To start a restaurant is indeed an intimidating task as a menu needs to be created, pick up all the goods required and handle the legal side. Due to two people involved, Sole proprietorship needs to be stroked off and so is Corporation due to no large company or group of companies, so Fernando and Perera is left with either a partnership or a Limited Company(LC) for the start-up restaurant. A business organisation where either two or more people pool money and skills and accordingly share profits and liabilities of the business as per the partnership agreement is a Partnership. Two heads/more are better than one. More partners, more money as start-up capital, thereby easy to establish, high borrowing capacity and profit which is equally shared. The responsibilities of running the business can be split up and will benefit from a combination of skills due to more brains and will lead to cost effectiveness. As decision-making power is shared, more ideas. Less strictly regulated and thereby easy to change the legal structure as far as partners agree. Weaknesses are resistance among partners due to different ideas on how the business needs to run. Due to a jointly run, less freedom as partners need to agree on things they don’t want to and is responsible/liable for their share as well as all debts due to unlimited liability yet partnership is comparatively more flexible than LC. Limited life as it may end up in a death of a partner or due to a dramatic split up as decisions are shared, so limitation in becoming a large business. Inconsistency due to equally sharing profits as equal efforts are not put by partners. is a form of incorporation where liability is limited whose share capital is restricted. Main benefits in running a LC is the limited liability, meaning only the shareholders are liable for the debts according to their investment levels (no personal liability affected). LC is preferred by investors due to the high financial security. Even after a death of a member, the company will exist by ensuring the jobs of the employees as LC is a separate legal entity. More favourable and low taxation rates comparatively. LC is costly to establish and manage due to its complicated rules and regulations and also more capital that is hard to raise is required. Accounts are complex and the accountancy fee is relatively high and consumes time. Has less privacy as the financial affairs are public and also less flexibility due to losses made by a company are used by the company. It’s impossible to tell how the business would do in the future. As a ‘start-up’, would look on the short term first, meaning the advantages of starting up and running. The recommended would be a partnership at the beginning due to easy start up, more capital as borrowing capacity high, simply its flexibility is high but partners need to be aware of risks before starting, like unlimited liability but a risk needs to be taken to encounter returns, either to start-up smoothly by having an unlimited liability in future or barely start-up with a limited liability. When the partnership is at growth, makes a difference of structure, it can be easily converted to a Limited company. Then, recommendation is to change to a limited company in the future when the business is at success. This way the company has more money and more safety to personal assets and accidents wouldn’t stop them following their dream of building a successful restaurant. Recording, briefing and reporting of business transaction Classifying, measuring and communicating info to achieve organization goals. Financial Accounting Management Accounting For External Users For Internal Users Evaluates financial position Decision Making Historical Orientation Future Orientation In FA, financial information is needed for the external users to evaluate the financial position of the organisation. Financial reports are prepared according to the historical information and are concerned about the results achieved, so it’s historically oriented. These reports are usually prepared to the statutory requirements and issued at the end of the accounting period. In MA, financial information is used by the internal users for decision making where mostly deals with estimates than provable proofs and may report budgets and forecast to have future orientation. As per the management requirement, the management accounts need to be prepared unlike in FA and the reports are issued more frequently so managers can look through them immediately.