A study of TATA chemicals & IFFCO companies with special reference to corporate financial reporting
Dr. Shahla Rahman Khan
In order to overcome the limitations of man and money and to tide over the risks attached to the businesses activities, entrepreneurs invented the concept of doing business along with others. Thus came into existence partnerships. There was division of ownership and risk amongst the entrepreneur known as partners. To compensate for the contribution of capital and labor and sharing of risks, the profits of the business were shared amongst the partners either equally or as agreed. For many centuries the sole proprietorship and partnerships were the organizational forms employed in doing business. Edward Peragallo in his Origin and Evolution of Double Entry Book Keeping states that one of the great achievements of the Florentines was the development of large associations (partnerships) were capital was pooled together. Initially they were within the family groups but later on the family aspect of partnership disappeared fully. There were two types of partners. The first group consisted of those who invested money but do not took part in the affairs and whose liability was restricted to their capital contributions. The second category consisted of those who managed the venture and took responsibility for the partnership debts.