A company that goes public has the disadvantage of losing a certain amount of control over their organization and t he direction that it takes. They have increased responsibility to keep shareholders happy.
The company faces more government regulations
The pressure to make profits is increased.
When the company goes public there is often greater pressure to make bigger profits.
A public limited company is set up to make a company a legal person and therefore making the company liable for any loss or bankruptcy. i.e. if it goes bankrupt only the company will be chased and not those who run it. A p.l.c. issues shares which are units of ownership and these are open for the general public. Each 3/4/5 years a board of directors is elected during the AGM - Annual General Meeting. the biggest disadvantage of a p.l.c. is that if the company goes bankrupt all the shareholders will lose their money which they invested.
receives money from the govenment
The company faces more government regulations
One disadvantage for a company that goes public is increased regulatory requirements and compliance costs. Public companies are subject to more stringent reporting and disclosure requirements, which can be costly and time-consuming to maintain. Additionally, going public means the company's financial performance and strategic decisions become more visible and scrutinized by the public and investors.
The pressure to make profits is increased.
When the company goes public there is often greater pressure to make bigger profits.
A public limited company is set up to make a company a legal person and therefore making the company liable for any loss or bankruptcy. i.e. if it goes bankrupt only the company will be chased and not those who run it. A p.l.c. issues shares which are units of ownership and these are open for the general public. Each 3/4/5 years a board of directors is elected during the AGM - Annual General Meeting. the biggest disadvantage of a p.l.c. is that if the company goes bankrupt all the shareholders will lose their money which they invested.
receives money from the govenment
A company goes public when share can be purchase by the general public. This usually means it must be listed ona stock exchange.
more government regulations
It begins selling shares of stock in a public stock market
Disadvantage of a private limited bank is that they cant raise capital through public offering . They should have their own capital for the company.
Selling shares of stock
It begins selling shares of stock in a public stock