Company information: Definitions of business types
Company
This is a business that has been legally incorporated under the Companies Act 1993. There are two types of incorporated company.
- Public listed company
- These are companies that are listed on the stock exchange. They are required to produce annual reports which provide details about the company for shareholders or prospective shareholders.
- Private companies
- These are privately owned and not required to produce annual reports. This is the most common type of company in New Zealand.
In addition a company may be a holding company or a subsidiary company. When one company owns more than 50% of another, the owner is the holding company and the owned company is a subsidiary.
Other types of business
- Sole traders
- Any individual may run a business as a sole trader. In this type of business the owning individual receives all the profits and is personally responsible for all debts and losses from the business.
- Partnerships
- Partnerships and joint ventures are enterprises entered into by groups of individuals, trusts, companies or a combination of any of these.
- Trusts
- A trust is formed when one person places assets under the control of another (the trustee) for the benefit of some other person or people (the beneficiaries). A charitable trust usually undertakes some kind of business venture with the beneficiary being a charity or charities. The beneficiaries of a trust may request information, but unless the trust deed specifies that information on the trust be made public there may be no publicly available information.
- Local authorities
- Under the Local Government Act 2002 these are bodies "formed to
enable democratic local decision-making and action by, and on behalf of, communities and to promote the social, economic, environmental, and cultural well-being of communities, in the present and for the future"
(Local Government Act 2002 S10)
Local Authorities are also required under the Act to publish annual reports and financial statements. - Incorporated societies
- An incorporated society is a group or organisation that has been registered under the Incorporated Societies Act and, when incorporated, is authorised by law to run its affairs as though it were an individual person.
- State Owned Enterprises (SOEs)
- These are registered companies that are owned by the government. Many SOEs are former government departments or agencies that were converted to public companies while ownership remained with the government.
- Crown Research Institutes (CRIs)
- In 1992 CRIs were established from former government departments. They are required to produce annual reports and financial statements in the same way as a public listed company.
- Local Authority Trading Enterprises (LATEs)
- This is a company in which one or more local authorities hold or control 50% or more of the voting rights; or an organisation which operates with the intention or purpose of making a profit, and which is also subject to significant control directly or indirectly by one or more local authorities.
LATEs are required to produce annual reports and financial statements in the same way as a public listed company.
