Organizing a Business Structure Essay - 1375 Words

Organizing a Business Structure (Essay Sample) Content: ORGANIZING A BUSINESS STRUCTUREName:Tutor:Course:Date:Setting up a business requires proper planning and compliance with all legal requirements as stipulated by the relevant authorities. The paper focuses on the establishment of a partnership within the Australian borders. The paper focuses on the background information of the business, its managerial structure, and all the components relating to stakeholders and adherence to the set regulations.The proposed business is to be a partnership organization, where my two friends and I will set up "The Swatch Place." The Swatch place is to be a tea and coffee shop that will complement its products with confectioneries and other beverages. The firm is to be located around campus, as the target customer group is students. Amidst competition, the firm will create a competitive edge by distinctively rebranding its products and offering services such as free Wi-Fi connection at the premises. The shop will provide sitting space for fifty people, as a start with a plan to expand later.As mentioned earlier, the form of business structure that we are about to start is a partnership. The Partnership Act of 1892 defines a partnership as the relationship that is existent between people whose final aim is profit. It, therefore, means that two or more parties ought to agree, without coercion, to enter into a legally binding agreement that has a contractual nature. As such, my friends and I are in the process of coming up with a written partnership agreement with the aid of a lawyer. The agreement lays down the duties and responsibilities of every member and hence it will help in reducing disputes. The partnership agreement will also cover issues such as dissolution of the firm and what happens upon such a time. It will describe the events when a partner decides to quit or dies, or when the partners want to admit a new partner.The Partnership Act provides for three types of partnerships organizational structures: a normal partnership, a limited partnership and an incorporated limited partnership. These forms of partnerships differ in that they have different features in relation to registration, sources of funds, complexity, taxation, and liability of partners. A normal partnership refers to the partnership that does not require registration under the Partnership Act (Business.vic.gov.au, 2015). As such, they are suitable for people who want to conduct business together, but do not have to form a company structure. In our case, a normal partnership will be a bit confusing as it leaves a lot of loopholes for the emergence of disputes, especially at later dates.Limited partnerships are forms of partnerships that provide for the presence of general and limited partners; they are different owing to their duties and liabilities. General partners have unlimited liability to the limited partnership and are responsible for the daily running of the organization (Business.vic.gov.au, 2015). The Partner ship Act defines that there has to be at least one and utmost twenty general partners in a limited partnership. The limited partners take no charge of the management of the organization but have limited liability to the debts of t he limited partnership. The liability is limited to the amount that they contribute to the firmà ¢Ã¢â€š ¬s capital as recorded and maintained at the NSW Fair Trading (Business.vic.gov.au, 2015; Fairtrading.nsw.gov.au, 2015). The Partnership act stipulates that there has to be at least one such partner but the upper limit is not set (Fairtrading.nsw.gov.au, 2015).The limited partnership is advantageous in that it allows for easier raising of funds. This is because a limited partner just invests their money for a share of the profits without necessarily having to be involved in the management. Also, according to Section 69 of the Partnership Act, a partner may be admitted into the limited partnership without having to getting approval from any limited partn er (Business.vic.gov.au, 2015). This increases the chances of increased funding for the firm. This form of partnership is favorable for us as one of the partners has declared to have no interest in the management of the firm. He will only invest his capital and expect profits in return. We will also be able to admit other partners as the business thrives so as to grow our capital base and expand our operations.The other form of partnership is the Incorporate Limited Partnership (ILP). There are four types of ILPs that can be established under the Commonwealth legislation. They are limited to purposes of venture capital investments. They include: Venture Capital Limited Partnership, Venture Capital Management Partnerships, Early Stage Venture Capital Limited Partnerships and the Australian Venture Capital Fund of Funds (Business.vic.gov.au, 2015). This category of partnerships is in no way related to our coffee shop idea and not to mention that it has s lot of complexities.The manag ement of the coffee shop will be handled by me and my friend X. My friend Y wants to only contribute his cash towards the running of the business, but states managerial incompetence as the reason for not wanting to be involved in the management activities. Since the organization is still small, we have agreed that X will handle all the issues relating to finances, marketing and supply. I will handle the resources and production. I will, therefore, oversee the supervision of employees and the coordination of activities within the firm.We believe in the business thriving and growing over the years, we look forward to opening more shops across the states. As such, we find it necessary to not only register the business name but also make it a trademark. This is because, the mere registration of the name does not guarantee full rights (Business.gov.au, 2015). According to the Australian regulations, the name in which our firm will be registered will be connected to the Australian Busines s Number (ABN) and that the registration of the name is only necessary when it is not the ownersà ¢Ã¢â€š ¬ name. As such Swatch Place will have to be registered once for national purposes. We further will register the name as a trademark to forbid any other person from trading with it (Business.gov.au, 2015). We will, therefore, have exclusive use of the name across all the states in Australia.There are various tax requirements that apply to partnerships in Australia. The first one is the Tax File Number (TFN) that every partnership is supposed to have and which is attached to the firms ABN for a separate tax return. All the same, when profits are divided among the partners, each partner ought to comply with their personal income tax and remit it for assessment by the ATO. The second one is the Goods and Services Tax (GST) which requires the firm to collect GST for the year whose turnover is mo... Organizing a Business Structure Essay - 1375 Words Organizing a Business Structure (Essay Sample) Content: ORGANIZING A BUSINESS STRUCTUREName:Tutor:Course:Date:Setting up a business requires proper planning and compliance with all legal requirements as stipulated by the relevant authorities. The paper focuses on the establishment of a partnership within the Australian borders. The paper focuses on the background information of the business, its managerial structure, and all the components relating to stakeholders and adherence to the set regulations.The proposed business is to be a partnership organization, where my two friends and I will set up "The Swatch Place." The Swatch place is to be a tea and coffee shop that will complement its products with confectioneries and other beverages. The firm is to be located around campus, as the target customer group is students. Amidst competition, the firm will create a competitive edge by distinctively rebranding its products and offering services such as free Wi-Fi connection at the premises. The shop will provide sitting space for fifty people, as a start with a plan to expand later.As mentioned earlier, the form of business structure that we are about to start is a partnership. The Partnership Act of 1892 defines a partnership as the relationship that is existent between people whose final aim is profit. It, therefore, means that two or more parties ought to agree, without coercion, to enter into a legally binding agreement that has a contractual nature. As such, my friends and I are in the process of coming up with a written partnership agreement with the aid of a lawyer. The agreement lays down the duties and responsibilities of every member and hence it will help in reducing disputes. The partnership agreement will also cover issues such as dissolution of the firm and what happens upon such a time. It will describe the events when a partner decides to quit or dies, or when the partners want to admit a new partner.The Partnership Act provides for three types of partnerships organizational structures: a normal partnership, a limited partnership and an incorporated limited partnership. These forms of partnerships differ in that they have different features in relation to registration, sources of funds, complexity, taxation, and liability of partners. A normal partnership refers to the partnership that does not require registration under the Partnership Act (Business.vic.gov.au, 2015). As such, they are suitable for people who want to conduct business together, but do not have to form a company structure. In our case, a normal partnership will be a bit confusing as it leaves a lot of loopholes for the emergence of disputes, especially at later dates.Limited partnerships are forms of partnerships that provide for the presence of general and limited partners; they are different owing to their duties and liabilities. General partners have unlimited liability to the limited partnership and are responsible for the daily running of the organization (Business.vic.gov.au, 2015). The Partner ship Act defines that there has to be at least one and utmost twenty general partners in a limited partnership. The limited partners take no charge of the management of the organization but have limited liability to the debts of t he limited partnership. The liability is limited to the amount that they contribute to the firmà ¢Ã¢â€š ¬s capital as recorded and maintained at the NSW Fair Trading (Business.vic.gov.au, 2015; Fairtrading.nsw.gov.au, 2015). The Partnership act stipulates that there has to be at least one such partner but the upper limit is not set (Fairtrading.nsw.gov.au, 2015).The limited partnership is advantageous in that it allows for easier raising of funds. This is because a limited partner just invests their money for a share of the profits without necessarily having to be involved in the management. Also, according to Section 69 of the Partnership Act, a partner may be admitted into the limited partnership without having to getting approval from any limited partn er (Business.vic.gov.au, 2015). This increases the chances of increased funding for the firm. This form of partnership is favorable for us as one of the partners has declared to have no interest in the management of the firm. He will only invest his capital and expect profits in return. We will also be able to admit other partners as the business thrives so as to grow our capital base and expand our operations.The other form of partnership is the Incorporate Limited Partnership (ILP). There are four types of ILPs that can be established under the Commonwealth legislation. They are limited to purposes of venture capital investments. They include: Venture Capital Limited Partnership, Venture Capital Management Partnerships, Early Stage Venture Capital Limited Partnerships and the Australian Venture Capital Fund of Funds (Business.vic.gov.au, 2015). This category of partnerships is in no way related to our coffee shop idea and not to mention that it has s lot of complexities.The manag ement of the coffee shop will be handled by me and my friend X. My friend Y wants to only contribute his cash towards the running of the business, but states managerial incompetence as the reason for not wanting to be involved in the management activities. Since the organization is still small, we have agreed that X will handle all the issues relating to finances, marketing and supply. I will handle the resources and production. I will, therefore, oversee the supervision of employees and the coordination of activities within the firm.We believe in the business thriving and growing over the years, we look forward to opening more shops across the states. As such, we find it necessary to not only register the business name but also make it a trademark. This is because, the mere registration of the name does not guarantee full rights (Business.gov.au, 2015). According to the Australian regulations, the name in which our firm will be registered will be connected to the Australian Busines s Number (ABN) and that the registration of the name is only necessary when it is not the ownersà ¢Ã¢â€š ¬ name. As such Swatch Place will have to be registered once for national purposes. We further will register the name as a trademark to forbid any other person from trading with it (Business.gov.au, 2015). We will, therefore, have exclusive use of the name across all the states in Australia.There are various tax requirements that apply to partnerships in Australia. The first one is the Tax File Number (TFN) that every partnership is supposed to have and which is attached to the firms ABN for a separate tax return. All the same, when profits are divided among the partners, each partner ought to comply with their personal income tax and remit it for assessment by the ATO. The second one is the Goods and Services Tax (GST) which requires the firm to collect GST for the year whose turnover is mo...