BRCM COLLEGE OF BUSINESS ADMINISTRATION

BRCM COLLEGE OF BUSINESS ADMINISTRATIONASSIGNMENT 2(2015-2016)MANAGERIAL ECONOMICS-(PAPER-2)F.Y.BBA (SEM-2)TOPIC : JOINT STOCK COMPANYPUBLIC ENTERPRISEPresented by: group-2

INTRODUCTIONJoint Stock Company is a voluntary association of different persons created by law as a separate body for specific purposes.

It possesses a common capital contributed by its members such capital being divided into transferable shares.

The liability of each such member is limited to the face value of the shares he holds.

DEFINITION

MEANINGA company or association consisting of individuals organized to conduct a business for gain and having a joint stock of capital represented by shares owned individually by the members and transferable without the consent of the group

FEATURES

Artificial person

Created by law

Capital divisible into transferable shares

Limited liability

Perpetual succession

Ownership is distinct from management

Common seal

Voluntary association

Separate legal entity

May sue or be sued

FORMATION

DOCUMENTS TO BE PROVIDED FOR CERTIFICATE OF INCORPORATIONMemorandum of associationArticles of associationList of directorsConsent of directors (in writing)Address of the companys officeProspectusDeclaration by secretary about legal requirements

CLASSIFICATION

ON THE BASIS OF INCORPORATION

ON THE BASIS OF LIABILITY

ON THE BASIS OF NUMBER OF MEMBERS

ON THE BASIS OF CONTROL

ON THE BASIS OF PLACE OF REGISTRATION

PUBLIC VS PRIVATE COMPANY Number of members

Transfer of shares

Number of directors

Subscription of shares

Provision for minimum subscription

Word inserted after name

Certificates

Provisions of AOA

First statutory meeting

MERITS Huge resources

Limited liability

Transferability of shares

Stability of existence

Efficient management

Scope for expansion

Economies of large scale production

Public confidence

Social benefits

Diffused risk

Tax benefits

DEMERITS Difficulty in formation

Oligarchic management

Delay in decision-making

Separation of ownership and management

Lack of secrecy

Speculation in shares

Fraudulent management

Concentration of economic power

Excessive Government regulations

Evils of Factory system

SUITABILITY OF JOINT STOCK COMPANYVolume of business is large

Businesses which involve heavy risks

Business activities which require public support and confidence

Ex: like production of pharmaceuticals, machine manufacturing, information technology, iron and steel, aluminum, fertilizers, cement, etc.

CONCLUSION

Meaning:The business units owned, managed and controlled by the central, state or local government are termed as public sector enterprises also known as public sector undertakings.

denotes a form of business owned and managed by the state government or public authority.

undertaking owned & controlled by the local ,state or central government.

The whole or most of the investment is made by the government.

definitions

featuresAutonomous or semi-autonomous organization

State control

Rendering service

Useful to various sectors

Monopoly enterprises

A direct channel for use of foreign money

Public accountability

Agent for implementing government plans

Financial independence

OBJECTIVES OF PUBLIC ENTERPRISEEconomic development

Self-reliance

Development of backward areas

Employment generation

Economic surplus

Egalitarian society

Consumer welfare

Public utilities

Defence

Labour welfare

Forms of management :

MERITS Balanced growth

Long period planning

Facilities for economic development

Greater public welfare

Equal distribution of wealth

Better co-ordination

Abolition of monopoly

Greater economy

Better relation with labour force

Better deal to consumers

Utilization of local resources

Achievement of self-reliance

Establishment of heavy and strategic industry

Balanced production

DEMERITSLack of initiation and efficiency

Lack of selection of goods

Political interference

Slow growth

Poor management

Lack of flexibility

SUITABILITYPublic accountability and operational autonomy

Monopoly powers

Financial dependence

CONCLUSION