Benefits Of Partnership
Easy formation and registration
Partnership formation is very easy. A simple agreement among the partners in oral or written words brings a partnership into existence. Comparatively to company, Partnership registration is quite easy. There is less hassle and easy documentation. Legal formalities and expenses is low.
Only two partners is required to start a partnership. There is no need to perform and submit an audit annually.
Partnership can be formed by any legal entity
Other than individuals, any legal entity like a company can enter in to a partnership.
Utilization of partners strength
Partners contribute capital. The scale of business can be increased with partners added financial strength. Further, new partners can be added to meet the capital requirements.
With the changing circumstances the operations can be change easily and quickly unlike company where such changes cannot be implemented easily because many restrictions imposed.
Risk sharing makes the risk of each partner less in comparison to sole proprietorship.
Reduced management cost
Managerial expenses is saved by the partners working in different functional isas. Business can be run privately since partnerships is not required to publish their accounts.