Business consulting
FAQ - FREQUENTLY ASKED QUESTIONS
Incorporation of companies
Where to buy a limited liability company?
There are now a lot of entities on the market offering to sell the company. It can be a ready-made company that has been in business, even for years. It can also be a ready-made company set up specifically for sale.rnrnThere are a lot of advertisements on the Internet offering ready-made companies for sale. They can also be found on auction sites. Ready-made limited liability companies are offered by law firms, for example. Also we have companies registered and ready for sale.
What to look for when buying a ready-made company?
The company can unfortunately hide surprises. So, you should start with a thorough audit, checking the legal status, company documents, financial obligations, lawsuits, ownership of property. But these caveats are more likely to apply to companies that have been operating on the market.rnrnWhen the ready-made company has not been in business, that is, it was intended for sale from the beginning, surprises are unlikely to occur. Then it is worth paying attention to how long it has been registered, as an older company inspires more confidence. A ready-made company registered in a large city, on the other hand, is a matter of prestige. The fact that it uses the services of a virtual office does not prevent it. What remains is the share capital. There are different cases, but a ready-made company is unlikely to have a huge share capital. However, in the case of companies that have not been in business, this capital can certainly be increased without any problems.
Why do companies buy back their own shares?
Reasons for a company to buy back its own shares can be various and it is impossible to list them all. It may be, for example, the desire to invest the company's spare money in the absence of prospects for another good investment. A company buying back its own shares sends a signal to the market that it is in good shape. This may be dictated by a desire to give shares as an incentive to employees, or to prevent a drop in the value of publicly traded shares. Sometimes limited liability companies buy back all publicly traded shares because the owners no longer need outside capital and don't want to share profits.
What does the sale of companies with debts look like?
Companies with debts that are sold should go through a clean-up process before being issued. It is advisable to review and evaluate the debts. If there are opportunities to pay off some of the debts, this should be considered, as it may make it possible to sell the company more expensively.rnrnFor a buyer of a limited liability company, the procedure should begin with due diligence, i.e. a thorough examination before the purchase. An analysis of the finances should be carried out, the prospects for restructuring, debt relief and development should be assessed. After these steps, you can think about negotiations and signing a contract.
Who owns a limited liability company?
The owners of a limited liability company are its shareholders. However, the influence of individual owners on its operation may be specified in the company's articles of association and need not reflect the amount of shares.
How to account for the sale and purchase of a company?
If you sell shares in the books you enter the payment for the shares. If you sell the company's assets and liabilities you make an entry in the appropriate accounts in the books for the departure of these assets and liabilities.rnrnIf you buy the company by purchasing shares you record the payment for the shares in the books. If you buy the entire company with its assets and liabilities you record these assets and liabilities in the appropriate accounting accounts.