Monday, March 26, 2012

Know about Limited Company

limited company is a company in which the liability of the members or subscribers of the company is limited to what they have invested or guaranteed to the company. Limited company is divided into public companies and private companies.

public limited  company is a limited liability company that offers its securities (stock/sharesbonds/loans, etc.) for sale to the general public. 

A private limited company is a limited company, whose liability is limited, the transfer of whose shares is limited to its members and who is not allowed to invite the general public to subscribe to its shares or debentures. 

Firstly there is a difference in the statutory limit of minimum members required to form both type of companies. There is requirement of at least 2 members to form private company while in a public company number of minimum members required are 7. 
The word 'Pvt Ltd' is used at the end of the name of private company while the word 'Ltd' is used in the case of public company.

Further compare other forms of business with Limited company .


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