What Exactly Is A Partner?
Meaning And Definition
In a legal or accounting business, a partner might imply one thing and another in a company, corporation, international agreement between two countries, or joint venture. A business partner is a person or a firm that has formed a relationship with another person or business.
Partners in a partnership might be persons who agree to work together to further their common (mutual) goals. Businesses, schools, colleges, interest-based groups, governments, and combinations of these are all possible partners in a partnership.
Two organizations may form a partnership in order to increase their chances of attaining their goals and expand their reach. A partnership might result in the holding or issuance of stock, or it could be regulated solely by a contract.
Liability
Unlike shareholders in a limited liability company, full participants in a partnership are personally accountable for the business's losses and obligations. This implies that persons and businesses who owe money - creditors – can pursue their personal assets and resources, including their houses, in order to recoup their losses.
Some limited partnerships, also known as limited liability partnerships, include some partners who are not personally responsible for the firm's losses.
"How are you doing, partner?" is a cordial term of salutation used by one person to another in the United States.
The verb 'to partner' can refer to joining another organization or individual in a commercial operation, as well as acting as someone's partner in a dance, sport, game, or activity.
Partners' Compensation
Different types of partners exist in legal and accounting businesses, such as equity and contract (salaried) partners.
An equity partner in a conventional law firm, for example, has an underlying ownership stake in the whole business and receives a share of the partnership's distributable earnings.
A salaried partner gets given a salary but does not receive a share in the firm's distributions, as the name implies. He or she may be eligible for a bonus based on the profitability of the company.