Keenan and Riches’BUSINESS LAW

Part 2Business organisations

96

1 Explain the requirements that a company

must comply with in order to be entitled to the

maximum exemptions in terms of its financial

statements.

2 Assume you are one of a number of entrepreneurs

who are considering the form of business

organisation that might be used to run a business.

The other members of the group seek your advice as

to whether they should form a partnership or a

company – their only concern at this stage being

Contracts for the supply of goods

organisation.

Explain what forms of business vehicles are

available in the partnership and corporate structures

and then consider the position in terms of individual

liability for the debts of each one.

3 You have been appointed to manage a branch of the

National Knightsbridge Bank plc. A business

customer, Mr Egon Toast, has asked for a business

loan and is offering the family home, of which he is

the joint owner with Mrs Toast, as security.

Explain why you should be concerned about

making the loan and security transaction and what

steps you would take to overcome those concerns.

Specimen examination questions

http://www.companieshouse.gov.ukThis chapter is of
a general introductory nature but further information on
partnerships, particularly LLPs and companies, including

Guidance Notes on a wide variety of corporate

topics, can be accessed on the website of

Companies House.

Website references

Visit http://www.mylawchamber.co.uk/riches

to access selected answers to self-test questions in the

book to check how much you understand in this chapter.

Use Case Navigatorto read in full some of the key cases

referenced in this chapter:

Salomon vSalomon[1895–9] All ER Rep. 33.

CASE

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