What is a subsidiary. Subsidiary
When creating a subsidiary, companies, as a rule, either establish new organizations or separate them from their structure. Each of these methods entails certain organizational, legal and tax problems. Therefore, it is necessary to carefully analyze possible consequences making any decision.
The decision to create a subsidiary company is made in the organization, as a rule, if necessary, to focus production on the most specialized areas in order to increase competitiveness and develop new markets. In addition, individual business units respond more flexibly than branches to the rapidly changing situation on the market for a particular product. For example, in 2004, Hitachi AC Systems decided to create a subsidiary, Hitachi Industries Refrigeration-Heating Division, to separate from its core business of industrial heating and air conditioning. According to the company's management, such a reorganization of the Industrial Air Conditioning Equipment business area will increase the pace of technology development, production and sales, which will accordingly lead to the expansion of the range of manufactured goods and the emergence of new interesting solutions. In Russian practice, the creation of subsidiaries is also widely used in order to increase competitiveness and effective management capital. Especially the issue of creating subsidiaries is relevant for large business entities. So, at present, OJSC Russian railways“(hereinafter referred to as Russian Railways JSC) issues of creating subsidiaries on the basis of the property of Russian Railways JSC branches of various industries are being actively discussed: in the field of suburban passenger transportation; long-distance passenger transportation; repair technical means for railway transport and the production of spare parts, in the field of trade, Catering and working supplies, etc. The experience allowed the author to analyze the most significant legal aspects creation of subsidiaries, pros and cons various ways and offer readers practical advice.
Two ways to create subsidiaries
The company is considered established from the moment of its state registration, namely from the moment the corresponding entry is made in the Unified State Register of Legal Entities (Unified State Register of Legal Entities). Russian civil law provides that a company can be created in two ways - the reorganization of an existing company (including in the form of a spin-off) or the establishment of a new one1.
The most common way to create subsidiaries is to separate them during the reorganization of legal entities. This is primarily due to the fact that with this method of reorganization, one or more subsidiaries are created without terminating the activities of the company being reorganized (as opposed to reorganization in the form of division, in which the activities of the company being reorganized are terminated).
Personal opinion Maxim Chernov, financial director of Descartes CJSC (Moscow) The choice of the way to create a subsidiary largely depends on the company's goals. For example, a company needs to transfer part of its highly liquid assets to a subsidiary (in Russian business, this is the most common purpose for creating subsidiaries, especially when protecting a business from a hostile takeover). In this situation, the establishment of a new legal entity would be optimal, since reorganization in the form of a spin-off may result in the recognition of such a transaction as invalid due to the clear interdependence of the parties. In addition, spin-off subsidiaries today often come under suspicion as an element of tax optimization schemes.
The choice of one or another method of creating a subsidiary company in each specific case is individual and depends on many factors, which we will analyze below.
Factors affecting the choice
Deadlines and organizational aspects. The reorganization of any legal entity is a complex and lengthy procedure. In practice, in most cases, the creation of subsidiaries in the form of a spin-off takes five to six months. It is especially difficult to single out a company if it is planned to create several subsidiaries, since within the framework of each of them various issues must be resolved (on the composition of the property transferred to authorized capital subsidiary, on the election of management and control bodies), as well as the preparation of constituent and other documents. At the same time, until the reorganization of one legal entity is completed, a decision on another reorganization and, accordingly, on the creation of other subsidiaries cannot be made. A company will be considered reorganized from the moment of state registration of a separated subsidiary (clause 2, article 51, clause 4, article 57 of the Civil Code of the Russian Federation).
It should be noted that the reorganization of a legal entity is characterized by the risk of a mismatch between the composition of the property reflected in the approved separation balance sheet and the composition of the property available at the time of registration of the subsidiary, since a long time may elapse between the approval of the balance sheet and registration. This problem is especially acute for large business entities.
Establishment of a new company is a simpler and less time-consuming procedure than reorganization, and may take about two weeks from the moment the decision is made to the entry into the Unified State Register of Legal Entities. In addition, the establishment of one subsidiary is not linked to the establishment of other legal entities, therefore, an organization can create several subsidiaries at the same time.
When establishing a company, there is no risk of inconsistency in the composition of the property.
Decision making body. The decision to reorganize a joint-stock company falls within the competence of the general meeting of shareholders (clause 1, article 48 of Law No. 208-FZ). For legal entities in which the powers of the sole shareholder are exercised by the Government of the Russian Federation (as, for example, in JSC Russian Railways), the issues of reorganization and, accordingly, the creation of a subsidiary are completely dependent on the state authority.
The current civil legislation does not directly provide for the competence of which management body of the organization to make a decision on the establishment of a subsidiary. In this regard, this issue, as a rule, is reflected in the charter of a business company. Thus, according to the charter of Russian Railways, the decision to establish a subsidiary is made by the Board of Directors of Russian Railways.
However, the contribution of property to the authorized capital of subsidiaries can be considered as a major transaction (if the value of the alienated property is more than 50% of the balance sheet value of the organization's assets) and, accordingly, may require approval by the general meeting of shareholders (Articles 78 and 79 of Law No. 208-FZ). Moreover, the contribution of the property of an organization to the authorized capital of several companies can be considered as interrelated transactions and, in terms of the total value of the property contributed, is classified as a major transaction. The fact that such transactions must be approved by the general meeting of shareholders was also indicated in their decisions by the courts, including in relation to the establishment of several subsidiaries (decisions of the Federal Antimonopoly Service of the Volga District dated 06.05.99 in case No. A55-97 / 98-17 and Federal Antimonopoly Service of the East Siberian District dated October 23, 2003 in case No. A19-3289 / 03-10-F02-3543 / 03-C2).
It should be noted that in order to avoid legal problems, it is necessary to prescribe in the company's charter which management body of the enterprise will make the specified decision.
Notice to creditors. The separation of subsidiaries from large organizations that have a large number of creditors may result in a decrease in assets. The fact is that when making a decision on reorganization, the company will have to notify its creditors in writing about the planned separation of subsidiaries within 30 days and publish its decision in a special printed publication. Within the next 30 days, creditors have the right to demand in writing from the reorganized company early termination or performance of the relevant obligations and compensation for losses (clause 6, article 15 of Law No. 208-FZ).
Thus, if the analysis of the structure of accounts payable reveals high probability the risk of a decrease in the company's assets due to possible early claims of creditors, it is advisable for him to abandon the reorganization and create a subsidiary by founding, since Russian civil law does not provide for mandatory notification of creditors in this case.
Succession issues. The decision to create a subsidiary company in practice may be associated with the need to transfer to this company part of the company's risks associated with obligations under various agreements (debts, loans unpaid by account suppliers). This can be done only when the business is reorganized in the form of a spin-off and in accordance with the separation balance sheet (clause 4, article 19 of Law No. 208-FZ). This method of creating subsidiaries should also be chosen if it is assumed that there are receivables or payables for the property that will be transferred to the subsidiary. However, when transferring property to a subsidiary, one should not forget about the possible risk of inconsistency in the composition of the property reflected in the approved separation balance sheet and available to the company at the time of registration of the subsidiary, since a long time can pass between the approval of the balance sheet and registration. This problem is especially acute for large companies.
With regard to newly established companies, Russian civil law does not provide for succession in civil law transactions, which is also confirmed by arbitration practice (Decree of the Federal Assembly of the North Caucasus District of November 15, 2000 in case No. F08-3316 / 2000). However, the transfer of civil debt in the case of the establishment of a subsidiary is possible, but requires the development of additional legal mechanisms1.
Tax risks
Along with the existing organizational problems, the implementation of these methods of creating subsidiaries entails a number of tax risks associated with the calculation and payment of VAT and income tax. Personal experience
Igor Mironov, Head of Internal Audit at SABMiller
It is necessary to take into account and think over who will be the shareholder or founder of the subsidiary. It should be remembered that if the owner of the parent and subsidiary is the same person, then there is a risk of consolidated liability, for example, for obligations to creditors, since in this case the subsidiary is the so-called asset of the parent company.
As in the process of separation of the company, and when establishing a new subsidiary, part of the property is transferred. In most cases, this leads to controversial situations associated with the calculation and payment of VAT.
VAT recovery. One of the main problems of the transfer of property within the holding is the obligation of the transferring party to recover the amount of VAT paid from the residual value of the transferred property. The fact is that the company acquires fixed assets for production activities, confirming this by putting the property on the balance sheet and depreciation. After the assets are registered, the company deducts the VAT paid to suppliers in full. However, in the opinion of the tax authorities, if the enterprise subsequently transfers the said property to a subsidiary, then in accordance with paragraph 3 of Art. 170 of the Tax Code of the Russian Federation, an obligation arises to restore the amounts of VAT and pay them to the budget due to the fact that the transfer of property to the authorized capital of a subsidiary, as well as to an assignee during reorganization, is not recognized as an object of VAT (Articles 39 and 146 of the Tax Code of the Russian Federation).
By now by this issue there is extensive arbitration practice. The Supreme Arbitrazh Court of the Russian Federation1 also formulated its position on the issues of restoring the VAT. The court noted that it follows from the analysis of Articles 39,146,170-172 of the Tax Code of the Russian Federation that if the disputed property was acquired and used for production or other activities subject to VAT, then the company has the right to a tax deduction, despite the subsequent change in the purpose of using the property. If the property was actually acquired for a contribution to the authorized capital, then there is no right to a tax deduction of the amount of VAT paid to the supplier. And consequently, the amount of tax must be restored, however, only from the residual value of the transferred property.
However, despite the norms of the Tax Code of the Russian Federation and the established law enforcement practice, the tax authorities still adhere to the opinion that when carrying out transactions with fixed assets that are not subject to VAT, it is necessary to restore the tax on the residual value of fixed assets, regardless of the fact of their previous use for production purposes2. Therefore, the company needs to be ready to defend its position in court.
VAT deductions on transferred debts. When transferring accounts payable and receivables within the holding, the parent company and the subsidiary may face a tax risk associated with the deduction of VAT amounts. The fact is that when the debt is transferred to the subsidiary, the right to deduct VAT should also be transferred, provided that the parent company did not use this right. The conditions necessary for obtaining a deduction are listed in Art. 171 of the Tax Code of the Russian Federation. These include, in particular, the fact of posting and payment for goods, and in relation to fixed assets, also the fact of their commissioning. The disputable situation lies in the fact that in most cases, by the time the property is transferred by the subsidiary, part of the listed conditions for deducting VAT has already been fulfilled by the parent company. In this situation, the tax authorities believe that neither party will be able to deduct VAT. The way out of this situation may be the resolution of this issue in court3.
income tax
As mentioned above, it can take a long time from receiving real estate objects according to the separation balance sheet to state registration of the transfer of ownership to a subsidiary company for these objects. Also, a long time may pass from the moment of transfer of property objects to the authorized capital of a newly created company until its registration as a legal entity. In both cases, during this period, the enterprise can already use the received property in production purposes. However, the tax authorities believe that for objects, the rights to which are subject to state registration, depreciation can only be charged from the 1st day of the month following the month in which the fact of filing documents for registration of rights is documented. According to the author, the analysis of the norms of the Tax Code of the Russian Federation allows us to conclude that it is possible to charge depreciation from the 1st day of the month following the month in which the property was put into operation (Articles 247, 252 and 259 of the Tax Code of the Russian Federation). On the basis of these articles of the Tax Code of the Russian Federation, an enterprise may attribute the amount of depreciation accrued from the moment of receipt of fixed assets according to the separation balance sheet to expenses that reduce tax base. However, it should be noted that today the arbitration practice on this issue has not yet developed.
With regard to the creation of a subsidiary by reorganization in the form of a spin-off, there is a risk that the transferred property will be recognized as the gratuitously received income of the subsidiary and, therefore, subject to income tax. The fact is that, in accordance with the Tax Code of the Russian Federation, the property (property rights) received by the successor during the reorganization is not included in income tax-free (Article 251 of the Tax Code of the Russian Federation). According to the tax authorities, such property can be qualified as received free of charge and included in non-operating income of a subsidiary, which is subject to income tax.
However, this position, according to the author, is not indisputable. This is confirmed by arbitration practice on this issue in favor of taxpayers (for example, the decisions of the Federal Antimonopoly Service of the Volga-Vyatka District dated March 2, 2000 in case No. A11-4620 / 99-K2-2245, the Federal Antimonopoly Service of the West Siberian District case No. Ф04/1526-431/А45-2002, FAS Northwestern District dated 08.10.02 in case No. А52/747/2002/2). Nevertheless, the possibility of filing claims by the tax authorities on the issue under consideration remains.
Problem of choice
TO achieve the desired result, it is necessary to carefully analyze the advantages and disadvantages of each of the ways to create a subsidiary, and also take into account the individual characteristics of the organization (production volumes, the presence and size of accounts payable, the composition of property, etc.) . With regard to the creation of subsidiaries of Russian Railways comparative analysis two methods led to the conclusion that the establishment of new subsidiaries is more preferable. This conclusion is based on the following aspects:
- establishment procedure easier procedure reorganizations;
- the decision on the establishment is made by the board of directors;
- when establishing, there is no obligation to notify the creditors of Russian Railways and, accordingly, the risk of creditors presenting claims for early termination or the performance of relevant obligations;
- no need for tax audit OJSC Russian Railways;
- civil law risks in the establishment are minimal.
Thus, the decision on the method of creating subsidiaries directly depends on the conditions for doing business and the goals that the organization sets for itself.
As the business develops, companies expand their areas of activity, and there is a need to form new branches and departments. That is, subsidiaries are opened. In the future, organizations are combined into business groups, which consist of many firms. Subsidiaries can be created as new legal entities controlled by parent companies. As a rule, a subsidiary is controlled by decision-making at a general meeting or by the board of directors.
Creation of a subsidiary
A subsidiary is created in the same way as any other commercial institution. But at the same time, she is not independent view firms, since its activities are carried out according to the model of the parent organization. Basically, the main firm has a stake in the subsidiary, and with its help it influences all decisions. At the same time, the mandatory minimum participation in the capital of a “daughter”, upon reaching which the company becomes the main one, is not established by the Law on joint-stock companies or the Civil Code.
The influence of the parent company on the subsidiary
The main firm does not have to have controlling stake shares to influence the subsidiary. Two organizations can work on the basis of a special agreement or according to the charter adopted by the controlled company. For example, a firm transfers to another enterprise the right to use its own production technology for manufacturing goods. At the same time, the agreement concluded between them stipulates the condition that the subsidiary company, within a certain period of time, will coordinate the sale of goods with the controlling firm.
Responsibility of the parent company
As a rule, a subsidiary is an independent organization with separate capital and property. She is not responsible for the debts of the main company, parent firm cannot be held liable for the debts of a subsidiary. The controlling company will be liable for the debts and claims of the controlled company only in two cases:
- If the transaction is concluded at the direction of the main organization, and there is documentary evidence of this.
- If a subsidiary company went bankrupt as a result of following the instructions of the parent company.
In the first case, one of the debtors must fully pay off the total obligations of the creditor, the rest of the debt will be released. In the second, the main company must repay that part of the debt of the controlled company, which it is not able to cover with its own property.
Purposes of creating child structures
The main firm creates sub-control structures in order to sort out the resources of the organization and allocate the most promising directions to specialized firms. This increases the competitiveness of the entire company. Also, a subsidiary company can perform routine work, which will optimize the management of a common company. With the help of transfer prices and transactions, it is possible to reduce tax and financial losses. Registration of subsidiaries abroad contributes to the development of foreign economic activity due to preferential customs and tax conditions.
A subsidiary company is a legally free organization that has the right to control production, supply, development of new technologies, sale of shares, and so on, however, a subsidiary company must give all its income to the parent company, and this company, in turn, allocates funds for the wages of workers , on equipment, production and various expenses. In fact, the state of the subsidiary depends on the financial position of the head office of the parent company.
From a legal point of view, a subsidiary is practically a free entity funded by another company, however, today we see that the parent company has a huge influence on its subsidiary. That is, he changes leaders, putting his people, indicates the path of the downed goods and controls production.
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Changes in control took place in 1994, until that time the subsidiary, from the legal side, was completely controlled by the parent company only by finances, however, it was in 1994 that a law was passed that states that a subsidiary, which is also a business company, is a created or a company acquired by another company.
Such a society has the right to dictate the conditions of production, however, at the same time it has a huge dependence on the mother community. As a rule, disagreements never arise between the child and parent communities, because they are directly dependent on each other.
In the event of the bankruptcy of a subsidiary, the parent company must take all the blame for this incident. In the event that the power sees that financial condition head office can fully financially support its subsidiary, then it has the right to force it to do so.
Opening a subsidiary, step by step instructions
To date, opening a child community is not difficult, for this you will need:
- All documents of the ruling company.
- Charter of the subsidiary.
- A legally formalized decision to establish a subsidiary.
- You will need an application form p11001.
- It is also very important to have a document that indicates that your company does not have any debt.
There are two ways to create a child community:
Method number 1 instruction
- To get started, draw up a special charter for the subsidiary and indicate in it all the conditions you need. If the company has several shareholders of the main capital, then you should create an agreement that describes the distribution of shares between them.
- It is necessary to draw up a protocol among the founders. This protocol must legally confirm the fact of the creation of a subsidiary.
- When creating any enterprise, including a subsidiary, you need to specify its location and contact details. Such a document has the right to create only the director of the main community, which will continue to control the child.
- It is worth noting that before registering a subsidiary, you need to get a certificate that indicates that the main office does not have any kind of debt. A subsidiary is registered only when all debts of the parent community are repaid. If the subsidiary incurs losses due to underfunding by the heads of the head office, then through the court, the parent company will be forced to incur losses in favor of its subsidiary.
- Form p11001 must be completed in full.
- After all the above documents are completed, Chief Accountant and all collected Required documents All paperwork must be submitted for review. tax authority in which your company is actually registered. After all contracts are ready, the subsidiary company can start its existence.
Method number 2 instruction
There are times when a subsidiary is not created, but assigned by mutual agreement. In the common people, this can be called "Absorption". Everything happens very simply: one company ruins another, after which, for a small amount, it appropriates it for itself. Today, there are a lot of companies that absorb enterprises.
Take, for example, the automotive concern Volkswagen Group, which over the years of its existence has absorbed almost the entire automotive business in Germany and Europe.
The great concern has a well-established scheme, for example, let's take the takeover of the automaker Audi: When Audi experienced financial difficulties at the end of the 20th century, it was kept afloat by the production of only one car, but Volkswagen creates a car of the same class, which is cheaper, more beautiful, more reliable and better in technical characteristics.
Naturally, motorists will buy a Volkswagen product, not an Audi.
Such a scheme is somewhat unprofitable for the acquiring company, however, this contribution completely illuminates Audi, as a result of which it asks financial assistance from Volkswagen, after which it becomes a subsidiary, to which its directors are placed.
There are many such examples, for example, take the same car industry: today there are three concerns: Volkswagen, Toyota, General Motors. They control 85 percent of the entire automotive world. Few would think, however, almost all famous brands belong to these companies.
Well, whether you are absorbing a company or simply agreed on everything by mutual agreement, you must do the following:
- First you need to choose the direction of the subsidiary, that is, give detailed instructions by production. It should be noted that the production of a subsidiary may differ from that of the parent community.
- The subsidiary is an independent entity, however, the rules are still dictated by the parent community, so a detailed charter should be developed regarding the subsidiary community.
- According to the law, the acquired company must have its seal, its bank account, its address and its registered office. individual so take care of all that.
- Decide on the choice of director and accountant in the controlled community. Agree with them all agreements regarding profits.
- You need to contact the govt. chamber and submit an application with the following documents: A bank statement on your account, official characteristics of the officials of the affiliated community, the charter you signed, letter of guarantee, in which the address of the subsidiary community is indicated, information about the founder, a certified copy of the act of acceptance and transfer of the fund, certified copies of payment transactions must be provided in writing.
- The last step is simply to obtain a certificate of registered subsidiary, after the company is registered, it can begin its official duties.
Pros and cons of a subsidiary:
pros
- The subsidiary does not have to worry about bankruptcy, as the parent company is obligated to pay off any debts of its company.
- You should not calculate the budget and expenses of the company, because all this responsibility is assumed by the parent community.
- There is no need to be afraid of competitors, because the parent company is personally worried about them.
Minuses
- Of course, the main disadvantage is the lack of freedom. A subsidiary must produce what will be imposed on it! No control over supplies, production and finances. With such conditions it is very difficult to develop technically.
- The entire capital is under the control of the parent community, so it is difficult for you to invest in the development of a subsidiary. The parent community allocates some capital, which is fully distributed.
- If there are still enterprises under the authority of your parent community, then in the event of their bankruptcy, it must compensate for all losses, so the money will be allocated from the earnings of another subsidiary, which will actually provide several enterprises with its production. But if the bankruptcy is too severe, and it is the office of the parent community that goes bankrupt, then, most likely, the subsidiary will be closed, since there will be no money to finance it. The main salvation will be either sponsors or some other parent company.
tax accounting
A subsidiary company is obliged to pay taxes to the state, however, in the same way as the parent organization sponsors this community. There are cases when a subsidiary company is indebted to the office of the parent company.
In such cases, there are several developments of events, among which:
- the closure of a subsidiary (in the event that the debt is too large);
- reducing the capital of a subsidiary, while the pace of production should not fall;
- debt forgiveness;
The most common option is the third, because the subsidiary does not have its own capital, so all the debt was formed due to underfunding from the parent community.
Forgiveness of the debt of a subsidiary is a legal process that is quite legal and transparent.
What is the difference between a subsidiary and a branch?
A subsidiary is a legal entity, all its activities, such as contracts and various important decisions, must be agreed with the parent company in the form of a transaction. A subsidiary may be located exclusively in the region in which its "Mother" is located.
The branch is not a legal entity, it deals only with those cases that main company. Due to the fact that the branch is not a legal entity, all transactions are executed on behalf of the main enterprise. It should also be understood that a branch can be located not only in a different region from the main company, but also located on the territory of other states.
Many businessmen do not see the difference between opening a branch, a representative office or a subsidiary. Meanwhile, it is there and very tangible. Before making a decision on the reorganization of existing production, one should understand the terms and choose the most appropriate form of expanding activities.
What is a branch office?
This word is called a separate subdivision of a legal entity, which gives it a full range of powers or only a part of it. A branch of an enterprise or organization may be located on the territory of a foreign state. In this case, all aspects of its activities must be coordinated with the legislation of this country, since it may differ significantly from the domestic one.
The branch must be included in the unified state register, but it is not a legal entity. He is in complete subjugation management of the parent company and exercises its powers only on the basis of a power of attorney. About the “separate subdivision”, branch and representative office, according to Art. 95 of the Civil Code of the Russian Federation. The Civil Code spells out all the stages of opening a branch.
What is a subsidiary?
This is a more independent separate subdivision, which is formed by transferring part of the property of the parent enterprise to the full economic management of the subsidiary. Its founder determines the Charter of the subsidiary and the ownership rights to the transferred property.
This form of management is beneficial for the head office in that it relieves itself of the obligation to manage the document flow at this facility and is content with receiving basic reports on the work of its subsidiary. The main responsibility for its activities lies with the business executive appointed by the head enterprise. He is engaged in the organization of work, the "promotion" of the unit, manages all current operations. But he is obliged to coordinate all major costs and decisions with the head office.
Thus, the conclusion is: a subsidiary is a more independent unit, endowed with much greater powers on the part of the founder, possessing property transferred to him on the basis of ownership. The branch has much more limited opportunities both in terms of independent management and document management.
You will need
- A clear business plan for the manufacture and sale of their own products, developed motivation for staff, capital that can be used for bonuses, incentives, etc., a management team and several theoretical manuals on personnel management.
Instruction
To open and manage any enterprise, a clear plan is needed, which will take into account investment risks, stages of development of the enterprise, volumes, points and methods of selling products, and a number of other points that affect development. With a good business plan, you can get a significant amount of money from the bank or from people who want to share with you.
Any enterprise needs management, that is, a management group that will set clear goals for the team and monitor their implementation. The leader of the management group is the director of the company, who manages several top managers. These should be competent people familiar with the theory and practice of management and personnel. Their number depends on the size of the company and may be different.
On must be developed by personnel. It can be both encouraging and punishable measures. The so-called "carrot and stick method" is used in the manual of many . It is advisable not to abuse the “whip”, as this can scare away potential highly qualified specialists, earn the company a bad name in the labor market and increase employee turnover. The amount of money allocated for bonuses and cash incentives is better in advance when budgeting for New Year to avoid subsequent problems with and reporting.
note
When forming a management team, see if your top managers are able to convey the required goals to the staff and stimulate the team to further productive work. Many managers, alas, sometimes do not have a clear idea about the main, short-term and long-term goals of the company. It happens that in the course of development, it is necessary to reorganize the enterprise, the consequences of which also need to be carefully analyzed.
It would not be superfluous to conduct focus groups to discuss the problems of the team and the work of the company, attract various consulting firms, conduct audits, trainings and seminars to improve the quality of the services offered and coordinated work in the team.
Tip 3: What is the difference between director and CEO
How the head of an enterprise or organization will be called - president, director or general director - is specified in the Charter of this enterprise. But on what basis the name for the manager is chosen and how his labor relations with the enterprise are built, you need to figure it out by referring to the legislation.
How to "call" the head of the enterprise
There is a contractual relationship between the head of the enterprise and the enterprise. They are regulated federal laws, including: the Labor Code of the Russian Federation, federal laws "On joint-stock companies", "On companies with limited liability”, as well as other regulatory and legal documents and acts approved by the subject of the Federation or the territorial body of local self-government.IN founding documents organization and, in particular, its charter must spell out the name of its head - an individual who manages and performs the functions of the sole executive body, as defined by Article 273 Labor Code RF. According to it, the founders can choose any name: director, general director, chairman or president - there is no difference, it does not change the essence, the rights and obligations of the head also do not depend on this.
The head of the organization is an individual elected to the position by the general meeting or who occupies it on a competitive basis.
Therefore, you can choose any name, but you should still take into account the specifics of the work, the field of activity and the volume of production of this particular organization. If it is small, its leader may, without any prejudice to his authority, be called a director. But in the case when it is enough large enterprise, which has, for example, several branches and subsidiaries, their directors may be called directors, and the general one will be the one who exercises general management. CEO the head may also be named in the case when the enterprise provides for positions, for example, technical, financial or executive directors.
The signature on behalf of the employer in the employment contract is put by the person specified in the Charter. This may be the chairman of the general meeting of founders or the chairman of the Board of Directors.
Features of registration of labor relations with the head of the enterprise
Whatever the name of the head of the organization, in accordance with Article 20 of the Labor Code of the Russian Federation, in the employment contract with him, this organization itself must be indicated as an employer. Basis for employment and conclusion employment contract will be the decision of the meeting of the founders or their authorized body - the Board of Directors. All these nuances should be reflected in the Charter.In the course of accounting, an accountant may detect a shortage of inventory items that arose as a result of damage, theft or natural loss. In this case, an inventory is organized at the enterprise, which is designed to identify the validity of the amount of debt for shortages and determine the guilty person.
Instruction
Approve the order to conduct inventory if a deficiency was found. Specify in this document the date of the meeting, the composition of the commission and the property that is subject to verification. Provide the commission with all receipts and expenditure documents for this case. Determine the balance of values according to accounting data. Collect receipts from financially responsible persons.
Determine the actual availability of property, draw up an inventory and a collation statement, which will allow you to identify the amount of the shortage. If it refers to money, then it is also necessary to carry out an audit of the cash desk and draw up an appropriate act. The balance of cash is checked against the data of the company's cash book.
Reflect the amount identified during inventory and revisions of shortages on the debit of account 94 “Shortages and losses from damage to valuables”. At the same time, in correspondence with this account there is an account that characterizes the values for which given fact. So account 50 “Cashier”, account 10 “Materials”, account 01 “Fixed assets”, account 41 “Goods” and so on can be used.
Draw up an act of shortage, which occurred due to regrading, natural attrition or technical losses. On the basis of these documents, the amount of the shortage must be reflected in the credit of account 94 in correspondence with account 20 "Main production", account 44 "Sales expenses" and so on. At the same time, for tax purposes, these costs are related to the material costs of the enterprise.
A commercial firm can operate in another region or even a state by opening a subsidiary or branch. What are these structures?
What is a subsidiary?
Under subsidiary means a legal entity, the authorized capital of which belongs to the parent organization that founded it. At the same time, both companies can operate in different areas. Moreover, the parent organization is not always directly involved in the management of the subsidiary. But, as a rule, this happens, and the segment of the companies' activities coincides.
Subsidiaries are established through state registration. In addition, the parent company develops for the "daughter" a charter containing the required provisions, and, if necessary, also a memorandum of association.
A subsidiary, since it is an independent legal entity, has property in its own management, with which it is liable for its obligations. Besides, this organization may be a plaintiff and defendant in court hearings independent of the parent company.
A subsidiary is not liable for the debt obligations of the parent company. In turn, reverse liability is provided for by the legislation of the Russian Federation. That is, if a subsidiary has financial difficulties, then the parent company may have subsidiary liability for the debts of the enterprise owned by it.
What is a branch?
Branch- this is a structure dependent on the main organization, which is not an independent legal entity, but located, as a rule, at a considerable geographical distance from the head office. For example, in another subject of the Russian Federation.
The branch is completely subordinate to the head office in terms of management. All contracts are signed by the head of this structure, who carries out his activities by proxy from the top managers of the main organization.
Information about established branches should be recorded in the constituent documents of the company. These structures are formed on the basis of special provisions approved by the management. State registration of branches as legal entities is not carried out - you only need to notify the Federal Tax Service of their opening. If this is not done, the tax authorities may issue fines. But if we talk about branches of foreign companies in Russia, they must be accredited by the State Registration Chamber.
Branches have fixed property, but are not able to have property or non-property rights, do not act as a party to legal relations and are not plaintiffs or defendants in court hearings.
The property that is assigned to the branch is often used as security for the debts of the main organization. In turn, the head office bears property liability for the obligations of its subdivision.
Comparison
The main difference between a subsidiary and a branch is that the first structure is legally independent from the main organization, the second is completely connected with it. This predetermines all other differences between the two types of firms in question.
It should be noted that the main organization can establish a branch in one region, and a subsidiary in another, and both structures will do the same thing. Therefore, in practice, the activities of branches and subsidiaries usually do not differ much. Their status is dissimilar only on legal grounds.
Having determined what is the difference between a subsidiary and a branch, we fix the conclusions in the table.
Table
| Affiliated undertaking | Branch |
| What do they have in common? | |
| The activities of a branch of an organization in one city and its subsidiary in another may be the same | |
| What is the difference between them? | |
| Is a legally independent organization | It is a structure completely dependent on the head office |
| May be the subject of legal relations, plaintiff and defendant in court | Cannot be a subject of legal relations and a participant in court hearings |
| Has separate property | Has secured property |
| Not responsible for the obligations of the parent organization | Assets assigned to the branch can be collected against the debts of the head office |
