Міністерство освіти і науки України

Кіровоградський національний технічний університет

Кафедра іноземних мов

Методичні вказівки до читання текстів англійською мовою для студентів спеціальності 6.050106 – „Облік і аудит”

(за кредитно-модульною системою)

Кіровоград – 2004

Міністерство освіти і науки України

Кіровоградський національний технічний університет

Кафедра іноземних мов

Методичні вказівки до читання текстів англійською мовою для студентів спеціальності 6.050106 – „Облік і аудит”

(за кредитно-модульною системою)

Затверджено на засіданні

кафедри іноземних мов.

Протокол № від

Кіровоград – 2004

Методичні вказівки до читання текстів англійською мовою для студентів спеціальності 6.050106 – „Облік і аудит”.

Укладач.: В. В. Підоренко. – Кіровоград: КДТУ, 2004 -

Дані методичні вказівки і завдання до читання текстів англійською мовою призначенні для студентів II курсу економічних спеціальностей очної і заочної форм навчання. Методичні вказівки спрямовані на розвиток навичок і умінь читання текстів за фахом.

Методичні вказівки розраховані на 30 годин практичних занять та 20 годин самостійної поза аудиторної роботи.

Укладач: В.В.Підоренко, викладач.

Рецензент: С.В.Щербина., кандидат педагогічних наук.

Оцінка виконання завдань за кредитово-модульною системою здійснюється шляхом підрахунку балів, які набрані за кожний розділ методичних вказівок (Unit) окремо.

Набрана кількість балів трансформується в українську 5-ти бальну систему оцінювання знань, а українська оцінка перетворюються в європейську системі балів:

кількість правильних відповідей	90-100%	76-89%	61-74%	60%
українська оцінка	5	4	3	3-
відповідна кількість балів за європейською системою	3	2	1	0.5

Unit1. What are English companies like? (Total Score – 103 points)

Text1. Forms of business in the United Kingdom: advantages and disadvantages. (Score – 12 points)

As the United Kingdom is a country where market economy was established centuries ago, it would be interesting to look at British forms of business organization. The UK economy is mixed, that means that there exist both private and public sectors, the former being by far larger than the latter. Four major types of business represent the private sector: sole trader (sole proprietor), partnership, limited company and unlimited company. Limited companies in turn can be private limited and public limited. The public sector consists of nationalized companies. Let us review all of these forms in greater detail to identify their main features, advantages and disadvantages. The classification of business forms is illustrated by the following scheme:

Private sector

Public sector

Nationalized company

Sole trader

Partner-ship

Limited company

Un-limited company

Nationalized company

Private limited company

Public limited company

Company limited by shares

Company limited by guarantee

S

Nationalized company

ole trader (sole proprietor).

The proprietor is the sole owner of a business and has full control of it. He is personally liable for all business debts, i. e. he carries an unlimited liability. This means that if his business fails, not only business asserts are to be sold to cover outstanding debt, but also the owner’s personal property. It is easy to start a sole trader’s business at any time, as there are no legal formalities to complete before commencing trade. For a small business there are no statutory requirements for formatting accounting records and no need for an annual audit. In terms of taxes, sole traders may be required to register for Value Added Tax (VAT) and pay-as-you-earn (PAYE – a system of income tax deducting and National Insurance contributions for all organizations that have employees) purposes, and maintain corresponding records. They are required to submit account and tax computations to the Inland Revenue – a government agency that controls individuals’ and companies’ tax payments. Sole trader and partnerships are dominant forms in the small business segment.

Partnership

Partners jointly own a business and each partner is personally liable for the firm’s debt. If any of partners have limited liability (in a limited partnership) in a worse-case scenario they can lose only the capital they invested in the business (limited partnership was established by the Limited Partnership Act of 1907; the use of this form of partnership has not been extensive due to the ease of incorporating a private company). However, they cannot actively run the business and are therefore called "silent" partners. There are limitations to the number of partners:

minimum of two and maximum of twenty (there is no maximum for accountants and solicitors). The partners are free to choose any name for the firm; however, "limited" must not be the last word of the name. Like a sole trader, a partnership is not obliged to publish its accounts or have them audited. It shares requirements similar to those a sole proprietor does in terms of VAT and PAYE.

A partnership may be created without any legal formalities based solely on the Partnership Act of 1890. However, to prevent possible future discord among partners, it is usual practice to draw up an agreement that clarifies the following issues:

• profit-sharing arrangements;

• capital contributions;

• voting rights;

• admission or expulsion of a partner;

• withdrawal from a partnership.

The next forms of business are commonly named companies. All issues regarding formation, registration and operation of companies are regulated by the Companies Ad of 1985, amended as of 1989 (hereafter— the Companies Act).

Limited company

A limited company is the most common form of business. A limited company is a legal entity that is separate from shareholders and directors. The shareholders are not liable for the company's debts beyond the amount remaining unpaid on the shares they hold or guaranteed to a third party. To register a firm as a limited company (to incorporate a company) certain documents must be submitted to the Registrar of Companies who then issues a Certificate of Incorporation. This certificate permits the company to start its operations. A limited company is managed by the Board of Directors elected at annual shareholders' meetings.

As a rule, the accounts of a limited company have to be audited by registered auditors. A limited company must submit a set of audited accounts to the Registrar of Companies each year. This set should include the directors' report, the auditors' report, profit and loss accounts, the balance sheet, the statement of cash flow and explanatory notes to the figures in the accounts. In addition, it is required to file an annual return giving details on the directors and shareholders as well as some other statutory information. All information on file at the Companies' Registry is open to public inspection. Limited companies are classified as private limited by shares, private limited by guarantee and public limited. In a private company limited by shares, members' liability is limited to the amount unpaid on shares they hold. If a company is limited by guarantee, its members' liability is limited to the amount they have agreed to contribute to the company's assets in case of its winding up. A public limited company's (PLC) shares may be offered for sale to the general public and members' liability is limited to the amount unpaid on shares held by them. The shares of a PLC can be transferred without the shareholders' permission. A private limited company (Ltd.) is prohibited by the Companies Act (Part III, Ch. 1) from advertising its shares for sale. Its shares may only be transferred with the agreement of all shareholders. A PLC is also required to issue shares in the amount of J50.000 minimum (Section 118 of the Companies Act) and to have at least two people as the company owners (Subsection 1 (1) of the Company Act).

A Private company may have even one owner (Subsection 1 (ЗА) of the Company Act).

Here are some examples of well-known companies that are registered in the UK as Ltd. or PLC.

Private Limited companies:

Du Pont, Henkel, Rhone Poulenc, Chemicals, Shell, Kraft Foods, McDonalds, Nestle, Procter & Gamble. Public limited companies: British Airways, Marks & Spencer, SmithKline Beecham, Unilever

There is no apparent preference as to which form (Ltd. or PLC) applies more to this or that sector of the British economy. For instance, of the Big 5 accounting firms, Deloitte & Touché and Price Waterhouse Coopers are Ltd., KPMG is PLC, Arthur Andersen is a private unlimited company and, finally, Ernst & Young is a partnership. As to the national origin of the companies, large multinationals originating from abroad tend to be registered as private limited in the UK, whereas large British companies are predominantly private limited.

Unlimited company

Unlimited companies are less common but sometimes they are useful entities, which combine characteristics of both companies and unincorporated businesses (sole trader or partnership). They are treated as companies for taxation purposes (they pay corporate tax instead of income tax), but the liability of theirs shareholders is unlimited. There are certain businesses, regulated by professional bodies, which are required to be unlimited companies.

Nationalized company

Nationalized companies are established by Acts of Parliament. Usually they are natural monopolies, although there are some exceptions, such as the British Broadcasting Corporation (BBC), which competes with independent radio and TV stations. The accounts of nationalized companies go directly to the Parliament for inspection.

Now let's consider the advantages and disadvantages of the reviewed forms of business organization.

Sole trader/Partnership

Advantages:

• Easy to start up.

• No legal formalities (partnerships, however, should have a partnership agreement).

• Relative freedom from legislative control and more secrecy. No requirement to file or publish audited accounts or other information concerning the business with the exception of

• Accounts for VAT and PAYE and Inland Revenue tax return.

• No requirement to be audited.

• Taxed as self-employed, which may have tax advantages in the first three years of operation.

• Low National Insurance contributions.

• More favorable tax treatment.

• Financial flexibility with regard to sharing profits.

Disadvantages:

• Some suppliers do not deal with sole traders and partnerships due to lack of statutory and financial control.

• Unlimited liability. The sole proprietor is liable for all business losses; he can lose all his assets and become a bankrupt. Partners jointly liable for business debts.

• Profit tax paid at personal rates, top rate being 40% whether or no withdrawn from business.

• Need to make independent pension provision — less advantageous rules than for companies.

• Raising finance can be difficult.

• No statutory protection of a business name.

Limited company

Advantages:

• Lower tax rate on profits retained in business.

• Limited liability. Shareholders' liability limited to the amount of contributed capital.

• Higher confidence from suppliers and bankers; easier to raise finance for the business.

• Ideal form for expansion.

• Protection of companies' names.

• Tax efficient ways of getting shares into the hands of employees via employee share schemes.

• The ownership and management can be split.

• Company pension scheme can provide greater benefits than self-employed arrangements.

Disadvantages:

• Limited liability could be negated in practice, as director / shareholders may have to give personal guarantees to third parties.

• Disclosure of information on the company through submitting audited accounts, annual reports, etc.

• Tight regulation by the Companies Act, Insolvency Act 1986, Company Directors' Disqualification

Act 1986.

• High set-up costs and annual operating costs.

• High National Insurance contributions.

• Less flexible profit-sharing arrangements.

• Statutory records to be kept.

• State duty generally payable on transfers of shares.

• Double charge to capital gains tax.

• Firstly, the company is charged on gains made by selling its assets.

• Secondly, the shareholders are charged when realising their shares in the company.

So, all forms of business in the United Kingdom have their pros and corns, which must be carefully considered before creating a new enterprise. The right choice of a business form is the first step to success.

Words and word combinations. (Score – 56 points)

Advantage	перевага
Disadvantage	недолік
Market economy	ринкова економіка
Private sector	приватний сектор
Public sector	державний сектор
The former	перший
The latter	останній
Major	більш важливий
Sole trader	приватний підприємець
Partnership	товариство
Unlimited/limited company	компанія з/не обмеженою відповідальністю
In greater detail	докладніше
Feature	риса
Scheme	схема
Sole owner	приватний власник
Company limited by guarantee	товариство з додатковою відповідальністю
Company limited by shares	товариство з обмеженою відповідальністю
Carries liability	несе відповідальність
Asserts	активи
To cover outstanding debt	сплатити непогашений борг
Legal formalities to complete	юр. формальності, які повинні бути дотримані
Small business	мале підприємство
Statutory requirement for formating	встановлена законом вимога по формі
Accounting records	бухгалтерські рахунки
In terms of taxes	що стосується податків
To register for Value Added Tax (VAT)	зареєструватись для сплати ПДВ
Pay-As-You-Earn (PAYE) purpose	з метою сплати податків через роботодавця
Income tax deducting	збір прибуткового податку
National Insurance contributions	збори на загальнодержавне страхування
Submit accounts	давати фінансові звіти на розгляд
Tax computations	податкові розрахунки
The Inland Revenue	внутрішній департамент по збору податків
Individual	фізична особа
Government agency	державна служба
In a worse-case scenario	у найгіршому випадку
Run the business	керувати бізнесом
Silent partners	„сплячі” партнери
Solicitor	юрисконсульт
Possible discord	можливі розбіжності
Profit-sharing arrangement	розподіл прибутку
Capital contributions	частка участі в капіталі
Admission or expulsion of a partner	прийняття або виключення
Withdrawal from a partnership	вихід з товариства
Legal entry	юридична особа
Shareholder	акціонер
The Registrar of Companies	реєстраційне бюро компаній
Board of directors	рада директорів
Statement of cash flow	звіт про рух коштів
In case of its winding up	у випадку її ліквідації
Incorporated business	некорпоративне підприємство
More favorable tax treatment	пільгове оподаткування
Light regulation	суворе підпорядкування
Insolvency Act	закон про банкрутство
State Duty	гербовий збір
Double change to capital gains tax	подвійний податок на приріст капіталу

1. Назвіть речення, що відповідають змісту тексту. Виправте невірні твердження. (Score – 10 points)

1. In the UK economy there exist both private and public sectors.

2. The proprietor is the sole owner of a business.

3. For a small business there are statutory requirements for formating accounting records.

4. Limited companies can be private limited and public limited.

5. Partners jointly own a business but they are not liable for the firm’s debt.

6. Partners who cannot actively run the business are called “silent”.

7. A partnership may be created without any legal formalities.

8. Limited companies are classified as private limited by shares, private limited by guarantee and public limited.

9. Unlimited companies don’t pay corporate tax.

10. Nationalized companies are natural monopolies.

2. Заповніть пропуски в наступних реченнях. Перекладіть ці речення на українську мову. (Score – 7 points)

1. Four major types of business represent the private sector: …, …, …, … .

2. … and … are dominant forms in the small business segment.

3. The partners are free to choose any name for the firm, however, … must not be the last word of the name.

4. To prevent possible … among partners, it is usual practice to draw up an agreement.

5. To register a firm as a limited company certain documents must be submitted to the … .

6. A limited company is managed …, elected at annual shareholders’ meetings.

7. If a company is …, its members liability is limited to the amount they have agreed to contribute to the company’s … in case of its winding up.

3. Знайдіть еквіваленти до наступних словосполучень: (Score – 8 points)

1. Private limited company	a) явна перевага
2. Personally liable for	b) вести відповідні розрахунки
3. To maintain the corresponding records	c) особисто відповідає за
4. To share requirements	d) скласти договір
5. To draw up an agreement	e) виконувати вимоги
6. Profit and loss accounts	f) закрита акціонерна компанія
7. To file an annual return	g) звіт про прибуток та збиток
8. Apparent preference	h) відсилати щорічний звіт

IV. Дайте відповіді на питання до тексту: (Score – 10 points)

1. What major types of business represent the private sector of the United Kingdom?

2. What does the public sector consist of?

3. What is the proprietor?

4. Who is liable for the firm’s debt in partnership?

5. How to register a firm as a limited company?

6. What is the classification of limited companies?

7. How are unlimited companies treated?

8. What are nationalized companies?

9. What are disadvantages of partnership?

10. What are the main advantages of limited companies?

(Total Score – 103 points)

Unit2. How to FOUND A BUSINESS: (Total Score – 75 points)

READ THE PROCEDURE FOR REGISTERING AN ENTERPRISE IN GREAT BRITAIN (Score – 6 points)

Registration of a company in the UK is much easier than in Ukraine as there are fewer steps to take and fewer hurdles to overcome. The whole process can be completed simply by mail. In fact, there is just one necessary step before launching a business — to mail required documents to the Companies House, a nonprofit government agency. This agency has three main functions:

• the incorporation, re-registration and striking-off of companies;

• the registration of documents that must be filed under company, insolvency and other related legislation;

• the distribution of information about accompany to the public.

The newly established company then needs to register with the tax commission, which is also easy and described below.

To register a company one should submit the following documents to the registrar of companies — the main official of the Companies House:

• a memorandum of association;

• articles of association;

• form 10;

• form 12. Below is a description of these documents.

Memorandum of association contains a company's name, address and objectives (for example, "to carry on business as a general commercial company"). Other clauses to be included in the memorandum vary depending on the type of the company being incorporated. A company's memorandum delivered to the registrar must be signed by each subscriber in the presence of a witness.

Articles of association specify the rules for a company's internal affairs. The Companies House provides model articles for a company's use.

Form 10 provides personal details of the chief executive officer(s); his or her secretary and the address of the company being registered. In addition to their names and addresses, the company's officers must give their birthdates, occupation and details of other management positions they have held within the last five years. Each officer must sign and date the form.

Form 12 a statutory declaration of compliance with all the legal requirements relating to the incorporation of a company. It must be signed by the solicitor who is engaged in the company's registration, or by one of the persons named as an officer or company secretary in Form 10.

Every company must have formally appointed company officers. A private company must have at least one officer and one secretary. A public company must have at least two officers and one secretary.

There are some restrictions on the choice of the company name. Before submitting the company formation documents one should check with the Companies House to ensure whether the name is acceptable. Briefly, the restrictions state that names must be original; the use of certain words is restricted; names likely to cause offence are not permitted. Also, if the chosen name is too similar to another name, an objection can be made within twelve months following the incorporation of the company and the company could be directed by the Secretary of State to change its name. The name of a public company must end with the words "public limited company." in case of a private company limited by shares or by guarantee, the name must end with the word "limited." The registration documents are usually submitted to the Companies House by mail. It takes the Companies House five business days to register a company, and registration costs J20. Urgent (within one day) registration costs J80. After the registration of a company's memorandum, the registrar of companies gives a certificate proving that the company is incorporated and, in case of a limited company, that it is limited. The certificate may be signed by the registrar or authenticated by his official seal. Besides registration with the Companies House, a newly established company must be registered with the Inland Revenue as a taxpayer of the corporation tax. (The Inland Revenue is a government agency which is responsible for the administration of income tax, capital gains tax, corporation tax, petroleum revenue tax, inheritance tax, stamp duty and, as of 1999, National Insurance Contributions (NIC)). This is done by calling the local Inland Revenue office to inform that company X exists and it is liable to taxation. This must be done within twelve months from the end of company X's accounting period, otherwise the company will be subject to a penalty. The Inland Revenue then sends company X form CT41 G to fill out and return.

In most cases a company should also register as a value-added tax payer. It must register if:

• at the end of any month the total value of the taxable supplies it has made within the last twelve months exceeds J52.000; or

• at any time the expected value of its taxable supplies within the next thirty days will exceed J 52,000.

To register for VAT, form VAT 1 is to be completed and sent to Her Majesty Customs and Excise (Her Majesty Customs and Excise is responsible for collection of VAT and customs and excise duties) within thirty days of either of the above. A firm with a taxable turnover below the above mentioned threshold can apply for voluntary registration if it finds this economically beneficial.

Words and word combinations. – 32 points

How to found a business	як відкрити підприємство
Procedure for registering	порядок реєстрації
Hurdles to overcome	перешкоди переборювати
Lunching a business	відкриття підприємства
Required documents	необхідні документи
The Companies House	організація, яка займається реєстрацією компаній
Non-profit	неприбутковий
Incorporation	реєстрація в якості корпорації юридичної особи
Re-registration	перереєстрація
Striking-off	виключення з реєстру
Under company, insolvency and other related legislation	у відповідності з законами про компанії, банкрутство та іншими законами, пов’язаними з реєстрацією
Tax commission	податкова комісія
Official	посадова особа
Memorandum of association	установчий договір
Articles of association	устав компанії
Other clauses	інші пункти
Being incorporated	який проходить реєстрацію як юридична особа
Model articles	зразки уставів
Chief executive officer	гол. вик. директор
Management positions	роботи в якості директорів
Statutory declaration	декларація, встановлена законом
Legal requirements	юридичні вимоги
Of compliance with	у відповідності з чимось
Solicitor	адвокат
Private company	компанія закритого типу
Public company	компанія відкритого типу
Public limited company	відкрита акціонерна компанія
Capital gains tax	податок на прибуток від продажу інвестицій або власності
Accounting period	звітний період
Inheritance tax	податок на спадщину
Turnover	оборутка
Customs and excise duty	митний та акцизний збір