f) A business purpose which describes the incorporated tasks a company has to do or provide.

Incorporation is the legal process used to form a corporate entity or company.

A corporation is the resulting legal entity that separates the firm's assets and income from its
owners and investors. The chosen name should be followed with a corporate identifier such
as "Corp.", "Inc.", or "Co.". A private company is a firm held under private ownership.
Private companies may issue stock and have shareholders, but their shares do not trade on
public exchanges and are not issued through an initial public offering (IPO). As a result,
private firms do not need to meet the Securities and Exchange Commission's (SEC) strict
filing requirements for public companies. A public company is a company whose ownership
is organized via shares of stock which are intended to be freely traded on a stock exchange or
in over-the-counter markets. A public company can be listed on a stock exchange (listed
company), which facilitates the trade of shares.

How to Incorporate a Private Limited Company or a Public Limited Company

The first step is to find a suitable name for the company as enshrined in section 25 of the
Companies Act Chapter 24:03

After finding the names a name search will be conducted. Five names will be chosen in order
of preference and submitted to the Registrar of Companies using CR 2 “Application for
search as to availability of name” upon paying ZWL$81-00

When the Registrar approved a suitable name from the names submitted a CV 4 will be
issued indicating the name by which the company should be incorporated.

Thereafter the following documents will be submitted to the Registrar of Companies,

Memorandum of Association

This is the supreme document governing the company and the external world.

This document encompasses five clauses; these are the name clause, capital clause, object
clause and the limited liability clause.

It shall be in English language.

If the company is to be incorporated in Harare one original and a duplicate copy will be
required for submission.
If the company is to be incorporated in Bulawayo one Original and two certified copies are
required for submission.

Articles of association

These are internal regulations which govern the company and its members inter ser.

It must be signed by subscribers and duly witnessed.

Table A and B provides models articles for Private and Public limited companies
respectively.

The names of the first directors and secretary must be submitted to the Registrar of
Companies on companies form CR 6 “List of Directors and Secretaries”

Moreover the Company registrar must be informed of the situation of the registered company
on companies form CR 5 “Notice of situation & postal address of a company’s registered
office, registered principal place of business and any changes thereto”

All the aforementioned forms should be submitted in a file to the registrar of companies

A receipt for payment of registration fee of ZWL$ 1000-00 must also be included in the file
with the registration documents.

If all is in order the Registrar of Companies will issue a certificate of incorporation. This is
the birth certificate of the company.

The certificate will bear the following

Date of incorporation

The company’s registered number

Stating that the company is private or public limited company

A Private Company may commence business upon receiving the certificate of

incorporation.

However for a Public limited Company there are other legal formalities which need to
be taken into account before commencing business operations.
 The Directors of a public company must consent that they act as director on form CR
20 “Consent to act as Directors of a Public Limited Company”

Furthermore, a Public limited Company should first meet the capital requirements are met.

The company will issue a prospectors or a statement in lieu of prospectors calling the public
to subscribe for companies’ shares or debentures.

The Directors are required to take their qualification shares before the company commences
business.

After the Registrar of Companies is satisfied with all the due processes, a certificate to
commence business will be issued and the company will assume its operations.

How to change from Private to Public Limited Company

The directors, at a board meeting must resolve that an Extra Ordinary General Meeting to be
called to pass a special resolution that a company be re-registered as a Public limited
company.

Notice of the meeting should be sent to all members of the company.

There is need to alter the memorandum and articles of association of the company to be in
line with the memorandum and articles of Public limited company.

The articles should be altered to remove the restrictions of membership, transfer of shares and
the invitation of members of the public to subscribe for company’s shares and debentures.

A print of special resolution CR 8 formerly CR 11 should be prepared to be filed with the

Registrar of Companies within 30 days of passing such resolution.

The memorandum and articles of association should be reprinted incorporating the alterations
and should be submitted to the Registrar of Companies.

Moreover, a copy of statement of the auditors of the company that in their opinion the
company’s balance sheet shows that the amount of its net assets was not less that it’s
aggregate called up share capital and distributable reserves.

After all the due processes the registrar of Companies will issue a certificate of incorporation
stating the company is a Public Limited Company.
A prospectus or a statement in lieu of prospectus must be issued.

The company must remove the word Private on its name painted or fixed outside the
registered office and put Public limited after its name.

Stationery must also be reprinted to reflect the new name. All obsolete stationery must be
destroyed.