1. 1 INTRODUCTION TO BUSINESS PROCESSES FOR WEB DEVELOPERS

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3. 3 So far………. Organisations Organisations Commercial Organisations Commercial Organisations –Sole Trader –Partnership –Limited Company Incorporation Incorporation –Independent Body

4. 4 Organisational Structures Share Capital Share Capital Company Constitution Company Constitution Directors responsibilities Directors responsibilities

5. 5 Share capital Shareholders (Subscribers) own Company Shareholders (Subscribers) own Company At start of Company At start of Company –Authorised share capital Number & Nominal (par) Value Number & Nominal (par) Value Say 100 shares @ £1 Say 100 shares @ £1 Shareholders risk is share value Shareholders risk is share value –Partly Paid –Premium

6. 6 Shares On being Wound Up On being Wound Up –All debts must be paid before shareholders –All assets sold –If remainder then divided equally between shareholders –If debts > assets Shareholder lose money

7. 7 Bureaucracy Large Companies (PLCs) Large Companies (PLCs) –Regulated by Companies Act and Stock Exchange Small & Medium Companies Small & Medium Companies –Regulated by Companies Act Small Company Medium Sized Company Turnover<=£2,000,000<=£8,000,000 Balance Sheet <=£975,000<=£3,000,000 Average Employees <=50<=250

8. 8 Company Constitution Memorandum of Association Memorandum of Association –Controls External Relations Articles of Association Articles of Association –Control Internal Relations (Shareholders Agreement) (Shareholders Agreement)

9. 9 Memorandum of Association Company Name Company Name –Restrictions Country of Registration Country of Registration –England & Wales, Wales, Scotland Objects of Company Objects of Company –Companies Act 1989 allow general commercial company A Liability Clause A Liability Clause –Liability of members is limited Authorised Share value Authorised Share value –Nominal Share Value and Number

10. 10 Articles of Association Use Table A if required (Companies Act 1948) Use Table A if required (Companies Act 1948) Rules of Share capital Rules of Share capital Transfer of Shares Transfer of Shares Meetings of Members Meetings of Members Rules Governing Directors’ Appointments Rules Governing Directors’ Appointments Power of Directors Power of Directors Dividends and Reserves Dividends and Reserves

11. 11 Shareholders Agreements Protect interests of minor shareholders Protect interests of minor shareholders Article of Association Article of Association –Changed at General Meeting –Needs 75% majority Agreement Between Shareholders Agreement Between Shareholders –All must sign –Can govern way voting is done

12. 12 Directors & Company Secretary Directors Elected by Shareholders Directors Elected by Shareholders –Act In best Interest of Company –Honest –Declare Interests –Aware of Company’s Trading Position –Exexutive & Non-Executive Directors Company Secretary Company Secretary –Statutory Returns to Companies House –Could be Director

13. 13 Next Lectures Prices and Costs Prices and Costs Company Finances Company Finances Sales & Marketing Sales & Marketing Business Plan (Assignment) Business Plan (Assignment)