Partnerships Essay, Research Paper
A REPORT ON PARTNERSHIPS
A partnership is a term applied to an association of two or more persons who have agreed to combine their labour, property and skill. For the purpose of engaging in lawful business and sharing profits and losses between them.
The parties forming such an association are known as partners. The agreement to form a partnership is known as
The deed of partnership , the most important provision of which, spells out the manner in which profits are to be distributed.
A partnership can be formed only by contract, the Companies house requires the agreement to be in writing if the term exceeds one year; failure to comply results in a partnership at will. Between two and twenty people can form together in a partnership. New members may be admitted into an existing partnership only with the consent of all partners. The agreement of partnership generally is for a definite term of years; if no duration is specified, it is said to be a partnership at will.
By agreement of the members, a partnership may be dissolved or terminated and the terms of the partnership agreement modified at any time. Death or bankruptcy of a partner, the insanity or misconduct of a partner, and the end of the period fixed for the duration of the partnership also operates to terminate the partnership.
A partner must, exercise the highest degree of good faith in all dealings with other partners, devote time and attention to the partnership business, and must account to the other partners for any secret profits made in the conduct of the partnership business. The liability of a partner for partnership debts is said to be unlimited, except when the partner is a limited one in a limited partnership organised in accordance with the provision of a contract permitting such limitation of liability.
For my partnership to analyse, I have chosen:
“firm x” a firm of solicitors located in placex.
Within this business there are:
· Two senior partners
· Two junior partners
· Four associate partners
There are no sleeping partners, as these are not allowed in a firm of solicitors. The partners and associates in the firm all are qualified to and do work in one of the legal departments:
· Marital law
· Criminal law
· Family law
· Trusts and equity
The partners are heads of the departments in their field of expertise. In order to ensure smooth running of the departments, they hold departmental meetings in which the members of the appropriate department are to attend, and bring up any points they may have about the running of the department.
Obviously, because the partners and associates work they receive a salary. Which is approximately double to that of a normal solicitor in the company. On top of this, at the end of the financial year, they will receive a dividend, which varies on the amount of profit the business has made throughout the year. A partner s or associates share of this profit depends on their status in the firm, for example: a senior partner would receive a larger dividend, than a junior partner would.
The status of a partner in the firm depends on the amount of money put into the business and the time spent working for the firm.
The money the partners put into the business is usually spent on:
· I.T. The firm has a great number of computers, which are continually being updated.
· Stationery. Pens, paper, pins etc.
· Consumables. Teabags, coffee, toilet roll etc.
The partnership has only been dissolved once, this was because The partner was not working hard enough and was not bringing in his money for the firm.