to lift themselves from weaknesses into strength through business organization [Talmaki]
Following is the features of co-operatives: (OMTEX CLASSES)
1. Service motive 2. Limited Liability 3. Stability: 4. Voluntary associations 5. Equal voting rights 6. Open Membership 7. Lack of Secrecy
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Service motive: The main aim of a co-operative society organization is to render service to the people. It is a service-oriented organization. It is mainly formed for promotion of welfare of the society.
2. Limited Liability: In a co-operative society, the liability of each member is limited. The liability of the member is limited to the face value of shares purchased by them.
3. Stability: The co-operative society enjoys a stable life. There is continued existence. The society survives even if some members resign or leave the society. Because it is a corporate (public) body. 4. Voluntary associations: co-operative society is a voluntary association of people who come together on the basis of unity and equality to protect and promote their common economic interest. The individual joins the cooperative society on his free will.
5. Equal voting rights: - All members are treated equal. Equal voting rights are given to all. Every members has one voting rights only, as the society follows the principal of one man one vote. Voting by proxy is not allowed.
6. Open Membership: - Normally, membership is open to all those who are willing to join the cooperative. There is no restriction of caste, creed, race, religion, etc. At Least 10 Members are required to form a Co-operative Society. 7. Lack of Secrecy: - The co-operative Lacks secrecy. This is because, the account are made available to the members and others. It is difficult to maintain business secrecy in a cooperative organization.
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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/CHARACTERISTICS/FEATURES OF MANAGEMENT.
Meaning: -The verb manage has been derived from the Latin word Manus which means hands. In general to manage would mean to handle some work or activities. The survival and success of an organisation largely depends upon the quality of management. Some organisation prospers and progress not only in good times but also during tough times, but others fails even during good times. Therefore, it is vital for every organisation to have dynamic and dedicated managers. Definition: - (write any one or two definition as per your convenience)
To manage is to forecast to plan, to organise, to command, to coordinate and to control. (Henri Fayol)
Management is art of getting things done through and with people in formally organised groups. (Harold Koontz)
Following are the some of the important features/characteristics of MANAGEMENT 1. Management is a process: - Every business organisation strives to achieve its targets. After successfully achieving one target it moves ahead to take another challenge. It can be observed that the activities of an organisation are continues in nature. As long as an organisation shall continue to grow, there shall be to need to manage its activities. 2. Management is a Group Activity: - Management is getting things done through others. Management emphasizes on the need of team work. The manager should create a feeling of belonging among the members of the group. 3. Involves Getting Things done through people: -Management involves getting things done through the people in the organisation. To get the work done, managers need to: a. Lead the subordinates b. Communicate effectively, and c. Motivate the subordinates 4. Result Oriented: - Management places emphasis on results. The activities of the managers are focused on the attainment of goals or results. It is not just activities that matters but better results. The results can be in the form of:
A. Reduction in wastages B. Optimum use of resources C. Motivated workforce D. Higher efficiency, etc.
5. An art as well as a Science: -There is a considerable debate as to whether management is an art or science. In practice, managing is an art. However, a manager can work better by using the organised knowledge (Science). Therefore, management has characterised of both art as well as science. 6. Follows established Principles: - Management follow well established principles in managing their organisation. The principles includes
A. Division of work B. Authority-responsibility balance C. Discipline D. Unity of Command, etc.
7. Need not be ownership: - In Large organisations, management and ownership need not be one and the same. The owners, i.e. shareholders can hire the service of professional managers.
8. Dynamic in nature: -Management need to be creative and innovative. The success and survival of the organisation largely depends upon innovation. Managers must come up with: A. New and Creative Ideas B. New and better products C. Cost-effective processes, etc.
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NATURE/CHARACTERISTICS/FEATURE OF EVENT MANAGEMENT
Meaning: - Events play an important role in our society. Any happening or an activity can be referred as an event. Examples of event can include: Celebration of a festival or any other celebration. A football match between two clubs or countries. A launching of a new product. Farewell party to students, etc. Definition: -Dr. J. Gold blatt defines special Event as A unique moment in time celebrated with ceremony and ritual to satisfy specific needs. The Following are the characteristic of Event Management: 1. Creative Process: -Event Management is a creative process. The event management team must be creative or dynamic. It must come up with new ideas to manage and deal with the event. Creative ideas will enable the success of the event. 2. Objective Oriented: - Event Management focuses on objectives. Every event has certain goals or objectives to be achieved. Therefore, all the activities will be directed to achieve the objectives. Unwanted activities or unnecessary formalities may be done away with. 3. Requires effective Leadership: - Event Management requires effective leadership on the part of event managers. The Event Managers have to influence and motivate the employees in order to undertake the event successfully. Therefore, there is a need to have effective leadership skills on the part of Event Managers to manage the event successfully.
4. Requires effective Promotion: - Event Management requires effective promotion. The event promotion involves: Publicity of the event. Advertising of the event. Maintaining good public relations Omtex
5. Planning and Control: -The event management team has to plan and control the activities relating to the event, the planning and controlling activities involve: Developing a mission statement for the event. Establishing the objectives of the event. Preparation of event proposal. Evaluating the performance of the event. Taking Corrective measures for the future event 6. Deals with different event: - To manage event successfully, there is a need for professionalism on the part of event management. Professionalism involves: Mega-event such as Olympics or World-Cup Football. Local events such as Carnival in Goa or Boat-race in Kerala. Organisational events such as launch of a new product. Etc. 7. Requires Professionalism: -To manage an event successfully, ther is a need for professionalism on the part of event management. Professionalism involves:
Systematic planning and control of activities Proper training of manpower Proper compensation to the employees.
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NATURE/CHARACTERISTICS/FEATURE OF PROFESSIONAL MANAGEMENT
Meaning: - Professional management refers to the professional approach in managing the organisations. Professional management is vital in todays competitive business world. The importance of professional management is explained as follows
Following are the important characteristics of professional management:
1. Formal Education: - professional managers are formally educated and trained to run the business organisation. They place great emphasis on training and development of managers. Most of the professional managers have either degree or diploma in management.
2. Merit the basis of promotion: - professionally managed companies follow merit as the basis of promotion at higher levels. Family neither ties, nor biased as the basis of promotions is normally not followed in such organisations. 3. Delegation of authority: - The senior managers delegate authority to the subordinate managers. Routine and repetitive activities are given in the charge of subordinates. Only important and crucial matters are decided by the superiors.
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4. Social responsibility: - professional managers give the due consideration to the concept of social responsibility. In fact, they try to bring reconciliation or a balance between profit motive and social responsibility. They go for consumer oriented products. They try to improve the quality through research and development, and so on. 5. Employees Participation: - The top management not only secures the active participation of subordinate managers in planning and controlling activities, but they also encourage initiative and innovative ideas from the employees. Valuable suggestions are implemented and those who provide ideas are often rewarded.
6. Automation and Modernisation: - professional managers advocate the need for automation and modernisation. They recognise the change brought in by changing situations, and are ready to accept that change. They also encourage their subordinates to willingly accept the automation and modernisation plans of the organisation. 7. Decentralisation: - professional management believes in balance between centralisation and decentralisation. Important matters are centralised, and other matters are decentralised. The top management believes that involvement of lower level managers is vital to the success of the organisation.
8. Style of leadership: - professional managers follow the situational style in managing their business activities. They are more of democrats rather than autocrats.
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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/CHARACTERISTICS/FEATURE OF DISASTER MANAGEMENT
Meaning: -According to Oxford Dictionary a crisis is a decisive moment-a time of great difficulty, a
disaster, or a catastrophe. It is a turning point that changes the destiny of an individual or a group or a company or a government. Therefore, the term Crisis and Disaster are used as synonymous. However, usually crisis is considered as made and a disaster as a natural calamity. World book, 2001, Chicago has defined disaster as a sudden extremely unfortunate event that affects many people. It includes natural occurrences such as earthquake, volcanic eruptions, floods, famine and so on. It also includes man made calamities such as bomb blasts, accidents, looting and rioting during communal riots, etc.
The following are some of the important features of disaster management: 1. Disaster Management Teams: - World wide, governments, business and non-business organisation are setting up disaster or crisis management teams in order to manage the disaster. The disaster management teams are broadly divided into three parts namely (1) The Policy Team (2) The management Team (3) The Liaison Team.
2. Systematic Planning: - Disaster management involves systematic planning to avert a disaster, and if it occurs, then systematic planning is required in order to overcome the crisis arising out of disaster, Disaster planning indicates, what to do, when to do, how to do and who is to do certain activities to manage and overcome the problems of disaster. 3. Organising of Resources: - Disaster Management requires proper organising of resources such as manpower, materials, funds, etc., in order to deal with the calamity. Proper organizing of resources will help the disaster management personnel to overcome the problems caused by the calamity or disaster.
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4. Training to Manpower: -To manage a disaster effectively, there is a need to provide proper training to the disaster management personnel. The training will help to develop and improve Disaster Management skills in the personnel. Training may help to avert a disaster effectively. 5. Suitability: - Disaster Management is required before and after a disaster. It is suitable before a disaster in order to avert a disaster, or to caution the people and to take proper appropriate measures before the disaster strikes. Disaster Management is also very much required after a disaster takes place in order to undertake rescue, relief and rehabilitation measures at the time of floods, earthquakes. 6. Stability: -Normally, disaster management teams lack stability. They are formed just prior to a disaster in order to avert it, whenever possible. However, in advanced countries such as in USA, UK, Japan, etc., some organisations form more or less permanent Disaster Management teams. 7. Organisation Structure: -Robert F. Littlejohn in his paper on Crisis Management suggested a matrix organisation structure to deal with disaster or crisis in the organisation or in the city or country. The disaster management team is to be headed by a crisis manager.
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FEATURES/CHARACTERISTICS/NATURE OF TOTAL QUALITY MANAGEMENT
Meaning: -The concept of TQM was developed by Dr.W.E. Deming (regarded as the father of TQM) in 1960s in Japan. TQM is strategic approach that focuses on production of best possible product or services through constant innovation and timely action. It places emphasis on prevention of errors rather than on rectification. Definition: - TQM is a management approach that places emphasis on continuous improvement in quality, in the interest of the organisation and that of its customers. (Prof. K.K Choudari) THE FOLLOWING ARE SOME OF THE FEATURES OF TQM 1. Customer Focus: - - TQM Palaces emphasis in meeting the requirement of both the internal as well as the external customer. In order to meet the requirements for the external customer, it is necessary to meet the needs of the internal customer. The initial focus should be on meeting needs of internal customer before an attempt is made to meet the requirements of the external customers. 2. Continuous Process: - TQM is a continuous process. Constant and continuous efforts are made to improve the quality, and to reduce internal costs. Quality improvement helps the organisation to face the challenges of the competitors and to meet the requirements of the customers. TQM is a process which goes on forever, because at no time the quality can be 100% right. There is always a possibility for new and better way of doing things. 3. Defect-free Approach: - TQM place emphasis on the defect-free work most of the time. The defect free approach is phrased in various ways as right first time, working smarter or zero defects.
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4. Employees Involvement: - in TQM everyone is involved in the process from the management director to the junior clerk or worker in the organisation. It is not just manufacturing people, but also the accounting, finance, marketing, and even the canteen people are involved in the TQM process. 5. Recognition and Rewards: - Recognition and rewards is an integral part of companys TQM Programme. Positive reinforcement through recognition and reward is essential to maintain achievement and continuous improvement in quality.
6. Synergy in Team Work: -The Japanese are great believers in synergy (to work together). Engineers, technicians, and workers look upon themselves as equals and communicate easily as they work side by side. They create what professor Okuda has called a synergetic Partnership.
7. Techniques: - TQM can take place by following various techniques such as quality circle, value engineering, statistical process control, etc. Through such techniques it is possible to improve systems and procedures. 8. System Approach: - TQM is a system approach to managing the business and improving the performance. Without the total commitment on the part of chief executive officer and his senior executives, TQM cannot take off to a good start.
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FEATURES OF MULTINATIONAL COMPANIES/CORPORATIONS (MNC) Meaning: - The term Multinational is widely used all over the world to denote large companies having vast financial, managerial and marketing resources. MNCs are like holding companies having its head office in one country and business activities spread within the country of origin and other countries. IBM computer and Pepsi-Cola from U.S.A., Siemens from Germany, Sony and Honda from Japan Philips from Holland etc., are some of the MNCs operating at international levels. Definition:-According to ILO report (i.e. International Labour Organisation) The essential nature of the multinational enterprises lies in the fact that its managerial headquarters are located in one country, while the enterprise carries out operations in number of other countries. Following are the some of the important features/characteristics of MNCs:
1. Area of operation: - The MNCs operate in many countries with multiple products on large scale. A MNC may operate both manufacturing and marketing activities in a number of countries. Some MNCs operate in several countries, whereas, others may operate in a few countries. Mostly MNCs from developed countries dominate in the world markets. 2. Origin:-The development of MNCs dates back to several centuries, but their real growth started after the Second World War Majority of the MNCs are from developed countries like U.S.A, Japan, UK, Germany and European countries. In recent years MNCs from countries like Korea, Taiwan, India, China, etc. are operating in the world markets.
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3. Comprehensive Term: - In general, the term MNC is a Comprehensive term and includes international and transnational corporations. The term global corporation is also included in the list of MNC.
4. Profit Motive: - MNCs are profit oriented rather than social oriented. Such corporations do not take much interest in the social welfare activities of the host country.
5. Management: - The Parent company works like a holding company. The subsidiary companies are to operate under control and guidance of parent company. The subsidiaries functions as per the policies and directions of parent organisation.
6. Manufacture and Marketing Activities: - MNCs undertake both Manufacturing and Marketing Activities and they are predominantly engaged in hi-tech and consumer good industries. Majority of the MNCs are engaged in pharmaceutical, petrochemicals, engineering, consumer goods, etc.
7. Quality Consciousness: - MNCs are quality and cost conscious and managed by professionals and experts. They have their own organisation culture and systems. MNCs believe in the concept of total quality management.
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NATURE/CHARACTERISTICS/FEATURES OF NEW INDUSTRIAL POLICY 1991
Meaning: -The Government of India announced the new industrial policy (NIP) on 24th July, 1991. The NIP aims at liberalisation of Indian industry. The main objectives of the NIP are: 1. 2. 3. 4. 5. 6. Attainment of international competitiveness. Development of backward areas. Encouraging competition within Indian industry. Efficient use of productive resources. Full utilisation of plant capacities to generate employment. Revival of weak units, etc. Following are some of the main features of the industrial policy 1991 1. Dereservation of Public Sector: -The role of public sector has been reduced to a great extent. The number of industries reserved for public sector was reduced to 8 industries. There was further Dereservation. At present, there are only three industries reserved for public sector which include. (a) Atomic energy (b) Railways, and (c) specified Minerals.
2. Delicensing: -The most important features of NIP, 1991 was the abolition of industrial licensing of all industries except six industries. The six industries are of social and strategic concern. The six industries are
1. Hazardous Chemicals. 2. Alcohol 3. Cigarettes 4. Industrial Explosives 5. Defence Products, and 6. Drug and pharmaceuticals. 3. Disinvestment of public sector: -The NIP 1991 permitted disinvestment of public sector units. Disinvestment is a process of selling government equity in PSUs in favour of private parties. Disinvestments aim at certain objectives. (1) To provide better customer Service. (2) To make effective use of disinvestment funds. (3) To overcome the problem of political interference. (4) To enables the government to concentrate on social development. Etc, 4. Liberalisation of Foreign Investment: -Prior to this policy, it was necessary to obtain approval from the government in respect of foreign investment. At present, 100% foreign equity participation is allowed in select industries.
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5. Liberalisation Foreign Technology: -The NIP 1991 liberalised foreign technology to bring about technological improvement in Indian industry. (1) No Permission is required for hiring foreign technicians and foreign testing of indigenously developed technologies. 6. Liberalisation of Industrial Location: -The IP 1991 stated that there is no need to obtain approval from Central Government to locate industries in areas (other than cities of more than one million populations). However, industries subject to compulsory licensing, approval need to be obtained. In cities with a population of more than one million, polluting industries were required to be located outside 25 Kms of the city area. 7. Removal of Mandatory Conversion Clause (MCC): - In India, banks and FIs provide a large part of industrial finance. The banks and FIs have the option to convert the loans into equity. This may create a threat of takeover by FIs. Therefore, the IP 1991 abolished MCC. 8. Abolition of phased Manufacturing Programme: - The IP 1991 has suggested for the abolition of PMP, which was in force in engineering and electronic industries. 14 Achieve success through
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OBJECTIVES/FEATURES OF WORLD TRADE ORGANISATION
Meaning: -The World Trade Organisation came into existence with effect from 1-1-1995. The WTO replaced General Agreement on Tariffs and Trade (GATT). The main objective of WTO is to increase world trade and thereby employment. In 1947, 23 countries including India signed the General Agreement on Tariffs and Trade (GATT). GATT was created to reduce the tariff barriers. GATT has been replaced by WTO in 1995. WTO is wider in scope. It is concerned with not only reducing or eliminating tariff barriers but also non-tariff barriers such as quotas. In April 2004, the membership of WTO was 147 countries including India. The Main Objectives of the WTO are as follows:
1. Trade without Discrimination: -Trade without Discrimination through the application of most favoured nation (MFN) principle. As per MFN clause, a member nation of WTO must accord the same preferential treatment (in case of tariff reduction or concession) to other member nations which it gives to any other member nation.
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2. Settlement of Disputes: - Settlement of Disputes among members through consultation, conciliation, and as a last resort through dispute settlement procedure.
3. Raising Standard of living: - Raising standard of living and incomes and ensuring full employment of the citizens of its member nations. 4. Optimum use of world resources: - Ensuring optimum use of worlds resources and, thereby, expanding world production and trade of goods as well as services.
5. Protection of environment: -Preserving and protecting the environment of the world so as to benefit all the nations of the world.
6. Growth of less developed countries: - Recognises the need for positive efforts, designed to ensure that developing countries. Especially the less developed countries, secure a better share of growth in international trade.
7. Employment: - WTO aims at generating full employment and broad increase in effective demand.
8. Enlargement of Production and Trade: -WTO aims to enlarge production and trade of goods as well as services.
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NATURE/FEATURE/CHARACTERISTICS OF CONSUMER MOVEMENT
Meaning: - Consumer movement is a social movement of consumers that has come into existence to educate and unite consumers to fight for protection of their rights. Definition: - Philip Kotler and G. Armstrong Consumerism is an organised movement of citizens and government to impose the rights and powers of buyers in relation to seller.
Following are the some important features of Consumer Movement:
1. 2. 3. 4. 5. 6.
Voluntary movement Production of rights Strength of unity Comprehensive term Prevention of unethical practices Enforcing consumer rights
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1. Voluntary Movement: - It is a voluntary and collective movement of consumers; it is a movement of the consumers, by the consumers and for the consumers. A group of active consumers come forward, forms a union and fight for the well-being of the community.
2. Protection of Rights: - The objective of the consumer movement is to make the business community and government to guarantee and enforce the legitimate rights of consumers.
3. Strength of Unity: -Consumerism is a social force whose aim is to protect rights of consumers by exercising legal and social pressure on business community.
4. Comprehensive Term: - Every one of us is a consumer of goods and services provided by private and government undertakings. Today, the concept of consumerism is not restricted to commercial activities alone. Also extended to public utilities, and services like banking, transport, telephones, medical.etc.
5. Prevention of unethical Practice: - consumerism is a voluntary association of consumers, whose one of the objective is to prevent the business from following unethical practices like blackmarketing, exploitation of consumers etc.
6. Enforcing Consumer Rights: - The consumer movement aims at enforcing four basic rights of consumers-Right to safety, Right to be informed, Right to choose and right to redress.
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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/FEATURE/CHARACTERISTICS OF PRINCIPLES OF MANAGEMENT
Meaning: -Principles of management are the guidelines to be followed by managers in managing the organisation. No manager can be effective if he/she does not follow the principles of management. Therefore, managers in all organisations, whether large or small, business or non-business, and at al levels (top, middle and lower) must follow the principles of management. The nature of principles of management can be briefly explained as under: 1. Basic Guidelines: -The principles provide basic guidelines to the managers to manage the subordinates effectively. If managers follow the well established principles of management, then he/she would be in a better position to get the work done effectively and efficiently from the subordinates. 2. Applicable to business and non-business organisation: - principles of management are applicable to business organisations as well as to non-business organizations. For instance, the principle of management must be followed by managers in a non-business organisation such as hospitals, educational institutions, charitable trust, etc.
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3. Applicable at all levels: -The principles of management must be followed by managers at all levels. Principles of management are the guidelines to be followed by managers in managing the organisation. No manager can be effective if he/she does not follow the principles of management. Therefore, managers in all organisations, whether large or small, business or non-business, and at al levels (top, middle and lower) must follow the principles of management. 4. Applicable to any size of business: - The principles of management are applicable not only to large organisation such as joint stock companies but also to small organisations, like sole trader too. It necessary for the sole trader to follow the principles of management in order to satisfy the customer and to run the organisation successfully. 5. Time Tested: - The principles of management are time tested. The basic principles of management have remained the same for a number of centuries (although Henri Fayol first published the list of 14 Principles of management in 1916). Principles of management are practiced by the people over period of time. 6. Ensures smooth working of an organisation: - The principles of management ensure smooth working of an organisation. For instance, the principles of division of work, team spirit, order, etc., enable the organisation to conduct its activity in a systematic and successful manner. 7. Situational in Nature: -Certain principles of management may be applied depending upon the situation. For instance, a manager may not delegate authority to subordinates, if subordinates have no knowledge of a certain type of work. In such a condition the managers must first training the subordinates, and then to delegate the authority. 8. Intangible: - The principles of management are not directly visible. The effect of principles can be felt by the results. If the managers follow the principles, then there can be higher results in the organisation in the form of : Reduction of wastages Optimum use of resources Motivated and dedicated workforce Higher efficiency. 17 Achieve success through
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ORGANISATION OF COMMERCE AND MANAGEMENT DEFINE DISTRICT FORUM? EXPLAIN ITS FEATURES?
Meaning: -A Consumer Disputes Redressal Forum, to be known as the District Forum,

established by the State Government in each district of the State as per the Consumer Protection Act 1986.
FEATURES OF DISTRICT FORUM

1. Composition of District Forum: -A District Forum has to consist of: a. A person who is or has been or is qualified to be a District Judge, to be nominated by the State Government, to be its President. b. Two other persons of eminence, in the field of education, trade, or commerce one of whom shall be woman.
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2. Term of Office: -Members of the District Forum hold office for a term of 5 years or upto the age of 65 years whichever is earlier and are not eligible for re-appointment. In other words, the maximum period of membership of the forum is 5 years.
3. Salary: -The State Government drafts rules regarding salary or honorarium and other allowances payable to members and also the terms and conditions of their service.
4. Jurisdiction of District Forum: -As per the latest amendments, the District Forum has the jurisdiction to entertain complaints, where the value of goods or services and the compensation, if any, claimed does not exceed Rupees Twenty Lakh.
5. Number: -There are a number of District Forums in Maharashtra eg, In Mumbai, Pune, Ahmednagar, Aurangabad, Nagpur, Nasik, Ratnagiri, Satara, Sholapur, Sangli etc. In Mumbai, the District Forum has 3 offices, at Dadar, Worli and C.S.T.
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1.
DEFINE PRIVATISATION? EXPLIAN NEED/IMPORTANCE OF PRIVATISATION?
Meaning: -Privatisation means inducing private ownership, management and control into public sector undertakings. It is opposite of nationalising private firms. It implies disinvestment in public sector units and passing of management rights to private entrepreneurs. In some cases the management and control of public undertakings may be transferred to private sector without transferring the ownership. Privatisation is importance due to the following reasons: Omtex
1. Improvement in efficiency: -The motive of private enterprises is to maximise profits.
Therefore, they have to improve efficiency and performance without the competitive forces.
2. Raising Funds: -By selling government equity to private sector it is possible to raise funds
for public investment.
3. No political influence: - Once a public sector is privatised it becomes free from political,
ministerial and government intervention.
4. Quick Decisions: - In private sector organisation quick decisions can be taken to respond to
changing circumstances.
5. Better Service to the customers: -The survival and growth of private sector enterprises
depends on consumer satisfaction. Therefore they try to provide better quality goods and services to their customers.
6. Quick remedial measures: -In private sector enterprises quick remedial measures must be
taken to avoid wastages, losses and to secure benefits from business opportunities. There is no scope for red tapism.
7. Easy to fix responsibility: -In private sector organisation authorities, responsibilities and
accountability are generally fixed by the Board of Directors and corporate laws. Therefore, it is easy to fix the responsibility in the case of failure in performance by any employee
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DEFINE LIBERALISATION? EXPLAIN THE NEED FOR LIBERALISATION?
Meaning: - Wikipedia the Internet Encyclopaedia refers to Liberalisation as a relaxation or previous

Government restrictions, usually in areas of social or economic policy. In other words liberalisation is the process of liberating the economy from various regulatory and control mechanisms of the state and of giving greater freedom to private enterprise. India adopted the policy of liberalization in 1991 when the Government was facing a severe crisis. It was not able to honour international payments and was in a doubt trap. The foreign exchange reserves were also low. To solve the problems, the government led by the then Prime minister Dr. Narsimha Rao and the then Finance Minister Dr. Manmohan Singh undertook series of measures to overcome this crisis. These measures led to the process of economic liberalisation. Our Prime Minister Dr. Manmohan Singh is known as the architect of the Liberalisation Movement.
Definition: - Liberalisation can be defined as, Unilateral or multilateral reductions in tariffs and other measures that restrict trade
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NEED FOR LIBERALISATION

1. 2. 3. 4. 5. 6. 7.
It is abolishing the licensing requirements for most of the industries. Bring flexibility in the operations of business organisations. This will lead to increase the production and distribution. Paves the way for globalisation like it will make simple procedure for imports and exports. Helps companies to compete with other companies at international level. Saves time, efforts and money of business enterprises. reduces cost of production and distribution Increase efficiency, productivity and profitability of business organisations. This will lead to expand its business activities.
Measures of Liberalisation have been adopted by the Government of India are as follows: 1. Write New Industrial Policies Explanation
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DEFINE GLOBALISATION? EXPLAIN THE NEED FOR GLOBALISATION?
Meaning: - It is a process of global integration of products, technology, labour, investment, information and even cultures. In other words, globalisation is the process of integrating a countrys economy with the world economy with a view to exploit global opportunities for countrys growth. Definition: -According to Harris Globalisation has
FACTORS RESPONSIBLE FOR GLOBALISATION OF BUSINESS

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1. Free Trade: -it makes freedom to set up and operate business in any part of the world. In recent years, there have been efforts by various countries to reduce the number and level of trade restrictions i.e. to achieve free trade country should remove tariff duty and quota limits should be avoided.
2. Setting up of W.T.O: - The world Trade Organisation has been set up which is made up of countries committed to the principle of freeing world trade from restrictions.
3. Free Trade blocks: - These are groups of countries (often geographically grouped) that have arranged to trade with each other without restrictions. E.g. (NAFTA) and (ASEAN) the members of the European Union (EU) also trade freely amongst themselves.
4. International banking and revolution in information technology have a big push to globalisation.
5. International education and tourism facilitates globalisation of cultures and languages.
6. Increasing demand of consumers for world class products and services.
7. Growth of multinational countries i.e. the business organisations having their headquarters in one country but operating branches, factories and assembly plants in other countries.
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IMPORTANCE/ADVANTAGES/ FUNCTIONS/ROLE OF BUSINESS ENVIRONMENT? (March 2009)
Meaning: - Business Environment consists of all those forces or factors both internal and external that affects the
working of a business. Analysis of the internal environment helps a firm to identify its strengths and weakness, and the analysis of the external environment helps to identify opportunities and threats. Thus, environment analysis helps to undertake the SWOT analysis, i.e., strength, weaknesses, opportunities and threats.
Definitions: - According to Keith Davis, Environment of the business means the aggregate of all conditions, events and influences that surround and affect it. The role and importance of business Environment analysis is briefly explained as follows:
1. Identification of Strengths: -The analysis of the internal environment helps to identify the strengths of the firm. For instance, if the company has good personnel policies in respect of promotion, transfer, training, etc., then it indicates strength of the firm in respect of personnel policies. After identifying strengths, the firm must try to consolidate its strengths by further improvement in its existing plans, policies, and resources.
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2. Identification of Weaknesses: -The analysis of the internal environment indicates not only strengths but also weakness of the firm. A firm may be strong in certain areas, whereas, it may be weak in some other areas. The firm should identify such weaknesses so as to correct them as early as possible. For instance, the machines used by the firm may be outdated; therefore, the firm may replace the obsolete machines with new ones so as to improve the quality and quantity and also to reduce the cost of production. 3. Identification of Opportunities: -An analysis of the external environment helps the business firm to
identify the opportunities in the market. The business firm should make every possible effort to grab the opportunities, as and when they come. Failure to do so would mean that someone also would grab the
opportunities.
4. Identification of Threats: -Business may be subject to threats from competitors and others. Therefore, environmental analysis helps to identify threats from the environment. Identification of threats at an earlier date is always beneficial to the firm as it helps to defuse the same. Identification of competitors strengths is very much helpful for the firm to take immediate actions to counter the strategy of the competitors by introducing a new product or entering into new markets or in new product lines. 5. Effective Planning: -A proper study of environment helps a business firm to plan its activities properly. Before planning, it is very much necessary to analyse the internal as well as external environment. After SWOT analysis, the firm can identify specific objectives, which in turn helps to frame proper plans. 6. Facilitates organising of resources: -A Proper analysis of environment enables a firm to know the demand potential in the market. Accordingly, the firm can plan and organize the right amount of resources to handle the activities of the organisation. 7. Optimum use of Resources: -A study of technological development, government policies, demographic pattern, etc. will help the business firm to plan its activities and allocate the limited resources in a better way. 8. Helps to be active and alert: - Environmental analysis help a business firm to remain active and alert in the competitive market. In the absence of environmental analysis, a business firm may adopt a casual approach towards business, which in turn leads to failure or closure of the business. 22 Achieve success through
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5.
IMPORTANCE/ADVANTAGES/ FUNCTIONS/ROLE OF BUSINESS ETHICS (March 2008) Meaning: - The term ethics is derived from the Greek word ethos, which means character. Ethics is a branch of social sciences, which deals with concepts such as right and wrong, good and bad, fair and unfair, just and unjust, legal and illegal, moral and immoral, proper and improper in respect of human actions. Definition: -Thomas M. Garett defines Business Ethics is primarily concerned with the relationship of business goals and techniques to specific human needs. The following points explain the need for and importance of Business Ethics: 1. Protection of Consumer Rights: -Consumer is the centre of all the business activities. In fact, business is essentially meant for satisfaction of consumer wants. Unfortunately, consumers are the most neglected and exploited group. The application of business ethics will help to confer and implement consumer rights.
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2. Social Responsibility: -Business Ethics is a means of making business socially responsible for its actions. Exploitation of consumers, employees, discriminate use of natural resources, etc., is quite common in all type of business. Compliance to ethical standards will ensure (a) Protection of consumer rights (b) Public accountability (c) Protection of workers interests, and (d) Proper utilisation of natural resources. 3. Concept of Socialism: -The Concept of Socialism in business states that gains of a business must be shared by all and not just by the owner of business. Profit is a sign of business skill and talent. Profit is also a result of group efforts. Employees, shareholders, consumers, suppliers, and others contribute to the success of the business. Therefore, success should be shared by all concerned. 4. Interest of industry: - Business Ethics are necessary to safeguard the interests of the small scale business firms. The tendency of big business firms is always to dominate the market and drive away the small industries out of the market. Small scale units can establish their position and fight for their right if the industry follows a code of ethics. 5. Consumer movement: -The growth in consumer movement is also another important factor that has necessitated the need for business ethics. The spread of education and awareness among consumers about their rights has made the business community to conduct business on ethical principles. 6. Better Relations With the Society: -Business Ethics is needed to develop good relations between business and society. The relationship of business with society has various dimensions such as its relations with shareholders, employees, consumers, distributors, competitors and government. 7. Buyers market: - There has been a structural change in the concept of business. The concept of profit has been gradually taken over by consumer satisfaction. The large scale production and increased competitions in the market changed the business scene from a sellers market to a buyers market. 8. Beneficial to Business and Society: - Ethics suggests what is good and bad, right and wrong, ethical and unethical, etc., to businessman. It also brings an element of honesty, sincerity, fairness, and human touch to business activities.
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ORGANISATION OF COMMERCE AND MANAGEMENT 6. NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF CONSUMER MOVEMENT.
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Meaning: - Consumer Movement is a Social Movement, Consumer movement aims at promoting an

interest of the consumers the following are the objectives of consumer movement.
Definition: - Philip Kotler & G. Armstrong define Consumerism is an organised movement of

then citizen and government to impose the rights and powers of buyers in relation to seller.
Following are the Importance of Consumer Movement

1. Protection against Malpractices: - the main objective of consumer movement is to protect the interest of the consumer from the malpractices adopted by the business community such as charging high prices, supplying inferior goods, creating artificial shortage. 2. Educating the consumers: - consumer movement aims at educating and informing the consumer about their rights, such education makes the consumer aware of their rights. 3. Representing Consumers: - the consumer protection organisation such as consumer guidance society of India represents on behalf of the consumers to the government authorities so as to frame proper consumer protection laws and other measures for consumer protection. 4. Publishing unfair practices: - Consumer protection organisation publishes in various media regarding the unethical practices of the businessman. 5. Forming of Association: - consumer movement encourages consumer to form consumer protection associations at the local level. 6. Support to business community: - consumer movement aims at co-operation and support to the business community in dealing with their problems and difficulties 7. Assistance in legal matters: - the Consumer protection organisation assist individual consumers in legal matters i.e. the procedure to be followed in filling a complaint in the court.
8. Exerting or creating pressure on businessman: - consumer movement aims at exerting a
pressure on businessman and makes them more socially responsible.
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7. ROLE AND FUNCTION OF WORLD TRADE ORGANISATION (WTO) (March 2009) Meaning: -The World Trade Organisation came into existence with effect from 1-1-1995. The WTO replaced General Agreement on Tariffs and Trade (GATT). The main objective of WTO is to increase world trade and thereby employment. In 1947, 23 countries including India signed the General Agreement on Tariffs and Trade (GATT). GATT was created to reduce the tariff barriers. GATT has been replaced by WTO in 1995. WTO is wider in scope. It is concerned with not only reducing or eliminating tariff barriers but also non-tariff barriers such as quotas. In April 2004, the membership of WTO was 147 countries including India.
1. Administration of Agreements: -It looks after the administration of the 29
agreements (signed at the conclusion of Uruguay Round in 1994), plus a number of other agreements, entered into after the Uruguay Round.
2. Implementation of Reduction of Trade Barriers: -It checks the implementation of
tariff cuts and reduction of non-tariff measures agreed upon by the member nation at the conclusion of the Uruguay Round.
3. Examination of Members Trade Policies: -It regularly examines the foreign trade
policies of the member nations, to see that such policies are in line with WTOs guidelines.
4. Collection of Foreign Trade Information: -It collects information in respect of
Export-Import trade, various trade measures and other trade statistics of member nations.
5. Settlement of Disputes: -It provides conciliation mechanism for arriving at an
amicable solution to trade conflicts among member nations.
6. Consultancy Services: -It keeps a watch on the development in the World economy
and it provides consultancy services to its member nations.
7. Forum for Negotiation: -WTO is a forum where member nations continuously
negotiate the exchange of trade concessions. The member nations also discus trade restrictions in areas of goods, services, intellectual property, etc.
8. Assistance of IMF and IBRD: -It assists IMF and IBRD for establishing coherence
in universal economic policy administration.
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8.
ORGANISATION OF COMMERCE AND MANAGEMENT WRITE SHORT NOTES ON CONSUMER RIGHTS?
Introduction: -In 1962 the American president John F. Kennedy, in his Consumer message to U.S. congress had specifically mentioned four consumer Rights and opened the door for consumerism in .U.S. and all over the world. Kennedy declared that consumers have the right to safety, to be informed, to choose and to be heard. Consumer Movement is a Social Movement of Consumers that has come into existence to educate and unite consumers to fight for protection of their rights. Def: - Philip Kotler & G. Armstrong define Consumerism is an organised movement of then citizen and government to impose the rights and powers of buyers in relation to seller. 1. Right to Choose: - A Consumer should be given open access and freedom to choose from a variety of products and services. Right of choice aims at promoting competition and discarding monopoly. Sometimes leading competitors for the sake of business purpose joint hands and allocate market among them. In order to restrict their monopoly it is necessary to get freedom of choice. 2. Right to Safety; -A Consumer has a right to be protected against the marketing of goods, which are dangerous to human health and life. Consumer has a right to receive an assurance from the producer about the quality, reliability and performance of good for products like electrical appliances, automobiles etc. considerable safety and security is required similarly food articles like sweets, fast food, colddrings etc. should be free from substances that are harmful for human consumption. 3. Right to be informed: -A Consumer has a right to be protected against fraudulent, miss leading information, advertising, labelling or other practices and to be given facts needed to make proper choice. 4. Right to be heard: - This right permits the consumer to register his dissatisfaction or complaint with the company and government. The right to heard also includes legal hearing to get redress of their complaints. This right can be exercised effectively only when the consumers are properly organised.
5. Right to redress: - Many times, it so happens that the actual performance or quality of product does not match with what is advertised or stated on package. This right enables the consumers to get his claims settled, if he becomes a victim of exaggerated claims. 6. Right to Consumer education: -This is another important right aims at supplying information and educating consumers regularly. It is a continues process and works to update consumers knowledge about the developments in business and industry, and changes made in laws affecting consumers rights.
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NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF TOTAL QUALITY MANAGEMNET
Meaning: -The concept of TQM was developed by Dr.W.E. Deming (regarded as the father of TQM) in 1960s in Japan. TQM is strategic approach that focuses on production of best possible product or services through constant innovation and timely action. It places emphasis on prevention of errors rather than on rectification. Definition: - TQM is a management approach that places emphasis on continuous improvement in quality, in the interest of the organisation and that of its customers. The need and importance of TQM can be stated with the help of its advantages: 1. Customer Satisfaction: - TQM stresses the need to satisfy both the internal as well as the external customer. Internal customer refers to the persons within the company who receives the work of another and then adds his or her contribution to the product or service before passing it on to someone else. TQM must focus on the customers, the eventual buyer of the product or services. To do so, the initial focus should be on meeting needs of internal customer before an attempt is made to meet the requirements of the external customers.
2. Helps to Face Competition: - A Proper emphasis on TQM enables a company to face the competition in the market. The company may even come out as a winner or a leader. This is because of high quality product, at the lowest possible cost, produced by a dedicated team of workforce. 3. Good will: - TQM generates name and reputation to the company in the market. This is because of its constant efforts in bringing the improvement in the products-design, variety, shape, size, colour, shade and other features.
4. Highly motivated personal: - TQM develops a sense of dedication and discipline in the employees. There is willingness on the part of the employees to identify quality improvements and waste elimination opportunities. The employees become aware of their importance in the companys performance and progress. This leads to greater involvement and participation of the employees. 5. Lower rejection rate: - Internal rejection rate gets reduced considerably over a period of time. Various initiatives such as quality circles, process control, right first time approach, just in time approach, etc., enable the company to reduce rejection rate. 6. Reduction in customer complaints: - TQM results in less or no customer complaints. This is because the products are built to specification with zero defects. Again, efforts are made to improve upon the customer specification so as to provide complete satisfaction. 7. Better facilities to employees: - TQM results in higher benefits to the organisation in terms of increased profits. The higher profits are utilized in a way to provide better facilities to the employees in terms of training, salary, canteen facilities etc. 8. Expansion and Diversification: - TQM generates a good name in the market. It also brings in higher returns. This enables a company to expand and diversify. 27 Achieve success through
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NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF EVENT MANAGEMENT (March 2009) Meaning: - Events play an important role in our society. Any happening or an activity can be referred as an event. Examples of event can include: Celebration of a festival or any other celebration. A football match between two clubs or countries. A launching of a new product. Farewell party to students, etc. Definition: -Dr. J. Goldblatt defines special Event as A unique moment in time celebrated with ceremony and ritual to satisfy specific needs. Event management is vital for the following purposes:
1. Develops the theme of the Event: - The event management team develops the theme of the event. The theme of the event should be linked to the purpose of the event. It should develop team sprit or friendship between two clubs or states or nations. Therefore, the theme of the event may be described as The friendship Series or The Good will Series. 2. Provides Career Opportunities: - Event management Provides career opportunities. Apart from event manager, there are several other job opportunities in the Event management such as: 1. Operation and Logistics managers. 2. Entertainment managers 3.Sponsorship managers. 4. Event coordinator 5.Event Designer 6.Security Coordinator, etc. 3. Develops leadership qualities: - Event management develops leadership qualities. To manage an event, the managers require good leadership qualities to influence and motivate the subordinates to work effectively in making the event more successful. 4. Develop Team sprit: - Event management helps to develops team spirit in the employees. The success of the Event management largely depends upon the team effort. Therefore, there is need for team work between managers and their subordinates, and between the various departments in the organisation, so as to make the event more successful. 5. Enhances Corporate Image: -Proper Event management helps to develop corporate image of an organisation. If the event is well managed, then there is a possibility of greater success. 6. Encourages Creativity: - Event management encourages and develops creativity in the managers. Managers need to be dynamic or innovative in managing the event. The mangers have to find out new and innovative ways in managing the event. 7. Ensures safety and security: - Event management team ensures safety and security of the people during the event. The Event management team makes proper security and safety arrangements. For instance, the event management team makes proper arrangement to deal with the certain crisis such as occurrence of fire, failure of lighting or air conditioning, gas leaks, and so on. 8. Financial Management: -The Event management team may be responsible for the financial management of the event. The event management team may be responsible for: Preparation of budget for the event. Determining break-even point Preparation of cash-flow analysis, and preparation of profit and loss statement, etc. 28 Achieve success through
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11.
NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF DISASTER MANAGEMENT
Meaning: -According to Oxford Dictionary a crisis is a decisive moment-a time of great difficulty, a disaster, or a catastrophe. It is a turning point that changes the destiny of an individual or a group or a company or a government. Therefore, the term Crisis and Disaster are used as synonymous. However, usually crisis is considered as made and a disaster as a natural calamity. World book, 2001, Chicago has defined disaster as a sudden extremely unfortunate event that affects many people. It includes natural occurrences such as earthquake, volcanic eruptions, floods, famine and so on. It also includes man made calamities such as bomb blasts, accidents, looting and rioting during communal riots, etc. Disaster management is vital for the following purposes. 1. To avert a disaster: - Disaster management teams can help to avert a disaster before it occurs. The Disaster management team may examine the possible causes of disaster, and may take appropriate measures to avert a disaster. For instance, forest fires, or even terrorists bombings can be averted through effective planning and pre-emptive action. 2. To undertake rescue operations: - Disaster management personnel can undertake rescue operations effectively. Trained disaster management personnel can rescue people effectively at the time of floods, major fires, building collapses, and so on. 3. To provide relief measures: - Disaster management team is responsible to provide relief measures to the victims. For instance, the team can make arrangement for food, clothing, and relief camps, medicines and so on. Such measures would reduce the misery of the disaster victims. 4. To undertake rehabilitation programmes: - Disaster management team can work effectively to undertake rehabilitation programmes in the affected areas. For instance, in the earthquake affected areas, rehabilitation programmes include: a. Construction of dwellings b. Schools and other infrastructure. 5. To undertake liaison work: -The disaster management team undertakes liaison work relating to the disaster. The liaison work is required with various agencies-private and government (including hospitals) in order to obtain funds and donations, and other resources or services so as to manage and overcome the disaster. 6. To reduce trauma and tension: - The Disaster management team can help to reduce the trauma and tension before and after the disaster. For instance, before a disaster, the team can properly guide the people to face or handle the disaster such as floods. Also, after the disaster, the team can provide not only material or financial support, but also psychological support to overcome the traumatic effect of disaster. 7. To protect the Environment: - Disaster management team can help to protect and preserve the environment. For example, a disaster management team can plan pre-emptive action to avert forest fires. Etc. 8. To minimize losses: - Disaster management teams can help to minimize loss of life and property. This is because; the Disaster management team can take pre-emptive actions to avert a disaster. 29 Achieve success through
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NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF PROFESSIONAL MANAGEMENT
Meaning: -Professional management refers to the professional approach in managing the organisations. Professional management is vital in todays competitive business world. The importance of professional management is explained as follows:
1. Innovation: -Professional management facilitates innovation in the organisation. Now-a-days, it is essential to generate new ideas; new product, and new technology, etc. innovation helps to gain competitive advantage in todays competitive business world.
2. Corporate Image: - Professional management enables the organisation to enhance corporate image. Effective management is required to bring improvement in quality of goods and services offered by the company. A good corporate image creates confidence about the company in the minds of customer, employees, shareholders, etc.
3. Team work: - Professional management develops team sprit in the organisation. It is the team work that brings success to the organisation. There is a need for team work among the employees and the departments in the organisation.
4. Optimum use of resources: - Professional management facilitates optimum use of resources in the organisation. Effective management helps to reduce wastage of resources to a greater extent. Optimum use of resources brings good results to the organisation.
5. Motivation: - Professional management facilitates motivation of the employees in the organisation by providing incentives. Motivated employees work with application and dedication. The dedication on the part of motivated work force brings higher efficiency in the organisation.
6. Reduction in Wastages: - Professional management ensures reduction of wastages in the organisation. Now-a-days, reduction in wastages is vital to any organisation. Reduction in wastages generates higher productivity in the organisation.
7. Higher Efficiency: - Professional management is required to generate higher efficiency in the organisation. Efficiency is the relation between returns and costs. The more the returns at the same costs or at a lower cost, then the organisation is said to be more efficient.
8. Quality of workers life: - Modern management shares the fruits of productivity and efficiency with the workers. Workers are provided not only with good working conditions but they are also rewarded monetarily and non-monetarily, and as such their quality of life enhances
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ORGANISATION OF COMMERCE AND MANAGEMENT IMPORTANCE OF MANAGEMENT? (March 2009)
Meaning: -The survival and success of an organisation largely depends upon the quality of management. Some organisation prospers and progress not only in good times but also during tough times, but others fails even during good times. Therefore, it is vital for every organisation to have dynamic and dedicated managers. Definition: - To manage is to forecast and to plan, to organise, to command, to coordinate and to control. (Henri Fayol) Management is the art of getting things done through and with people in formally organised groups. (Harold Koontz) Following are the importance of MANAGEMENT
1. Efficiency and Effectiveness of Human Efforts: - The management tries to combine the resources
of an organisation in the most productive manner so as to maximise the benefits and minimise the Wastages. This leads to efficiency. The management insists on using innovative ideas to bring out quality and effective products.
2. Harmony in Work: -Employees who come from different backgrounds have different qualification
and different styles of working. If everyone is allowed to follow their own style of working, it can lead to chaos and confusion in the organisation the management brings uniformity in their efforts leading to systematic working with good results.
3. Critical ingredient in nations growth: -Economic growth of a country depends on how efficiently
resources are being utilised efficient management makes optimum utilisation of resources. This brings good results in the organisation.
4. Right Decisions: - The Management helps in taking right decisions in the selection, utilisation and
allocation of the resources in different activities.

5. Achieving the group goal: -The effective Management tries to integrate the individual goals of all
the employees with the goal of the organisation.

6. Effective leadership and motivation: - The effective and dynamic management is the source of
stimulus to the employees. They are motivated to contribute their best efforts in their jobs.
7. Clear authority and responsibility: -Management, being a group effort, clearly assigns duties,
established\s authority and responsibility of every employee in the organisation. It eliminates overlapping confusion and duplication.
8. Solution of labour problems: - These days employees have become conscious of their rights and
their precious contribution to the organisation in the achievement of its goal. They demand more wages, bonus, improved working conditions etc; in such circumstances the efficient management avoid confrontation between employees and management.
9. Reducing labour turnover and absenteeism: -
10. Fulfilling social responsibility: -Modern management understands its social responsibility and its
commitment to the workers, consumers, investors, government and the public. it also participates in social welfare programmes.
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14. IMPORTANCE/NEED/FUNCTION OF PRINCIPLES OF MANAGEMENT? (March 2009) Meaning: - Management Principles are the statements of fundamental truth. These principles set as guidelines for mangers to take decisions. The management principles are both descriptive (state features or nature) and Prescriptive (lying down rules of usage) in nature. Definition of the term principle: A basic generalisation (simplification) that is accepted as true and that can be used as a basis for reasoning or conduct. Principles of management act guidelines to the manager in an organisation, their significance can be understood as follow:
1. Better Understanding: -Principles of management serve as guidelines to the managers. As they are tried and tested over period of time, manager gets a better understanding of managing his organisation. He can plan his activities in the desired manner to achieve the goals of his organisation.
2. Increases efficiency: - The aim of any business organisation is to improve output and productivity by reducing wastages and cost. Principle of Division of Labour leads to assigning a job to an employee based on his skill and expertise. This leads to specialisation.
3. Boost morale of the employees: - increases efficiency and productivity adds to morale of the employees. Increases productivity is also linked with financial or non-financial incentives plus fair remuneration. This helps in increasing morale of the employees who would put their best possible efforts to increase the overall efficiency of the organisation.
4. Social Responsibility: -A business enterprise is a part of the society. It draws its resources from the society. Therefore it has certain moral and social responsibities towards the society. By adopting principle of fair remuneration and principle of equity, it acts as a responsible organisation of the society.
5. Helps in coordination and control: -principle of unity of direction emphasizes on coordination of departmental goals with the goals of the organisation. All activities of all the departments should be directed towards achieving the common goal of the business enterprises.
6. Acts as guide for research and development: -Principles of management are evolutionary in nature. They have evolved with the passage of time. They have undergone changes with practice and experimentation. They also serve as guideline for conducting research, further can be introduced to suit the demands of the changing time.
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1. .
MANAGEMENT IS AN ART EXPLAIN
Meaning: - There is a considerable debate as to whether management is an art or science. In practice, however, a managers job involves both science and art.
Definition: - Mary parker follet, Harold Koontz and several other management authors called management as the art of getting things done through people. Management is an art due to the following reasons 1. Creativity: -Management like any other art needs to be innovative i.e. creative; managers have to come up with new ideas or solutions to handle situations. There is a constant need to be innovative in order to gain competitive advantage. Copying has no place in management.
2. Individual Approach: - Every manager needs to adopt his individual approach or style of managing to handle situations. Individual approach can create a big difference in managing the subordinates. For instance, given the same situation, same resources, and the same environment, some managers can easily get the work done from their subordinates. Whereas, others fail in spite of their best efforts.
3. Application and dedication: -Good managers require not only skills and knowledge but there is also a need for discipline, dedication, and commitment. It is often said that success is the outcome of knowledge + intelligence + dedication. Managers need to work with their minds (application) as well as with their heart (dedication).
4. Result oriented: - Every good manager, like an artist, is always practical and action based. What matters is not just activities but accomplished of results. Emphasis needs to be placed on the results rather than activities. The result of manager may be seen in the form of reduction in wastes, optimum use of resources, motivated workforce, higher efficiency, etc.
5. Initiative: - Managers like artists take the initiative in doing the right things right at the right time. Good managers also encourage initiative on the part of their subordinates. The initiative helps to take the right decisions, which in turn improves the overall performance of the organisation.
6. Intelligence: - Successful managers are intelligent. They need to have mental intelligence, social intelligence, inter-personal intelligence and emotional intelligence. They need to have more intelligence than their subordinates so as to command respect and get the work done from them efficiently and effectively.
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2.
ORGANISATION OF COMMERCE AND MANAGEMENT MANAGEMENT IS AN SCIENCE EXPLAIN
Meaning: - Science is a systematic body of knowledge which is universally accepted. F.W. Taylor father of scientific management was perhaps the first person to consider management as a science. He was of the opinion that management should conduct their business affairs by following certain well established standards. Science can be broadly divided into two groups: (a) Physical Sciences (b) Social Sciences
Physical sciences like Physics, chemistry and mathematics are exact and accurate, whereas, social sciences are not so exact and accurate as they deal with human beings. Management is a social science because it deals with human beings. Since human nature cannot be predicted with accuracy, the decisions taken in management may just be one way of doing things in a given situation and not the only way of doing things. Management is a social science due to the following reasons: 1. Systematic body of knowledge: -Management need to make systematic decisions. For this purpose the managers need to collect the right information from the right source at the right time. The collected data need to be processed and analysed systematically. The systematic collection and processing of data helps management to take better decisions.
2. Identical result may not be obtained: -In physical sciences, output may vary with a change in input. However, in social sciences, like management, output may vary without a change in input. For instance, when workers are properly motivated, their performance can improve even without any increase in resources like material, time, etc.
3. Cause and effect relationship: -Management principles also establish cause and effect relationship. For e.g. providing financial benefits for motivation the employees is a well establish fact of management.
4. universally accepted principles: -All successful organisations do follow the well established principles of management, such as division of work, unity of command, discipline, and so on. However, the degree of application varies from one manager to another manager and from one situation to another situation and from one organisation to another organisation. Thus, it can be concluded that management is an art as well as a science. Managers need to be scientific artists in order to accomplish the goals. For this purpose, they need to be innovative, and systematic. It is the science that discovers and the art that develops.
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ORGANISATION OF COMMERCE AND MANAGEMENT MANAGEMENT AS AN PROFESSION EXPLAIN
Meaning:-Profession is an occupation carried on by professional people like doctors, lawyers, architects, etc. it involves application of expert knowledge to solve specific problems or to handle specific tasks. There is a debate whether management is a profession or not. To find out whether management is a profession, one needs to know features of professions.
Following are some of the important features of professions
1. Formal Education: - a true professional needs to have minimum formal education from a recognised institution. For instance, a lawyer needs to have a degree in law from a recognised university.
2. Fees: - The professional normally charges fees for their services rendered to the clients. The fees may be varying from professional to professional. Normally, they do not work exclusively for only one client. They have number of clients.
3. Expertise: - professional require expert knowledge in a particular discipline. For instance, a doctor needs to have expert knowledge in the field of medicine.
4. Code of Conduct: -The actions of the professional are guided by a code of conduct. It is the association, either at national level or at state level that lays down certain standards to be followed by the professionals
5. Requirement of Licence: - Professionals require a license or a permission to practice. For instance, a doctor requires a licence to practice as a medical practitioner.
6. Independent office: - Normally, the professionals practice from their own independent office.
7. Social Responsibility: - The professionals are socially responsible to their clients and to the society, while handling their tasks and responsibilities. Their actions should be guided not only by monetary consideration, but also by social responsibility.
8. Specialisation: - The professionals may specialise in a particular field. For instance, there may be doctors only for a particular disease or for a particular class of patients. For instance, ther are heart specialist, child specialist, etc.
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4.
EXPLAIN THE FUNCTIONS OF THE TOP LEVEL MANAGEMENT? (March 2009)
Meaning: -All Managers in the organization do not belong to the same class or level, just as all
students of a college do not belong to the same class. Managers belong to the higher levels, whereas, others belong to the lower level, and some others belong to the middle level. Every level of management performs certain function. The function does vary from level to level. Normally, management positions are graded into three broad levels, i.e. 1. Top Level 1 2. Middle Level, and 2 3. Lower Level. 3
The functions of Top level Management are briefly explained as follows:

1. Mission Statement: - The top management frames mission statement of the organisation. The mission statement gives a clear direction to the activities of the organisation.
2. Plans and Policies: -The Top management frames plans and policies from long term point of view. The long term goals and objectives of the company are set by the top management.
3. Organising Resources: -The top management make arrangement of important physical, financial and other resources of the company.
4. Selection: -The top management has the responsibility of selecting departmental heads and other key executives.
5. Direction: -The top management provides necessary direction to the middle level executives to implement the plans.
6. Control of Activities: -The top management designs and develops a system of monitoring, measurement and evaluation of performance.
7. Motivation: -The Top management has the responsibility to train and motivate key personnel of the organisation.
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5.
EXPLAIN THE FUNCTION OF THE MIDDLE LEVEL MANAGEMENT
Meaning: -All Managers in the organization do not belong to the same class or level, just as all
students of a college do not belong to the same class. Managers belong to the higher levels, whereas, others belong to the lower level, and some others belong to the middle level. Every level of management performs certain function. The function does vary from level to level. Normally, management positions are graded into three broad levels, i.e. 1. Top Level 1 2. Middle Level, and 2 3. Lower Level. 3
The functions of Middle level Management are briefly explained as follows:

1. Planning: -The middle level management frames plans and policies for the departmental activities. They get the plans approved by top management.
2. Organising: -The middle management make arrangement of physical, financial and other resources to undertake departmental activities.
3. Selection: -The middle level management undertakes the selection of lower level executives. They also train the lower level executives.
4. Direction: -The middle level management provides direction to lower level executives to undertake the activities effectively.
5. Motivation: -The middle level management motivates the lower level executives so that they perform efficiently and effectively.
6. Controlling: - The middle level management monitors and controls the departmental performance.
7. Reporting: -The middle level management report to the top management in respect of departmental performance. They provide recommendation to the top management.
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6.
EXPLAIN THE FUNCTIONS OF THE LOWER LEVEL MANAGEMENT
Introduction: -This level is also called Operational or supervisory Level of Management. This level consists of Supervisors, Superintendents, foremen, Inspectors, etc. All Managers in the organization do not belong to the same class or level, just as all students of a college do not belong to the same class. Managers belong to the higher levels, whereas, others belong to the lower level, and some others belong to the middle level. Every level of management performs certain function. The function does vary from level to level. Normally, management positions are graded into three broad levels, i.e. 1. Top Level 1 2. Middle Level, and 2 3. Lower Level. 3
Their main Functions of Lower Level Management are as follows: 1. Preparing plans: - They prepare plans regarding their work and allot the work to the workers.
2. Representing the problems of workers: -The supervisory level managers come to know the problems and grievances of the subordinates and pass them on to the middle level management.
3. Maintaining good working conditions: -The supervisory managers provide good working conditions such as adequate lighting, ventilation, etc. and provide other amenities to the staff.
4. Looking to safety of workers: - The Supervisory level managers provide safe and secure work environment for the workers by proper fencing and putting safety guards at all critical points for avoiding accidents.
5. Helping the middle level management: -The supervisory level managers guide and help the middle level managers in the selection, training, placement and the promotion of the workers.
6. Welcoming suggestions: -The Supervisory level managers encourage the workers to take initiative in their work. They invite suggestions from the workers for better production and reducing wastage.
7. Maintaing quality standards: -The Supervisory level managers have to make sure that there is steady flow of output and that the quality standards are maintained by the workers. 8. Boosting the morale; - The supervisory level managers need to boost the morale of the employees in order to get the work done from them effectively and efficiently
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7.
WHAT ARE THE DIFFERENT LEVELS OF MANAGEMENT
Meaning: - All Managers in the organization do not belong to the same class or level, just as all students of a college do not belong to the same class. Managers belong to the higher levels, whereas, others belong to the lower level, and some others belong to the middle level. Normally, management positions are graded into three broad levels, i.e. 1. Top Level 1 1. Middle Level, and 2 2. Lower Level. 3
1. At the Top Level, the managerial personnel are few in number. The top level executives report to the Board of Directors. The Top level managerial personnel includes: Chief Executive Office (CEO) or General Manager. President of the organisation. The CEO may hold position of the president as well. Vice-Presidents of the functional areas such as marketing, production, finance, and personnel. Managing Director. In some firms, the managing directors and the CEO are one and the same.
2. At the Second Level, the organisation has more managerial personnel as compared to the top level. The managerial personnel at the second level report to the top level management. The managerial personnel includes in the Second Level are: Divisional Heads of a multi-divisional organisation. Special Business Unit (SBU) Heads in organisations. Regional and Area Managers in a large national or international organisation. Departmental Heads such as Marketing Manager, Finance Manager, Production Manager, Human Resource Manager, etc.
3. At the third level, the organisation has more personnel as compared to the second level. The managerial personnel at the third level include: Assistant Managers. Supervisors (Foremen) Junior Executives.
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8.
WRITE SHORT NOTES ON DEEMED PUBLIC COMPANY?
The concept of private company becoming a public company is stated under sec.43 A of Indian Companies Amendment Act 1960.
The following were the provisions of section 43 A.
Where not less than 25% of the paid-up share capital of a private company is held by one or more bodies corporate, such a private company shall become a public company from the date on which such 25% is held by body corporate. (section 43 A (1)
Where the average annual turnover of a private company is not less than Rs. 10 crores during the relevant period, such a private company shall become a public company after the expiry of the period of three months from the last day of the relevant period when accounts show the said average annual turnover. (section 43 A (1A)
When a Private company holds not less than 25% of the paid up share capital of a public company, the private company shall become a public company from the date on which the private company holds such 25% (section 43A (1B)
When a private company accepts, after an invitation is made by an advertisement or renews deposits from the public other than its members, directors or their relatives, such private company shall become a public company (section 43a 1C)
The above provisions of section 43A shall not apply on or after the 31-12-2000 (section 43A (11). Deemed concept of a public limited company on account of the above four factors is abolished (as per Companies Amendment Act 2000).
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9.
EXPLAIN THE IMPORTANCE OF SOCIAL VALUES?
Meaning: -Social Values are values (standards) concerned with social aspects of human life. For example, truth, honesty, justice, kindness, generosity, tolerance, patriotism, perfection, excellence, etc. the business organisations are expected to participate in the development of social values through educative advertising, cultural programmes, national integration programmes , assistance to educational institutions, etc.
1. Economic Progress: -Social Values foster economic progress of a society. For instance, if truth and honesty are practised by every body, it will promote fair dealings in all walks of life such as business, education, political, social services, etc.
2. Social Development: -Social Values foster social development also, for instance, several industrialists and charitable institutions have shown generosity and started schools, colleges, hospitals, cultural centres for the benefit of common people.
3. Social relations: -Social values like co-operation, tolerance, respect for seniors, etc. tend to improve social ties or relations. When a person extends his hand of co-operation to others, even the enemies will have to check their inimical relations. 4. Regional Co-operation: -Social Values like co-operation, patriotism, and tolerance can help to mitigate the differences between the regions, states and countries. These three values, if practised it will promote social and economic development of the nations.
5. Love, peace and happiness: -Values like respect for others, co-operations, tolerance develop a bond of togetherness. As a result, conflicts and clashes get solved through mutual understanding.
6. Standard of living: - Values of perfection and excellence enables people to develop new methods, process and techniques. As a result, new and better products and services become available in the market. This ultimately led to raising the standard of living.
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10.
WRITE SHORT NOTES ON CONSUMER PROBLEM (March 2009)
Meaning: -The customer is the start and the success point of any business. The Survival and success of business depends on the customers support. Customer is a king in the Market. Definition: -Peter Drucker ones stated. There is only one definition of business purpose; to create customer.
In India, Consumers face a number of problems. The main problems are as follows:
1. False Weights and measures: -Consumers in India are cheated by traders and others with false weights and measures in unorganised as well as organised markets..
2. Poor after-sale-service: -In India, after-sale-service is very poor. Even in the big companies also do not provide effective after sale service to its customers.
3. Problem of duplicate Goods: -In India, the customer face a major problem of duplicate goods. Unethical producers duplicate popular brand names and thereby customers get cheated.
4. Problem of artificial shortage: - Unethical dealers, some traders or shopkeeper indulge in artificial shortages. The purpose is to inflate the prices. Therefore, customers have to pay high due to artificial shortage of goods.
5. Problem of Health and Safety hazards: -Another problem faced by customers in India is the problem of health hazards. There are several such examples are: Certain manufacturers duplicate health related products such as medicines. Shopkeepers or Traders may also sell products even after the expiry date.
6. Unethical Advertising: -Customers are cheated with false advertising. There are several examples of unethical advertisements: Tall Claims or Exaggerations. Testimonials by professionals or personalities who do not even use the product. etc.
7. Problem of Delivery of Goods: - Customers also face the problems of Delivery of goods on a specific delivery date
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11.
IMPORTANCE/ADVANTAGES/ FUNCTIONS/ROLE OF PUBLIC SECTOR
Meaning: -In India, the sectoral organisation of business can be broadly divided into two groups Private sector organisation and public sector organisation. Public sector plays an important role in the economic development of India. The role and importance of public sector can be briefly explained as follows:
1. Employment: - public sector provides employment to large number of people in the country. For instance, the Indian Railways provide employment to about 15.5 lakh people, perhaps the largest employer in the world.
2. Rural Development: - public sector units facilitate rural development. This is possible due to: i. Infrastructure development, both economic and social infrastructure ii. Locating Projects in rural areas like the Bokhara Steel Plant, the Raurkela Steel Plant, etc.
3. National Income: - public sector units contribute to the national income of the country. The public sector has grown in size over the years both in terms of number of units as well as in production. It is estimated that the public sectors contribution to GDP is about 25%, and that of the private sectors 75%.
4. Capital formation: -The public sector contributes to capital formation by mobilisation of savings through public sector banks. The all India financial institutions like IDBI, ICICI, etc., play an important role in industrial investment and capital formation by providing medium terms and longterm funds to industry and service sector.
5. Foreign Exchange Earnings: -The public sector enterprises have contributed to the export earnings of the country. The public sector units export a number of products like engineering goods, chemicals, minerals, metals, etc. they also export services. 6. Social Order: -The public sector units contribute to the social order b y providing employment to a large number of people in the country. The employment generation reduces the possibility of antisocial activities.
7. Government Revenue: -PSUs bring revenue to the Government. The revenue is in the form of: a. Direct Taxes b. Indirect Taxes c. Profits of PSUs 8. Infrastructure Development: -Public sector units play an important role in the development of the infrastructure of the nations. The public sector has developed roadways, railways, airways, power, and so on.
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12. IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF CONSUMER PROTECTION ACT, 1986
Meaning: -The Consumer Protection Act, 1986 was passed to provide better protection of the interest of consumers and for the purpose of establishing of consumer councils and other forms for the settlement of consumer disputes: Salient Features of Consumer Protection Act are as follows:
1. The Act acknowledges six rights of the consumers: Right of Choice Right to safety Right to be Informed Right to be Heard Right to Redress, and Right to Consumer Education
2. The Act Provides for the establishment of: Central Consumer Protection Council at Central Levels The State Consumer Protection Council at State Levels, and Consumer Disputes Redressal Agencies.
3. The Act is applicable to all private, public or co-operative business sectors.
A trader or a person against whom a complaint is lodged fails to comply with any order made by any council, is punishable with imprisonment for a term which shall not be less than one month but which may extend to 3 years or with fine shall not be less than Rs. 2000 or may extend to Rs. 10,000 or both
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OMTEX CLASSES ORGANISATION OF COMMERCE AND MANAGEMENT 1. DEFINE SOLE TRADING CONCERN? EXPLAIN ITS MERITS AND DEMERITS?
Meaning: - Sole trading concern is the oldest form of commercial organisation. Sole means one person. So a trading concern is an organization where all business activities are controlled and managed by one man. He is also solely responsible for the debt and risk of the firm. The following are some of the features of a sole trading concern. Definition: A sole trader is a person who trades on his own account rather than in partnership or as a member of a company. (Michael Greener)
A sole trading concern has the following merits over other forms of commercial organisation: 1. Ease in formation: - a sole trading concern is considerably easy to start and to conduct its activities. There are least formalities in the formation of a sole trading concern. A sole trader may also close down the business as per his own will.
2. Complete control: - The sole trader can have complete control over business operations. He can take his own decision regarding the business activities. No need to consult with any one
3. Business Secrecy: - The sole trader can maintain complete business secrecy. He needs not to publish any accounts and reports to any body. Competitors cannot easily get business secrets and information of the sole traders activities.
4. Flexibility: -Sole trader enjoys maximum flexibility. He can take right decision at the right time depending upon the situation. At any time, he need not have to consult with anyone because he is a single owner of his business.
5. Minimum Government Control: - Sole trading concern is less affected by government control. This is because, there are almost no legal formalities are required to start or close down a business.
6. Close conduct with the customers: -The Sole trader can develop close contacts with his customers. This is because; he deals regularly with the customers. By developing personal contacts with his customers, the sole trader can come know the likes, dislikes, preferences and tastes of the customers. This helps to increase the sales turn over.
7. Proper utilisation of resources: -The sole trader will make proper utilisation of resources (men, money, materials, etc.) this is because, the sole trader enjoys all the profits.
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In spite of several advantages/merits, the sole trading concern suffers from a number of disadvantages. The main disadvantages are:
1. 2. 3. 4. 5. 6. 7.
Limited Capital Limited Managerial skills Lack of continuity: Unlimited liability Limited Bargaining power No Legal status Limited Expansion:
The above important demerits are briefly explained as under. 1. Limited Capital: - The main drawback of sole trading concern is the limitation of capital. The sole trader can manage limited amount of capital from his own savings. He may also get some funds from his friends and relatives. The limitation of capital often restricts the size of the sole trading concern.
2. Limited Managerial skills: - Normally, a sole trader manages the business on his own. The sole trader may not have all the abilities or skills to manage all by himself. Now a day, ther, ther is a need for specialized managerial staff. The sole trader may not able to appoint a skilled managers or staffs this is because of his limited capital.
3. Lack of continuity: -The sole trading business lacks continuity. If the sole trader cannot run his business due to ill health or if he dies, the business comes to an end. This is because the successors may not be interested to run the business or they may lack the necessary business skills.
4. Unlimited liability: - The liability of the sole trader is unlimited. This means he is alone responsible for all the risks and debts of the firm. In the eyes of law, there is no distinction between the private property and business property of the sole trader.
5. Limited Bargaining power: -the sole trader often lacks bargaining power. This is because he purchases on a small scale from the wholesalers; secondly, he may not have the skill of bargaining. Thus he may not be able to obtain competitive terms from his suppliers.
6. No Legal status: - Legally, the sole trader and his business concern are one and the same in the eyes of law. The sole trader and his business cannot be separated from each other. So the sole trader lacks legal status. But a joint stock company enjoys a separate legal status.
7. Limited Expansion: -The Sole trading concern is restricted in its growth. This is because of limitation of capital and lack of managerial skills that are necessary for the expanding organisations.
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2.
DEFINE JOINT HINDU FAMILY FIRM? EXPLAIN ITS MERITS AND DEMERITS?
Meaning: -: -A business, which continues from one generation tom another generation is known as joint Hindu family business or firm. This is special form of business organization, which now exists only in India. And the business is with in the family. The head of the family is the head of the business also. He is known as karta and the members are known as co- parceners. Joint Hindu Family is governed by the Mitaksara Law.
Advantages of Joint Hindu Family Business are: 1. 2. 3. 4. 5. 6. 7. Easy formation Quick decisions and prompt action Flexibility in operation Business Secrecy Continuity of business Minimum Government regulations Limited liability of co-parceners
1. Easy formation: -Formation of Joint Hindu family is very easy. Because it does not require any legal formalities to form. It comes into existence under the Hindu succession Act 1956.
2. Quick decisions and prompt action: -The Karta is the sole manager of the business and head of the family. He need not consult any one before taking any decisions. Therefore he can take quick decisions and prompt actions
3. Flexibility in operation: -The management is in the hands of the Karta. He takes the decisions according to the changing circumstances. He can expand or contracts his business at his convenience. He enjoys maximum flexibility in operation.
4. Business Secrecy: -A joint Hindu family business can maintain business secrecy. Because they need not have to publish theres any account to any outsider of the family.
5. Continuity of business: -Joint Hindu family business does not dissolve due to death of Karta. Because a minor members that is a co-parceners can become a karta after the death of the Head of the family
6. Minimum Government regulations: - Though the Hindu undivided Family is the result of Hindu Law, there is least Government control over Hindu undivided Family because the business are conducted by the family members itself so they no need to publish any accounts and reports to any outsiders. 7. Limited liability of co-parceners: - The Co-parceners enjoy limited liability. The liability of the coparceners is limited to the extent of the shares in the family business. However, the liability of the Karta is unlimited. 47 Achieve success through
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Disadvantages of Joint Hindu Family Business are as follows:
1. 2. 3. 4. 5. 6. 7.
Limited Capital Unlimited liability of Karta Lack of stability Less motivation Limited Growth and Expansion No entry for non family members No Legal Status
1. Limited Capital: -This type of business does suffer from the limitation of capital. This is because the business has to depend upon the savings of the family. Again, limited amount of borrowings is possible from friends, banks and others. 2. Unlimited liability of Karta: -The liability of the karta is unlimited but the liability of co-parceners is limited. The karta is liable to pay the dues even from his personnel property. Unlimited liability makes him more cautions and he may not take any risk.
3. Lack of stability: -The continuity and stability of the firm depends upon good relations among the family members but in practice it is not possible. Therefore there may be results in the discontinuation of the firm. However in many case there is continuity of business.
4. Less motivation: -All the members of the family are entitled to equal share whether they put in work or not. There is no relation between efforts and rewards. Hence, there is less motivation to put in more effort.
5. Limited Growth and Expansion: -The investment of the joint Hindu family business is limited. Growth and expands is possible only when there is large investment. But the liability of the Karta is unlimited. Hence, there is less scope for Growth and expansion.
6. No entry for non family members: -Only family members can get entry into the business. Outsiders are not allowed to interfere in the family business. So there is less scope for increasing the capital of family members.
7. No Legal Status: -Like Sole trading concern, the Joint Hindu family business lacks legal status. The registration of this type of business is not compulsory. The members and the firm do not have separate entity.
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3.
DEFINE PARTNERSHIP FIRM? EXPLAIN ITS MERITS AND DEMERITS?
Meaning: - Partnership is a voluntary association of two or more people who contributes skill and time for carrying on a lawful business for their benefits. It is the second stage in the evaluation of commercial organization. It comes into existence under the partnership act 1932. The liability of the partner is joint several and unlimited. Definition: -Partnership is the relation between persons who have agreed to share the profits of a business carried on by all or any of them acting for all. (Section 4 of the Indian Partnership Act, 1932.) The merits of partnership firms points are explained briefly as under 1. 2. 3. 4. 5. 6. 7. Easy formation Business Secrecy Limited Government control large capital Flexibility in operation Easy dissolution Effort-Reward Relationship
1. Easy formation: -The formation of a Partnership is quite easy, less expensive and does not involve any legal formalities. An oral or written agreement is sufficient to start partnership. 2. Business Secrecy: -Business Secrecy can be maintained because the annual accounts are not required to be published. Business secrets are known to partners only. Hence, there is a chance of maintaining maximum business secrecy. 3. Limited Government control: -Partnership is based on mutual trust, confidence and co-operation, registration is not compulsory. There fore interference from government in partnership business is limited. 4. Large capital: -Partnership is an association of several persons. Large amount of capital can be raised through large number of partners; as compared to sole trader the partners can collect or generate huge funds from their savings and borrowings from their friends, relatives and also by the way of loans from banks. 5. Flexibility in operation: -The working of a partnership firm is flexible there are no statutory restrictions on the management of business. Partners are allowed to bring about change this brings about operational flexibility. 6. Easy dissolution: -Like formation dissolution of partnership is also easy. Events like death, insolvency and insanity of a partner are some of the reason for dissolution.
7. Effort-Reward Relationship: -There is often a direct relationship between efforts and rewards. Each and every partner puts in best efforts and the rewards are shared among themselves. The active partners may get a higher share in profits as compared to dormant partners.
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Following are the De-merits of Partnership Firm

1. Limited Membership: -There is a limit to the number of partners in a partnership firm. A maximum of 10 members can run a banking business and a maximum of 20 members are permitted in case of an ordinary partnership.
2. Unlimited Liability: -The liability of the partners is joint, several and unlimited. It means partners will be held responsible to pay off debts and obligations of the firm even out of their private estate.
3. Lack of Stability: -A partnership firm lacks stability. The life of partnership is affected by events like retirement, death and insolvency of the partners.
4. Problem of Continued Existence: -There is a problem of continued existence. Initially partners are united and the relations are friendly but with the passage of time, conflicts, misunderstanding, are commonly affected which lead to dissolution of partnership firm.
5. Lack of Public Confidence: -A partnership firm is not required to publish final accounts, sales returns etc.due to this; public confidence is limited towards this type of partnership firm. Ans as such, public may not lend money to partnership firm
6. Difficulty in admitting new partner: -There is often a difficulty in admitting new partners. This is because, some of the partners may object to such admission. Secondly, because of the restriction on the maximum number of partners, imposed by the Indian partnership Act, 1932.
7. Difficulty in Transfer of shares: -The Partners cannot easily transfer share or interest to an outside party. Prior consent is required to be obtained from all other partners. Often the other partners do not allow for such transfer of interest to an outside party. LULPLDD
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4.
DEFINE JOINT STOCK COMPANY? EXPLAIN ITS MERITS AND DEMERITS?
Meaning: -A Joint stock is an incorporated association, which is an artificial person, having independent legal status with a perpetual succession, a common seal, a common capital of transferable shares carrying limited capital. In other words, Joint Stock Company is a business organization organized and owned by shareholders but managed by directors. But the directors must have to purchase the Qualification of shares. Definition: -- PROF. (H.L.Haney) A joint stock company is a voluntary association of individual for profit, having its capital divided into transferable shares, the ownership of which is the condition of membership. The advantages of joint stock companys points explained briefly as under: 1. Large Capital: - A joint stock company can raise large amount of funds by way of shares, debentures, public deposits, loans and advance from bank and financial institution. This is due to no limit in the membership of public limited company.
2. Limited Liability: -As compared to other forms of organization a joint stock company is the best type of business organization. The liability of members of a joint stock company is limited to the face value of the shares purchased by them.
3. Transferability of Shares: -Shares of the Joint Stock Companies can be easily transferred. The transferability of shares is always welcome in this of organization. A member can sell his shares in the open market at any time or transfer it at any one. This encourages the public and others to invest in shares. 4. Specialised Management: -A Joint Stock company can afford to appoint specialised experts in the field of production and distribution. Specialised Management brings in higher returns to the company and as such the company can further expand diversify its activity. 5. Scope for Expansions: -Due to availability of huge funds, Expert management, stables and continues existence, public confidence is created. It enables the company to make progress and expand its activities. 6. Statutory Regulations: - the formation of companies is regulated by the provisions of the Indian companies Act 1956. The working of a company ism fully regulated by the company act. Sending report regularly to the registrar of companies, maintenance of statutory books, this will help to create Public confidence in this form of organization. 7. Democratic Management and Control: -The management and control of a joint stock company is in the hands of highly skilled Board of Directors. The Board of Directors are professional managers who efficiently look after the management and control of the organisation. The shareholders have the right to remove then directors if the shareholders find that the directors are insufficient or corrupt.
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The disadvantages of Joint stock companys points are explained briefly as under:-
1. Complicated Formation: -The promotion and formation of a joint stock company is complicated. A number of legal formalities have to be completed before its registration. Thus formation is time consuming.
2. Lack of Secrecy: -Business secrecy cannot be maintained in the joint stock company. All the public limited companies have to publish their final accounts as per the provisions of the companies. And this may result in lack of secrecy of business matters.
3. Selfish Management: -The directors of the company are Infact the representatives of the shareholders. They are the agents, managers and trustees of the company. But they misuse the power, because of the inactiveness and passive nature of the share holders.
4. Excessive Government Control: -The Joint Stock Companies are subject to excessive government control. A company suffers from too much of unrealistic controls over its working through government interference. Excessive controls create a lot of obstacles in the smooth working of a company.
5. Delay in Decision Making: -The process of decisions making is slow. Because the decisions are to be taken only in the meeting. As the procedure of the meeting is lengthy and time consuming. Hence, there is delay in decisions and actions.
6. Conflict of Interest: -There is often conflict of interests among the various parties in a joint stock company. There may be disputes between the management and employees. Again, there may be disputes between the directors and shareholders.
7. Problem of Flexibility: -A Joint Stock Company is less flexible as compared to sole trading and partnership firm. This is because; it cannot change or take immediate decisions. Again, if they want their line of business may require the approval of the shareholders.
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5.
DEFINE CO-OPERATIVE SOCIETY? EXPLAIN ITS MERITS AND DE-MERITS?
Meaning: -A Co-operative society is an organization, which is service oriented rather than profit oriented. It is an association of persons who joint to form an organization for mutual benefit. In other words, co-operative organisation is defined as a form of organisation where in person voluntarily associate together as human being on the basis of equality for economic interests for themselves. Following points are the merits of co-operative society:
1. Easy Formation: -As per the co-operative society act 1956 it can be easily formed. The minimum number of members required is 10. The Procedure of registration with the registrar of co-operative societies is also simple and less expensive.
2. Limited Liability: -In a co-operative society, the liability of each member is limited. The liability of the members is limited to the face value of shares purchased by them.
3. Low overhead cost: -The overhead costs are comparatively low. The members of the managing committee may provide honorary services. It has government support also.
4. Stability: -The Co-operative Society enjoys stability and continued existence. A co-operative society has a long life. It is not affected due to death, insolvency or insanity of a member. Hence, there is a stability of business.
5. Open Membership: -The membership of a co-operative society is open to all members of the public. Irrespective of castes, creed, religion and so on.
6. Socially Desirable: -Co-operative societies are formed to help the poor and middle-income people. They protect the society from the evils of monopoly and concentration of economic power. Hence, it develops social desirability among the people.
7. Reasonable Prices: -The members can make their purchases at reasonable prices. This is because the main objective of the cooperative is to provide service to its members. Profits become the secondary motive.
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Following points are the de-merits of co-operative society

1. Limited Capital: -A co-operative society can collect limited capital only from the members. As it is, a local organisation and member are poor and middle income group.
2. Lacks of Business Secrecy: -In a co-operative society, it is not possible to maintain secrecy. Democratic management also effects business secrecy. Because the business done in this organisation is openly.
3. Lack of Motivation: -Most of the members in a co-operative organisation are less educated and ignorant about the rights and principles of co-operative. Hence, there is lace of motivation in a cooperative society.
4. Lack of Economies of Scale: -A Co-operative society lacks economics of scale. This is because the co-operative conducts its business activities in a local area on a limited basis.
5. Non-Transferability of Shares: -The shares of co-operative society are not freely transferable to any one. Every member can purchase a limited number of shares, as there are restrictions for purchasing more numbers of shares.
6. Political Interference: - The Co-operative organisation acts as a platform for political interests. At the time of elections to managing committee, some of the political parties get involved.
7. Limited Scope for Expansion: -A co-operative society is owned managed and controlled by middle class people. The capital of this people is limited. Its area of operation is also restricted to certain extent only. Hence, there is limited scope for expansion.
8. Lack of Loyalty among Members: -The members are often not loyal to their cooperatives. Some of the members may buy their requirements from private traders rather than buying from co-operative.
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Explain the characteristics of an ideal form of a business organisation? Pg 93
Meaning: -Before selecting a suitable form of commercial organization, entrepreneur[s]will have to consider a number of factors. The choice of the form of commercial organization largely depends upon the following factors. Following are some of the important features of ideal forms of business organisation:
1. Ease in Formation: - An ideal form commercial organization is one, which can be formed with ease.
It should involve the least expense and minimum legal formalities. On this account, the sole trading concern scores over the other forms of commercial organization.
2. Ease in Raising Capital: - Every commercial organization requires capital. Some organization may
require less capital. Whereas others may require more capital. When a small amount of capital is required, then the entrepreneur himself can invest. However the amount of capital is large, then Joint Stock Company is the most suitable form.
3. Extent of Liability: - The owner (s) of a business would normally prefer limited liability. In such a
case, the joint stock company form of commercial organization is ideal. All other form of organization requires more liability except co-operative society.
4. Business Secrecy: -The sole trader can maintain complete business secrecy. This is because; he
undertakes business activities all by himself. However, business secrecy may not be possible in joint stock companies and to a certain extent in partnership firms.
5. Continuity and Stability: - an ideal form of organization should exist for a long period of time. It
must not be closed down or wound up within a short period of time. Here a joint stock company and a co-operative society have an advantage over sole trading concern and partnership firm.
6. Flexibility of operations: - Flexibility refers to the ability of the organisation to adjust its activities,
depending upon the changed situation. On this account, the sole trading concerns and partnership firms outweigh the joint stock companies.
7. Ownership Management and Control: -As far as possible, there should be a direct relationship
between ownership, management and control. Those who manage must have complete control over business matters. On this account, the sole trading concerns and partnership firms outweigh the joint stock companies.
8. Tax Considerations: -An ideal form of commercial organisation should attract minimum tax
liability. Here the sole trader scores over the partnership firm and joint stock companies.
9. Minimum Government Regulations: -As far as an ideal form of commercial organisation must be
subject to least government regulations. A Joint stock Company is subject to more government regulations, and the sole trader is least subject to such regulations.
10. Bargaining Power: -An ideal form of commercial organisation also needs to have a good bargaining
power with the suppliers and customers. The joint stock company may scores over the partnership firm and the sole trading concern in this respect.
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7.
WHAT ARE THE DIFFERENT TYPES OF COMPANIES?
There are different types of companies. A brief explanation on the various types of companies is given below:
ON THE BASIS OF INCORPORATION
1. Chartered Company: - A chartered company is a company, which is, establish under a special
charter issued by the head of the state i.e. the king or queen. British East Indian Company is an example of such company. In India, such types of companies do not exist.
2. Statutory Company: - A statutory company is formed under a special Act or statute passed by
legislature [parliament] of the country. Such companies are subject to the provisions of special act. The R.B.I & U.T.I are some of examples.
ON THE BASIS OF LIABILITY
3. Company limited by Shares: - In this type of company, the liability of the members is limited to
the extent of the unpaid value on shares.

4. Unlimited Company: - In this type of company, the liability of the members is unlimited. They
are not found in India due to risk involved at the time of winding up. ON THE BASIS OF OWNERSHIP
5. Government Company: -It is that type of company in which not less than 51% of the paid up
capital is contributed by the government i.e. central and/or state government[s].

6. Non-Government Company: -Such companies are owned by private parties and government is
not involved. Most of the joint stock companies in India belong to this category.
ON THE BASIS OF NUMBER OF MEMBERS
7. Public Limited Company: -A companies which are owned, managed and controlled by
government on behalf of people are known as public limited company. A public limited company must have minimum 7 members and maximum number of member is unlimited. After getting certificate of incorporation and trading certificate. It must hold statutory meeting.
8. Private Limited Company: - A companies, which are owned, managed and controlled by private
organizations, are called private limited company. A private limited company must have minimum 2 members and maximum number of member is 50. It can start its business after getting certificate of incorporation. It need not have to hold statutory meeting.
ON THE BASIS OF CONTROL
9. Holding Company: - A holding company controls some other company by holding a majority of
shares or by controlling the composition of the board of that company.
10. Subsidiary Company: - It is that company which is controlled by another company i.e. by the
holding company. 56 Achieve success through
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Explain the Merits and Demerits of Multinational Corporations?
Meaning: - The term Multinational is widely used all over the world to denote large companies having vast financial, managerial and marketing resources. MNCs are like holding companies having its head office in one country and business activities spread within the country of origin and other countries. IBM computer and Pepsi-Cola from U.S.A., Siemens from Germany, Sony and Honda from Japan Philips from Holland etc., are some of the MNCs operating at international levels. Definition:-According to ILO report (i.e. International Labour Organisation) The essential nature of the multinational enterprises lies in the fact that its managerial headquarters are located in one country, while the enterprise carries out operations in number of other countries. The following are the benefits/merits of MNCs: 1. Economic Development: -The Developing countries need both foreign capital and technology to make use of available resources for economic and industrial growth. MNCs can provide the required financial, technical and other resources to needy countries in exchange for economic gains. 2. Technology Gap: - MNCs are the instruments of transfer of technology to the host country. Technology is necessary to bring down cost of production and produce quality goods on a large scale. The services of MNCs can be of great help to bridge the technological gab between developed and developing countries. 3. Industrial Growth: - MNCs are dynamic and offer growth opportunities for domestic industries. MNCs assist local producers to enter the global markets through their well established international network of production and marketing. And there by ensure industrial growth.
4. Marketing Opportunities: - MNCs have access to many markets in different countries. They have the necessary skills and expertise to market products at international level. For example, an Indian Company can enter into Joint Venture with a foreign company to sell its product in the international market.
5. Work Culture: - MNCs introduces a work culture of excellence, professionalism and fairness in deals. The sole objective of Multinational is profit Maximation. To achieve this, the Multinationals use various strategies like product innovation, technology up gradation, professional management etc.
6. Export Promotion: - MNCs assist developing countries in earnings foreign exchange. This can be done by promoting and developing export oriented and import substitute industries.
7. Research and Development: -The resources and experience of MNCs in the field of research enables the host country to establish efficient research and development system. It is a fact that many MNCs are now shifting their research units to countries like India to avail of monetary incentives and cheap labour.
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The following are the De-merits MNCs

1. Problem of Technology: - Technology developed by MNCs from developed countries does not fully fit in the needs of developing countries. This is because, such technology is mostly capital intensive.
2. Political Interference: -The MNCs from developed countries are criticised for their interference in the political affairs of developing nations. Through their financial and other resources, they influence the decision-making process of the governments of developing nations.
3. Self-Interest: -MNCs work towards their own self-interest rather than working for the development of host country. They are more interested in making profits at any cost.
4. Outflow of foreign Exchange: -The working of MNC is a burden on the limited resources of developing countries. They charge high price in the form of commission and royalty paid by local subsidiary to its parent company. This leads to outflow of foreign exchange.
5. Exploitation: - MNCs are criticised for exploiting the consumers and companies in the host country. MNCs are financially very strong and adopt aggressive marketing strategies to sell their products, adopt all means to eliminate competition and create monopoly in the market.
6. Investment: -MNCs prefer to invest in areas of low risk and high profitability. Issues like social welfare, national priority do not find any place on the agenda of MNCs.
7. Artificial Demand: -MNCs are criticised on the ground that they create artificial and unwarranted demand by making extensive use of the advertising and sales promotion techniques.
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9. EXPLAIN THE SOCIAL RESPONSIBILITY OF COMMERCIAL ORGANISATION TOWARDS EMPLOYEE AND SHAREHOLDERS? Definition: -H.R.BOWEN defines Social responsibility of business refers to the obligation of business to pursue those policies, to make those decisions, or to follow those lines of actions, which are desirable in terms of objectives and values of our society.
Meaning: -The survival & success of a business depends upon the service of its efficient work force. Human resource or employees is one of the greatest resources of all the resources.
1. Job security: -The Company should provide job security to its employees. The workers should not be kept temporarily for a long time. They must be given permanent jobs. Otherwise they may be frustrated.
2. Monetary factors: - Workers should be paid adequate wages and other incentives like bonus, medical allowance, travelling allowance; etc Prompt payment often results in higher motivation to the workforce.
3. Working conditions: - The workers should be provided with good working conditions. There should be adequate lighting and ventilation. Noise, dirt and dust pollution should be avoided.
4. Health and Safety measures: - The Company should take adequate measures to protect health of the employees. They should be provided with canteen facilities, and medical facilities. Proper maintenance of machines and buildings must be done to prevent accidents.
5. Proper personal policies: - There must be proper personal policies in respect of transfers, promotions, recruitment, training, etc. There should be no partiality in Promotions and transfers of employees.
6. Workers Participation in Management: -The Workers must been courage to take part in management. There are different ways of workers participation in management, such as quality circles, work committee, suggestions scheme, and co-partnership, etc., 7. Grievance Procedure: -There should be a proper Grievance Procedure to handle employees complaints. Any complaint of the employee must be immediately sorted by following suitable Grievance Procedure.
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SOCIAL RESPONSIBILITIES OF COMMERCIAL ORGANISATION TOWARDS SHAREHOLDERS
The shareholders are the owners of the company. They have invested their funds for higher returns. They expect certain responsibilities on the Part of the management.
1. Fair return on investment: -The shareholders expect a fair return on their investment. After all they have invested their valuable resources.
2. Expansion and Diversification: -The shareholders expect that the management should undertake expansion and diversifications programmes. This will result in more returns to the shareholders.
3. Proper use of Shareholders Funds: -The shareholders expect optimum utilization of their funds. They will not tolerate the management, if it spends their funds in unproductive manner.
4. Proper conduct of share holders meetings: -The shareholders want fair conduct of meeting. There should be fair conduct of meetings. There should be fair elections at company meetings.
5. Proper Disclosure: -The management should make a proper disclosure regarding the affairs of the business. The accounts must be properly maintained and audited from time to time. The share holders should allowed getting the copies of the audited report sheets of the company.
6. Good public image: -The shareholders expect that the management should develop and maintain a good public image. A company that enjoys name and goodwill commands a lot of respect and trust in the share market, labour market, consumer market, and so on.
7. Periodic Information: -The Shareholders expect the company to inform them about important happenings in the company, either at company meetings or through correspondence. The shareholders have a right to be informed of the development in the company.
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ORGANISATION OF COMMERCE AND MANAGEMENT 10. EXPLAIN THE SOCIAL RESPONSIBILITY OF COMMERCIAL ORGANISATION TOWARDS EMPLOYEES AND GOVERNMENT? Definition: -H.R.BOWEN defines Social responsibility of business refers to the obligation of business to pursue those policies, to make those decisions, or to follow those lines of actions, which are desirable in terms of objectives and values of our society.
FOR EMPLOYEE REFER FROM PAGE NUMBER 58
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RESPONSIBILITIES TOWARDS GOVERNMENT

The Government also expects social assistance from the corporate sector in the following areas:1. Assistance in implementing Socio-economic policies: -The government expects cooperation and assistance from the business sector to assist it in implementing socio-economic programmes
2. Payment of Taxes: -The government expects the corporate sector to pay taxes and duties regularly. If the corporate sector does not pay taxes and duties on time, then it would be difficult for the government to undertake its plans.
3. Observance of Government Rules and Regulations: -The government expects strict observances of its rules and regulations on the part of the corporate sector. If the corporate sector has any valid suggestions to modify the rules and regulations, then it should do so in the interest of the society as a whole.
4. Political Stability: -The corporate sector should work towards the political stability of the country. A stable government often brings more returns and peace in a democratic society. Therefore, corporate sector should not support those elements who are indulging in political instability.
5. No seeking of Unfair Favours: -The companies should not seek unfair favours from government officials by bribing or influencing them.
6. Earnings of Foreign Exchange: -Companies, especially the large ones should enter in export trade to earn valuable foreign exchange for the country. This foreign exchange is necessary to pay for vital imports.
7. Advising the Government: -Corporate sector should provide timely advise to the government in respect of framing various policies, such as export-import policy, licensing policy, industrial policy. Etc,
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ORGANISATION OF COMMERCE AND MANAGEMENT 11. EXPLAIN THE SOCIAL RESPONSIBILITY OF COMMERCIAL ORGANISATION TOWARDS CUSTOMER AND SOCIETY OR COMMUNITY? Definition: -H.R.BOWEN defines Social responsibility of business refers to the obligation of business to pursue those policies, to make those decisions, or to follow those lines of actions, which are desirable in terms of objectives and values of our society. The survival and growth of a business depends upon customers satisfactions, service, and support. The company should win over the confidence of the customers.
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1. Quality: -The Company should produce quality goods. The company should always strive to improve its quality. At no time quality can be 100%, and as such there is always a room for improvement.
2. Fair Price: -The consumers will not take if they are being cheated. After all, the company will not be able to fool the consumers all the time.
3. Honest Advertising: -The consumers expect true facts of the product, its uses, merits, and side effects and so on. They will not like exaggerated and tall claims. The company should also refrain from vulgar and unethical advertisement.
4. Availability of Goods: -The consumers should be made available the goods regularly as and when they need it. The company should not create artificial shortage and hoard the goods in cooperation with unethical dealers.
5. After Sales Service: -The consumers expect efficient and effective after-sale-service, especially in the case of consumers durables.
6. Redressal of Complaints: -The complaints of the consumers must be immediately dealt with. Valid suggestions of the consumers must be taken into consideration.
7. Research and Development: -The Consumers expect the company to conduct research and development for the purpose of improving the quality and reducing the cost of the product.
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RESPONSIBILITY OF COMMERCIAL ORGANISATION TOWARDS SOCIETY/ COMMUNITY
1. Protection of Environment: -A business should act as a good and useful citizen of society. A business should ensure that its production process does not create environmental pollution. The Company should take all possible measures to prevent air, and water pollution.
2. No Discrimination: -A business should not discriminate the society of individual on the basis of race, religion, caste, sex, etc., in providing employment to people.
3. Optimum use of Resources: -The business firms make use of scarce natural resources such as raw materials of iron, steel, fuel, and so on. And also a business should take adequate
4. Upliftment of Backward Regions: -The society expects that the companies should start industries in backward areas. This will generate employment facilities and increase in purchasing power of the rural masses.
5. Help to weaker sections of the Society: -The business organisation should also uplift the weaker sections of the society. Certain jobs may be reserved for economically weaker section of the society.
6. Financial Assistance: -The society also expects donations and financial assistance to various social causes, such as eradications of poverty, illiteracy, etc. they expect the company to take part in antidrug campaigns, anti-noise campaigns, and so on.
7. Prevent Congestion in Cities: -The companies should also work to avoid congestion in cities by spreading their industries in different places and locations.
8. Expansion: -The society expects expansion and diversification of industries so as to generate employment opportunities and at the same time to enhance standard of living of the society.
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11. EXPLAIN THE SOCIAL RESPONSIBILITY OF COMMERCIAL ORGANISATION TOWARDS SUPPLIERS FINANCIAL INSTITUTION AND COMPETITORS? (B)
H.R.BOWEN defines Social responsibility of business refers to the obligation of business to pursue those policies, to make those decisions, or to follow those lines of actions, which are desirable in terms of objectives and values of our society.
Suppliers:
Suppliers are businessmen who supply raw materials and other items required by manufacturers and traders. Certain suppliers, called distributors, supply finished products to the consumers. To suppliers, a business enterprise is expected,
1. 2. 3. 4. 5. 6. 7.
To ensure timely payment of the dues. To avail reasonable credit period. To maintain fair standards of trading. To honour terms and conditions of purchase or sale. To respect settlement dates. (i.e. Payment of accounts) To give regular orders for purchase of goods. To deal on fair terms and conditions.
Financial institution:
1. The Payment of loan and interest instalments must be made on time. 2. They should not bribe bank officials in sanctioning loans. 3. Provide regular reports to the financial institutions. 4. There should be proper use of funds provided by financial institutions. 5. They should not convert bank loans into bad debts.
Competitors:
Competitors are the other businessmen or organisation involved in a similar type of business. Existence of competition helps the business in becoming more dynamic and innovative so as to make itself better than its competitors. It also sometimes encourages the business to indulge in negative activities like resorting to unfair trade practices. The responsibilities of business towards its competitors are: 1. 2. 3. 4. Not to offer exceptionally high sales commission to distribution, agents etc. Not to offer to customers heavy discounts and/or free products in every sale. Not to defame (insult) competitors through false or ambiguous advertisements. Not to resort to unfair trade practices.
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13.
DEFINE PLANNING? EXPLAIN ITS FEATURES AND IMPORTANCE?
Meaning: - Planning provides a sense of direction to business activities. If you dont know where you are going, no road will take you there. Planning bridges the gap from where we are and where we want to go. Definition: - Koontz and ODonnell Planning is deciding in advance what to do, how to do it, when to do it, and who is to do it Planning bridges the gap from where we are and where we want to go..
The nature and characteristics of planning can be explained as follows: 1. Planning is goal oriented: - Planning is goal-oriented in the sense that plans are developed and executed to achieve goals. At first the goals are set, and then plans are framed to accomplish them.
2. Future Oriented: - Planning is future related activity. Necessary forecasts are made about the future and accordingly plans are made. In other words, plans are made for the future activities-whether short term, medium term, or long term.
3. Continues activity: - Planning is a continues activity. It is an ongoing process. Effective planning requires constant and continues checking of events. Accordingly plans are redrawn depending upon the situation or circumstances at the time of implementation.
4. Link between the past, present and future: - Planning acts as a link between the past, present and future. Although planning is a future related activity, yet, one cannot totally ignore the past and present events and achievements while planning for the future events or achievements. It is the past experience that helps in preparing realistic future plans.
5. Primacy of planning: - Planning is the primary or basic function of management. Without planning, it would be difficult to organise, to direct, and to control. When the plans are well defined and clear, it would be easy to organise the resources, to provide necessary directions, and to take proper control measures.
6. Pervasiveness of planning: - Planning is the function of every manager. The need for planning exists at all levels of management. Such as government organisation, educational institution, charitable trust, etc.
7. Intellectual process: - The success of plans depends upon to a great extent on the intelligence of the manager. A great deal of imagination and intelligence is needed to prepare sound plans.
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FOLLOWING ARE THE NEED/IMPORTANCE/OBJECTIVE/ROLE/FUNCTION/OF PLANNING
Meaning: - Planning provides a sense of direction to business activities. If you dont know where you are going, no road will take you there. Planning bridges the gap from where we are and where we want to go. Definition: - Koontz and ODonnell Planning is deciding in advance what to do, how to do it, when to do it, and who is to do it Planning bridges the gap from where we are and where we want to go.
The need and importance of planning can be explained as follows

1. Minimizes Risks: - Planning helps to minimize or reduce risks. Potential risks are forecasted and necessary protective devices are decided well in advance. If the risks occur, then the protective devices are put into practice.
2. Facilitates Coordination: - The plans of one department are coordinated with the plans of all other concerned departments. This brings in unity among of all various departments of the organisation.
3. Facilitates Organising: - Planning enables a manager to organise he resources properly. Depending upon the targets, the manager will make proper arrangement of all resources.
4. Facilitates Proper Direction: - Planning provides proper schedules or time table or to when the activities need to be conducted. Planning enables superiors to give clear directions to the subordinates so that they undertake the right tasks at the right time.
5. Facilitates Control: - A plan provides a yardstick (target) against which actual performance can be compared. If deviations are notices, the manager may take the right corrective steps at the right time.
6. Optimum Utilisation of Resources: - Planning enables optimum utilisation of resources. All the resources i.e., physical, financial and human resources are put to their best use.
7. Encourages Innovation: - The planning process encourages creative thinking on the part of managers.
8. Focus on Goals: - Planning is goal oriented in the sense that plans are developed and executed to achieve certain goals. Every activity is directed towards the attainment of goals. 5
MF EO
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14.
ORGANISATION OF COMMERCE AND MANAGEMENT DEFINE ORGANIZAING? ALSO EXPLAIN ITS FEATURES AND IMPORTANCE?
Meaning: -To conduct any activity-business or non-business, there is a need for an organisation. If there is no organisation, it is not possible to conduct activities. Organisations big or small have at least two common characteristics. They are composed of people, and They exist to achieve goals. Definition: - Louis Allen defines organisation as The process of identifying and grouping of the work to be performed, defining and delegating responsibility and authority, and establishing a pattern of relationship for the purpose of enabling people to work most effectively together in accomplishing objectives.
The main characteristics of an organisation are as follows: 1. Structure of Relationships: - organisation is a chain of relationships among different parts of an organisation. There is a need for relationships between superior and subordinates, various departments, and various levels. It is through effective relationships, the organisation progresses and prospers.
2. Common objectives: - every organisation exists to achieve certain goals. The overall goals of the organisation are decided by the top management. Individuals and departments set their own goals. The goals of the individuals and departments must be in line with overall goals.
3. Group of individuals: - organisation consists of a group of individuals who come together to achieve the goals of the organisation. Without people associating themselves, organisation is meaningless.
4. Division of work: - In every organisation, there must be division of work; the work of the organisation must be divided among the individuals and department. Division of work leads to specialisation, and brings certain benefits such as quality and quantity improvement and reduction in costs.
5. Co-ordination: -In every organisation there is a need for a system of c0-ordination. This is required to inter-link the various activities in the organisation. There is a need for co-ordination throughout the organisation.
6. Authority: - Authority is the power to take and to get the work done from the subordinates. Every manager in the organisation must be given adequate authority so that he can take the right decisions to get the work done. 7. Responsibility: - The managers who are provided with authority must be made responsible. There must be a balance between authority and responsibility.
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ORGANISATION OF COMMERCE AND MANAGEMENT FOLLOWING ARE THE PORTANCE/OBJECTIVE/ROLE/FUNCTION/OF ORGANISING
Meaning: -To conduct any activity-business or non-business, there is a need for an organisation. If there is no organisation, it is not possible to conduct activities. Organisations big or small have at least two common characteristics. They are composed of people, and They exist to achieve goals. Definition: - Louis Allen defines organisation as The process of identifying and grouping of the work to be performed, defining and delegating responsibility and authority, and establishing a pattern of relationship for the purpose of enabling people to work most effectively together in accomplishing objectives. The need and importance of organising can be explained as follows: 1. Ensures Co ordination: - Due to good organisation structure, coordination is possible in the organisation. Coordination refers to interlinking of actions of the subordinates by the superior. 2. Optimum Utilisation of Resources: - Organisation ensures optimum utilisation of resource i.e., human, financial and physical resources are put to best possible use.
3. Facilitates Effective Management: - A properly designed organisation facilitates effective management. It avoids confusion, delays and duplication of work.
4. Motivates Personnel: - A sound organisation avoids confusion, misunderstandings and overlapping of functions, and as such employees are motivated to produce their better results.
5. Facilitates Delegation of Authority: - A good organisation structure enables the superiors to delegate authority to the subordinates. The superiors are in a position to delegate the proper degree of authority to the right subordinates.
6. Encourages Initiative and Innovation: - Due to effective delegation of authority, there is freedom of self expression. The subordinates are encouraged to show their initiative, which helps the organisation to excess and grow.
7. Technological Improvements: - Sound organisations have contributed to the technological developments. Through research and development, the organisation comes with new methods, new machines, and techniques. 8. Facilitates Growth: - sound organisations achieve good success. This enables the organisations to grow and diversify. Large progressive firms are the direct outcome of the success of effective organising.
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ORGANISATION OF COMMERCE AND MANAGEMENT DEFINE STAFFING? ALSO EXPLAIN ITS FEATURES AND IMPORTANCE?
Meaning: - There are no two opinions that people alone will determine the fate and future of the organisation. Therefore, management should place proper focus on the function of staffing. The staffing function includes the following elements: 1. Recruitment and selection of employees 2. Placing the right person at the right job 3. Performance appraisal of the employee 4. Promotion and transfer of employees. 5. Training and development. Definition: - H Koontz defines staffing as filling and keeping filled, positions in the organisation structure. The nature of the staffing can be briefly explained as follows: 1. Continues Process: - staffing is a continues process. As long as the organisation exists, there is a need for staffing. It is not enough to select people, and make them to work. There is a constant need to monitor the performance of the employees through performance appraisal reports. If required, training may be provided to the employees on regular basis. 2. Multi-dimensional in nature: - staffing is multi-dimensional in nature. It involves various subelements. Each of the sub-elements is vital to the success of the organisation. The various sub elements are as follows: Recruitment and selection of employees Placing the right person at the right job Performance appraisal of the employee Promotion and transfer of employees. Training and development
3. Factors: - staffing depends on various factors. The factors affecting staffing can be broadly divided into two groups. Internal Factors such as image of the firm, expansion or growth plans, etc. External factors such as educational standards, labour policy of the government. Etc. 4. Result-oriented function: - The staffing functions places emphasis on results. All the sub-functions of staffing aim at achieving higher efficiency and productivity.
5. Systematic approach: - staffing requires systematic approach. For instance, there should be a systematic approach in selection of employees. The firm should select the right people by conducting systematic interviews. 6. Long-term benefits: - staffing aims to obtain long-term benefits. The long-tem benefits include Corporate image. Market Share. Loyalty of employees. Loyalty of customers, etc.
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Meaning: - There are no two opinions that people alone will determine the fate and future of the organisation. Therefore, management should place proper focus on the function of staffing. The staffing function includes the following elements:
1. Recruitment and selection of employees 2. Placing the right person at the right job 3. Performance appraisal of the employee 4. Promotion and transfer of employees. 5. Training and development.
Definition: - H Koontz defines staffing as filling and keeping filled, positions in the organisation structure. Staffing is important due to the following reasons: 1. Helps to Achieve Objectives: - staffing helps to achieve organisational objectives. Through proper staffing policies, such as motivational policies, motivates the employees to put in their best efforts, which in turn helps to achieve organisational goals.
2. Job satisfaction: - Staffing generates job satisfaction in the employees. For instance, proper placement and promotion policies enhance job satisfaction. Higher job satisfaction leads to higher efficiency.
3. Labour Relations: - Staffing policies helps to develop good labour relations. Due to proper staffing policies, the employees develop positive attitude towards the management and organisation, and therefore, the labour relations improve considerably.
4. Improve Efficiency: - Staffing helps to improve efficiency and productivity of the organisation. Due to proper staffing policies, the employees are motivated to put in their best efforts, which in turn improve efficiency. 5. Reduces Absenteeism: - Proper staffing helps to reduce absenteeism. Employees work with application and dedication and they become loyal to the organisation.
6. Optimum Use of Resources: - Staffing helps to make optimum use of resources. Due to proper staffing, not only human resources are put to maximum possible use, but also the physical and financial resources as well. 7. Reduces Employee Turnover: - Proper staffing helps to reduce employee turnover. Employees work with application and dedication and they become loyal to the organisation. 8. Team work: - Proper staffing facilitates team work in the organisation. Disputes in the organisation are reduced to the minimum due to proper staffing policies.
9. Enhance Corporate Image: - Staffing leads to better performance. This helps to improve corporate image. Corporate image gives competitive advantage in the market.
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ORGANISATION OF COMMERCE AND MANAGEMENT 16. DEFINE DIRECTING? ALSO EXPLAIN ITS CHARACTERISTICS AND IMPORTANCE?
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Meaning: -Directing is one of the most important functions of management. Directing involves instructing, guiding and inspiring people in the organisation tom achieve desired objectives. Definition: - According to J.L. Massie Directing concerns the total manner in which a manager influences the actions of subordinates. It is the final action of a manager in getting others to act after all preparations have been completed. Nature and characteristics of Directing as a function of management are as follows: 1. Continuous Process: - Directing is a continuous process. As long as the organisation exists, there is a need for directing. Managers need to direct their subordinates to get the work done effectively and efficiently.
2. Focus on goals: - Directing place emphasis on goals. The manager gives directions to the subordinates to achieve the goals. Depending upon the goals, a manager makes use of the elements of directing communication, leading, and motivation.
3. Creativity activity: - Directing is a creative activity. Managers need to be innovative in giving instructions to the subordinates. They should also provide new and innovative ideas to the subordinates to complete the work effectively and efficiently.
4. Individual approach: - Directing is affected by individual approach of the manager. Every manager should follow his own leadership style in leading and motivating the subordinates. One should not copy the leadership styles of the other manage in directing the subordinates.
5. Psychological Factor: - There is lot of psychological factor in directing. The manager should analyse the feelings and emotions of the subordinates and accordingly deal with them. The manager must also respect the subordinates to get the work done from them effectively and efficiently.
6. Linking Function: - Directing links planning and controlling activities. The plans are put into action through effective directing. The comparison of actual performance (due to directing) can then be compared with actual plans.
7. Chain of command: - Directing follows the principle of chain of command. The directions normally flow from top to down through the chain of hierarchy in the organisation. For instance, the top direct the middle level, the middle level directs the lower level, and accordingly the lower level directs the subordinates.
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Meaning: -Directing is one of the most important functions of management. Directing involves instructing, guiding and inspiring people in the organisation tom achieve desired objectives. Definition: - According to J.L. Massie Directing concerns the total manner in which a manager influences the actions of subordinates. It is the final action of a manager in getting others to act after all preparations have been completed. Proper directions help in the following ways: 1. Facilitates Innovation: -Proper directions facilitate innovation in the organisation. Due to effective directions, employees may be motivated to come up with innovative ideas, plans, and policies.
2. Corporate Image: -Proper directions help to improve corporate image. Due to effective directions, there can be better performance of the employees. The better performance of the employees can help to develop goodwill in the market.
3. Team Work: - Directing develops team spirit in the organisation. It is the team work that brings success to the organisation. Due to effective directions of the superiors, the subordinates work as a team.
4. Optimum use of Resources: -Directing facilitates optimum use of resources. Through effective directions, the manager can make optimum use of resources such as 1. Physical resources, 2. Financial resources. 3. Human resources.
5. Motivation: -Directing facilitates motivation of employees in the organisation. The managers can motivate the subordinates to perform effectively through effective communication, and leading.
6. Reduction in wastages: - Effective directions help to reduce wastages of resources. The subordinates would make every possible effort to minimize or avoid wastages of resources, wherever possible.
7. Reduces Absenteeism: -Proper directing helps to reduce absenteeism. For instance, if a lecturer gives proper directions to the students, then the absenteeism on the part of the students may be reduced considerably.
8. Higher Efficiency: -Proper directing can facilitate higher efficiency in the organisation.
Efficiency is the ratio or returns to cost. Due to effective directions, there can be higher returns at reduced costs.
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OMTEX CLASSES ORGANISATION OF COMMERCE AND MANAGEMENT 17. DEFINE CO-ORDINATION? ALSO EXPLAIN ITS NATURE AND IMPORTANCE
Meaning: -Co-ordination refers to inter-linking of actions. There is a need or co-ordination at all levels. The top management has to coordinate the plans of the middle level managers or the departmental managers. The middle level managers are responsible to coordinate the activities of the lower level managers. The lower level managers are responsible to coordinate the activities to their subordinates. Definition: - Theo Haimann defines co-ordination as Coordination is the orderly synchronizing of efforts of the subordinates to provide the proper amount, timing and quality of execution so that their unified efforts lead to the stated objective, namely the common purpose of the enterprise. Nature and characteristics of Coordination are as follows: 1. Essence of management: - Coordination is the essence of management. There is a need for Coordination in every function of management. For instance, there is a need for Coordination in planning. The top management has to coordinate the plans of the middle level managers or the departmental managers. 2. Managerial Responsibility: - Coordination is the basic responsibility of the managers at all the levels. The top-level managers are responsible to coordinate the activities of the middle level managers. The middle level managers are responsible to coordinate the activities of the lower level managers. The lower level managers are responsible to coordinate the activities to their subordinates. 3. Deliberate Effort: - Coordination involves deliberate effort on the part of managers. It does not arise spontaneously or by chance. Managers have to make definite efforts to coordinate the activities of their subordinates. 4. Creativity: - Managers require creativity or innovativeness to coordinate the activities of the subordinates. One cannot copy earlier decisions or efforts in coordinating the activities of the subordinates. Coordinating the activities involves lot of challenges, especially in the case of complex activities and in the case of sensitive matter.
5. Continuous process: - Coordination is a continuous process. As long as the organisation exists, there would be activities. Therefore, there is a need to coordinate the activities of the organisation on the part of the management.
6. Required in group activity: - Coordination is required, when there is group activity. Coordination is not required in the case of individual activity. If an individual person carries on the work, then there is no question of coordinating the activities. Coordination arises only when there is group activity.
7. Coordination is different from co-operation: - Coordination and cooperation are not one and the
same. Cooperation involves willingness on the part of people to help one another. However, Coordination is the function of managers, whereby they try to interlink the activities of their subordinates. Coordination is broader in scope than cooperation.
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FOLLOWING ARE THE IMPORTANCE/FUNCTION/OF CO-ORDINATION

Meaning: -Co-ordination refers to inter-linking of activities in the organisation. It is very much necessary for the organisation to accomplish common goals or objectives. There is a need or coordination at all levels. Definition: - Theo Haimann defines co-ordination as Coordination is the orderly synchronizing of efforts of the subordinates to provide the proper amount, timing and quality of execution so that their unified efforts lead to the stated objective, namely the common purpose of the enterprise. The significance or importance of co-ordination can be stated as follows: 1. Integration of Group efforts: - Coordination involves integration of group effort. In the absence of Coordination, there would be confusion and disorder in the organisation, as various members may tend to work independent of each other, and as such the organisation would not be able to accomplish its objectives. It is very much necessary for the organisation to accomplish common goals or objectives.
2. Facilitates mutual Dependence: - Coordination facilitates mutual dependence in the organisation. Coordination helps to manage interdependence and interactions among the different departments or unit in the organisations.
3. Helps to resolve the conflicts: -there may be conflict of interests in the organisation among individuals and departments. For instance, there can be a conflict between finance department and marketing department on issues relating to credit period, rate of discount, and so on. It can be resolved effectively by the proper coordination of higher authorities.
4. Development of Team Spirit: - Coordination develops team spirit in the organisation. The superiors coordinate the activities of their subordinates for the purpose of achieving group objectives. For this purpose, managers need to develop team spirit among their subordinates.
5. Motivate subordinates: - Coordination facilitates motivation of subordinates in the organisation. The subordinates are motivated by the superiors by providing them monetary and non-monetary incentives. The superiors encourage the subordinates to perform better and achieve the objectives.
6. Better Relations: - Coordination develops better relations throughout the organisation. Managers at all levels coordinate the activities of the subordinates. Effective Coordination results in good relations with the subordinates.
7. Optimum use of Resources: - Coordination facilitates optimum use of resources. There is

optimum use of both physical and human resources. The resources of the organisation are put to the best possible use by the members of the organisation.
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OMTEX CLASSES ORGANISATION OF COMMERCE AND MANAGEMENT 18. DEFINE CONTROLLING? ALSO EXPLAIN ITS NATURE AND IMPORTANCE
Meaning: -Controlling is a process of monitoring actual performance, and taking corrective measures, if required. Definition: - George Terry, defines Controlling is determining what is being accomplished, that is, evaluating the performance, and if necessary, applying correcting measures so that the performance takes place according to the plans.
The nature of Controlling is explained as follows: 1. Focus on objectives: - Controlling focuses on achievement of objectives. The actual performance is compared against the targeted performance. If there are deviations, corrective measures are taken so as to attain the pre-determined objectives.
2. Continuous Process: - Controlling is continuous process. As long as the organisation exists, there are activities. And as long as there are activities, there is a need to control such activities. Therefore, controlling is a never-ending process.
3. Suggestive in nature: -The control system must be suggestive in nature. It should indicate where the problem is, who is at a fault and what should be done to correct the faults, if any.
4. Critical point Control: - It may be neither desirable nor economical to control each and every activity. Therefore, an organisation should be selective in control matters. A good control system should focus on critical factors or areas, where control is vital to ensure successful achievement of goals or targets.
5. Control by exception: - The control system should enable the managers to focus their attention on exceptional or significant deviations. The senior managers should control major or exceptional deviations. The junior managers should be allowed to control routine matters.
6. Forward Looking: -A good control system should be forward looking in nature. It should help the managers to plan their activities for the future. 7. Variety of techniques: -To control activities, management may adopt various control techniques or tools. Budgetary control. Management audit. PERT (Programme Evaluation Review Technique) CPM (Critical Path Method) MBO (Management by objectives) Break Even Analysis Management information System (MIS), etc. 75 Achieve success through
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Meaning: -Controlling is a process of monitoring actual performance, and taking corrective measures, if required. Definition: - George Terry, defines Controlling is determining what is being accomplished, that is, evaluating the performance, and if necessary, applying correcting measures so that the performance takes place according to the plans. The importance of controlling is as follows: 1. Guide to operations: -Control System guides the actions of the organisation. Activities are undertaken in the right direction. It acts as a traffic signal post, and keeps the activities moving on the right track.
2. Facilitates performance Appraisal: -Control system facilitates employee appraisal. The actual performance is measured in the light of the plans. The superior can easily measure the performance of his subordinates and provide them necessary performance feedback.
3. Improves Morale: -employees are aware that their performance is reviewed periodically. They will put in their best efforts to show better performance. Thus, employee morale is improved because those employees who show better performance are normally rewarded.
4. Facilitates Coordination: -Controlling facilitates coordination among the various departments of the organisation. Whenever, there are any, deviations, the concerned departments come together to review and to take collective and corrective measures. 5. Facilitates optimum utilisation of resources: -the resources of the organisation physical, financial and human are put to best possible use. This generates higher productivity and efficiency.
6. Minimisation of wastages: - Control helps to reduce wastages of raw materials, machines, men and money. Wasteful expenditure is avoided. There is proper material management. Again, the right personnel are placed at the right place of work.
7. Fixes Responsibility: -Control system fixes responsibility on the superiors. It is the duty of the managers to correct the activities, if they are not taking place as expected or as planned. Managers cannot simply ignore their responsibility, because it is their duty to control the activities.
8. Higher Efficiency: -Controlling brings in higher efficiency to the organisation. This is because
of optimum utilisation of resources and minimization of wastages. Again, the right corrective measures are taken at the right time.
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OMTEX CLASSES 19.
ORGANISATION OF COMMERCE AND MANAGEMENT (September 2008)
EXPLAIN THE 14 PRINCIPLES OF HENRY FAYOLS
In 1916, Henry Fayol provided a list of 14 principles in his book titled Industrial and General Administration. Fayol was of the opinion that all managers in all organisations, whether large or small, needs to follow the principle or guidelines in managing business affairs.
The 14 principles are as follows:

1. Division of Work: - The work in an organisation must be divided among individuals and departments. Division of work leads to specialisation. It results in improvement in quality, increase in quantity, and reduction in costs. Specialisation also leads to innovation. 2. Authority and Responsibility: -Fayol stressed that there should be a balanced between authority and responsibility. Authority is the power or right to take decisions. The responsibility is the obligation for accepting authority. Authority must be equal to responsibility. If authority is more than responsibility, then a manager may misuse it. And, if responsibility is more than authority, then he may feel frustrated. 3. Discipline: -Fayol stressed the need for discipline in an organisation. Discipline needs to flow from top level to lower level in the organisation. Discipline involves not only obedience to rules and regulations of the organisation, but more importantly, it involves application and dedication on the part of the employees. Fayol wrote that the best means of maintaining discipline is to have: Disciplined superiors at all levels. Clear and fair agreements, and Judicious use of penalties. 4. Unity of Command: - A subordinate should receive orders from only one superior. In turn, the subordinate should report only to one superior. Fayol observed that if one subordinate receives orders from more than one superior, then everything will be in disorder. Lack of unity of command is like Too many cooks spoil the soup. 5. Unity of Direction: -There should be the same directions to all employees doing similar activities. A particular activity must be directed with the help of a single plan. In the absence of unity of direction, there would be confusion among the employees. 6. Subordination of interest: -The interest of organisation should be primary and that of an employee or a group of employees be secondary or subordinate. Every employee or a group should work in the interest of the organisation and not for their own self interest. 7. Remuneration: - Wages and salaries should be fair. More importantly wages must be paid on time. It should depend on factors, such as cost of living, ability of the company to pay, prevailing wage rates in the industry, etc. Also the value of the employee must be taken into consideration. 8. Centralisation: -Fayol stated that certain matters are to be centralised and others to be decentralised. There is a need to have a proper balance between centralisation and decentralisation. He advised that extreme centralisation or decentralisation is to be avoided. Especially in large companies.
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ORGANISATION OF COMMERCE AND MANAGEMENT 9. Scalar Chain: -It refers to the line of command which runs from top level to the lowest level in the organisation. Fayol stated that scalar chain needs to be followed, but not at all times. He stressed that the scalar chain can be broken if the situation so demands in the interest of the organisation.
A
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P Gangplank To avoid distortion in communication and delay in action, Fayol suggested that with the help of Gangplank/bridge, F can directly communicate with P, provided both of them inform their immediate superior of any action taken.
10. Order: - Fayol stated that there should be order in the organisation. He stressed that there should be place for everything, and everything must be in place. Again, there must be a place for every one, and everyone must be in their place. Thus, this principle requires the orderly organisation and placement of men, machines and other resources. Misplacement would lead to misuse and disorder. 11. Equity: -Equity means social justice. All members of the organisation should be given fair and just treatment, depending upon the performance and circumstances. Ther must not be any partiality in transfers, promotions, etc. 12. Stability of Tenure: -Employees should not be kept temporary for a long period of time. Employees should be made permanent so that they do not leave the organisation. However, incompetent persons need to be removed or replaced and those who perform well must be rewarded. 13. Initiative: -The superior must sacrifice his own vanity to encourage and inspire those under him to show initiative. Subordinates should be given freedom to come up with suggestions and ideas. This will not only add to the success of the success of the organisation but will also boost the morale of the subordinates. 14. Esprit de Corps: -The superior must encourage esprit de corps (team sprit) among his subordinates. It is the team spirit that results in loyalty, dedication and commitment of the employees.
According to Fayol, even small matters help in developing team sprit. The superior should not criticise or discourage subordinates for making mistakes, but must encourage them not to make mistakes. Also, verbal communication needs to be used instead of formal, written communication, wherever possible, Fayol warned of the consequences of (a) Divide and rule, and (b) Abuse of written communications.
20.
Explain the Merits and Demerits of Government Companies?
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Meaning: -A Government Company is registered under Indian Companies Act, 1956. 51% or more of its paid-up share capital is to be held by central and/or state government. Examples of such 79 organization include Indian Oil, BHEL, SAIL, GAIL, Hindustan Petroleum Ltd., and Bharat Petroleum Limited. The following are Merits of Government Companies.
1. Quick Decision Making: -The Management of Government Company can take quick decisions. This is because; the management enjoys considerable autonomy or powers to take the decisions.
2. Efficiency: -The Efficiency of employees of Government Company is high as compared to that of departmental undertakings. This is because the staff can be recruited independently by the 79organization79. There is a less interference of government in the appointment of top officials in such 79organization.
3. Flexibility: -This type of 79organization enjoys flexibility in decision making. The management can change their decisions, if required depending upon the situation.
4. Statutory Discipline: -There is statutory discipline on the part of management. This is because; the management has to follow the provisions of Indian Companies Act.
5. Easy Formation: -It is relatively easy to form a Government Company. It can be created by executive decision of the Government. The objects and powers of the company can be changed easily. This is because as it is formed under the Indian Companies Act 1956.
6. Suitability: -This type of 79organization is suitable to industrial and commercial undertakings. Therefore, this type of 79organization makes effort to operate on commercial lines rather than purely on social lines.
7. Employment: -This type of 79organization generates employment to several people. For instance, the Indian Oil Corporation employs lakhs of people in the country.
8. Capital Formation: -This type of 79 organization facilitates capital formation, for instance, Government Companies encourage savings as they borrow money from the public by way of bonds.
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ORGANISATION OF COMMERCE AND MANAGEMENT The following are De-merits of Government Companies
1. Political Interference: - Although this type of organisation enjoys autonomy in decision-making, yet there is good amount of political interference. The minister, government officials, and politicians interference in the day to-day management of the corporation.
2. Inefficiency and Corruption: -There is inefficiency and corruption in public undertakings. The inefficiency is due to faulty selection, lack of training, poor performance appraisal, faulty promotions, etc. Apart from inefficiency, there is also corruption on the part of officials which in turn affects the overall performance.
3. Consumers Exploitation: -Before 1991, most of the Government companies were exploit the consumers because of their monopolistic position, However, after 1991 due to liberalisation, most of them have lost their monopolistic positions.
4. Wastage of Resources: -There is good amount of wastages of resources. There is poor material management. Raw materials and even costly machinery are purchased and often remain unutilized. At times, such machinery is sold for scrap.
5. Lack of Motivation: -There is lack of competitive spirit in Government Companies. Quite often, the inefficient ones are promoted at higher levels due to political connections. Therefore, efficient employees lack motivation to perform effectively.
6. Low-Labour Productivity: -The Government Companies suffer from the problem of lower productivity. The efficiency is low due to various problems such as: Faulty selection and promotion Lack of training and development Poor Performance appraisal Faulty placement and forced transfers, etc.
7. Poor Labour-Management Relations: -The Government Companies suffer from the problem of
poor labour-Management relations. This is due to corrupt and inefficient management and also due to selfish and militant trade union.
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21.
Explain the Merits and Demerits of Statutory Corporation? (March 2009)
Meaning: - A Statutory corporation is also called as public corporation. A Statutory corporation is established under a special Act of the Parliament or state legislature. The central government or state government owns the corporation. Examples of such corporations are Life Insurance Corporation, Industrial development bank of India, Unit Trust of India, Export Credit Guarantee Corporation of India Let., and so on. The Following are the merits of Statutory Corporations:
1. Quick Decision Making: -The Management of Statutory Corporation takes quick decisions. This is because; the management enjoys considerable autonomy or powers to take the decisions.
2. Efficiency: -The Efficiency of employees of Statutory Corporation is high as compared to that of departmental undertakings. This is because the staff can be recruited independently by the 81organization81. There is a less interference of government in the appointment of top officials in such 81organization.
3. Flexibility: -This type of 81organization enjoys flexibility in decision making. The management can change their decisions, if required depending upon the situation.
4. Suitability: -This type of 81organization is suitable to indusial and commercial undertakings. Therefore, this type of 81organization makes effort to operate on commercial lines rather than purely on social lines.
5. Employment: -This type of 81organization generates employment to several people. For instance, the Indian Oil Corporation employs lakhs of people in the country.
6. Capital Formation: -This type of 81 organization facilitates capital formation, for instance, Statutory Corporation encourage savings as they borrow money from the public by way of bonds.
7. Service Motive: -This type of 81organization works more on service motive rather than profit motive. However, this does not mean that this type of 81organization does not focus on profit making. Through service motive it tries to protect the interest of the consumers.
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The following are De-merits of Statutory Corporations:
1. Political Interference: - Although this type of organisation enjoys autonomy in decision-making, yet there is good amount of political interference. The minister, government officials, and politicians interference in the day to-day management of the corporation.
2. Inefficiency and Corruption: -There is inefficiency and corruption in public undertakings. The inefficiency is due to faulty selection, lack of training, poor performance appraisal, faulty promotions, etc. Apart from inefficiency, there is also corruption on the part of officials which in turn affects the overall performance.
3. Consumers Exploitation: -Before 1991, most of the Statutory Corporation are exploit the consumers because of their monopolistic position, However, after 1991 due to liberalisation, most of them have lost their monopolistic positions.
4. Lacks of Motivation: -There is lack of competitive spirit in Government Companies. Quite often, the inefficient ones are promoted at higher levels due to political connections. Therefore, efficient employees lack motivation to perform effectively.
5. Wastages of Resource: -There are several cases, where the public corporations do not utilize the resources properly. There is often wastage of: Physical Resources (Such as Machines, Materials, etc.) Capital Resources (Funds or Money) Manpower Resources (due to surplus staff)
6. Rigidity in Statute: -The Statute or Charter of a public corporation is rigid. It is very difficult to change its objectives and functions. The statute has to be amended, which is a time-consuming process.
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22.
Explain the Merits and Demerits of Departmental Undertaking?
Introduction: - It is considered as a suitable form of organisation of public Enterprises. The departmental form of public sector operates under the control and guidance of the concerned ministry. The Departmental form of public sector includes the railways, broadcasting, post and telegraphs, telephone services, etc.
The following are the merits of departmental undertakings:
1. Development of Public utilities: - The Departmental form of Public sector facilitates development and expansion of public utilities. For instance, Indian railways facilitate development and expansion of railways in India.
2. Regional Development: - The Public undertakings facilitate regional development. For instance, Indian railways facilitate regional development. This is because; it facilitates easy movement of people and goods from developed regions to backward regions, and vice versa.
3. Generates Employment: -The Public undertakings generate employment in the country. The undertakings generate employment in the undertakings itself.
4. Economics of Scale: -The Departmental undertakings such as Indian railways enjoy monopoly power. Therefore, there is limited or no competition. As such they operate on a large scale, which in turn generates economies of large scale.
5. Less Misuse of Funds: -There is less risk of misuse of money due to strict budget accounting and audit control. However, the proper application of funds remains only on paper and not in practice.
6. Reduction of Poverty: -Departmental Marketings facilitates reduction of poverty. This is because; departmental undertakings generate employment to the masses. Also, they facilitate regional development, which in turn reduces poverty.
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The following are the De-merits of departmental undertakings:
1. Lack of Autonomy: - departmental undertakings lack autonomy in decision-making. This is because; the management of such undertaking is in the hands of Government officials who are under the direct control of the concerned ministry. Major decisions have to be approved by the ministry concerned.
2. Lack of Flexibility: -There is lack of flexibility in decision-making. The Management has to follow strict guidelines from the concerned ministry relating to implementation of the various activities or projects. The Management has to respect strictly to the rules and regulations laid down by the concerned ministry.
3. Inefficiency and Corruption: -There is a lot of inefficiency and corruption in departmental undertakings. The inefficiency is due to the following reasons: Faulty Selections. Poor Training. Poor Performance Appraisal. Faulty Promotions, etc. Apart from inefficiency, there is also corruption on the part of officials which in turn affects the overall performance.
4. Lack of Professionalism: -The management of departmental undertakings lacks Professionalism. Many-a-times, the decisions are taken in an unsystematic manner. Often outdated data is collected. Also, there is no proper analysis of such data. Therefore, the decisions are taken in a haphazard manner.
5. Poor Manpower planning: - There is poor manpower planning in several departmental undertakings. Due to poor manpower planning there is surplus staff. As a result of this, the Government expenditure increases on account of salaries, and other overheads.
6. Political Interference: - There is too much of Political Interference in departmental undertakings. The Political interference is in respect of: Selection of top officials Awarding Contracts Location of Projects, etc. Due to undue political interference, the overall performance of such undertakings does get affected.
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1.
Distinguish between Sole Trading Concern and Partnership Firm (March 2009)
1.
SOLE TRADING CONCERN
PARTNERSHIP FIRM
Meaning Meaning A Sole trading Concern is a form of business A Partnership is a form business which is organisation which is carried on by a single carried on by two or more persons person. Membership Membership The sole trading concern is carried on by one A Partnership firm must have at least two Person partners. The maximum number of partners is 10 in the case of banking business and 20 in the case of ordinary business.
Capital The Capital contributed by a sole trader is comparatively less as compared to partnership firm.
Capital The partners can raise large capital as compared to a sole trader. This is because the partners are more in number.
Formation Formation Formation of sole trading concern is very Formation of partnership firm is comparatively easy, simple and less costly less easy, simple, quick, and more costly. Agreement Agreement is necessary between two or more Agreement As there is single owner the question of person to do business. I.e. oral or written. agreement does not arise
Business Secrecy In a Partnership firm, there can not be 100% Business Secrecy A Sole Trader can maintain 100% business Secrecy, because of more number of partners. Secrecy, because of his single ownership Sharing of Profits In a Partnership firm, there is sharing of profits Sharing of Profits A Sole Trader enjoys all the profits of the among all the partners either equally or in an firm. He need not share with any one. agreed proportion.
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2.
Distinguish between Joint Hindu Family and Partnership Firm
2. JOINT HINDU FAMILY Meaning This type of business is undertaken only in India under the Hindu law applicable to joint Hindu family
PARTNERSHIP FIRM Meaning A Partnership firm is a business which is jointly carried on by two or more persons.
Number of member There are no restrictions regarding the members of a Joint Hindu Family business.
Number of member In a Partnership firm, the minimum number is two and maximum is 10 in case of banking and is 20 in case of non-banking.
Capital The Capital of this type of business is comparatively less
Capital In a partnership firm, the capital contribution can be more.
Continuity and stability There is greater continuity and stability of business as the business is carried on for a number of generations
Continuity and stability It may not enjoy continuity and stability of business, due to disputes among partners or other reasons.
Formation There are less complications in its formation
Formation The formation of a partnership firm is little complicated due to legal formalities.
Liability The liability of the Karta is unlimited but that of co-parceners is limited to the extent of their share in the business.
Liability The liability of all the partners is unlimited. They are jointly and severally responsible for the acts of the firm.
Business Secrecy There is a great deal of business secrecy can be maintained
Business Secrecy As Compared to Joint Hindu Family Business the Partnership firm, cannot maintain be 100% business secrecy.
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3.
3.
Distinguish between Joint Stock Companies and Partnership Firm

JOINT STOCK COMPANY PARTNERSHIP FIRM
Meaning It is a form of commercial organisation in which two or more persons come together to run a business for common purpose.
Meaning A Joint Stock Company is a voluntary association of members formed for the purpose of undertaking a business.
Number of Members For a Private limited company, the minimum number is 2 and maximum 50. For a public limited company, the minimum number is 7 and there is no limit for maximum number.
Number of Members The minimum number to form a Partnership firm is 2. The maximum number is 10 in case of Banking business and 20 in case of non-banking business.
Transfer of interest The Partners cannot transfer the interest or share Transfer of interest The shareholders in a public limited company can without the consent of all partners freely transfer their shares. However, in a private limited company, the right to transfer shares is restricted by articles. Formation The formation is the simple process as less legal Formation The formation is a complicated process as many formalities are required. legal formalities are required. Liability The Liability of the partners is unlimited. They are Liability The liability of the members in a Joint Stock jointly and severally responsible for the debts of Company is limited to the extent of unpaid value the firm. on shares.
Continuity and Stability A Joint Stock Company enjoys continued existence. The death of shareholder or director does not affect the existence of a company.
Continuity and Stability The continuity of a partnership firm depends upon the mutual trust among partners. Again due to death or retirement of a partner, the partnership may have to be closed down.
Capital It can raise limited Capital. Capital It can raise large capital because of huge membership
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4.
Distinguish between Co-operative Society and Partnership Firm
4.
CO-OPERATIVE SOCIETY
PARTNERSHIP FIRM
Meaning It is a business organisation in which 2 or more persons come together to run a business for common purpose. Membership The minimum number to form a Partnership firm is 2. The maximum number is 10 in case of Banking business and 20 in case of non-banking business.
Meaning It is a voluntary association formed for the purpose of promoting and protecting the interest of its members. Membership Minimum 10 persons are required to form cooperative society. There is no maximum limit for membership.
Primary Motive The main aim is to conduct business at a profit. Primary Motive The main aim is to provide service to its members.
Act It is subject to state co-operative societies Act. For Example Maharashtra State Co-operative Societies Act, 1960.
Act It is governed by Indian Partnership Act, 1932.
Liability The liability of members is limited in cooperative society.
Liability The liability of partners is unlimited.
Stability and Continuity The continuity of a partnership firm depends upon Stability and continuity Normally, a co-operative society is more stable in the mutual trust among partners. Again due to it existence. death or retirement of a partner, the partnership may have to be closed down.
Distribution of Profits Profits are distributed to members in the form of dividend
Distribution of Profits Each partner gets a share of profit as agreed upon.
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5.
Distinguish between Joint Stock Companies and Co-operative Society

CO-OPERATIVE SOCIETY Meaning It is a voluntary association formed for the purpose of promoting and protecting the interest of its members.
5. JOINT STOCK COMPANY Meaning A Joint Stock Company is a voluntary association of members formed for the purpose of undertaking a business.
Primary Objective/Motive Primary Objective/Motive The Primary objective is to make profit. The main aim is to provide service to its members. Providing services to society is secondary Profit making is secondary objectives. objectives.
Number of Members For a Private limited company, the minimum number is 2 and maximum 50. For a public limited company, the minimum number is 7 and there is no limit for maximum number.
Number of Members Minimum 10 persons are required to form cooperative society. There is no maximum limit for membership.
Voting Rights Each member enjoys Voting Rights in proportion of his shareholding. The principle of One shares, one Vote is followed. Proxies are allowed.
Voting Rights Each Member enjoys voting rights. The Principle of One man one vote is followed. Proxy is not allowed.
Formation The Formation of Joint stock company is Formation complicated. There are a number of legal The Formation of cooperative formalities are to be followed. comparatively easy. There are formalities are to be followed.
society is less legal
Rate of Dividend There is normally no restriction on the rate of Rate of Dividend dividend. Companies may declare any rate of There is a restriction on the rate of dividend, which dividend depending upon the profits. works out to be about 15% Area of Operations The area of operations may be even at Area of Operations. international level. The Co-operative society conducts its operations in the local area.
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6.
Distinguish between Public limited Company and Private Limited Company
6. PUBLIC LIMITED COMPANY PRIVATE LIMITED COMPANY Membership Membership Minimum number of persons is 7 and maximum Minimum number of persons is 2 and maximum number of person is unlimited. number of person required is 50.
Statutory meeting It Must hold a statutory meeting
Statutory meeting It need not to hold a statutory meeting
Transfer of shares The shares are freely transferable
Transfer of shares The right to transfer shares is restricted by its articles.
Prospectus Prospectus It must file with the registrar prospectus or A Private company need not file a prospectus or statement in lieu of prospectus before allotment of statement in lieu of prospectus shares.
Number of Directors It must have Atleast 3 Directors
Number of Directors It must have Atleast 2 Directors
Share Warrant A public company issue bearer share warrant
Share Warrant A Private company cannot issue bearer share warrant
Preparation of Articles Preparation of Articles It is not necessary to prepare articles it can adopt It Must Prepare its articles. Table A.
Commencement Certificate Commencement Certificate It is necessary to receive commencement It is not necessary to receive commencement Certificate Certificate
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7.
Distinguish between Memorandums of association and Articles of Associations

ARTICLES OF ASSOCIATION Meaning It is subordinate document which provides rules to achieve the objectives. It is regarded as the rules and regulations for internal working of the company.
7. MEMORANDUM OF ASSOCIATION Meaning It is a fundamental document which lays down the objectives of the company. It regarded as the constitution or charter of the company.
Establishment of relationship Establishment of relationship It defines the relationship between company and It defines the relationship between company & its outsiders. shareholders/Directors.
Purpose Purpose The main purpose is to define limits or the scope The main purpose is to provide directions for the of the companys activities. internal management of the company
Ease in Alteration It is not so easy to alter memorandum.
Ease in Alteration It is convenient to alter articles.
Obligation Obligation Every company has to prepare its memorandum A Public company limited by shares need not to & register it with the register of companies. register its Articles and as such can adopt Table A in place of its Articles.
Contents It contains six clauses such as name clause, Domicile clause, objective clause, liability clause and association clause.
Contents It contains rules and regarding internal management of the company. Such as rules regarding meeting, appointment of directors, issue of shares etc
Status Status The Memorandum is the fundamental document The Articles is subordinate to memorandum which required for the formation of the company. is required for the formation of the company.
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8.
Distinguish between Incorporation certificate and Commencement certificate

COMMENCEMENT CERTIFICATE Meaning It is a Certificate issued to a public company by the registrar, giving a signal to commence the business.
8. INCORPORATION CERTIFICATE Meaning It is a certificate issued to a Joint Stock Company by the Registrar of Companies, signifying the birth of a company.
Effect Effect On obtaining this certificate, the company gets On Obtaining this certificate, the company starts its legal Status. business.
Which Companies require it? All Joint Stock companies i.e. Private as well as Public need such a certificate.
Which Companies require it? Only public limited company with a share capital needs such certificate.
Purpose It is a proof or evidence of the fact that the company is incorporated and a private company can start its business operations immediately on receiving such certificate. Documents Required To obtain this certificate the following documents are required : Memorandum of Association and Articles List of Directors Declaration of Directors Written consent of directors Statutory declaration regarding incorporation
Purpose It enables the public company to start its business operations, immediately on the receipt of such a certificate.
Documents Required To obtain this certificate the following documents are required : Declaration of Filing Prospectus. Declaration of receiving minimum subscription Declaration of payment towards qualification of shares. Statutory declaration regarding commencement Order This Certificate is obtained only after Incorporation Certificate.
Order This certificate must be obtained first.
Implication for not obtaining The Public Company with a share capital must obtain it; otherwise, it will not be allowed to Implication for not obtaining All companies need to obtain it. In case any commence business. company operates without it, then it will be termed as illegal association and company can be wound up under the act.
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9.
Distinguish between Private Sector Organisation and Public sector organisation.
9. PRIVATE SECTOR ORGANISATION PUBLIC SECTOR ORGANISATION Meaning Meaning A private sector organisation is owned and A Public sector organisation is normally owned by managed by private individuals or firms. government and managed by officials appointed by Government. Constituents It includes sole trading concerns, partnership firms, co-operative organisations, and joint stock companies. Constituents A Public sector organisation includes departmental undertakings, statutory corporations, and Government Companies.
Examples Companies Like Godrej Limited, Hindustan Lever Limited, Tata motors, are examples of Private Sector.
Examples Organisations like LIC, Indian Oil Corporation, Department of Railways are examples of public sector organisations.
Main Motive Main Motive The main motive of private sector organisations is The Main Motive of public sector organisation is to earn profit to serve public interest.
Management Management The management of private sector organisations The Management of a public sector organisation is remains with the owners or their appointed or in the hands of Government officials or Board of elected representatives. Directors.
Business Areas Business Areas The private sector organisations operate in The Public sector operates in defence, public industrial and commercial areas. utilities like railways, and also industrial and commercial undertakings.
Decision-Making In Private sector, the decision-making is quick, especially in the case of sole trader, and partnership firms.
Decision-Making In Public sector, the decision-making is delayed due to bureaucratic hurdles. Also departmental lack autonomy in Decision-Making.
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10.
Distinguish between State Commission and National Commission. (March 2008, 2009)
10. STATE COMMISSION Area Jurisdiction It has jurisdiction over a particular State.
NATIONAL COMMISSION Area Jurisdiction It has jurisdiction over the entire nation
Amount of Compensation The distinct forum can decide complaints where the value of goods and services and the compensation, if any, claimed exceeds Rs 20 lakhs but does not exceed Rs 1Crore.
Amount of Compensation The National Commission has the powers to deal with complaints where the value of goods and services and compensation, if any, claimed exceeds Rs 1Crore.
Membership The State Commission shall consists of:
Membership The National Commission Consists of:
Headed by a person who is or was a judge of Headed by a person who is or was a judge of High Court. Supreme Court. The two other members, one of whom shall be The Four other members, one of whom shall be a woman. a woman.
Appeals Any Person not satisfied with State Commission Order may appeal to National Commission within 30 days of the order.
Appeals Any Person not satisfied with National Commission Order may appeal to Supreme Court within 30 days of the order.
Administrative Control Administrative Control The State Commission has administrative control The National Commission has administrative over all the District Forums in the State. control over all the State Commission in the Country.
Enforcement Enforcement Every order made by the state Commission is Every order made by the National Commission is enforced by the State Commission Itself. enforced by the National Commission Itself.
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11.
Distinguish between Departmental undertaking and statutory corporations
11. DEPARTMENTAL UNDERTAKINGS STATUTORY CORPORATIONS Establishment Establishment A departmental undertaking is established by a A Statutory corporation is established by a Special Government Ministry. Act of the Parliament or State Legislature.
Legal Status A Statutory corporation has separate entity distinct Legal Status A departmental undertaking has no separate from the Government. distinct from the Government. Capital The Capital is contributed by the Government at the time of establishment. Additional capital, if required may be further contributed by the government
Capital The funds required by a departmental undertaking come from annual budget appropriations of the Government.
Borrowing Power A Statutory corporation can borrow funds from the Borrowing Power A departmental undertaking cannot borrow public by way of bonds. money from the public Management A Statutory corporation is managed by board of Management A departmental undertaking is managed by directors nominated by the government. Government officials of the concerned ministry. Control A Statutory corporation is controlled by the Control A departmental undertaking is controlled by the parliament or State Legislature concerned Ministry. Autonomy A Statutory corporation enjoys autonomy in Autonomy A departmental undertaking does not have decision-making to a certain extent autonomy in decision making Staff The staffs of Statutory corporation are recruited Staff The Staff of departmental undertaking is independently by the corporation and their service Government servants and the term of their service is governed by the Contract of Service Rules. is governed by Civil Service Rules.
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ORGANISATION OF COMMERCE AND MANAGEMENT 12. DEPARTMENTAL UNDERTAKINGS V/S GOVERNMENT COMPANIES
12. DEPARTMENTAL UNDERTAKINGS GOVERNMENT COMPANIES Establishment Establishment A Departmental Undertakings is established by a A Government Companies comes into existence Government Ministry. on account of incorporation under Indian Companies Act.
Legal Status Legal Status A Departmental Undertaking has no separate entity A Government Company has separate entity distinct from the Government. distinct from the Government.
Capital The funds required by a Departmental Undertaking come from annual budget appropriations of the Government.
Capital The Capital of a Government Company is Contributed by the Central/State Governments, and partly by general public and financial institutions.
Borrowing Power A Departmental Undertaking cannot borrow money from the public.
Borrowing Power A Government Company can borrow Funds by way of debt from the public.
Management Management A Departmental Undertaking is managed by A Government Company is managed by Board of Government officials of the concerned ministry. Directors appointed by Government and Shareholders.
Control Control A Departmental Undertaking is controlled by the A Government Company is controlled by the concerned ministry. Government and Shareholders.
Staff The Staff of A Departmental Undertaking is government servants and the term of their service is governed by Civil Service Rules.
Staff The Staff of A Government Company is recruited independently by the company and their service is governed by the contract of Service Rules.
Autonomy Autonomy A Departmental Undertaking does not have A Government Company enjoys autonomy in autonomy in decision making. decision-making to a considerable extent.
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14.
ORGANISATION OF COMMERCE AND MANAGEMENT TOP LEVEL MANAGEMENT V/S MIDDLE LEVEL MANAGEMENT TOP LEVEL MANAGEMENT MIDDLE LEVEL MANAGEMENT
1. Meaning: 1. Meaning: It refers to highest level of authority in an It refers to the intermediary level of management. organisation. It consists of Board of Directors, Consists of departmental heads such as finance Managing Directors, and President etc. manager, production manager, sales manager etc. 2. Nature of Function: 2. Nature of Function: It is concerned with framing of policies for the It is concerned with implementing the policy entire organisation. formulated by the top management. 3. Skills Required: 3. Skills Required: It requires more of analytical (logical) and It requires more human skills, and mix of conceptual (theoretical) skills. conceptual and technical skills. 4. Accountability:
Top management reports to the share holders, government agencies.
4. Accountability:
Middle level reports to the top level management.
5. Main Function: 5. Main Function: It is mainly involved in framing of policies and It is involved in implementing policies and organising required resources. directing the lower. 6. Span of Period:
Formulating policies is a time consuming affairs as it requires more time to analysis situation and formulate plan to achieve the targets
6. Span of Period:
Implementing the policies may require comparatively lesser time than formulating the same.
15.
TOP LEVEL MANAGEMENT V/S LOWER LEVEL MANAGEMENT ORSUPERVISORY
TOP LEVEL MANAGEMENT LOWER LEVEL MANAGEMENT 1. Meaning: 1. Meaning: It refers to highest level of authority in an It refers to supervisory or operational level of organisation. It consists of Board of Directors, management. It consists of foreman, Managing Directors, and President etc. superintendent, supervisor and junior executives. 2. Nature of Function: 2. Nature of Function: It is concerned with framing of policies for the It is concerned with executing the policies and entire organisation. achieving goals on behalf of the organisation. 3. Skills Required: 3. Skills Required: It requires more of analytical (logical) and It requires more technical and operative skills. conceptual (theoretical) skills. 4. Accountability:
Top management reports to the share holders, government agencies.
4. Accountability:
Lower level management reports to the middle level management.
5. Main Function: It is mainly involved in framing of policies and 5. Main Function: It is involved in operational activities of the organising required resources. organisation. 6. Span of Period: Formulating policies is a time consuming affairs as it 6. Span of Period:
requires more time to analysis situation and formulate plan to achieve the targets. Executing the plans may require lesser time as it the operational aspect of the policy.
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16. TAYLORS CONTRIBUTION TO MANAGEMENT V/S FAYOLS CONTRIBUTION TO MANAGEMENT

TAYLORS CONTRIBUTION TO MANAGEMENT FAYOLS CONTRIBUTION TOMANAGEMENT
concern
Taylors technique and principles are concerned with worker
Fayols principles are concerned with management efficiency.
level Taylor started his studies and approach from lowest Fayol started his studies and approach from the level in the organisation. highest level in the organisation. emphasis Taylor laid great emphasis on standardisation of work focus Taylor laid focus on eliminating wasteful movements and saving energy of workers
Fayol laid great emphasis functions of managers.
Fayol laid focus on development of principles for better management
main contribution Taylors main contribution was development of Fayols main contribution was development of scientific techniques and scientific principles. fourteen principles of general management. personality Taylor developed a personality of scientist and Fayol developed the personality of a researcher and became famous as father of scientific management. practitioner. He became famous as father of general management.
17.
MANAGEMENT V/S ADMINISTRATION
MANAGEMENT
Meaning Management involves getting the work done from the others in order to accomplish the objectives. Level of Management Management is related to the lower level of management.
ADMINISTRATION
Meaning Administration is concerned with framing plans and policies and objectives for an Enterprise. Level of Management Administration is related to the Top, Middle level of organisation. Skills required: Administration requires conceptual and Analytical skills as it involved with framing of the policies.
Skills required: Management requires technical skill as it is involved with implementing the policies.
Nature of Function: Management is an executive function as it involves implementation of formulated plans.

Significance: It has more significance in business enterprise. It is more widely used in a business organisation.
Nature of Function: Administration is an analytical function as it involves framing of the plan and policies. Significance: It has more significance in non-profit or government organisation. It is more widely used term in government organisation Decision Making: Administration answers the questions of what is to be and when it should be done. Ownership:
Decision Making: Management answers the questions of how to do it and who shall do it. Ownership:
Management is the implementation part of the policy Administration is the formulation part of the policy therefore it is related to the employees of the therefore it is related to the owners of the organisation. organization.
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18.
Distinguish between Shares and Preference Shares.

PREFERENCE SHARES Preference Shares are those shares which enjoy certain Preferences, as to payment of dividend, and repayment of capital, over the equity shareholders.
18. EQUITY SHARES Meaning Equity Shares are those shares which enjoy rewards as well as bear risks of the company. They provide permanent capital to the company.
Nature of preference They do not enjoy preference over preference They enjoy Preference over equity shareholders in terms of receiving dividend and shareholders in terms of payment of dividend repayment of capital. and repayment of Capital. Dividend They normally get higher dividend. They get The Preference Shareholders get a regular dividends only after making payment of dividend. They enjoy a Preference for payment dividend to preference shareholders. of dividend over the equity shareholders.
Voting Rights The equity shareholders enjoy normal voting They do not enjoy normal voting rights, except rights. on those matters which affect their interest. Face value Normally, equity shares are issued for a face Normally, Preference Shares are issued for a value of Rs. 10/face value of Rs. 100/Dividend Rate The dividend rate is not fixed. The rate The rate of dividend is fixed. The rate of depends upon the profits of the company in dividend differs from one company to that of each year. another. Bonus shares Equity shareholders are eligible for bonus Preference Shareholders are not eligible for shares, if issued by the company. bonus shares, if issued by the company. 1. Indian Companies Act 1956 2. Indian Partnership Act 1932 3. Indian Co-operative Societies Act 1912 4. Joint Hindu Family Business Act 1956 5. Essential Commodities Act 1954 6. Indian Consumer Protection Act 1986 7. International Consumer Movement 1960 8. Consumer Movement in India 1966 9. Consumer Movement 1920 10. Mumbai Grahak Panchayat 1975 11. Voice 1983 12. Consumer Education Research Centre 1978 at Ahmadabad 13. New Industrial Policy 1991 14. World Trade Organisation 1995 15. World Consumer Rights Day 15th march 1983. 16. National Consumer Day is 24th December. 99 Achieve success through
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19.
Distinguish between Shares and Debentures

19. SHARE HOLDERS DEBENTURE HOLDERS A debenture represents a part of the debt capital of the company. The holders of debentures are called as debenture holders.
Meaning A Companies owned capital which is spilt into large number of equal parts each such part is called as shares. Status of Holder The shareholder is the owner of the Company.
The Debenture holder is the creditor of the Company.
Income The Shareholders get an income on their The debenture holder gets a fixed rate of investment called dividend. The dividend interest as income. They get the interest even fluctuates from year to year depending on the when the Company makes losses. profits and policy of the company. Voting Rights The shareholders enjoy normal voting rights at The Debenture holders do not enjoy normal the company meetings. voting rights, except on those matters which affect their interest. Conversion Shares Cannot be converted into debentures.
The Convertible debentures can be converted into shares.
Repurchase A Company cannot repurchase its own shares.
The company can purchase back its own debentures
Repayment of Capital The shareholders are eligible for repayment They get priority over the shareholders in only after making payment to debenture repayment of principal amount at the time of holders at the time of winding up of the winding up of the company. company. 1. Sole Trader: - Michael Greener (local market, 1 owner, unlimited liability, weak bargain power) 2. Partnership Firm :- Sec 4 of the IPA Act 1932 (min 2, Max 10 for Banking and 20 for Non- Banking) 3. Joint Hindu Family: - Act 1956, unlimited membership, head 4. Joint Stock Company :- H.L Haney 5. Co-operative Society: -Talmaki 6. Management: - Henri Fayol 7. Planning: -H.Koontz 8. Organising: - Louis Allen 9. Directing: - J.L. Massie 10. Co-ordination: - Theo Haimann 11. Event Management:- Dr. J. Gold blatt 12. Staffing: - H Koontz
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ORGANISATION OF COMMERCE AND MANAGEMENT

ORGANISATION OF COMMERCE AND MANAGEMENT

: - ______________________________ S.Y.J.C (Second year junior college)

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ORGANISATION OF COMMERCE AND MANAGEMENT

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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF SOLE TRADING CONCERN?

THE ABOVE IMPORTANT FEATURES ARE EXPLAINED BRIEFLY DETAIL IN UNDER

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ORGANISATION OF COMMERCE AND MANAGEMENT

FEATURES OF JOINT HINDU FAMILY BUSINESS?

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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF PARTNERSHIP FIRM?

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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF JOINT STOCK COMPANY?

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ORGANISATION OF COMMERCE AND MANAGEMENT FEATURES OF CO-OPERATIVE SOCIETY?

Following is the features of co-operatives: (OMTEX CLASSES)

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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/CHARACTERISTICS/FEATURES OF MANAGEMENT.

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ORGANISATION OF COMMERCE AND MANAGEMENT

NATURE/CHARACTERISTICS/FEATURE OF EVENT MANAGEMENT

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ORGANISATION OF COMMERCE AND MANAGEMENT

NATURE/CHARACTERISTICS/FEATURE OF PROFESSIONAL MANAGEMENT

Following are the important characteristics of professional management:

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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/CHARACTERISTICS/FEATURE OF DISASTER MANAGEMENT

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ORGANISATION OF COMMERCE AND MANAGEMENT

FEATURES/CHARACTERISTICS/NATURE OF TOTAL QUALITY MANAGEMENT

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ORGANISATION OF COMMERCE AND MANAGEMENT

NATURE/CHARACTERISTICS/FEATURES OF NEW INDUSTRIAL POLICY 1991

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OBJECTIVES/FEATURES OF WORLD TRADE ORGANISATION

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ORGANISATION OF COMMERCE AND MANAGEMENT

NATURE/FEATURE/CHARACTERISTICS OF CONSUMER MOVEMENT

Following are the some important features of Consumer Movement:

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ORGANISATION OF COMMERCE AND MANAGEMENT NATURE/FEATURE/CHARACTERISTICS OF PRINCIPLES OF MANAGEMENT

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Meaning: -A Consumer Disputes Redressal Forum, to be known as the District Forum,