A join stock company may be defined as an artificial person recognized by law, with a distinctive name, a common seal, a common capital comprising transferable shares carrying limited liability and having a perpetual succession.

It means the company is distinct from the person forming it. It enjoys many of the right of artificial person, e.g. it can sue or be sued in its name. It can own and transfer the title of property.

It means a joint stock company has a continuous life.The shareholders can come or go, but the existence of a company cannot effected. It can be winded up through compliance with the provision of companies ordinance 1984.

Common seal is used as a substitute of signature because company is an artificial person and cannot sign itself.It is also called official signature of company.

In a company limited by shares, the capital is divided into a number of shares. The shares can be freely transferred and sold. The liability of the members is limited to the amount if any, unpaid on shares held by them.

According to the companies ordinance 1984 it can be formed.
(a) At least by two persons and its total membership cannot exceed 50.
(b) The company by articles restricts the right to transfer it shares.
(c) It prohibits any invitation to the public to invest their money in shares or debentures of the company.

 8)Company limited by guarantee:
(a) It can be formed by at least seven members and there is no limit to maximum members.
(b) It can invite application from investor through advertisement in the news paper.

9) Unlimited company:
A company in which liability of its members is limited to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up.

10)Unlimited company:
A company in which liability of its members is unlimited. Every member of the company is personally liable to the full extent of his personal assets for the full debts of the company.

11)Association not for profit:
It enjoys all the privileges of a limited company without using the word limited or private limited. it is mainly formed for the promotion of commerce, art, charity, etc.

12)Memorandum of association: 
It is the basic document of the company. it contains the fundamental condition upon which alone a company can be incorporated. It sets out the limits outside which the action of the company cannot go.

13)Article of association:
It is second important document in the incorporation of a company. It contains the rules and regulation for the internal management of the company.


14)Prospectus:
It is a valuable document issued by the company for raising of the capital.

15)Shares:
The total amount of capital of a company is divided into smaller units. These units are called shares.

16)Share capital:
The total capital is divided into a large number of shares. The sum or total of the par value of shares of a company is called share capital.

17)Authorized capital:
The amount of capital with which the company is registered. It is also known as nominal capital or registered capital.

18)Issued capital:
shares offered to the general public for contribution are known as shares issued. The total par value of such shares is called issued capital.

The portion of subscribed capital which is called up by the company from public is called called up capital.

20)Paid up capital:
The total amount received by the company out of the total called up amount is known as paid up capital.

21)Reserve capital:
It is the portion of the subscribed capital which the company, through a special resolution, reserves to call in the event of winding up.

22)Par value of share:
The value which is assigned to a unit of share is called par value of share. It is also known as nominal value or face value.