ACCA Applied Knowledge · Business and Technology · The purpose and types of business organisation
Which of the following is a typical characteristic that distinguishes public sector organisations from private sector organisations?
Public sector organisations are typically funded mainly by taxation and are accountable to the public through government. Unlike private companies, they do not rely on share issues or profit maximisation, and their objectives are often shaped by political decisions.
- AThey are mainly funded by taxation and are accountable to the public through governmentCorrect
- BThey are mainly funded by issuing shares to investors
- CThey aim to maximise profit for owners
- DThey are free from political influence over their objectives
Explanation
Public sector bodies are generally financed through taxation and other government funding, and they answer to the public via elected government. Share issues and profit maximisation are features of private sector companies. Political influence is a common feature of public bodies, so option D is wrong.
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