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2013-03-20 10:17:39
2013-03-20 10:17:39

In a company limited by shares, each shareholder's loss in the event of the company being wound up is limited to the value of his/her shareholding. In a company limited by guarantee, the amount of loss is limited to the (usually nominal) amount that the members guarantee to pay (as stated in the company's Memorandum of Association). Since the guarantee already limits the amount of the members' liability, it is not necessary to further limit it according to the number of shares that the member holds. Companies limited by guarantee are also most often used for clubs, associations, etc. where all member votes count as equal and not according to the number of shares held.


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The main diffrerence between a company limited by guarantee and a company limited by shares is that the company has no share capital. A company limited by guarantee has members, rather than shareholders, the members of the company guarantee/undertake to contribute a predetermined sum to the liabilities of the company which becomes due in the event of the company going under.

The different types of capital are first bifurcated as fixed and working. The types of fixed capital are-Equity Share CapitalPreference Share CapitalLoan CapitalDebenture CapitalCorpusGrantsGuarantee CapitalThe working capital can be calculated as follows-Current Assets - Current Liabilities

Conversion of a private limited company to a public limited companyBoth a private company limited by shares and an unlimited company with a share capital may re-register as a plc., but a company without a share capital cannot do so. A private company must pass a special resolution that it be so re-registered and deliver a copy of the resolution together with an application form to the Registrar. The resolution must also:alter the company's memorandum so that it states that the company is to be a public limited company,increase its share capital to the statutory minimum of £50,000,make any other alterations to the memorandum so that it conforms to that required for a public limited company,make any required alterations to the articles of association of the company.The private company if it does not already have sufficient issued share capital must issue £50,000 in shares a minimum of 25% part paid.

Authorized share capital is that maximum amount of share capital a company can do it’s business and return in article of association of company and company cannot raise more capital then this limit unless changes the limit of authorized capital.Issued share capital is that amount of capital which is issued to public for purchase or invest in company.

Nominal share capital is like an authorized share capital. The share capital that the company allowed (the maximum amount) to issue as registered capital when the company is incorporated. It can be changed later by the approval of the shareholders.

Equity share is one share from all share capital of company and it is basic non devisable unit of measure of capital of company.

A private limited company is an incorporated firm which offers limited liability to its shareholders but places certain restrictions on its ownership. These restrictions are meant to prevent any hostile takeover attempt. The major restriction are: (1) stockholders (shareholders) cannot sell or transfer their shares without offering them first to the other stockholders for purchase, (2) stockholders cannot offer their shares or debentures to the general public over a stock-exchange, (3) number of stockholders cannot exceed a fixed figure.A company limited by guarantee, or guarantee company, lacks share capital and possesses liability limited to the individual involvement of each member participating in its operation. Guarantee companies generally comprise the category of non-for-profit companies or charities.

There are various reasons why a private limited company would change to public company. The main reason would be to raise more share capital so as to expand the operations of the company.

Shares are units into which the capital of a company is divided. Share Capital is the total amount of money contributed by the shareholders of the company, over which they will have claim at the time of liquidation of the company.

Preference share capital is type of capital which has preference on other type of share capital as preference share capital may have more profit ratio than other and it is paid first from profit of company and preference share holders get there share even if company has earn no profit. Equity share capital is share capital on which share holders get share from profit in the last after paying every other obligation on company. Detail answer available in related link.

There are four main types of company:Private company limited by shares - this is the most common type of company. The important difference from a public limited company is that a private company may not offer its shares for sale to the general public.Private company limited by guarantee - members of this type of company do not make any contribution to the capital during its lifetime as they do not purchase shares. The members' liability is limited to the amount that they each agree to contribute to the company's assets if it is wound up.Private unlimited company - this type of company may or may not have a share capital and there is no limit to the members' liability. Because there is no limitation on members' liability, far less of the company's affairs have to be disclosed publicly than is the case with the other types of company.Public limited company - this type of company has a share capital and, the liability of each member is limited to the amount unpaid on shares that a member holds. The important difference from a private is that a public limited company may offer its shares for sale to the general public. It may also be quoted on the stock exchange.A "private company" may be any of the first three on this list. Companies limited by guarantee and unlimited companies are private companies even if the word "private" is not used*.*There are still a few "companies limited by guarantee with a share capital". It has not been possible to form these since 1981 and they are ignored in this guidance.Company is, a company which are registered under the companies act, rules and regulations. In India it is registered under the companies act of 1956. In the case of company there will be a written document as Memorandum of association and Articles of association.Memorandum of association meant for external relation of the company and articles of association meant internal relations of a company. After fulfilling these procedures the Registrar of company issues certificate of incorporation and a company can functionformulation of companies are in many manner.1. Private limited companyA Company incorporates with more than two person and it is limited to fifty members . In this case it is only a huge partnership and the liability is unlimited.2.Public Limited companies.A companies which is constituted with a minimum of seven members and maximum is unlimited, and members called share holders. Here the liability is limited up to level of what he is invested.3.Government company.A company which are incorporated holely or jointly with state and central government or 51% & 49% with other joint ventures or with other public limited companies. Here also liabilities are limited by shares.4.Registered companies.A company which are incorporated with a special resolution of the Parliament .Here company means registered under companies act, and limited company means liability of company limited by shares.All companies uses as 'limited' after it's name Public limited or private limited.In the case of a voluntary organisation which are registered as pvt. ltd, though they can use only 'limited' after it's name.

Share capital is the investment in company from public to earn profit and it can be raised by offering shares to public for purchase.

It is beneficial for a company to have share capital because it is an alternative source to finance expansion projects. Money gained from share capital can also be used to buy new machinery for the company.

when company needs capital to finance business or run business activities it goes to public and issue shares to generate amount from the public and people contribute the amount in share capital of the company by means of there shares in share capital of company this process is called share issue.

The word "limited" stands for "limited liability". This means that the liability of a shareholder in a company for the company's debts (for example, in an insolvency or liquidation scenario) is "limited" to any unpaid capital on their shares. In most cases, there will be no amount unpaid (ie. a fully paid share) and so no liability of a shareholder for the company's debts.

it is limited to the extent of share value held by him

following are the advantages of public limited company:limited liabilityshare issued to publiclarge capitaldistribution of workloadteam workcentralization systemfollowing are the disadvantage of public limited companylack of secrecyleg pullinglack of interests of employeesgovernment restrictions.

It mens that how much share capital of company is employed by using debt by issuing bonds or other debt instruments and how much portion of share capital employed by using capital from the share holders of company which is called equity capital.

A PLC ( public limited company) is owned by shareholders, i.e who buys the share....

Public limited companies have their shares listed on a stock exchange. This is not the case for the private limited company, whose shareholders are generally directors of the company, or connected to it in some way. This means that PLCs are able to raise significantly larger sums of capital than private limited companies. A public limited company must have a minium authorised share capital of £50,000 with allotted shares of at least that value, and a minimum of two members and two directors whilst there are no miniumu capital requirements for the private limited company and the minium number of directors is just one. Also the public limited company is subject to detailed company law requirements with regards to its shares, directors, annual general meetings, accounting and so on. For the private limited companies, there is much less red tape!

It's a public limited company. Anyone can buy shares in the company - share ownership is not limited to employees.

Share capital is equity in the company. It is money raised by the company in exchange for issuing ownership of shares. Working capital is the money that is borrowed from a bank for a business to pay operating expenses.

It has a limited liability business that offers stock, bonds or loans to the public. It can sell share on the stock exchange. It raises more capital

A single share is a part of capital of the company so if anybody purchase the share of company that person is investing in the share capital of company and providing the company necessary money to operate that's why it is the investment of the owner of share which is called then the shareholder of company and that shares becomes the asset of the shareholders and while company is acquiring capital in the shape of shares that's why it is the liability of the corporation to pay back that amount of money back to the shareholders at certain time or at liquidation as written in the agreement to raise the capital through share issue.

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