When starting a new business, the company should have arrangements regarding the form of available finances. The company, while in the start up business, not only take account of how to start a business but also is worried about the point in time from where it is expected to get cash inflows. The expenditures incurred for starting up a business depends upon the type of business. Some expenses are unique to the types of business like manufacturing company will incur some expenses that a non manufacturing business won’t incur at all.
At the same time there are expenses which are common to every types of business. For manufacturing company incorporation Dubai has had several examples where a small set up was started initially but it gradually started to get successful and later on turned out to be a giant company. As soon as a start company in Dubai growing it tends to acquire other smaller companies in order to get a strong foothold in the market. In Dubai Company incorporation requires capital for the purpose of making expenditure to acquire land, buildings, furniture and fixtures, vehicles and other necessary computer items.
If you pick up a final report of a company that usually comprises balance sheet and income statement, you can see a heavy expenditure been made towards the above mentioned items. All these items were not acquired at start a business in Dubai but were slowly built on. The companies first try to get organic growth which means that it keeps on building up its resources until a time it reaches to a certain level that further growth is only possible if some other methods of growth are followed.
In such circumstances the company eyes for having a multiple business setup. The expansion in the company’s business is then dependent upon acquisition of some other companies. The company makes investment in other companies and depending upon the level of expenditures incurred, the investments are termed as associate, joint venture or subsidiary. In Dubai office of companies are sometimes central to the other activities. In such circumstances the central office is termed as head office and the subsidiary branches of the companies are termed as subsidiaries or associates.
In majority of cases the profits earned by the subsidiaries is remitted back to the head office. However, laws and regulation governing the remittance is technical in nature and needs to be understood before any progress is made in this regards. For understanding the concept of behind such legislations, the company may take assistance of an expert. The help and advice that are accompanied with any such repatriation of profits to other countries help in getting a free flow of funds.
Care should be taken because any mistake in this regard may be highly costly. The costs incurred in this regards are both in monetary as well as in non monetary terms. The penalties paid by the company are representative of monetary expenses. The non monetary expenses includes the damage done to the reputation of the company due to negativity caused to its name as more and more business circles get to know about such non compliance.