ZIMSEC O Level Business Studies Notes: The Features of a Public Limited Company
- Is a limited liability company whose shares can be bought and sold publicly on the stock exchange.
- The company is treated as a separate juristic person (legal entity) at law.
- The number of shareholders is unlimited.
- Its affairs are governed by the Memorandum and Articles of association.
- In addition to being issued with a certificate of incorporation public limited companies need to conduct an Initial Public Offering (IPO)
- after which they are issued with a certificate of trading once they are ready to trade.
- They also have a higher minimum issued capital when compared to private limited companies.
- Public limited companies are also required by law to hire external auditors at least once annually.
- Shareholders can elect a Board of Directors during the Annual General Meeting (AGM) to operate the business on their behalf.
- The name ends with the words Public Limited Company (PLC) or some other equivalent words.
- It is registered under the Companies Act
- Shareholders are free to sell their shares on the Stock Exchange
NB Visit this page to view the advantages and disadvantages of a Public Limited Company.
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