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A PRIVATELY HELD COMPANY or CLOSE CORPORATION is a business company owned either by non-governmental organizations or by a relatively small number of shareholders or company members which does not offer or trade its company stock (shares ) to the general public on the stock market exchanges, but rather the company's stock is offered, owned and traded or exchanged privately. More ambiguous terms for a privately held company are UNQUOTED COMPANY and UNLISTED COMPANY.

Though less visible than their publicly traded counterparts, private companies have major importance in the world's economy . In 2008, the 441 largest private companies in the United States accounted for US$ 1,800,000,000,000 in revenues and employed 6.2 million people, according to Forbes
Forbes
. In 2005, using a substantially smaller pool size (22.7%) for comparison, the 339 companies on Forbes
Forbes
' survey of closely held U.S. businesses sold a trillion dollars' worth of goods and services (44%) and employed 4 million people. In 2004, the Forbes' count of privately held U.S. businesses with at least $1 billion in revenue was 305.

Cargill , Koch Industries
Koch Industries
, Bechtel , Publix
Publix
, Pilot Corp. , Deloitte Touche Tohmatsu (a member of the Big Four group of accounting firms), Hearst Corporation
Corporation
, Cox Enterprises , S. C. Johnson , McWane , Carlson Companies , and Mars are among the largest privately held companies in the United States. KPMG , the UK accounting firms Ernst "> but it may be used anywhere when contrasting to a state-owned company.

In the United States, the term privately held company is more often used to describe for-profit enterprises whose shares are not traded on the stock market.

OWNERSHIP OF STOCK

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In countries with public trading markets, a privately held business is generally taken to mean one whose ownership shares or interests are not publicly traded . Often, privately held companies are owned by the company founders and/or their families and heirs or by a small group of investors. Sometimes employees also hold shares of private companies. Most small businesses are privately held.

Subsidiaries and joint ventures of publicly traded companies (for example, General Motors
General Motors
' Saturn Corporation
Corporation
), unless shares in the subsidiary itself are traded directly, have characteristics of both privately held companies and publicly traded companies. Such companies are usually subject to the same reporting requirements as privately held companies, but their assets, liabilities and activities are also included in the reports of their parent companies, as required by the accountancy and securities industry rules relating to groups of companies.

FORM OF ORGANIZATION

See also: Types of business entity

Private companies may be called corporations , limited companies , limited liability companies , unlimited companies , or other names, depending on where and how they are organized and structured. In the United States, but not generally in the United Kingdom, the term is also extended to partnerships , sole proprietorships or business trusts. Each of these categories may have additional requirements and restrictions that may impact reporting requirements, income tax liabilities, governmental obligations, employee relations, marketing opportunities, and other business obligations and decisions.

In many countries, there are forms of organization which are restricted to and are commonly used by private companies, for example the private company limited by shares in the United Kingdom (abbreviated _Ltd_) or private unlimited company and the proprietary limited company (abbreviated _Pty Ltd_) or unlimited proprietary company (abbreviated _Pty_) in Australia.

REPORTING OBLIGATIONS AND RESTRICTIONS

Privately held companies generally have fewer or less comprehensive reporting requirements and obligations for transparency , via annual reports, etc. than publicly traded companies do. For example, in the United States, unlike in Europe, privately held companies are not generally required to publish their financial statements . By not being required to disclose details about their operations and financial outlook, private companies are not forced to disclose information that may potentially be valuable to competitors and can avoid the immediate erosion of customer and stakeholder confidence in the event of financial duress. Further, with limited reporting requirements and shareholder expectations, private firms are afforded a greater operational flexibility by being able to focus on long term growth rather than quarterly earnings. In addition, private company executives may steer their ships without shareholder approval, allowing them to take significant action without delays. In Australia, Part 2E of the Corporations Act 2001 requires that publicly traded companies file certain documents relating to their annual general meeting with the Australian Securities and Investments Commission . There is a similar requirement for large proprietary companies, which are required to lodge Form 388H to the ASIC containing their financial report. In the United States, private companies are held to different accounting auditing standards than are public companies, overseen by the Private Company
Company
Counsel division of FASB .(see external links )

Researching private companies and private companies' financials can involve contacting the Secretary of State for the state of incorporation (or for LLC or partnership, state of formation), or using specialized private company databases such as Dun -webkit-column-width: 30em; column-width: 30em; list-style-type: decimal;">

* ^ Reifman, Shlomo; Murphy, Andrea D., eds. (6 Nov 2008). "America\'s Largest Private Companies". _ Forbes
Forbes
_. * ^ Loewen, Jacoline (2008). _Money Magnet: Attract Investors to Your Business_. Canada: