ADVANTAGES OF COMPANY LIMI-

TED BY GUARANTEE

• It's a private limited company that

has guarantors rather than share-

holders, so it's suitable for volunta-

ry organizations. The members ag-

ree to pay a fixed amount known as

guarantee towards the company's

debt if it goes into liquidation.

• The company is a clear legal entity,

separate from the person involved

in it. It can hold property, enter in-

to leases and other contracts, em-

ploy people etc. in its own name.

A company is generally regarded by

funding bodies and public agencies

as a more stable' structure than a

voluntary association.

DISADVANTAGES OF COMPANY LI-

MITED BY GUARANTEE

· A company structure may be more

intimidating for those considering

whether to join as members or put

themselves forward for election to

the board of directors.

• There are various statutory require-

ments which have to be followed in

relation to members' meetings etc.

· Set up costs can be higher than for

a voluntary association or trust;

and annual cost are higher, particu-

larly if there is an external compa-

ny secretary and/ or if a formal au-

ADVANTAGES OF INCORPORATED

TRUSTEES

Wealth off professional experience.

They have easier access to legal and

accounting expertise.

Wealth of professional experience.

Networks available to an organiza-

tion.

The structure provides more priva-

cy than a company.

There can be flexibility in distribu-

tions among the beneficiaries.

DISADVANTAGES OF INCORPORA-

TED TRUSTEES

Cost and complexity of setting up a

professional trust and record mana-

gement.

Lack of understanding of grantor's

unexpressed wishes.

The powers of trustees are restric-

ted by the trust deed.

Problems can be encountered when

borrowing due to additional com-

plexities of loan structures.

The trust can be expensive to estab-

lish and maintain.