Public limited company

A public  limited company or  one which can offer shares or securities  to the public which can them openly. the shares are freely transferable and there is no limitation as to the minimum  number  of share holders to be  one . it has a legal personality and has limited liability. it is incorporated under the companies act.

Features of public limited company

1. minimum number of share holders is one. as regards the maximum there is  no limit.
2. shares or other securities could be  offered to the  public to  purchase openly ( shares or securities could be sold to  the public openly )
3. shares can be transferred freely
4. subject to statutory control  and the  control of share holders.
5. has a legal  personality
6. liabilty is limited 
7.board of directors minimum of 02 , maximum unlimited.
8.after examination of the capacity  to pay back  loans , dividents or any other payments could  be made.
 9. it is compulsory to  maintain accounts and render statements  of accounts to the registrar of companies 
10. when indicating the company's name the word " The public Company" should  be indicated
11. could be registered in  the share market as a  quoted  company
12. any large scale business could be undertaken
13. there is  continuous  existence.
14. taxes could  be paid in the name of the company
15. accounting and auditing is compulsory
16.  could be dissolved voluntarily or under  the supervision of the judiciary or by the   judiciary.

Disadvantages of a Public Company

1. the initial  cost of  establishment is  exceessive
2. should abide  by the rules and regulations of  the  companies act
3. having the losses within the business itself
4. possibility  of acquisition by another company ( possibility of becoming a subsidiary )
5. difficulties  in management.

 Difference between private companies and public companies.

       private limited co.                                     public limited co.

1. maximum number of                              1. no  limit in the case of 
    members  is 50                                            maximum membership

2.No authority to  sell                                 2. shares or securities
   shares or securities                                      could be sold publicly

3. minimum number of                               3. minimum number of
    directors is one                                           directors is two

4. shares not transferable                           4. shares could be
    freely.                                                         transferred freely

5. Cannot be registered in                          5. can be registered in the
   a share market as a                                     share market as quoted     quoted company                                        company

6. Distribution of profit                             6. Distribution of profit
  could be made without                                cannot be made
  checking the payment                                 without checking the
   of loans                                                       payments of loan

7. Not compulsory to                               7. It is  compulsory to
  render the annual                                       render the statement of
  report along  with the                                 accounts along with the  the statement accounts.                               annual report.