Types of Partnership:

1. General partnership. Partners divide responsibility for management and liability, as well as the shares of profit or loss according to their internal agreement. Equal shares are assumed unless there is a written agreement that states differently.

2. Limited Partnership. ‘Limited’ means that most of the partners have limited liability (to the extent of their investment) as well as limited management decisions, which generally encourages investors for short term projects, or for investing in capital assets. This form of ownership is not often used for operating retail or service businesses. Forming a limited partnership is more complex and formal than that of a general partnership.

3. Joint venture. Joint Venture acts like a general partnership, but it is formed for a limited period of time or a single project. If the partners in a joint venture repeat the activity, they will be recognized as a continuing partnership and distribute accumulated partnership assets upon dissolution of the entity.

4. Corporation. A corporation is chartered by state in which it has headquarters. It is considered by law to be a unique entity, separate and apart from those who own it. A corporation can be taxed; it can be sued; it can enter into contractual agreements. The owners of a corporation are its shareholders. The shareholders elect a board of directors to oversee the major policies and decisions. The corporation has a life of its own and does not dissolve when ownership changes.

Advantages: 1) limited financial liability; 2) ability to sell shares; 3) easy to borrow from bank; 4) delegation of authority; 5) succession; 6) synergy and high salaries. 7) corporations can raise additional funds through the sale of stock

Disadvantages: 1) not easy to organize and ‘untwist’; 2) “double taxation” (corporate tax); 3) strict legal regulation; 4) corporations are monitored by federal, state and some local agencies, and may have more paperwork to comply with regulations

It is obvious that corporation is the dominant form of a large-scaled business organization it terms of a present market. The number of organizations has been growing constantly, and there is no reason why growth should not continue indefinitely. In the context of an organization the responsibility, authority and duty can be considered as the basic obligations.

Responsibility must be defined as an obligation to make sure that authority is used in the proper way and that duties are properly carried out as well. In this sense, a chief executive takes full and ultimate responsibility for the effective operating of the organization.

Authority must be stated as a power to assign duties to subordinates and to ensure their carrying out. And definitely, the delegation of authority is an important part of any job.

Duty. This is the obligation to obey the orders and instructions. In most organizations the number of orders and instructions grows with great rapidity to meet changing requirements and circumstances.

When organization is small it will be centralized: that is it will consist of one unit, and responsibility and authority for all activities will remain with a chief executive. With growth and development the unit should be split into parts with a level of authority (decentralization), or the larger the unit may be planned (centralization). Some business organizations are highly centralized with power concentrated in their head offices.