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Partnerships

A partnership is an arrangement in which persons carry on a business together and share outcomes under their agreement and applicable law. Partners typically agree how to share profits, contribute capital and make decisions. The accounting records of the business should be distinguished from the partners' personal records. Different partnership forms may give different partners different levels of liability. The agreement can also specify drawings, interest on capital and profit-sharing arrangements.

Worked example

Two partners share profits according to an agreed ratio.

Common mistake

Liability and legal personality vary with partnership type and jurisdiction; do not assume all partners have identical rights.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA FA Direct September 2026–June 2027
ACCA K1 Direct July 2027–August 2028
CIMA BA4 Direct Official assessment-window verification pending
FIA FFA Direct September 2026–June 2027

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