Public and private limited companies: A contrastive view.

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Presentation transcript:

Public and private limited companies: A contrastive view

ADVANTAGES PLC: The ability to tap the _____ markets to raise capital for expansion. Such companies sell ______ (equity) or _____(debt). Typically, the cost of _________ capital is less for a ________ _________ company. Ltd.: Management doesn't have to answer to __________ and isn't required to file ________ statements with the SEC. Proponents of ______ companies say this ______ management to do what's best for the ________ - even if it's costly and depresses _______ in the short-run.

ADVANTAGES PLC: The ability to tap the debt markets to raise capital for expansion. Such companies sell shares (equity) or bonds (debt). Typically, the cost of investment capital is less for a public limited company. Ltd.: Management doesn't have to answer to shareholders and isn't required to file financial statements with the SEC. Proponents of private companies say this allows management to do what's best for the company - even if it's costly and depresses profits in the short-run.

DISCLOSURES PLC: Must file __________ and annual reports with the Securities and ________ Commission, disclosing financial and other relevant information for __________. Ltd.: Private companies don't have to ________ their financial information to anyone. However, if they're trying to raise _______, potential investors will get a peek.

DISCLOSURES PLC: Must file quarterly and annual reports with the Securities and Exchange Commission, disclosing financial and other relevant information for stockholders. Ltd.: Private companies don't have to disclose their financial information to anyone. However, if they're trying to raise capital, potential investors will get a peek.

ACCESS TO FUNDING PLC: Public companies can sell stocks or bonds to ______ additional funds. Ltd.: Private companies can't dip into the public _______ markets and must therefore turn to _______ sources. This can boost the _____ of financing and may limit expansion.

ACCESS TO FUNDING PLC: Public companies can sell stocks or bonds to raise additional funds. Ltd.: Private companies can't dip into the public stock markets and must therefore turn to private sources. This can boost the cost of financing and may limit expansion.

EMPLOYEE COMPENSATION PLC: Public companies can offer stock options to attract and ______ top management and _____ personnel. Ltd.: Private firms lack the ability to offer significant non-cash compensation. This may force them to cough up more _____ upfront.

EMPLOYEE COMPENSATION PLC: Public companies can offer stock options to attract and keep top management and key personnel. Ltd.: Private firms lack the ability to offer significant non-cash compensation. This may force them to cough up more cash upfront.

Investment options PLC: _________ in public companies can buy or sell stock on the ______________, allowing them to respond ________ to a changing market. Ltd.: Stock in a privately held company may be _______ to sell quickly and this could ______ in a significant drop in value.

Investment options PLC: Investors in public companies can buy or sell stock on the Stock Exchange, allowing them to respond quickly to a changing market. Ltd.: Stock in a privately held company may be difficult to sell quickly and this could result in a significant drop in value.