ADVANTAGES

SOLE PROPRIETORSHIP 1. Easy to manage. 2. The owner enjoy a certain degree of flexibility. 3. Easy to form and dissolve (bubar). 4. All profits go to the owner. 5. Not subjected much to government rules. 6. Pays individual income tax

DISADVANTAGES
1. Limited source of capital. 2. The liability of the business is unlimited. 3. The future development of the business is limited. 4. The owner is solely responsible for carrying out all the tasks. 5. The life span of the business depends upon the age of the owner.

EXAMPLE
1. Ah Seng Grocery Sdn. Bhd.

PARTNERSHIP

1. Easy to set up. 2. Easier to secure financial assistance. 3. Equity can be increased through enlisting additional partners. 4. Business risks can be reduced and distributed among partners. 5. The responsibility of managing and handling the business can be divided equally. 6. Synergy 7. Individual income tax. 1. Funds easy to acquire. 2. All shareholders are protected by law. 3. Shareholders are not the managers of the company. 4. Liabilities are limited. 5. Life span not dependent upon the members. 6. Greater expansion potential. 7. One entity by itself.

1. Business liabilities are unlimited. 2. Life span of business depends on life spend of partners. 3. Unethical or misconduct behaviour may happen. 4. Risk of personal clashes among partners.

1. Gamuda Holdings Sdn. Bhd

PRIVATE LIMITED COMPANY

1. Subject to more rules and regulations. 2. Companys shares cannot be transacted through the share market. 3. Pay corporate tax. 4. Qualified Auditors must audit the companys yearly financial statement. 5. Financial affairs must be transparent to the public. 6. Setting up cost is high.

1. Antah Holdings Berhad

LIMITED COMPANY BY GUARANTEED

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The company has a legal existence separate from management and its members (the shareholders) Members' liability is limited The company's name is protected It has flexible borrowing powers The company continues despite the death, resignation or bankruptcy of management and members

1. Establishment costs 2. Disclosure Requirements and Reporting

1. Earnst & YOung

3. The Name of the Company

LIMITED COMPANY BY SHARE

Limited liability for shareholders. This means that if the company fails, the shareholders may lose the entire value of their shares but no more, unless they have given guarantees. 2. A company has its own legal identity. This means that, it can enter into legal agreements, it can own property, it can sue and be sued all in its own name. It will continue to exist, even if its shareholders or directors die, resign or go bankrupt. 3. It is easier to transfer the ownership of a company than an interest in a partnership, as all that is required is a transfer of shares, subject to the company's constitution.
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A director is always subject to removal by an ordinary resolution passed by the shareholders. Directors can have personal liability in some circumstances, for example if they breach their duties to the company, or if they commit wrongful or fraudulent trading. Limited liability may mean very little in practice, if the directors or shareholders have to give personal guarantees to banks or landlords. Ceasing to trade can be more difficult and costly than in the case of partnerships, as the business belongs to the company, and that company will need to be correctly wound up. Companies can be more expensive to set up than partnerships.

2. SME Group