A private company is a business with private ownership. Typically, private companies have one or a small number of owners.
There are four main types of private companies:
Each type has its own rules regarding shareholders, members and taxation.
Private corporations issue shares, but not through a public stock exchange. As a result, they do not need to meet filing and disclosure standards for public companies. Their shares are less liquid (tradable &/or convertible to cash) and harder to value than those of a public company.
Unlike public companies, private companies have a choice in how they prepare their financial statements. While public companies must use International Financial Reporting Standards (IFRS), private companies can choose between IFRS or the Accounting Standards for Private Enterprises (ASPE).