General Partnership Characteristics Of Partnership

1385 Words6 Pages
Profit is the aim of any business organisation. Their efficiency to perform profit maximization strongly depends on their internal organisational structure. There are several types of business organisation, each one of them with unique legal status. We have been requested to comment on the decision of two physical persons, Nikos and Konstantinos, to form a general partnership for the provision of catering services. Pursuant to that and in the following paragraphs, we shall analyse the general partnership; state the main differences between a general partnership and limited liability partnership. In addition, we shall apply the general partnership characteristics on the case study provided.
A partnership is a relationship which subsists between two or more persons carrying on a business in common with a view to profit. (Partnership Act 1890, S1,SS1). Persons involved, numbered from two to unlimited, are called partners. Each partner
…show more content…
No formalities are required for the formation of a General Partnership. A general partnership begins as soon as the agreed business activity starts. The agreed activity is stated on a partnership agreement/deed. The agreement is a contract, therefore it can be expressed in writing or even orally or even implied between the partners. It is wiser the agreement to be in writing, despite it is not obligatory. It should specify the duties of each partner, voting rights, share of profits, capital introduction and so forth. Unless the agreement specifies otherwise, all involved parties have equal voting rights and are expected to act for the best interest of the partnership and not to their personal benefit. All assets, liabilities and profits are shared equally between the partners. They should act responsibly towards each other for a trustful

More about General Partnership Characteristics Of Partnership

Open Document