ABSTRACT
This chapter describes alternative legal formats for business and explains how to interpret information contained within financial statements. Private sector organisations, that is to say, businesses funded by private investments and normally concerned with generating profits to provide a return on the owners’ investment, comprise sole trader, partnership, and limited company with subtle variants – particularly of the latter two, from time to time occurring. The economic climate of the early twenty-first century has seen a resurgence in the formation of consumer co-operative societies as a means of communities, particularly rural communities, taking over the management of vital community businesses such as pubs and village shops. In practice, workers’ co-operatives and their assets are managed much like any other large-scale business and many such organisations appear as huge industrial and retail leviathans, indistinguishable from multinational, high-street, trading-names. For a business to trade successfully and profitably the business manager(s) need to know the current cash situation at any point in time.
