ZIMSEC O Level Business Studies Notes: The Advantages and Disadvantages of a Private Limited Company
- A Private Limited Company has several advantages and disadvantages:
- The shareholders have limited liability.
- There is continuity after the death of a member.
- Are not required to publish their private accounts.
- More capital can be raised.
- There is more scope for expansion.
- Because sell of shares is limited there is no risk of hostile takeovers or loss of control.
- Decision making is much more complex and convoluted.
- Cannot sell their shares publicly so the amount of capital that can be raised is limited.
- Shareholders cannot freely sell their shares without consulting with other shareholders.
- Have to share profit among shareholders
- The procedure to form these is more complex.
- There is the possibility of double taxation
To access more topics go to the O Level Business Notes page.