Financing of business firms is a set of forms and methods, principles and conditions for financial support for simple and expanded reproduction. Financing refers to the process of generating funds or, more broadly, the process of generating capital for a company in all its forms. The concept of "financing" is quite closely related to the concept of "investing"; If financing is the formation of funds, then investing is their use. Both concepts are interrelated, but the first precedes the second. It is impossible for a company to plan any investments without having sources of financing. At the same time, the formation of a company's financial resources occurs, as a rule, taking into account the plan for their use.

When choosing sources of financing for an enterprise, it is necessary to solve five main problems:

1) determine the needs for short- and long-term capital;

2) identify possible changes in the composition of assets and capital in order to determine their optimal composition and structure;

3) ensure constant solvency and, therefore, financial stability;

4) use own and borrowed funds with maximum profit;

5) reduce the cost of financing business activities.

Sources of financing for an enterprise are divided into internal (equity capital) and external (borrowed and attracted capital). Internal financing involves the use of own funds and, above all, net profit and depreciation charges.

Financing from your own funds has a number of advantages:

P, due to replenishment from the profit of equity capital, the financial stability of the enterprise increases;

The formation and use of own funds is stable;

External financing costs (debt servicing to creditors) are minimized;

The process of making management decisions on the development of the enterprise is simplified, since the sources of covering additional costs are known in advance.

The level of self-financing of an enterprise depends not only on its internal capabilities, but also on the external environment (tax, depreciation, budget, customs and monetary policy of the state).

External financing involves the use of funds from the state, financial and credit organizations, non-financial companies and citizens. In addition, it involves the use of financial resources of the founders of the enterprise. Such attraction of the necessary financial resources is often the most preferable, as it ensures the financial independence of the enterprise and facilitates the conditions for obtaining bank loans in the future.

Internal sources of financing the enterprise's activities

The main internal sources of financing the activities of entrepreneurial firms are profits and depreciation charges. Profit as an economic category reflects the net income created in the sphere of material production in the process of entrepreneurial activity, and performs certain functions.

First of all, profit characterizes the economic effect obtained as a result of the activities of a business firm.

Profit also performs a social function, since it is one of the sources for the formation of budgets at different levels. It goes to budgets in the form of taxes and, along with other revenues, is used to finance public needs, ensure that the state fulfills its functions, and state investment, production, scientific, technical and social programs. The social function of profit is also manifested in the fact that it serves as a source of charitable activities of the company, aimed at financing certain non-profit organizations, social institutions, and providing material assistance to certain categories of citizens.

The stimulating function of profit is manifested in the fact that profit is both a financial result and the main element of the company’s financial resources. Indeed, profit is the main internal source of the formation of a company’s financial resources that ensure its development. The higher the level of profit generation of an enterprise in the process of its economic activities, the less its need to attract financial resources from external sources and the higher the level of self-financing for the development of the enterprise, ensuring the implementation of the strategic goals of this development. At the same time, unlike other internal sources of formation of a company’s financial resources, profit is a constantly reproducible source, and its reproduction in conditions of successful management is carried out on an expanded basis.

Profit is the main source of increasing the market value of a company. The ability to self-increase the value of capital is ensured by capitalizing part of the profit received by the company. The higher the amount and level of capitalization of the profit received by a company, the more the value of its net assets increases, and, accordingly, the market value of the company as a whole, determined during its sale, merger, acquisition and in other cases.

Profit is the main protective mechanism that protects a company from the threat of bankruptcy. Although the threat of bankruptcy may arise even in conditions of profitable economic activity of a company, other things being equal, the company is much more successful and quickly emerges from a crisis state with a high level of profit. By capitalizing the profits received, the company can quickly increase the share of highly liquid assets, increase the share of equity capital with a corresponding decrease in the amount of borrowed funds used, and also form reserve financial funds.

Thus, in a market economy, the importance of profit is enormous. The desire to make a profit directs commodity producers to increase the volume of production of products needed by the consumer and reduce production costs. For entrepreneurial firms, profit is an incentive to invest in areas of activity that generate profit.

Profit is the final result of a company's production and economic activities, an indicator of its efficiency, a source of funds for investments, the formation of special funds, as well as payments to the budget. Making a profit is the main goal of a business organization.

The total amount of profit (loss) received by an enterprise for a certain period, i.e. gross profit, consists of:

P profit (loss) from sales of products, services, work performed;

P profit (loss) from other sales;

P profit (loss) from non-operating operations.

Profit (loss) from sales of products (works, services). It is defined as the difference between revenue from the sale of products (works, services) without value added tax and excise taxes and the costs of production and sales included in the cost of products (works, services).

Profit (loss) from other sales. An enterprise may develop excess material assets as a result of changes in production volume, deficiencies in the supply system, sales and other reasons. Long-term storage of these valuables in conditions of inflation leads to the fact that the proceeds from their sale will be lower than the purchase prices. Therefore, from the sale of unnecessary inventory items, not only profits are generated, but also losses.

As for the sale of excess fixed assets, the profit from this sale is calculated as the difference between the sale price and the initial (or residual) value of the assets, which increases by the corresponding index, legally established depending on the rate of inflation.

Profit (loss) from non-operating operations. It is calculated as the difference between income and expenses for non-operating operations. The composition of income (expenses) from non-operating operations includes income received from equity participation in the activities of other enterprises, from leasing property, income (dividends, interest) on shares, bonds and other securities owned by the enterprise, profit received by an investor when execution of a production sharing agreement, as well as other income (expenses) from operations not directly related to the production of products, services, performance of work, or sale of property.

An important role in the composition of internal sources of financing is also played by depreciation charges, which represent the monetary expression of the cost of depreciation of fixed assets and intangible assets and are an internal source of financing for both simple and expanded reproduction. Objects for calculating depreciation are fixed assets that are in the company under the right of ownership, economic management, and operational management.

Attracting bank loans

The enterprise's needs for one-time funds are also satisfied by obtaining a loan from a bank. Lending is one of the forms of financial support for entrepreneurial activity. It is carried out on the basis of establishing financial relationships between an enterprise and a credit institution by concluding relevant agreements between them. The main one is the loan agreement, which creates the legal prerequisites for the security of loans, their timely repayment and payment of interest.

In economic theory, loan capital is traditionally viewed as a set of funds transferred on a repayable basis for temporary use for a fee in the form of interest. Based on this, a bank loan is funds provided by a bank to a business firm for targeted use for a specified period at a certain interest rate. Lending to enterprises is carried out on the basis of certain principles.

The principle of repayment means that financial resources received from the lender are subject to return or repayment by the borrower in full.

The principle of urgency means the need to repay the loan within a precisely defined period, and not at any time convenient for the borrowing company, i.e. the loan is issued for a certain period. The term of use of the loan depends on the duration of the actual need for the loan.

The payment principle means that a loan is provided to the borrower with the condition that it be repaid with interest, which forms the profit of the credit institution.

The principle of material security of a loan expresses the need to ensure the protection of the property interests of the lender in the event of a possible violation by the borrowing company of its obligations and finds practical application in such forms of lending as loans secured by collateral or financial guarantees. 176

The principle of the targeted nature of a loan applies to many credit transactions and is expressed in the need for the targeted use of financial resources received from the lender. This principle finds practical expression in the corresponding section of the loan agreement, which establishes the specific purpose of the loan issued. Violation of the obligation to use the loan for the intended purpose may become the basis for early revocation of the loan or the introduction of increased loan interest.

Main types of bank loan

The peculiarity of bank lending at the present stage of development of the Russian economy is that this loan has a broad target orientation and is attracted in a wide variety of forms. In recent years, both domestic and foreign banks have been involved in lending to business firms. A bank loan can be classified based on various characteristics, which are shown in Fig. 4.3.

Based on the loan repayment period specified in the loan agreement, the following are distinguished: on-call loans;

Short-term loans;

Medium-term loans;

Long-term loans.

The peculiarity of an on-call loan is that it is provided to the borrowing company without specifying the period of its use with the obligation of the borrower to repay it upon the first demand of the lender. Such a loan is repayable within a fixed period upon receipt of official notification from the lender. Currently, on-call credit is almost never used not only in Russia, but also in most countries, since it requires relatively stable conditions in the loan capital market and in the economy as a whole.

Long-term loans are used, as a rule, for investment purposes. Like medium-term ones, they service the movement of fixed assets, characterized by large volumes of transferred credit resources.

According to the method of loan repayment, there are:

P loans repaid in a lump sum;

Loans repayable in installments.

Loans repaid in a lump sum by the borrowing company are a traditional form of repayment of short-term loans. In the case of long-term and sometimes medium-term loans, a method of repaying the loan is used, such as installments. In this case, the specific terms of repayment are determined by the loan agreement.

According to the method of charging loan interest, there are:

P loans, the interest on which is paid at the time of its total repayment;

P loans, the interest on which is paid in equal installments by the borrower throughout the entire term of the loan agreement;

P loans, the interest on which is retained by the bank at the time of the direct issuance of the loan to the borrowing company.

The first form of charging interest is traditional for a market economy when issuing short-term loans and is the most functional in terms of ease of calculation. The second form is used for medium-long-term lending. The latter form of charging interest on loans is not typical for a developed market economy and is used in very rare cases.

Depending on the availability of collateral, there are:

P trust loans (bank);

P secured loans;

P loans under financial guarantees of third parties.

The only form of security for a trust loan is a loan agreement. Such loans are usually used in the process of lending to regular customers who enjoy the full confidence of the bank. As a rule, a bank loan is provided by a commercial bank that provides cash and settlement services to the company. Although formally it is unsecured, it is actually secured by the size of the company’s receivables and its funds in the current and other accounts in the same bank.

Secured loans are the main type of modern bank loan. In domestic conditions, the main problem when applying for secured loans is the procedure for assessing the value of property due to the incompleteness of the process of forming the mortgage and stock markets. Loans issued under financial guarantees of third parties have become widespread, primarily in the field of long-term lending.

The real expression of a financial guarantee is a legally formalized obligation on the part of the guarantor to compensate for the damage actually caused to the lender if the borrower violates the terms of the loan.

According to their intended purpose, they are distinguished:

P loans of a general nature;

P targeted loans.

The first loans are used by the borrower at his own discretion to meet the needs for financial resources. In modern economic conditions they have a very limited distribution. Basically, loans issued by banks are targeted.

Commercial lending to an organization

In the process of entrepreneurial activity, organizations carry out mutual lending. This happens due to the time difference between the shipment of products, goods, performance of work, provision of services and their actual payment. Therefore, in the cash flow of enterprises, along with bank loans, there are funds from other creditors, including supplier enterprises and regular business partners in commercial transactions.

In Art. 823 of the Civil Code of the Russian Federation establishes that contracts, the execution of which is associated with the transfer into the ownership of another party of money or other things determined by generic characteristics, may provide for the provision of a loan, including in the form of an advance, prepayment, deferment and installment payment for goods, work or services.

With a commercial loan, the purchase and sale transaction is associated with a credit transaction; the end of the trading transaction coincides with the beginning of the credit transaction, which will be completed when the borrower repays the loan debt. Thus, the movement of commodity capital is accompanied by the movement of loan capital. Thus, commercial credit is a commodity form of credit. For the supplier company, a credit transaction not only speeds up sales (the buyer purchases goods), but also brings additional income in the form of interest, which is included in the price of goods sold and the amount of the bill.

The use of a commercial loan facilitates the sale of goods, helps to accelerate the turnover of working capital, which leads to a reduction in the enterprise’s need for credit resources and cash. In addition, the cost of a commercial loan is usually significantly lower than the cost of a financial loan in all its forms. The advantages of this type of lending also include the fact that it is characterized by a fairly simple registration mechanism in comparison with other types of loans that business firms can use. The advantages of a commercial loan also lie in the speed of providing funds in commodity form, in expanding the ability of enterprises to maneuver working capital, and in providing financial support for enterprises to each other. For many small businesses, commercial credit is the most important source of financing.

The disadvantages of a commercial loan include the risk for the supplier when the price of the goods changes, the buyer fails to meet payment deadlines, the buyer goes bankrupt, and also the fact that this type of loan is provided for a very short period, the period of its provision is usually limited to several months.

There are several distinctive features of a commercial loan that fundamentally distinguish it from a bank loan:

The role of lender in commercial lending is not from specialized credit and financial organizations, but from business firms associated with the production or sale of goods or services;

It is provided exclusively in commodity form;

P the average cost of a commercial loan is always lower than the average interest rate on bank loans for the corresponding period of time;

The commercial loan fee is usually included in the price of the product and is not specifically determined, for example, through a fixed percentage of the base amount.

In economic practice, there are several types of commercial loans, the main ones are shown in Fig. 4.4.

Rice. 4.4. Main types of commercial loan

A commercial loan with deferred payment under the terms of the contract has become most widespread in economic practice of both domestic and foreign enterprises. This loan is subject to the terms of the contract for the supply of goods, which is concluded by the supplier and the buyer and does not require special registration. After shipping the product, the supplier issues an invoice indicating the size, price, value, delivery terms and payment term. This invoice is the basis for the buyer to provide a loan.

A commercial loan on an open account is used in the business relations of a company with its regular suppliers for multiple deliveries of a pre-agreed list of products in small quantities. The conditions for providing such a commercial loan are also stipulated in the contract for the supply of products. In this case, the supplier company debits the cost of the shipped goods to the account opened for the buyer company, which repays its debt within the stipulated time frame.

Commercial loan with debt registration by promissory note. This method of obtaining a loan is that the buyer company, having received the goods, issues a bill of exchange indicating the payment period. This form of commercial loan is the most promising. Bill turnover on a commercial loan is serviced by promissory notes and bills of exchange.

A commercial loan in the form of consignment is a type of commission transaction in which the supplier company ships goods to the warehouse of a trading enterprise with instructions to sell it. Settlements with the supplier are made only after the delivered goods are sold.

It should be noted that in Russian economic conditions such a form of lending as a commercial loan is limited. Its spread is objectively hampered by such factors as unreliable partnerships, shortcomings of economic law, and inflation.

Investment tax credit

An investment tax credit is a form of external financing for the activities of entrepreneurial firms. In accordance with Art. 66 of the Tax Code of the Russian Federation, an investment tax credit is a change in the tax payment period in which an organization, if there are appropriate grounds, is given the opportunity, within a certain period and within certain limits, to reduce its tax payments with subsequent stage-by-stage payment of the loan amount and accrued interest. This loan can be provided to a business firm for income tax, as well as for regional and local taxes for a period of 1 to 5 years. This form of credit can be provided to a company that is a taxpayer in the following cases:

When this company carries out research or development work or technical re-equipment of its own production, including those aimed at creating jobs for people with disabilities or protecting the environment from pollution by industrial waste;

P when this company carries out implementation or innovation activities, including when creating new or improving existing technologies, creating new types of raw materials or materials;

In the event that this company carries out a particularly important order for the socio-economic development of the region or provides particularly important services to the population;

Fulfillment by the organization of the state defense order.

Factoring as a form of financing

One of the methods of financing entrepreneurial activity is factoring operations - a type of trade commission operation. Factoring is the assignment to a bank or a specialized factoring company of unpaid debt claims (receivables) arising between counterparties in the process of selling goods and services on the terms of a commercial loan, in combination with elements of accounting, information, sales, insurance, legal and other services of the supplier company.

There are three parties involved in factoring operations:

A factoring company or a bank's factoring department is a specialized institution that purchases claims from its clients for their customers. In fact, the purchase of receivables and financing of client firms occurs;

P client company (supplier of goods, creditor) - a company entering into an agreement with a factoring company;

The borrowing company is the buyer of the goods.

Factoring operations help speed up settlements, save the company's working capital, and also accelerate the turnover of the company's working capital. Factoring services are most effective for small and medium-sized companies that traditionally experience financial difficulties due to late repayment of receivables and which are limited in obtaining a bank loan.

Leasing as a type of investment activity

The legal basis for leasing is established by the Civil Code of the Russian Federation (Chapter 34, paragraph 6) and the Federal Law of October 29, 1998 No. 164-FZ “On financial lease (leasing)” (hereinafter referred to as the Leasing Law). The law determines the legal status of leasing entities, forms, types and types of leasing, legal and economic foundations of leasing, measures of state support for leasing activities.

Leasing is a set of economic and legal relations arising in connection with the implementation of a leasing agreement, including the acquisition of the leased asset. Leasing activity is a type of investment activity for the acquisition of property and leasing it. The subject of leasing can be any non-consumable things, including enterprises and other property complexes, buildings, structures, equipment, vehicles and other movable and immovable property that can be used for business activities. The subject of leasing cannot be land plots and other natural objects, the free circulation of which is prohibited by federal laws or for which a special procedure for circulation has been established.

A leasing agreement is an agreement under which the lessor (lessor) undertakes to acquire ownership of the property specified by the lessee (lessee) from a seller specified by him and to provide this property to the lessee for a fee for temporary possession and use. The leasing agreement may provide that the choice of the seller and the purchased property is made by the lessor. The leasing agreement may include terms providing for the provision of additional services and additional work. Additional services (work) are services (work) of any kind provided by the lessor both before the start of use and during the use of the leased asset by the lessee and directly related to the implementation of the leasing agreement. The list, volume and cost of additional services (work) are determined by agreement of the parties.

Leasing is a direct investment activity.

The subjects of leasing are the lessor, the lessee, and the seller (supplier). Lessor - an individual or legal entity who, at the expense of borrowed and (or) own funds, acquires ownership of property during the implementation of a leasing agreement and provides it as a leased asset to the lessee for a certain fee, for a certain period and on certain conditions for temporary possession and for use with or without transfer to the lessee of ownership of the leased item. Lessee is an individual or legal entity who, in accordance with the leasing agreement, is obliged to accept the leased asset for a certain fee, for a certain period and under certain conditions for temporary possession and use in accordance with the leasing agreement.

Seller is an individual or legal entity who, in accordance with the purchase and sale agreement with the lessor, sells to the lessor within the period specified in the agreement the property that is the subject of leasing. The seller is obliged to transfer the leased item to the lessor or lessee in accordance with the terms of the purchase and sale agreement. The seller can simultaneously act as a lessee within the same leasing legal relationship.

The main forms of leasing are domestic leasing and international leasing. When carrying out domestic leasing, the lessor and the lessee are residents of the Russian Federation. When carrying out international leasing, the lessor or lessee are non-residents of the Russian Federation. Subleasing is a type of sublease of a leased asset, in which the lessee under a leasing agreement transfers to third parties (lessees under a subleasing agreement) for possession and use for a fee and for a period in accordance with the terms of the subleasing agreement, the property previously received from the lessor under the leasing agreement and constituting the subject leasing To transfer the leased asset into subleasing, a mandatory condition is the consent of the lessor, expressed in writing.

The realization of the economic potential of entrepreneurial activity largely depends on the possibilities and conditions of financing. The availability of sources of financing for entrepreneurial activity is currently one of the main problems in investment activity. The sources of formation of financial resources are a set of sources to satisfy the additional need for capital for the coming period, ensuring the development of the enterprise. These sources are divided into own (internal) and borrowed (external).

When choosing sources of financing for an enterprise, it is necessary to solve five main problems:

• - determine the need for short- and long-term capital;
• - identify possible changes in the composition of assets and capital in order to determine the optimal composition and structure;
• - ensure constant solvency and, therefore, financial stability;
• - use own and borrowed funds with maximum profit;
• - reduce the cost of financing business activities.

Internal financing involves the use of own funds.

Table 1. - Own funds and their sources:

Own funds	Sources of financial resources
1. Depreciation (accrual of depreciation of fixed assets and intangible assets)	Sales revenue (cost)
2. Gross profit
2.1 Profit from the sale of goods and services (business income)	Revenues from sales
2.2 Profit from other sales	Income from other sales
2.3 Balance outside of operating results (income)	Non-operating income
2.4 Reserve fund	Gross profit before tax
3. Repair fund	Cost price
4. Insurance reserves	Cost or net profit

The most reliable sources of financing are our own sources of financing for business activities. Ideally, every business organization should always strive to be self-financing. In this case, there is no problem of where to get money, and the risk of bankruptcy is reduced. In addition, self-financing the development of an enterprise means its good financial condition, as well as the presence of certain advantages over competitors who do not have such opportunities. The main own sources of financing business activities in any commercial organization are net profit and depreciation charges.

Financing from your own funds has a number of advantages:

• 1. by replenishing the enterprise’s profits, its financial stability increases;
• 2. the formation and use of own funds is stable;
• 3. external financing costs (debt servicing to creditors) are minimized;
• 4. The process of making management decisions on the development of the enterprise is simplified, since the sources of covering additional costs are known in advance.

The level of self-financing of an enterprise depends not only on its internal capabilities, but also on the external environment (tax, depreciation, budget, customs and monetary policy of the state).

It is natural that the greater the amount of profit goes to finance and develop economic activities, the less the need for additional funds.

The amount of retained earnings of an enterprise depends primarily on the profitability of business operations, as well as on the dividend policy applied at the enterprise. This source is the simplest, most accessible and effective.

The use of profit as a source of financing real investments aimed at expansion, reconstruction and technical re-equipment of the enterprise has a positive aspect for the enterprise in the sense that this profit is not subject to income tax under existing tax legislation.

Among the own financial sources of entrepreneurial activity, depreciation charges play an important role. They are designed to ensure not only simple, but, to a certain extent, expanded reproduction.

In developed countries of the world, depreciation charges up to 70-80% cover the investment needs of enterprises.

With the transition of the Russian economy to market relations, the importance of depreciation charges as a source of financing business activities has also increased. The advantage of depreciation charges as a source of entrepreneurial activity compared to others is that, regardless of the financial situation of the enterprise, this source exists and always remains at the disposal of the enterprise.

External financing involves the use of funds from the state, financial and credit organizations, non-financial companies and citizens.

In addition, it involves the use of financial resources of the founders of the enterprise.

Such attraction of the necessary financial resources is often the most preferable, as it ensures the financial independence of the enterprise and facilitates the conditions for obtaining bank loans in the future.

Table 2. - External sources of financing:

Financial resources	Sources of financial resources
1. Borrowed funds	Relevant Lender Resources
1.1 Bank loan
1.2 Credit Financial Institute
1.3 Budget loan
1.4 Commercial loan
1.5 Accounts payable, constantly in circulation
2. Raised funds	Relevant Investor Resources
2.1 Funds for equity participation in current and investment activities
2.2 Funds from the issue of securities
2.3 Shares and other contributions of members of the workforce, legal entities and individuals
2.4 Insurance indemnity
2.5 Receipt of payments for leasing, franchising, rent, etc.
3. Budget allocations and receipts from extra-budgetary funds	Funds from budgetary financing and extra-budgetary funds

Attracting borrowed funds allows the company to accelerate the turnover of working capital, increase the volume of business transactions, and reduce the volume of work in progress. However, the use of this source leads to certain problems associated with the need for subsequent servicing of debt obligations assumed. As long as the amount of additional income secured by attracting borrowed resources covers the costs of servicing the loan, the financial position of the company remains stable, and the attraction of borrowed capital is effective.

One of the most common sources of financing for entrepreneurial activity today is a bank loan. The reason for this is a number of advantages that this form has compared to other forms of financing. Banks operating in conditions of fierce competition today offer a whole range of various types of loans.

A bond as a borrowing instrument is more responsive to modern financial market conditions and has a number of advantages relative to other instruments. These include the following:

• 1. the ability to access directly (without an intermediary) the investor’s financial resources;
• 2. due to the fragmentation of a large number of bondholders, there is little likelihood of interference by the creditor in the internal affairs of the borrower;
• 3. bond loans provide more opportunities for financing on a long-term basis;
• 4. there is the possibility of operational management of the structure and volume of debt, their optimization in accordance with changing business conditions, both internal and external;
• 5. The functioning of the secondary market reveals guidelines on which the issuer relies when developing the parameters of new bond issues. The existence of a liquid secondary market creates opportunities for subsequent issues of bonds by the issuer, since the high liquidity of bonds is one of their most attractive characteristics for potential investors;
• 6. Repayment of the principal debt on a bond loan occurs, as a rule, on the day the loan expires. This circumstance makes it possible to fully service the debt at the expense of profits from the implementation of the investment project itself.

Leasing is one of the newest and fastest growing forms of credit.

From an economic point of view, leasing is a specific loan provided by the lessor to the lessee in the form of property transferred for use.

Franchising has been widely used as an alternative method of product distribution and business expansion over the past forty years. In this method, the franchisor gives permission to the franchisee to sell their branded goods and services.

The franchisor must also provide a proven method of doing business, provide technical and advisory assistance in organizing the franchisee's business and provide its support in the future.

To obtain rights to a product, a franchisee typically makes an initial payment to the franchisor and then pays monthly installments.

Equity financing of business activities can be carried out in two main forms:

• 1. additional issue of shares of an enterprise existing as a joint-stock company;
• 2. establishment specifically for the implementation of an investment project of a newly created enterprise with the involvement of co-founders who make a monetary or property contribution to the authorized capital of this enterprise.

Equity financing can be carried out in the form of cash and property contributions.

Most often, a monetary contribution is required from invited third-party co-founders, since the initiator and main founder of the enterprise, as a rule, has some unique assets for a given project, but cannot himself fully meet the project’s need for funds.

Budget financing can be provided by providing:

• 1. budget investments;
• 2. budget loan;
• 3. state investment resources on the terms of securing state ownership of part of the shares of the created joint-stock companies;
• 4. federal budget funds allocated on a repayable basis for a period of no more than 24 months;
• 5. state guarantees for reimbursement from the federal budget of part of the financial resources invested by the investor.

Features of modern investment policy in Russia are a reduction in the share of financing of business structures from budgetary funds and the activation of enterprises themselves in finding investment resources, including through the instruments and institutions of the financial market.

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AUTONOMOUS NON-PROFIT ORGANIZATION

HIGHER PROFESSIONAL EDUCATION

"NATIONAL INSTITUTE NAMED AFTER CATHERINE THE GREAT"

Faculty of Management, Economics and Finance

Direction - Management, profile "Financial Management"

Test

in the discipline "FUNDAMENTALS OF ENTREPRENEURSHIP"

Internal and external sources of financing for business activities

Completed by: 3rd year student

Aganicheva T.V.

Checked by: teacher

Minaeva V.V.

Moscow - 2014

Introduction

Company- according to the Civil Code of the Russian Federation (Article 132) - a special object of civil rights, a property complex used for carrying out business activities. In the process of managing it, various issues are resolved, one of which is financing the activities of the enterprise, that is, providing the necessary financial resources for the costs of its implementation and development.

Business entities receive these resources from various sources, without which no enterprise can exist and operate. And, therefore, it is not surprising that the issue of possible sources of financing is relevant today for many business entities and worries many entrepreneurs.

Financial resources of the enterprise

The concept of financial resources is closely related to the concept of sources of financing the activities of an economic entity. The financial resources of an enterprise are the totality of its own funds and receipts of borrowed and raised funds intended to fulfill financial obligations, finance current costs and costs associated with the expansion of capital. They are the result of the interaction of receipt, expenditure and distribution of funds, their accumulation and use.

Financial resources play an important role in the reproduction process and its regulation, distribution of funds according to areas of their use, stimulate the development of economic activity and increase its efficiency, and allow monitoring the financial condition of an economic entity.

Sources of financial resources are all cash income and receipts that an enterprise or other economic entity has at its disposal in a certain period (or as of a date) and which are used to make cash expenses and deductions necessary for production and social development.

Financial resources generated from various sources enable the enterprise to timely invest funds in new production, ensure, if necessary, expansion and technical re-equipment of the existing enterprise, finance scientific research, development, their implementation, etc.

The main areas of use of an enterprise’s financial resources in the process of its activities include:

financing the current needs of the production and trading process to ensure the normal functioning of production and trading activities of the enterprise through the planned allocation of funds for main production, production and auxiliary processes, supply, marketing and sales of products;

financing administrative and organizational measures to maintain a high level of functionality of the enterprise management system through its restructuring, allocation of new services or reduction of the management staff;

investing funds in the main production in the form of long-term and short-term investments for the purpose of its development (complete renewal and modernization of the production process), creation of new production or reduction of certain unprofitable areas;

financial investments - investment of financial resources for purposes that bring an enterprise higher income than the development of its own production: acquisition of securities and other assets in various segments of the financial market, investments in the authorized capital of other enterprises in order to generate income and obtain rights to participate in the management of these enterprises, venture financing, provision of loans to other companies;

the formation of reserves, carried out both by the enterprise itself and by specialized insurance companies and state reserve funds at the expense of regulatory contributions to maintain the continuous circulation of financial resources, protecting the enterprise from unfavorable changes in market conditions.

Financial reserves are of great importance to ensure uninterrupted financing of the production process. In market conditions their role is significant. These reserves are capable of ensuring a continuous circulation of funds in the reproduction process even in the event of huge losses or the occurrence of unforeseen events. The enterprise creates financial reserves from its own resources.

Financial support for reproduction costs can be provided in three forms: self-financing, lending And state financing.

Self-financing based on the use of the enterprise's own financial resources. If its own funds are insufficient, it can either reduce some of its expenses or use funds mobilized in the financial market through transactions with securities.

Lending- this is a method of financial support for reproduction costs in which the costs are covered by a bank loan provided on the basis of repayment, payment, and urgency.

Statefinancing is made on a non-refundable basis at the expense of budgetary and extra-budgetary funds. Through such financing, the state purposefully redistributes financial resources between production and non-production spheres, sectors of the economy, etc. In practice, all forms of cost financing can be applied simultaneously.

Setting priorities among sources of financing and choosing the most optimal sources is a problem for many organizations today.

Let's start with external sources.

reproduction costs financial support

External funding

An enterprise cannot cover its needs only from its own sources. This is due to the peculiarities of cash flows, in which the moments of receipt of payments for goods, services and work for the enterprise do not coincide with the terms of repayment of the enterprise's obligations, and unexpected delays in payments may occur. An additional need for sources of financing may also be due to inflation, when the funds received by the enterprise in the form of sales proceeds depreciate and cannot satisfy the enterprise's increased need for funds due to rising prices for raw materials. The choice of the most suitable instrument should be made taking into account three interrelated key factors: the price of the instrument, the type of liability sought (equity or borrowed funds) and the urgency of the purposes for which financing is sought (long-, medium- or short-term). If the price of an instrument is a purely individual factor, depending both on the state of the company and the riskiness of the investment, and on the general state of the capital market and the specific instrument, then the other two factors are universal for all companies. Expanding the activities of an enterprise requires the involvement of additional resources. Thus, borrowed sources of financing appear.

Borrowed capital, depending on the loan terms, is divided into long-term(long-term liabilities) and short(short-term liabilities). Long-term liabilities, in turn, are divided into bank loans (repayable in more than 12 months) and other long-term liabilities.

Short-term liabilities consist of borrowed funds (bank loans and other loans to be repaid within 12 months) and accounts payable of the enterprise to suppliers and contractors, to the budget, for wages, etc.

An important source of financing the activities of an enterprise is a bank loan. Previously, many enterprises (especially industry and agriculture) could not take advantage of loans from commercial banks, since the cost of loans (interest rates) was high. But now they have the opportunity to pursue a more active policy of attracting borrowed funds, since in 2002-2003. the level of interest rates fell sharply. Foreign loans poured into Russia. By offering businesses lower rates and longer loan terms than Russian commercial banks, foreign banks have seriously asserted themselves in the Russian credit market.

The three main differences between equity financing and debt financing are the maturity of the instruments, the priority of payments on the instrument and, as a consequence, its price. In general, loan payments (interest) take precedence over equity investments (dividends). As a result, investors perceive debt instruments as less risky and therefore have a lower risk premium built into their prices. Also, equity financing is inherently a strategic investment for more than seven years. Therefore, attracting short- and medium-term funds automatically narrows the choice to debt instruments. Their undeniable advantage is that, according to the laws of many countries, interest payments on a loan are exempt from taxation. From the owner's point of view, the advantage of debt instruments is that the creditor is not given a stake in the business.

However, these instruments also have disadvantages: for new and small companies with irregular cash flows, it is quite difficult to make regular payments on a loan or loan. Thus, debt increases a company's vulnerability to economic downturns and interest rate increases. A high proportion of liabilities in the capital structure increases its risk in the eyes of investors, which reduces the ability to attract capital in the future. Equity financing is all about exchanging investors' money for a stake in the business. The main advantage of raising your own capital is that there is no need to repay funds. In return, investors expect to receive a portion of the company's future profits. In addition, the participation of serious investors in the business increases its reputation and makes it easier to attract additional financing.

The main disadvantage of equity financing is that the investor becomes a partial owner of the business and has a say in decision making.

Equity financing

Shareholders' equity refers to the portion of equity obtained from the sale of securities to shareholders in exchange for monetary or tangible assets. The offering of securities can be public and private, primary and secondary. As a rule, attracting equity capital is typical primarily for established companies that have already overcome the phase of rapid growth and entered a period of stable, more predictable growth in cash flows. In domestic practice, equity financing is not of a dominant nature, and recently it has often acted more as a tool for protecting businesses from hostile takeovers than for attracting capital.

To raise funds in this way, you should seek advice from representatives of well-known foreign or domestic trading platforms and/or consulting companies specializing in supporting the initial public offering (IPO). Venture capital is typical for young, high-risk and fast-growing companies with great potential. Venture capitalists and business angels own a portion (usually quite significant) of the equity capital in companies. At its core, venture capital investments are a separate case of an initial private placement.

Syndicate investing is the attraction of long-term capital to infrastructure and industrial projects, which is based on the expected cash flows of the project, and not the structure implementing it. Project finance is created by a consortium of equity investors (sponsors) and a syndicate of banks or other financial institutions providing debt funds. As a rule, such financing involves the creation of a separate legal entity, which makes it possible to protect the third-party assets of the sponsors from the risks associated with the project.

As for targeted lending, a frequently used scheme is leasing, in which the bank acts as an intermediary between the seller and buyer of expensive property, increasing its value by a pre-agreed percentage.

Debt financing

Syndicate lending. This type of debt financing is usually used when it is impossible to provide a loan of the required size using the monetary resources of only one bank. In this case, the project lenders initiate the organization of a syndicate, signing a loan agreement not only with the borrower, but also among themselves, regarding the voting rights of the parties in the syndicate, the procedure for loan payments to its members, and the policy in case of default. An additional agreement is also signed, which implies the right of creditors to influence decisions on the project in the event of reorganization or the threat of default. Project financing is of a long-term nature (from seven years).

Syndicate lending is very common in the West, but has not yet received proper distribution in our country. A real alternative to this instrument is the issue of bonds. Loans guaranteed by rating agencies. This lending scheme is usually used to finance the import purchase of equipment or large quantities of products.

In an effort to support local commodity producers and increase their competitiveness in world markets, a number of countries have created so-called rating agencies, which, for a moderate fee, act as guarantors when foreign buyers of products or equipment receive loans in the country where the rating agency is a resident. The buyer of the equipment gains access to cheaper sources of debt financing that would otherwise be closed, the rating agency improves the global competitiveness of its country's products, and the seller of the goods or equipment benefits from increased demand. Loans secured by property are a loan for the purchase of real estate (mortgage) or other type of property that serves as collateral for the loan. In a growing real estate market, a mortgage loan is a profitable alternative to renting, as it makes it possible to reduce expected costs by fixing regular payments at the current level.

Financial institutions are very willing to lend for the purchase of real estate in a growing market, since even in the event of bankruptcy of the borrower, the increased value of the collateral allows them to make a profit. On the contrary, in a falling or stagnating market, mortgages lose their attractiveness both for lenders (due to the risks of downward revaluation of the collateral) and for borrowers (due to rising loan interest rates and more attractive dynamics of rental rates).

Overdraft is a special form of short-term unsecured lending to a borrower by a financial institution. With an overdraft, the client's current account is credited to pay for settlement documents in an amount exceeding the balance of funds. The difference from a classic loan is that the received amounts are used in full to pay off the overdraft. The interest rate and limits depend on the client and the bank’s credit policy.

Bonds - This is a tool for raising funds by large companies. Secured bonds are distinguished from unsecured bonds by the presence of collateral. They can be the borrower's material assets. Unsecured debt is more common in the financial sector. In addition, the debt can be guaranteed (issued, as a rule, by companies affiliated with the state). Creditors, who can be both legal entities and individuals, do not receive shares in the company’s equity capital and do not have the right to vote when making decisions, but have priority in paying the agreed interest (coupons) and the body of the debt. Debt obligations in the form of bonds can be freely bought and sold

Leasing- this is short - or a medium-term instrument for raising debt funds for the acquisition of fixed assets or expensive tangible assets by enterprises.

Leasing is a special complex form of entrepreneurial activity that allows one party - the lessee - to effectively update fixed assets, and the other - the lessor - to expand the boundaries of activity on mutually beneficial terms for both parties.

Advantages of leasing:

Leasing involves 100% lending and does not require immediate payments. When using a conventional loan to purchase property, the company must pay about 15% of the cost from its own funds.

Leasing allows an enterprise that does not have significant financial resources to begin implementing a large project.

Unlike mortgage lending, the object of leasing can be assets that are not similar to real estate. In leasing, ownership rights belong to the lessor, that is, at its core, leasing is a lease with the right to purchase assets. A special form is leaseback, in which the seller of the asset is the lessee. Thus, by actually receiving a secured loan, companies can take advantage of the economic effect of the leasing tax system.

Internal financing

The main sources of financing the enterprise's activities are its own funds. Internal sources include:

authorized capital;

funds accumulated by an enterprise in the course of its activities (reserve capital, additional capital, retained earnings);

other contributions from legal entities and individuals (targeted financing, charitable contributions, donations, etc.).

Equity capital begins to form at the time of creation of the enterprise, when its authorized capital is formed, that is, the totality in monetary terms of contributions (shares, shares at par value) of the founders (participants) to the property of the organization upon its creation to ensure activities in the amounts determined by the constituent documents. The formation of authorized capital is associated with the peculiarities of the organizational and legal forms of enterprises: for partnerships it is share capital, for joint-stock companies - share capital, for production cooperatives - a mutual fund, for unitary enterprises - an authorized fund. In any case, the authorized capital is the start-up capital necessary to start the activities of the enterprise.

Since internal financing does not require raising capital and fulfilling the conditions of financing established by a third party, internal financing is usually a priority source for the company, and the company independently attracts such financing through the implementation of a set of projects that optimize the structure of liabilities and increase the liquidity of balance sheet assets. Unallocated profit- the most common source of financing in the structure of equity capital. At its core, the decision to reinvest retained earnings into equity is a proportional increase in shareholders' contribution to the business by reducing (or eliminating) dividends in order to stimulate further growth of the company. The reason for the popularity of this form of financing is that it does not require the involvement of external investors, and therefore is available to all companies with positive profits, regardless of age and size.

Automatic financing (accrual And creditor debt). We are talking about additional financing of the company by increasing the items of accrued salaries and other accruals, as well as accounts payable in the liabilities of the balance sheet. These articles, having the properties of a proportional increase or decrease depending on the corresponding change in our sales volumes, actually themselves, without our conscious intervention (automatically), additionally finance the company in the event of an increase in its business activity. Some companies deliberately use this property of automatic financing items to replace all other sources of financing. Although financing a business through accounts payable and accrued but unpaid wages may seem like the cheapest source of financing. Such financing increases not only the company's liabilities, but also its risks, which usually negatively affects its value due to the suboptimal structure of liabilities.

Factoring. By carrying out a factoring operation, a company sells its own short-term receivables (less than 180 days) to a third party (the so-called factor) at a discount. As a rule, the factor is a factoring company or a bank, and the discount ranges from 10 to 60% depending on the quality of the requirements. After the debtor has satisfied the party's claims, the factor pays the discount to the creditor minus interest for the loan and services. Thus, factoring is a form of short-term secured lending in which the company's assets in the form of receivables act as collateral for the loan. Depending on the distribution of risks between the factor and the creditor, factoring can be without recourse (the risks of non-payment of claims are transferred to the factor) and with recourse (the risks of non-payment lie with the creditor, who undertakes to pay off the losses of the factor in the event of non-payment.

Deliverance from non-core assets. A set of projects or operations to identify company assets that do not create additional value and/or are unnecessary for the normal maintenance of operational activities with their subsequent liquidation (sale). The operation allows you to reinvest the proceeds from the sale of non-core assets into property that creates additional value for the business.

Optimization worker capital is a set of projects and/or operations of a company designed to optimize (usually increase) prepayments from customers, automatic financing items and short-term debt items while simultaneously optimizing (reducing) our prepayments, inventory, work in progress and accounts receivable. It is important to act on all items comprehensively, considering them in a portfolio context. It is necessary not only to reduce or increase items, but to select the optimal ratio that maximizes the value of the business. Typically, this frees up funds that can be reinvested in other areas of the company's development.

Conclusion

Any enterprise needs sources of financing for its activities.

Today, an important task of the financial policy of an enterprise is the rationalization of sources of financing. The greater the share of equity capital, the higher the coefficient of financial independence of the enterprise, but business entities with a high share of borrowed funds also have certain advantages. Borrowed funds for an enterprise, although they are a paid source of financing. Practice shows that their use is more effective than our own.

Each enterprise independently determines the structure and methods of financing its activities; this depends on the industry characteristics of the enterprise, its size, the duration of the production cycle of products, etc. The main thing is to correctly prioritize among sources of financing, calculate the capabilities of the enterprise and predict possible consequences.

In any case, no matter what financing option the company’s management chooses, it is necessary to have a clear business promotion plan and properly configured internal and external processes in the enterprise.

List of used literature

1. Large economic dictionary / ed. Azriliyan A.N. - M.: Institute of New Economics, 1999.

2. Ermasova N.B. Financial Management: Exam Guide. - M.: Yurait-Izdat, 2006.

3. Karelin V.S. Corporate finance: Textbook. - M.: Publishing and trading corporation "Dashkov and K", 2006.

4. Kovalev V.V. Financial analysis: Capital management. Choice of investments. Reporting analysis. - M.: Finance and Statistics, 1998.

5. Romanenko I.V. Enterprise finance: lecture notes. - St. Petersburg: Publishing house Mikhailov V.A., 2000.

6. Selezneva N.N., Ionova A.F. The financial analysis. Financial management: Textbook for universities. - M.: UNITY-DANA, 2006.

7. Modern economics: Textbook / Ed. prof. Mamedova O.Yu. - Rostov-on-Don: Phoenix Publishing House, 1995.

8. Chuev I.N., Chechevitsyna L.N. Enterprise Economics: Textbook. - M.: Publishing and trading corporation "Dashkov and K", 2006.

9. Economics and management in SCS. Scientific notes of the Faculty of Economics. Issue 7. - St. Petersburg: St. Petersburg State Unitary Enterprise Publishing House, 2002.

10. Economics of an enterprise (firm): Textbook / Ed. prof. Volkova O.I. and Assoc. Devyatkina O.V. - M.: INFRA-M, 2004.

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Principles of the financial mechanism of an economic entity. The essence and significance of the enterprise's financial resources. The concept of cash and monetary funds, their difference from financial resources. Sources of formation and use of enterprise finances.

An important point in the proper organization of business financing is the classification of sources of financing. The classification of sources accepted in Russian practice differs from foreign ones. Thus, in our country, all sources of financing for entrepreneurial activities are divided into four main groups:

• 1) own funds of enterprises and organizations;
• 2) borrowed funds;
• 3) raised funds;
• 4) funds from the state budget.

In foreign practice, the classification of enterprise funds and the classification of sources of financing the enterprise’s activities are considered separately. Since these issues are closely interrelated, let us consider them in more detail. The general classification of enterprise funds in foreign practice is presented in Fig. 6.1.

Rice. 6.1.

In this classification of enterprise funds, the main element is equity capital. The components of the enterprise's own capital are shown in Fig. 6.2.

There is another option for classifying enterprise funds. In it, all the company’s funds are divided into the company’s own and borrowed funds.

The company's own funds include:

■ authorized capital (funds from the sale of shares and share contributions of participants or founders);

■ proceeds from sales;

■ depreciation charges;

■ net profit of the enterprise;

■ reserves accumulated by the enterprise;

■ other contributions from legal entities and individuals (targeted financing, donations, charitable contributions).

Funds raised include:

■ bank loans;

■ borrowed funds received from the issue of bonds;

■ funds received from the issue of shares and other securities;

■ accounts payable.

In foreign practice, there are different approaches to classifying sources of financing the activities of an enterprise.

In one case, all sources of financing are divided into internal sources and external sources.

Internal sources include the enterprise's own funds.

Rice. 6.2.

External sources respectively include:

■ bank loans;

■ borrowed funds;

■ funds from the sale of bonds and other securities;

■ accounts payable, etc.

In another case, all sources of financing are divided into internal and short-term, medium-term, long-term financial resources.

TO internal sources include expenses that the company finances from net profit.

Short-term funds used to pay wages, pay for raw materials and supplies, and various operating expenses.

Short-term financial resources can be presented in the following forms:

• 1) bank overdraft is a permission of a commercial bank to exceed the loan amount of the contractual limit. Overdrafts are payable on demand. Usually this is the cheapest form of loan, the amount of interest paid on it does not exceed 1-2% of the bank’s base discount rate;
• 2) bill of exchange (draft) - a monetary document according to which the buyer promises the seller to pay a certain amount, without setting any conditions, within the period established by the parties. The bank discounts bills of exchange by providing their holders with a loan for the period until maturity. As payment for a loan issued on a bill of exchange, the bank charges a discount (interest), the value of which changes daily. Bills of exchange are most often used in foreign trade payments;
• 3) acceptance credit occurs in cases where the bank accepts for payment a bill of exchange issued in the name of its clients (which is called a factor operation, or resale of the right to collect debts (factoring). In this case, the bank pays the creditor the value of the bill minus the discount, and upon expiration of its repayment period, collects this amount from the debtor:
• 4) commercial loan is the purchase of goods or services with deferred payment, usually for a period of one to two months, and in some cases more. The use of a commercial loan is determined by the specific type of economic activity. Turning to such a source of financing depends on the degree of need to sell goods to customers and the possibilities of deferring payments by the company itself.

Medium-term finance (for a period of 2 to 5 years) are used to pay for machinery, equipment and research work.

The purchase of machinery, equipment, and vehicles on credit by an enterprise takes place in the form of obtaining a medium-term loan on fixed terms. What is purchased serves as a guarantee of the loan, while the loan itself is repaid with regular installments.

The group of medium-term financial resources includes the rental of machinery and equipment. By analogy with an installment purchase, payment of an agreed amount for the use of leased means of production is carried out in regular installments, while ownership never passes to the debtor.

Long-term finance (for a period of more than five years) are used to purchase land, real estate and long-term investments.

Funds are allocated in the following forms:

• 1) long-term (mortgage) loans - provision of funds by insurance companies or pension funds under a mortgage (secured by land plots, buildings). Such loans are issued for a period of 25 years;
• 2) bonds - debt obligations issued in exchange for a loan received with a specified interest and repayment period. A significant portion of bonds have a specific maturity date and are usually issued at face value;
• 3) issue of shares - receipt of funds through the sale of various types of shares. The sale can be carried out by private or public subscription to shares.

The emergence of this classification of sources is due to the peculiarities of intra-company planning abroad. Intra-company planning can be long-term, medium-term and short-term.

The organization of intra-company planning is shown in Fig. 6.3.

When determining the need for financial resources necessary to finance the activities of an enterprise, the following main points must be taken into account:

■ specific purposes for which funds are required and the period (short-term or long-term);

■ specific deadlines;

■ sources of financing (can the necessary funds be found within the enterprise or will it be necessary to turn to other sources);

■ costs of paying debts.

Only after a detailed study of each of the above points is the choice of the most appropriate source of funds made.

With the transition of the Russian economy to market economic principles, enterprises faced the problem of providing production with financial resources. If in a planned economy, enterprises, in case of failure, could count on the help of the state with its system of redistribution of financial resources, then in modern economic conditions the solution to the issue of survival and prosperity is in the enterprise’s own hands.

Financing of business firms is a set of forms and methods, principles and conditions for financial support for simple and expanded reproduction. Financing refers to the process of generating funds or, more broadly, the process of generating capital for a firm in all its forms. The concept of “financing” is quite closely related to the concept of “investing”; if financing is the formation of funds, then investing is their use. Both concepts are interrelated, but the first precedes the second. It is impossible for a company to plan any investments without having sources of financing. At the same time, the formation of a company's financial resources occurs, as a rule, taking into account the plan for their use.

When choosing sources of financing for an enterprise, it is necessary to solve five main problems:

Determine short- and long-term capital needs;

Identify possible changes in the composition of assets and capital in order to determine their optimal composition and structure;

Ensure continued solvency and, therefore, financial stability;

Use your own and borrowed funds with maximum profit;

Reduce the cost of financing business activities.

The financial resources of a business firm can be defined as the totality of its own cash income and outside receipts at the disposal of the company and intended to fulfill its financial obligations, finance current costs and costs associated with the expansion of production.

Capital is a stock of economic goods accumulated through savings in the form of cash and real capital goods, involved by its owners in the economic process as an investment resource and a factor of production in order to generate income, the functioning of which in the economic system is based on market principles and is associated with time factors, risk and liquidity.

The term “capital” comes from the Latin “capitalis”, which means basic, main.

The financial resources of a business firm, by their origin, are divided into own and borrowed. Own financial resources are formed from internal and external sources. Among internal sources, the main place belongs to profit remaining at the disposal of the company, which is distributed by decision of the management bodies.

An important role in the composition of internal sources is also played by depreciation charges, which represent the monetary expression of the cost of depreciation of fixed assets and intangible assets and are an internal source of financing for both simple and expanded reproduction.

As part of external (attracted) sources for the formation of own financial resources, the main role belongs to the additional issue of securities, through which the company’s share capital is increased, as well as the attraction of additional share capital through additional contributions to the authorized capital.

For some enterprises, an additional source of formation of their own financial resources is the gratuitous financial assistance provided to them. In particular, these can be budgetary allocations on a non-repayable basis; as a rule, they are allocated to finance government orders, individual socially significant investment programs, or as state support for enterprises whose production is of national importance.

Other external sources include tangible and intangible assets donated to firms and included in their balance sheet.

One of the main characteristics of the classification of an enterprise’s capital is the characteristic of the title of ownership of the capital being formed. According to the title of ownership, the capital formed by an enterprise is divided into two main types - own and borrowed. In the system of sources of attracting capital, this division is decisive.

Equity capital characterizes the total value of the enterprise's funds owned by it and used by it to form a certain part of its assets. This part of the assets, formed from the equity capital invested in them, represents the net assets of the enterprise.

Borrowed capital characterizes funds or other property assets raised to finance the development of an enterprise on a repayable basis. All forms of borrowed capital used by an enterprise represent its financial obligations that must be repaid within the stipulated time frame.

Enterprise capital management is aimed at solving the following main tasks:

Formation of a sufficient amount of capital to ensure the necessary pace of economic development of the enterprise;

Optimization of the distribution of generated capital by type of activity and areas of use;

Providing conditions for achieving maximum return on capital at the envisaged level of financial risk;

Ensuring minimization of financial risk associated with the use of capital at the envisaged level of its profitability;

Ensuring the constant financial balance of the enterprise in the process of its development;

Ensuring a sufficient level of financial control over the enterprise on the part of its founders;

Ensuring sufficient financial flexibility of the enterprise;

Optimization of capital turnover;

Ensuring timely reinvestment of capital.

Let's consider the classification of financial resources of enterprises based on the sources of their formation (Fig. 1.1). The basis is the division of financial resources of enterprises into their own and attracted ones.

Rice. 1.1

Own financial resources of enterprises are formed from profits from sales of products (works, services), profits from other sales, and other operating income. The sources of own financial resources also include the personal funds of the owner and initial contributions of the founders. Enterprises and organizations rely primarily on their own sources in their activities. However, it should be noted that this source limits the growth of the enterprise, since it depends on the rate of growth of profits (owner deposits) Belovitskaya A.A. Financial support for the activities of small businesses / Abstract of thesis. ...cand. eq. Sci. Saratov, 2008..

In accordance with this classification, the attracted financial resources of enterprises are divided into three large groups: borrowed funds, government support funds and funds coming from third parties.

Attracted financial resources are formed on the basis of the redistribution of funds between business entities and characterize the degree of interaction of the enterprise with them. The sources of borrowed financial resources of enterprises are loans from commercial banks and non-banking organizations, loans, and private loans.

Financial resources in the form of government support can be allocated to a special group. Today, the state is beginning to increasingly influence the activities and financial stability of enterprises and organizations, both in the form of direct and indirect financial support in order to encourage and stimulate business investment activity. In this regard, it is advisable to allocate this type of financial resources into a separate group, including due to the fact that these sources often have a non-market nature associated with protectionist government policy, and also pursue social, political and other goals. The source of their formation is funds that are provided on a reimbursable basis and require their return - budget loans, interest-free loans, short-term loans, lending programs. Sources also include funds provided free of charge for the purpose of more efficient redistribution of resources between sectors of the economy, as well as for solving other socio-economic problems. Among these forms of support, one can highlight subventions, subsidies, subsidies (budget allocations, budget investments).

The source of funds raised from third parties are resources received from legal entities and individuals, receipts from industry and research funds, charitable contributions, financial resources coming from unions, associations, industry regional structures, grants from public organizations, international organizations, charitable foundations and others. Braschey A.A. Problems of financing small businesses in Russia at the present stage / Finance, money circulation and credit: Almanac. Issue 2. - Saratov: SGSEU, 2007.

This classification reflects the specifics of financial support for business activities, because own funds are the backbone of enterprises’ activities, and attracted funds from state support are primarily focused on supporting business entities. Also, this classification determines the nature of interaction of enterprises and organizations with the external environment and facilitates the management of financial resources.