BUSINESS ORGANIZATION

BUSINESS ORGANIZATION

PRIVATE SECTORUNDERTAKINGS

PUBLIC SECTORUNDERTAKINGS

JOINT SECTOR UNDERTAKINGS

PRIVATE SECTOR UNDERTAKINGS

Owned, Controlled and Financed by private businessmen.

No Government Participation

Main motive is to earn profits.

FEATURES

1. OWNERSHIP & CONTROL

Fully owned & controlled by Private Entrepreneurs.

Owned by one individual or by a group of individuals.

2.PROFIT MOTIVE

3. NO STATE PARTICIPATION

4. PRIVATE FINANCE

Capital is arranged by private owners.

Sole trader contributes the capital in Sole Proprietorship.

In Partnership, capital is invested by partners.

A Joint stock Company, raises its capital by the issue of shares & debentures.

5. INDEPENDENT MANAGEMENT

Managed by owners.

In Sole Proprietorship and Partnership, the owners, directly manage the firm.

In Joint stock Company, management lies in the hands of directors, who are the elected representatives of the shareholders.

PUBLIC SECTOR UNDERTAKINGS

FEATURES

1. STATE OWNERSHIP

Fully owned by the Government or some Public Authority.

2. GOVERNMENT CONTROL

3. SERVICE MOTIVE

4. STATE FINANCING

Capital and Funds through appropriation from Government Budget

Loan Financing.

5. BUREAUCRATIC MANAGEMENT

Managed and Governed within the policy framework and rules framed by the Government.

6. PUBLIC ACCOUNTABILITY

Accountable to public for performance.

Annual Audit of Public Sector Undertakings is conducted by the Comptroller & Auditor General of India.

Annual Reports are subject to discussion in the parliament or State Legislature.

JOINT SECTOR UNDERTAKINGS

WITHOUT FOREIGN PORTFOLIO :

Ownership, Control & Management is shared jointly by the Government, Private Entrepreneurs and Public at large.

Proportionate Shareholding : Government- 26% Private entrepreneurs- 25% Public- 49%

WITH FOREIGN PORTFOLIO :

Proportionate Shareholding : Government- 25% Private entrepreneurs- 20% Foreign Investors- 20% Public- 35%

FEATURES

1. MIXED OWNERSHIP

Government, Private Entrepreneurs and Public at large.

2. COMBINED MANAGEMENT

3. SHARE CAPITAL

PRIVATE SECTOR ORGANIZATION

SOLEPROP.

JOINT HINDUFAMILY BUSNS

PARTNERSHIP

JOINT STOCK COMPANY

COOP. SOCIETY

SOLE PROPRIETORSHIP

One individual provides capital, bears all risks and independently manages the business.

JOINT HINDU FAMILY BUSINESS

Owned & Controlled by a Joint Hindu Family, which consists of father, son, grandson and the great grandson.

Head of the family, called Karta, manages the business.

Liability of every member of the family, except Karta, is limited to his share in the family’s assets.

PARTNERSHIP

Two or more persons enter into a contract to carry on some lawful business jointly and share profits.

Each partner is jointly and individually liable for the debts of the firm.

Liability of every partner is unlimited.

Controlled and managed by Partners.

JOINT STOCK COMPANY

Incorporated association of two or more persons.

Distinct legal entity.

Continuity is independent of the lives of its members.

Management & Control lies in the hands of Board of Directors.

COOPERATIVE SOCIETY

Organized on the principle of Mutual- Self- help.

Incorporated association, with distinct identity.

Limited liability of its members.

Managed & Controlled by Board of Directors.