Match the English terms in the left-hand column with the definition in the right-hand column

	Pass-through taxation	A	Any technique to multiply gains and losses.
	Ownership liability	B	A separate legal entity, an LLP provides liability protection for all general partners as well as management rights in the business.
	S corporations	C	Probability of loss arising from the buyer’s reneging on the contract, as opposed to the buyer’s inability to pay.
	Tort	D	unincorporated business organization
	Professional corporations	E	separately taxable entities
	Nonprofit corporation	F	pass-through tax entities
	Memorandum of association	G	A state chartered organization which acts as a separate legal entity and is the most structured business entity.
	Limited liability partnership	H	The extent to which the owners of a business are liable for the debts of the company.
	Limited partnership	I	Tax due both on any salary drawn from the corporation and from any dividends received from the corporation.
	Leverage	J	A body of elected or appointed members who jointly oversee the activities of a company or organization.
	Contract risk	K	company formation
	Corporation	L	A legal entity that is formed as a non stock corporation with the intent to not realize a profit.
	C corporations	M	A separate legal entity, this type of business includes a general partner and one or more limited partners who invest capital into the partnership, but do not take part in the daily operation or management of the business.
	Incorporation	N	Method in which a firm’s owners pay income tax on the firm’s income and not the firm.
	Business trust	O	The document that governs the relationship between the company and the outside.
	Board of Directors	P	a civil wrong
	Personal income tax	Q	Corporate entities for which many corporation statutes make special provision, regulating the use of the corporate form by licensed professionals.

Complete the following texts using the suitable words or phrases from the box.

Text 1

A	debts	E	unlimited liability
B	partnership	F	enterprise
C	legal entities	G	risks and profits
D	limited liability	H	legal action

Partnerships and Sole Traders

A partnership is a business arrangement in which several people work together, and share _____(1)_____. In Britain and the US, partnerships do not have _____(2)_____ for debts, so the partners are fully liable for any _____(3)_____ the business has. Furthermore, partnerships are not _____(4)_____, so in case of a _____(5)_____, it is the individual partners and not the _____(6)_____ that is taken to court. In most continental European countries there are various kinds of partnership which are legal entities.

A sole trader business is an _____(7)_____ owned and operated by a single person who has _____(8)_____ for debts.

Complete the text. Replace the Russian words and phrases by the English equivalents.

Limited Liability

A company is a business that is a юридическое лицо. In other words, it has a юридическое право на самостоятельное образование от своих владельцев, the акционеры. It can заключать контракты, and can отвечать по иску в суде if it нарушит контракт. A company имеет непрерывность существования, even if the работники и владельцы change. Most companies have ограниченная ответственность, which means that the owners не нести ответственности for the business's debts. These companies are known as компании с ограниченной ответственностью. Their liability ограничена стоимостью их акционерного капитала. The limitation of liability стимулирует инвесторов to risk their money to become владельцами долей компании, while leaving the управление of these companies to квалифицированным менеджерам высшего руководящего состава, known as executive directors.

1.5.4 Text for discussion.

a. Look up the dictionary or Unit 1 Glossary for the meaning and pronunciation of the following words and word-combinations and use them to discuss the problems outlined in the text.

Sole trader; The Partnership Act of 1890; unanimity; majority vote; precluded by size.

b. Briefly scan the text and outline the list of major points.

c. Read the text more carefully and comment on the following items:

- the common features of a sole trader and a partnership;

- the main provisions of The Partnership Act of 1890;

- the difference between private companies and public companies;

- the disadvantages of a company as opposed to partnerships and sole traders.