Dele and Seun who are in partnership, have decided to covert their business into a limited liability company where both become directors. To convert the bus...

Dele and Seun who are in partnership, have decided to covert their business into a limited liability company where both become directors. To convert the business?

Answer Details

Converting a partnership business into a limited liability company requires the formal ending of the partnership and the opening of new company books. This means that the partnership agreement is terminated, and the assets and liabilities of the partnership are transferred to the new company. Since both partners become directors of the new company, they will be shareholders and the shares will be allotted to them in agreed proportions. However, it is important to note that the process of converting a partnership into a limited liability company may require the computation of goodwill in accordance with legal requirements.