Day to day managerial and operational control and all control over extraordinary transactions vested in the individual proprietor. Organization Formalities and Ongoing Compliance. No formalities to organize or qualify the enterprise as there is no separate legal entity. If business uses a trade name or fictitious name, that name should be registered. No particular formalities required to cease operations.
Creditors have full rights against the proprietor.
May be difficult to transfer good-will, permits and licenses in connection with business as there is no separate entity. Not a Good Way to Do Business. General Partnership Financial Exposure. With respect to creditors of the business, all general partners have joint liability for contract claims and joint and several liability for other claims. A Partnership agreement should provide for their respective contributions of cash, other property or services and the sharing of profits and losses.