Types of Company

There are various types of companies that can be formed to carry out business activities. Some of the commonly known types of companies are:

1. Sole Trader: A sole trader, also known as a sole proprietorship, is a business owned and operated by a single individual. In this type of company, the owner has complete control over the business and is personally liable for all debts and obligations.

2. Partnership: A partnership is formed when two or more individuals come together to carry out a business with the aim of making a profit. Each partner contributes capital, shares profits and losses, and has an equal say in the management of the business.

3. Joint Stock Company: A joint stock company is a business entity that is owned by shareholders who own shares in the company. The liability of the shareholders is limited to the amount of their investment in the company. Joint stock companies can be public or private.

4. Cooperative Society: A cooperative society is formed by a group of individuals who come together to meet their common economic, social, and cultural needs. The members of a cooperative society contribute capital, participate in the management, and share the profits and benefits of the society.

5. Public Limited Company: A public limited company is a type of joint stock company that can offer its shares to the general public for subscription. The liability of the shareholders is limited to the amount unpaid on their shares. Public limited companies are required to comply with various legal regulations and are subject to greater scrutiny.

6. Private Limited Company: A private limited company is a type of joint stock company that restricts the transferability of its shares and prohibits the invitation to the public to subscribe for its shares. The liability of the shareholders is limited to the amount unpaid on their shares. Private limited companies are suitable for small and medium-sized businesses.

Formation of a Company

The formation of a company involves several steps and legal procedures. Here is a brief overview of the process:

1. Decide on the Type of Company: The first step in forming a company is to decide on the type of company that best suits the business requirements and objectives.

2. Choose a Name: The company needs to have a unique name that is not already registered by another company. The name should also comply with the legal requirements and guidelines.

3. Prepare the Memorandum of Association (MOA): The MOA is a legal document that sets out the constitution, objectives, and powers of the company. It defines the relationship between the company and its shareholders.

4. Prepare the Articles of Association (AOA): The AOA is a document that contains the rules and regulations for the internal management and administration of the company. It covers aspects such as the rights and duties of the shareholders, directors, and other officers of the company.

5. File the Required Documents: The MOA, AOA, and other necessary documents need to be filed with the Registrar of Companies along with the prescribed fees.

6. Obtain the Certificate of Incorporation: Once the documents are verified and approved by the Registrar of Companies, a Certificate of Incorporation is issued. This certificate confirms