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aerccment. There is no statutory requirement to register (or even to have) a written LLP agreement, but such an agreement is essential in practice. The LLP is treated for tax purposes as an ordinary partnership: i.e. each partner is liable to income tax for his or her share of the profits, and to Capital Gains l ax in respect of any gains made on the disposal of assets by the LLP.

Community Interest Companies (CICs)

Communiiy Interest Companies are a relatively new type of company (from 2005) which can only be registered for objects which are for the good of the community.

Apart from having to have objects that benefit the community, the tw'o main features that distinguish CICs from 'normal' companiesare the asset lock and the Community Interest Statement and Report. Under the asset lock provisions, the assets and profits must be permanently retained within the CIC, and used solely for community benefit, or transferred to another organisation which itself has an asset lock, such as a charity, or another CIC. With every application to form a CIC, a Community Interest Statement must be lodged, with the usual documents, when seeking company registration. This statement, signed by all the directors, must describe the company's objects and certify that the company is formed to serve the community rather than for private profit. CICs can be limited by shares or by guarantee.

Charitable Incorporated Organisations (CIOs)

This new type of company became available for registration in England and Wales from 1 Oth. December 2012. CIOs are designed to be a more efficient way to register an incorporated charity.

Until CIOs became available a charity that wished to be incorporated (and so have limited liability) had to register as both a company limited by guarantee and as a charity. Using a CIO should be simpler to incorporate and run as it will be registered with just one body (the Charity Commission) and will only have to submit one annual return and one set of accounts per year.

Right to Manage (RTM) Companies

The Commonhold and Leasehold Reform Act 2002 provides a right for leaseholders to take over the landlord's management functions by transferring them to a special company set up for the purpose, the Right To Manage (RTM) company. The right was introduced to empower leaseholders, who generally hold the majority of value in the property, to take responsibility for the management of their block. It applies only to leaseholders of flats, not of houses. The process is relative-

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ly simple. The landlord's consent is not required, nor is any order of court. I he right is exercised by the service of a formal notice on the landlord. After a set period of time, the management transfers to the right to manage company (the RTM company) which has been set up by the leaseholders. Once the right to manage has been acquired, the landlord is also entitled to membership of the company.

Conversion from one type to another

Company Law Solutions provides company conversion services.

A private company limited by shares can be converted into a public company and vice versa, or to an unlimited company. An unlimited company can be converted to a private company limited by shares. A company limited by guarantee cannot be converted to a company limited by shares or vice versa.

E xisting companies can convert themselves into CICs but such conversions require the approval oi the CIC Regulator. Where the company converting to a CIC is a charity, the permission of the Charity Commission is needed for a change of name.

Vocabulary and Language Practice

1. Underline the correct word in italics:

1.My husband is a plumber. He’s autonomous/self-employed.

2.The people who own a private company might include the founder of the company, some family members, and perhaps a few business associates/companions.

3.In a public company anybody can buy the actions/shares.

4.A public company is listed/posted on a stock exchange.

5.Our railways were recently privatized. I think the service was better before, when they were a public company/state-owned enterprise.

2.Complete the sentences with a suitable preposition: To what extent are you able and willing to be responsible personally 1. ____ business debts and losses? If your business poses a risk of personal injury or property damage, this is an important consideration. Insulating your personal assets 2. ____ claims 3. ____

your business may be an overriding factor 4. ____ your choice of legal structure. Of course, you cannot eliminate the risk, so good insurance planning is critical.

What happens 5. ____ the business if you should die? Some forms of business exist only so long 6. ____ the owner lives. Proper estate planning should take this

7.____ account.

How easy will it be to liquidate the business? If you decide to quit doing business, 8. ____ whatever reason, how difficult will it be to liquidate? Some forms of business may be costly to liquidate. Keep 9. ____ mind that a high per-

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centage of small businesses do not make it beyond the first year or two 10. ____

doing business. In choosing the legal structure of your business, consider the cost of liquidating if your business should fail.

Word Formation

Apart from the perhaps more obvious possibility to derive words with the help of affixes, there are a number of other ways to create new words on the basis of already existing ones.

Conversion can be defined as the derivation of a new word without any overt marking. In order to find cases of conversion you have to look for pairs of words that are derivationally related and are completely identical in their phonetic realization. Such cases are not hard to find, and some are listed in the table.

As can be seen from the organization of the data, different types of conversion can be distinguished, in particular noun to verb (a), verb to noun (b), adjective to verb (c) and adjective to noun (d). Other types can also be found, but seem to be more marginal (e.g. the use of prepositions as verbs, as in to down the can).

Translate into English paying attention to the words in bold.

1. Newton’s binomial theorem helps to figure some scientific or mathematical problems. 2. The lines in this figure show the refraction of light. 3. The temperature changes influence greatly the accurate operation of the instrument. 4. The influence of different forces causes the motion of a body. 5. This phenomenon can occur due to two causes. 6. Heat causes many chemical changes in substances. 7. The increase in motion causes the molecules to collide with each other. 8. People throughout the world are fighting for the cause of peace. 9. Russia is a multinational state. 10. The fourth state of matter is plasma. 11. The newspaper states that the conference will be held in a week. 12. There are 50 states in the United States of America. 13. The Soviet economy developed in accordance with the state plans. 14. The letters h. p. stand for horse power. 15. The Soviet Union used to be long the world’s leader in the generation of thermal and electric power. 16. This newspaper article describes the political relations of great powers.

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Less Commonly Considered Concerns

Fill in the missing words and find their equivalent:

There are 1. ____ other important issues related to legal structure that business owners should understand.

Raising money. Lenders are more 2. ____ with certain business structures more than others. These structures may make it easier to borrow money. Certain structures also are more 3. ____ to limit the amount of personal information that must 4. ____ when raising finances once the business is established

Regulations. Although certain businesses are easy 5. ____, the more important question is which will be easiest to operate in the long term. If more time will 6. ____ on certain regulations over the long term, it may make sense to use a business structure that may seem more 7. ____ in the beginning but offers less red tape as the business develops.

Continuity. Often the owner thinks about what form best allows for the transfer a business or is most 8. ____ about who acquires the business upon the owner’s death. Owners also need to 9. ____ business succession and transferring the business to other family members.

Flexibility. It is important the that the structure chosen allows the owner to have the greatest number of 10. ____ as the business reaches points where 11. ____ decisions need to be made.

4. COMPANY STRUCTURE

Lead-in:

1.What is organizational structure?

2.Why should you develop a structure for your organization?

3.When should you develop a structure for your organization?

4.What conventional (generally accepted) departments are there in a compahy of any type?

In business, organization structure means the relationships between positions & people who hold the positions. Organization structure is very important because it provides an efficient work system as well as a system of communication. First of all we should distinguish between the organizing function & organizing structure. The

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organizing function is the process of breaking down the overall task into small jobs along with delegated authority to do those jobs & then putting them back together in units, or departments, of an optimal size according to some consistent bases. Thus we can describe the organizing function as dividing task into jobs, delegating authority, determining appropriate bases for departmentalizing jobs, & deciding the optimal number of jobs in a particular department. It helps to coordinate effort & create authority relationships. Organizing structure is considered by many to be “the anatomy of the organization, providing a foundation within which the organization functions”. So the idea of a structure is a frame work – differentiation of position, prescriptions of authority. So structure helps to regulate the behavior of employees. There are can be different kinds of organization structure, & firms can change their organization structure by becoming more or less centralized. The main principle of modern management is that there are no the best structure – appropriate structure depends on situation. Most organization have a hierarchical or pyramidal structure, with one person or a group of people at the top, & increasing number of people below them at each successive level. There is a clear line or chain of command running down the pyramid. All the people in the organization know what decision they are able to make, who their superior (or boss) is (to whom they report), & who their immediate subordinates are (to whom they can give instructions).

Organisation and Control of a Company

The Board of Directors, also called the Board of Management, is the highest authority in most companies, consisting of the main shareholders as well as the General Manager or the Managing Director of the company, acting as chairman.

In a number of large companies the system differs somewhat: the Administrative Council, consisting of shareholders, is the highest authority, and the Board of Directors, in this case consisting of directors of the company, is subordinate to the Administrative Council, also called the Supervisory Board.

Some bigger companies have a General Manager, but in most firms the Managing Director may be used. He may be assisted by an Assistant Managing Director and a Company Secretary.

The heads of the various departments are called departmental heads, or senior executives and may be assisted by deputies or assistants called junior executives. Below are listed some of the most common positions in a firm:

–CEO (Chief Executive Officer);

–General Manager Managing Director Sales Manager M arketing Manager/Director;

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–Purchasing Manager;

–Chief Buyer;

–Export Manager;

–Import Manager;

–Production Manager;

–Product Executive/Manager;

–Personnel Manager/Staff Manager;

–Human Resource Manager;

–Advertising Manager;

–Publicity Manager;

–Company Secretary;

–Administrative Manager;

–Office Manager;

–Chief Factory Manager/Works Manager;

–Chief Engineer;

–Deputy Sales Manager;

–Assistant Purchasing Manager;

–Director of Finance Departmental;

–Head of Department;

–Division Manager.

There may also be a Management Team in the company. In American firms titles like the following are used:

–President;

–Vice President;

–Executive Vice President.

The personnel of staff includes clerks, office employees, secretaries, typists, shorthand-typists, DP programmers, analysts, etc. They work in offices.

At a factory, foremen of supervisors supervise the work done by the workers in various shops. Skilled workers are called craftsmen or tradesmen: unskilled are labourers or workers.

Shops stewards are representatives of workers’ trade unions in the factories, trustees in offices.

Note the difference in the use of titles in English. Hr. marketingchef Ehlert = = Mr Ehlert, the Marketing Manager.

Most firms can be divided into three parts:

–capital (sbarebolders);

–management;

–labour.

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The management structure can be represented as follow:

–Shareholders Board of Directors (headed by the Ch airperson);

–Chief Executive Officer (CEO) (also known as the Managing Director);

–Senior Executive Officers (General Manager1 + sen ior managers);

–Middle/Line Managers.

A director is a senior manager who sits on the Board under the authority of the Chaiperson or President. The Board is responsible for deciding overall company policy and capital expenditure.

The CEO or MD is the link between the Board and senior management. Middle managers (also known as line managers) are responsible for running

sections or departments within a firm. They are accountable to senior management for their particular area of responsibility as illustrated in the organisation chart.

In a general manner of speaking, an executive is any senior person in the hierarchy of a firm. He / She makes important decisions that are carried out by subordinates.

Like the managing director, some directors are also concerned with the day- to-day running of the firm. In this capacity they are known as executive directors. Those who sit on the Board but have no direct interest in the running of the firm are called non-executive directors.

Executive can also be used as an adjective: some tour operators specialise in executive travel.

Departments

The list of departments below is typical for many business – each one corresponds to a business function.

Companies also have other departments related to their own particular business activity.

Production might also include Purchasing and Quality Assurance (QA).

Operations refers to all the internal processes of a company and might include, for example, Logistics.

Sales might also include Business Development. Customer Services might include Technical Support. Marketing might include Market Research.

Communications refers to all promotional activities including a strong focus on Public Relations (PR).

Finance has many subdivisions, such as Financial Control, Treasury, Accounts and Payroll (= managing salary payments).

Human Resources (HR). Information Technology (IT).

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Research and Development (R&D).

Legal.

1. Complete the text with the appropriate forms of verbs from the box:

perform do establish depend determine make arrange illustrate define report

Organizational structure refers to the way that an organization 1. ____ people and jobs so that its work can 2. ____ and its goals can be met. When a work group is very small and face-to-face communication is frequent, formal structure may be unnecessary, but in a larger organization decisions have 3. ____ about the delegation of various tasks. Thus, procedures 4. ____ that assign responsibilities for various functions. It is these decisions that 5. ____ the organizational structure.

In an organization of any size or complexity, employees' responsibilities typically 6. ____ by what they do, who they report to, and for managers, who 7. ____ to them. Over time these definitions are assigned to positions in the organization rather than to specific individuals. The relationships among these positions 8. ____ graphically in an organizational chart. The best organizational structure for any organization 9. ____ on many factors including the work it 10. ____; its size in terms of employees, revenue, and the geographic dispersion of its facilities; and the range of its businesses (the degree to which it is diversified across markets).

2. Complete the sentences with a suitable preposition.

There are multiple structural variations that organizations can take 1. ____, but there are a few basic principles that apply and a small number 2. ____ common patterns. The following sections explain these patterns and provide the historical context 3. ____ which some of them arose. The first section addresses organizational structure 4. ____ the twentieth century. The second section provides additional details of traditional, vertically-arranged organizational structures. This is followed 5. ____ descriptions of several alternate organizational structures including those arranged by product, function, and geographical or product markets. Next is a discussion 6. ____ combination structures, or matrix organizations. The discussion concludes 7. ____ addressing emerging and potential future organizational structures.

3. Underline the correct word in italics:

1.The Purchasing Department is responsible for buying parts and raw materials/making the final product.

2.If you have a complaint, please contact Consumer Services/Customer Services.

3.All recruitment and selection is done by our Human Relations/Human Resources Department.

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4.Innovation is the main factor to our success and we have recently expanded the Research and Design/Research and Development Department.

5.In the Legal Department three are lawyers/advocates trained in commercial

law.

6.It’s the CEO’s job to control/run the company.

7.Our Business Development Officer is responsible for/the responsible for

finding new business opportunities.

8.To take that decision is not on my own responsibility. It will have to be referred to higher people/more senior people.

9.That decision will have to be taken at a higher level/a more superior level.

10.In the department we have six Sales Representatives and their line director/line manager.

11.The Sales Department has to liaise/liaison closely with Marketing.

12.She is part of/makes part of a team of planners.

13.I am the Financial Controller, and I relate directly/report directly to the Finance Director.

4. Complete each sentence with a verb from the box.

answers arranges checks collects deals maintains

1.The Quality Assurance Section checks that the products have no defects.

2.The Logistics Department ____ the transport of goods and materials.

3.Technical Support ____ specific questions from customers about how to use the product.

4.The Market Research Section ____ and analyzes information about the needs of consumers.

5.The Accounts Department ____ with invoices and payments.

6.The IT Department ____ the computer network.

5. Complete the text about operations with the words and phrases in the box.

Everyone knows the functions of company departments such as Marketing and Finance. Marketing is about promoting the company, and making sure that customers can find products that 1. ____. Finance is about controlling the resources of a company to make sure that the business 2. ____. But what about Operations? The department name is less well-known, yet many large companies are run on a 3. ____ by Operations Managers. Operations is about the internal process-

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es of a company. In a manufacturing company an Operations Manager will make sure the production process is running smoothly. In a hotel they are responsible for bookings, front desk, maintenance, etc. In a bank they look after the administration of accounts and other 4. ____. Operations Managers have to 5. ____ with people from other departments. In the factory, it is with Purchasing Managers who buy the raw materials. In the hotel, it is with Human Resources Managers who 6. ____ new staff. In the bank it is with IT Managers who work 7. ____ to keep everything running. So the Operations Manager has to be careful not to 8. ____.

5. MANAGEMENT

Lead-in:

1. What is the role of a manager?

3.Which of the following statements do you agree with? Explain your reasons. A manager should:

a) know when your birthday is;

b) have tight control of employees movements and work schedules; c) not criticize or praise;

d) show recognition, compliment staff publicly or in face-to-face situations; e) handle (deal with) conflicts between members of staff;

f) encourage staff to put forward their ideas;

g) clearly give reasons why a certain decision has been made;

h) explain the benefits of this decision to the individual, to organization;

i) ask for people’s commitment to working with management to realize the goal; j) make employees to update on their progress;

k) be available at all times to give staff advice and support;

l) keep their distance from staff and not get involved in socializing outside work; m) use polite language at all times;

n) comment on personal appearance of their staff.

3.What are the key qualities for a successful manager today?

4.Do you think you have right qualities to become a successful manager?

5.What should an effective manager do before making contact with people in other countries?

Complete the text with the appropriate forms of verbs from the box.

use include encompass comprise include originate consist accomplish

Management in business and organizations is the function that coordinates the efforts of people to 1. ____ goals and objectives using available resources effi-

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