A public limited company (PLC) is a type of business entity that is owned by shareholders. PLCs are listed on a stock exchange, which means that their shares can be bought and sold by the public. This gives PLCs access to a large pool of capital, which can be used to grow the business.
The registration of a public limited company (PLC) in India.
- Choose a name for your company. The name of your company must be unique and cannot be the same as the name of any other company already registered in India.
- Reserve your company name. Once you have chosen a company name, you need to reserve it with the Ministry of Corporate Affairs (MCA).
- Appoint directors and shareholders. A PLC must have at least three directors and seven shareholders. The directors and shareholders can be individuals or companies.
- Obtain a digital signature certificate (DSC). A DSC is an electronic signature that is used to sign digital documents.
- Pay the registration fees. The registration fees for a PLC are based on the authorized capital of the company.
- Obtain the certificate of incorporation. Once the MCA has approved your application, you will be issued a certificate of incorporation
- Limited liability: The shareholders of a PLC have limited liability, which means that their personal assets are not at risk if the company goes bankrupt.
- Ability to raise capital: PLCs can raise capital by issuing shares to the public. This can be a great way to grow your business and expand your operations.
- Credibility and trust: PLCs are seen as more credible and trustworthy than other types of business entities. This can be important for securing contracts and other business opportunities.
- Ease of transfer of ownership: Shares in a PLC can be easily transferred to another person or entity. This makes it easy to sell your shares or bring in new investors.
- Access to government contracts: PLCs are often eligible to bid on government contracts. This can be a great way to generate revenue for your business.
- High compliance costs: PLCs are subject to more stringent regulations than other types of businesses. This means that they have to comply with a number of additional laws and regulations, which can be costly.
- Loss of control: The shareholders of a PLC have a limited say in the management of the company. The board of directors has the ultimate authority to make decisions about the company.
- Liability for the debts of the company: Even though the shareholders of a PLC have limited liability, they can still be held liable for the debts of the company if they have acted in a fraudulent or negligent manner.
- Dilution of ownership: If a PLC issues new shares, the existing shareholders will see their ownership diluted. This means that they will own a smaller percentage of the company.
- Public scrutiny: PLCs are subject to public scrutiny. This means that their financial statements and other documents are available to the public.
A public restricted organization is typically settled to produce capital from outside sources, for example the overall population for starting a business, business development, mechanical headway. worldwide development, and so forth
Yet, a PLC is more reasonable just to the enormous associations which have a far-reaching viewpoint and higher development prospects, instead of a little shop situated nearby.
HOW AURIGA ACCOUNTING HELP YOU IN
- Provide Limited liability and Ability to raise capital of Firm.
- Help you to ease of transfer of ownership.
- Generate revenue for your business.
- Reduces Liability for the debts of the company