ACW 1020

Key points for Week 2 topic

Introduction to Limited Companies

To get the most from your online learning and resources, you are strongly encouraged to make your
own note. By actively identifying the critical points while you are studying this week’s content, you
are reaffirming your understanding of the topic. You will find your notes would be very useful for
your revision for the tests or exam. You can use the following key points to start making your notes.

1. Three different types of business structure

 Sole proprietorship
 Partnership
 Companies/Corporations

2. Main features of companies

 Limited liability
 Legal nature
 Transferring of ownership
 Perpetual life
 Public or private
 Separation of ownership and management
 Extensive regulation

3. Sources of funds
 Internal funds
 External funds (Short-term and Long-term funding)

4. Equity, Borrowings and Assets in companies

5. Restrictions on the rights of shareholders to make drawings or reductions of capital