Commercial and non-commercial enterprises
To carry out production activity, the enterprise must register in the proper state authorities. After registration the company obtains legal entity status, enabling the organization to carry out production activities and to bear your own legal, tax and other responsibilities.
All existing plants are divided into commercial and non-commercial.
A commercial organization is a legal entity, whose main objective is profit from production. Profit is the main activities of a commercial enterprise. Such organizations produce goods or provide services to consumers. Legal entities which are commercial organizations may be created in the form:
- economic partnerships or societies;
- production cooperatives;
- state unitary enterprises;
- the municipal unitary enterprises.
Nonprofit organizations are legal entities whose primary purpose is not profit and the distribution of income between the parties. Such enterprises are created to achieve social, cultural, charitable, political, scientific and educational purposes aimed at achieving public goods. This is a public organization funded by the owner companies and various charitable funds. Non-profit businesses can engage in entrepreneurial activities only if these activities are aimed at achieving public goods.
The characteristics of the enterprise
The status of a legal person received by the organization after its state registration, necessarily implies the presence of signs of an enterprise. There are the following characteristics of the enterprise:
1) the Organization must have the ownership of separate property, i.e. the elements of space, equipment that will enable the company to independently produce products or provide services.
2) the Ability of the enterprise as a legal person, to answer their own property for existing obligations. Such obligations arise before or creditors in case of default of the budget.
3) Gaining the status of a legal entity, the organisation is in business on his own behalf. This means that the company at the conclusion of civil contracts and relations with consumers, suppliers of raw materials, etc. acting on its own behalf and not through intermediaries.
4) the company has the right to participate in litigation both as a plaintiff and a defendant.
5) the organization must be independent balance or the estimate, i.e., the entity shall keep records of income and expenses.
6) the Company must have its own name and operates under the bylaws or articles of incorporation.
These characteristics are fundamental in the definition of the enterprise.
Thus, the enterprise is an independent economic entity with rights and obligations and has the required number of signs that define this organization.