| A partnership, as commonly defined, is a type of | | | | - Profit and Loss Allocation - Individuals engage |
| business structure with two or more owners | | | | into business to earn income. Therefore, it is also |
| (partners) who has not filed any application with | | | | an important matter to discuss this issue with all |
| the state to transform their business into a | | | | other partners and put it into writing. Also as |
| corporation or LLC (Limited Liability Corporation.) | | | | important is the agreement regarding the |
| Partnerships may be categorized under general | | | | distribution of losses that might occur in running |
| partnership or limited partnership. | | | | your business. |
| To add further, partnerships can be considered as | | | | - Terms in Decision Making - Since each owner |
| the simplest and most inexpensive co-owned | | | | may differ in their opinions regarding various |
| corporate business structure in terms of | | | | matters revolving around the business such as |
| establishment procedures and maintenance. | | | | policies and procedures, it is just necessary to |
| Meanwhile, in partnership establishment, it is vital | | | | have, beforehand, an arrangement on |
| for you to have a well-drafted partnership | | | | decision-making. Although there are some |
| agreement that lay down the rights and duties of | | | | partnerships wherein a single partner has the full |
| each owner. Creating one will equip your business | | | | authority to decide on particular issue, others |
| in settling conflicts - from minor disagreement to | | | | resolve it through votes wherein all partners will |
| major disputes. Unless you have such contract, | | | | have participation. |
| the laws in your state will completely govern | | | | - Administrative Functions - Since a partnership |
| almost all aspects of your business. | | | | involves collective efforts between partners, |
| In a partnership agreement, you may include | | | | distributing management duties is of prime |
| details involving profit (or losses) sharing, individual | | | | importance. A person each should be assigned to |
| responsibilities of each partner, terms in leaving | | | | handle employee supervision, supplier negotiation, |
| the partnership and other vital regulations. | | | | bookkeeping, among other duties and functions. |
| Following are the major information that you | | | | You, then have to make sure that someone is |
| should consider in furnishing a good partnership | | | | tasked to supervise each post. |
| agreement: | | | | - Admission and Withdrawal of Partners - If in |
| - Partnership Name - Not all corporate players | | | | case you want to have a business expansion and |
| give high regards to this important feature of | | | | open your partnership to other investors, you |
| doing business. Yet, this is considered by many to | | | | need to have a standard admission procedure to |
| be significant in partnership establishment. Without | | | | prevent disagreements. This is same when a |
| a good and viable business name, your business | | | | partner decides to depart from the company. |
| may not have an appeal to your clients. In | | | | - Dispute Resolution - Deadlocks may happen |
| registering your partnership, you may opt to use | | | | especially in major decisions. A good partnership |
| your surnames or just file your partnership under | | | | agreement must tackle this matter. It may |
| a fictitious business name. | | | | suggest alternative dispute resolutions, such as |
| - Partnership Contributions - One of the major | | | | mediations or arbitrations in resolving a disputed |
| reasons that tend to cause the downfall of a | | | | issue. |
| business partnership involves disputes regarding | | | | Finally, furnishing a fine partnership agreement is |
| contributions or ownership percentage. Thus, to | | | | very critical in partnership establishment. It is vital |
| avoid this from happening to your company, you | | | | then to seek a corporate attorney's assistance to |
| should identify and record the contributions that | | | | make sure that it is done precisely and under the |
| each partner has provided for the company | | | | bounds of law. |
| before it starts its operations. | | | | |