Limited companies - Assignment Example

This type of company can be formed as partnership and there have to be a contract relationship amid the members as well as firm. However, there is no limit of maximum members in a limited liability company. This type of contract is considered as an agreement for a company and this agreement can be in the form of oral as well as in the form of written. This type of company can be managed by one or two members along with all the members of the firm. The person who manages the company to attain the goals is known as manager.

In this form of company the manager can be one or more but it is not necessary that the manager should be a member of the limited company. This type of company helps the business tycoon to save their money as well as reduce the individual risk (Callison & Vestal 2010 280-285). The members of this company are flexible to do their internal work. It is witnessed that minimum of two members are required to establish this company. Limited Liability Company can be managed by its managers as well as members.

The Limited Liability Company has all of the features for partnership as well as organization and this feature gives the chance to invest in a project. This company is a separate legal unit and works for a profit motive (Conaway 2012 pp. 32-35). The Limited Liability Company has number of advantages as well as disadvantages. The several advantages of this company include the liability of members is limited. Another advantage of the company is that in case of bankruptcy the obligation of the company is to pay back the debts to the debtors.

This company is a separate as well as a different legal unit. This company is separate from its owners as well as members who are involved in it and this can be considered as an advantage. Tax advantage is another benefit for this company wherein the owner of business firm can reduce their individual risk (Muchlinski