Unit -1
BUSINESS ORGANISATION
Introduction: Business means production & distribution of goods & services to the society with earning profit. Any firm which engaged in the conduct of business activities is known as a Business organization.
Business organization may be defined as, “An organization formed with Activity of Production and Distribution and the object of earning profit and providing services to the members of the society.”
Business Organization (Commercial Organization)
Private Joint Sector Public Sector Sector
• Sole Trading Concern *Departmental undertaking
• Partnership Firm *Public corporation
• Joint Hindu Family Firm *Government Company
Joint Stock Company
Co-operative Society
Management: When firms from different industries come together, they can share their knowledge of best practices in different areas. For e.g. If one firm has implemented Total Quality Management successful while another has implemented Total Productive Maintenance, they can share their knowledge. Managerial talent can be better utilized which would lead to efficiency in managing the organization.
Administration: The firms can integrate their transportation, administration and marketing costs. This leads to economies and reduction in costs.
Line
If a firm which was successful and efficient in one line of business, engages in other businesses it would run them also in a successful manner. Therefore more customers are benefited.
Functional
Types of Insurance Sector in India The Corporation had an Executive Committee consisting of the Chairman, two Managing Directors and two other Members of the Corporation. There was also an Investment Committee consisting of the Chairman, a Functional Director, and five other persons, to advise the corporation in matters referred to it relating to the investment of its funds.
Staff
Standardisation of forms is essential as it helps the staff to do the work quickly. They will be accustomed to do work in a particular standard form.
Every company, including a single member company, is required by law to have a company secretary, who may be one of the directors. The company secretary acts in accordance with directors’ instructions. A company secretary’s main functions are to oversee the company’s day to day administration and to ensure specifically that the company complies with the law and observes its own regulations.
Qualifications of a Company Secretary
No qualifications are required to be the company secretary of a private company. In the case of public limited companies, the directors have a statutory duty to ensure that the company secretary is a person who appears to them to have the requisite knowledge and experience to discharge the functions of company secretary.
A Joint Stock Company is a voluntary association of members formed for the purpose of undertaking a business. It is called a Joint Stock Company, because the shares or stock of the company are jointly owned by its members.
A Joint stock company undertakes different business activities like manufacturing, marketing and servicing. The funds required by the company are contributed by its members called shareholders. The company also borrows funds from banks and financial institutions. The shareholders are the Co-owners and they share in the profits of the company in the form of dividend.
The company is managed by Board of Directors. The Board is a group of elected representatives of the shareholders. The Board frames a plans and policies of the company. The Board in turn appoints several other managers and subordinate staff to look after day-to-day aspects of the Organization.
Definition: -
According to section 566 Indian Company Act, 1956, Company may be defining as “An incorporated voluntary association which act as an artificial person, created by Law, having common seal & perpetual succession.”
Section 566 of the Indian Companies Act, 1956 has defined Joint stock company as, “A company which is having a permanent paid-up or nominal share capital of fixed amount divided into shares, also of fixed amount or held and transferable as stock, or divided and held partly in one way and partly in the other and formed on the principle of having for its members, only the holders of those shares or that stock and no other persons”.
FINANCING OF JOINT STOCK COMPANY
Books Recommended:
- Dr. Y. P. Verma —Vyavshaya Sanghthan, Prabandh Ewan Prashashan (S. Chand & Co.)
- . 2. Yaducal Bhushan —Business Organisation
- 3. M. C. Shukla — Business Organisation
- 4. Ghosh and Om Prakash — Business Organisation
- 5. Dr. Padma Asthana — Vyavshaya Sanghthan Ewan Prabandh
6. R.K. Sharma, Shashi K. Gupta—Business Organisation
