Outline the disadvantages of partnership. – NABTEB QUESTION

The disadvantages of partnership are:

1. Unlimited liability: Each partner is jointly liable with the other partners for all the debts and obligations of the firm
2. The formation of partnership requires a lot of formalities.
3. Constant disagreement that may bring the business to end
4. Death or retirement of member may result to the end of the partnership
5. The pride of ownership in partnership business is always diminished
6. In most cases, action of one partner binds the other whether favorable or not
7. There is always delay in decisions making due to series of consultation.
8. Partnership business always lack retained profit because of the business profit shared.