The composition of the economic resources used by the organization is different. Of particular importance for the successful operation of an organization is the presence of a certain supply of funding sources.
Sources of finance are the financial resources used to purchase assets and carry out transactions.
Sources of financing include short-term and long-term debt, preferred and ordinary shares (balance sheet liability).
An analysis of the structure of the balance sheet liability, which characterizes the sources of funds, shows that their main types are: own and borrowed funds.
Sources of own funds are:
Authorized capital (funds from the sale of shares and share contributions of participants - the total nominal value of all types of shares, i.e. the authorized capital reflects the amount of all obligations of the company to investors, since in the event of its liquidation or withdrawal of a participant from its shareholders, the investor has the right only to compensation of its share within the residual property of the enterprise); formation authorized capital may be accompanied by the formation of an additional source of funds - share premium, if during the primary issue the shares are sold at a price above par;
Reserves accumulated by the enterprise, including retained earnings;
Mobilization of internal assets (in progress) capital construction the company may generate specific sources of financing, for example, the sale of part of its current assets);
Other contributions from legal and individuals(targeted funding, donations, charitable contributions, etc.).
The main sources of borrowed funds are:
Bank loans;
Postponement tax payment;
Borrowed funds from other companies (loans to legal entities against debt obligations - promissory notes);
Funds from the sale of bonds (registered and bearer) and other securities to other companies;
Accounts payable (commercial loan);
Leasing (financial transaction for the use of property through rent).
The fundamental difference between the sources of own and borrowed funds lies in the legal content - when a company is liquidated, its owners have the right to that part of the enterprise’s property that will remain after settlements with third parties.
The essence of the difference between equity and borrowed funds is that interest payments are deducted before taxes, that is, included in expenses, and dividends on shares of owners are deducted from profits after interest and taxes.
Depending on the duration of existence, the organization’s assets, as well as sources of funds, are divided into short-term (current) and long-term. Short-term sources include sources of financing raised for a period of less than 1 year. Long-term sources are equity capital and borrowed capital raised for a period of more than 1 year.
Own and borrowed capital are characterized by positive and negative features that affect the activities of the enterprise.
Own capital is characterized by the following positive features:
1. Ease of attraction, since decisions related to increasing equity capital (especially through internal sources of its formation) are made by the owners and managers of the organization without the need to obtain the consent of other business entities.
2.Higher ability to generate profit in all areas of activity, since its use does not require payment of loan interest in all its forms.
3. Ensuring the financial sustainability of the organization’s development, its solvency in the long term, and, accordingly, reducing the risk of bankruptcy.
At the same time, equity capital also has negative features:
1. Limitation of the volume of attraction, and therefore the possibility of significantly expanding the operating and investment activities of the organization during periods of favorable market conditions.
2. High cost in comparison with alternative borrowed sources of capital formation.
3. The unused opportunity to increase the return on equity ratio by attracting borrowed financial resources, since without such attraction it is impossible to ensure that the financial profitability ratio of the organization’s activities exceeds the economic one.
Thus, an organization that uses only its own capital has the highest financial stability (the autonomy coefficient is equal to one), but limits the pace of its development (since it cannot ensure the formation of the necessary additional volume of assets during periods of favorable market conditions) and does not use financial opportunities increase in profit on invested capital.
Borrowed capital is characterized by the following positive features:
1. Quite wide opportunities for attraction, especially with high credit rating organization, the presence of collateral or a guarantee of the recipient.
2. Ensuring the growth of the financial potential of the organization if it is necessary to significantly expand its assets and increase the growth rate of the volume of its economic activities.
3. Lower cost in comparison with equity capital due to the provision of a “tax shield” effect (withdrawal of costs for its maintenance from the tax base when paying income tax).
4. The ability to generate an increase in financial profitability (return on equity ratio).
At the same time, the use of borrowed capital has the following negative features:
1. The use of this capital generates the most dangerous financial risks in the organization’s activities - the risk of reduced financial stability and loss of solvency. The level of these risks increases in proportion to the increase in the share of borrowed capital used.
2. Assets formed from borrowed capital generate a lower (all other things being equal) rate of profit, which is reduced by the amount of loan interest paid in all its forms (interest on a bank loan; leasing rate; coupon interest on bonds; bill interest on goods loan, etc.).
3. High dependence of the cost of borrowed capital on fluctuations in financial market conditions.
In some cases, for example, when the average loan interest rate in the market decreases, the use of a previously obtained loan (especially on a long-term basis) becomes unprofitable for the organization due to the availability of cheaper alternative sources of credit resources.
4. The complexity of the recruitment procedure (especially in large sizes), since the provision of credit resources depends on the decisions of other economic entities (creditors), in some cases requires appropriate third-party guarantees or collateral (in this case, guarantees from insurance companies, banks and other organizations are provided, as a rule, on a paid basis).
Thus, an organization using borrowed capital has a higher financial potential for its development (due to the formation of an additional volume of assets) and the possibility of increasing the financial profitability of its activities, but to a greater extent generates financial risk and the threat of bankruptcy (increasing as the share of borrowed funds increases). funds in the total amount of capital used).
Any organization finances its activities, including investment, from various sources. As payment for the use of financial resources advanced to the organization’s activities, it pays interest, dividends, remuneration, etc., i.e. bears some reasonable costs to maintain its economic potential. As a result, each source of funds has its own value as the sum of the costs of providing this source.
The total amount of funds that must be paid for the use of a certain volume of financial resources, expressed as a percentage of this volume, is called the cost of capital (CC), i.e. The cost of capital is the ratio of the amount of funds that must be paid for the use of financial resources from a certain source to the total amount of funds from this source, expressed as a percentage. In the domestic literature you can find another name for the concept under consideration: price of capital, value of capital, cost of capital, etc.
The “cost of capital” indicator has different economic meaning for individual business entities:
a) for investors and creditors, the level of cost of capital characterizes the rate of return they require on the capital provided for use;
b) for business entities that form capital for the purpose of production or investment use, the level of its value characterizes the specific costs of attracting and servicing the financial resources used, i.e. the price they pay for the use of capital.
With this indicator, the organization estimates how much it should pay to attract a unit of capital (both from a specific source of funds, and for the organization as a whole from all sources).
The concept of cost of capital is one of the basic ones in the theory of capital of an organization. The cost of capital characterizes the level of profitability invested capital necessary to ensure a high market value of the organization. Maximizing the market value of an organization is achieved to a large extent by minimizing the cost of the sources used. The cost of capital indicator is used in the performance assessment process investment projects and the investment portfolio of the organization as a whole.
The cost of capital indicator is used in the process of assessing the effectiveness of investment projects and the organization’s investment portfolio as a whole. Making many financial decisions (forming a policy for financing current assets, deciding on the use of leasing, planning the operating profit of an organization, etc.) is based on an analysis of the cost of capital.
In the process of assessing the cost of capital, the cost of individual elements of equity and debt capital is first assessed, then the weighted average cost of capital is determined.
Determining the cost of capital of an organization is carried out in several stages:
1) identification of the main components that are the sources of formation of the organization’s capital is carried out;
2) the price of each source is calculated separately;
3) the weighted average price of capital is determined based on the share of each component in the total amount of invested capital;
4) measures are being developed to optimize the capital structure and form its target structure.
The cost of capital depends on its source (owner) and is determined by the capital market, i.e. supply and demand (if demand exceeds supply, then the price is set at more high level). The cost of capital also depends on the amount of capital raised.
The main factors that influence the cost of capital of an organization are:
1) the general state of the financial environment, including financial markets;
2) commodity market conditions;
3) the average loan interest rate prevailing in the market;
4) availability of various sources of financing for organizations;
5) profitability of the organization’s operating activities;
6) level of operating leverage;
7) level of concentration of equity capital;
8) the ratio of the volumes of operating and investment activities;
9) the degree of risk of the operations being carried out;
10) industry characteristics of the organization’s activities, including the duration of the operating cycle
The level of cost of capital varies significantly among its individual elements (components). The element of capital in the process of assessing its value is understood as each of its varieties according to individual sources of formation (attraction). Such elements are capital attracted by: 1) reinvesting the profit received by the organization (retained earnings); 2) issue of preferred shares; 3) issue of common shares; 4) obtaining a bank loan; 4) bond issues; 5) financial leasing, etc.
For comparable valuation, the value of each element of capital is expressed as an annual interest rate. The level of value of each element of capital is not a constant value and fluctuates significantly over time under the influence of various factors.
Financing of business organizations 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 the need for short- and long-term capital;
· identify possible changes as part 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.
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:
1. Due to replenishment from the profit of the enterprise, its financial stability;
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). 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 financial independence enterprises and facilitates the conditions for obtaining bank loans in the future. In a market economy, the production and economic activity of a company is impossible without the use of borrowed funds, which include: bank loans, commercial loans, i.e. borrowed funds from other organizations; funds from the issue and sale of shares and bonds of the organization; budgetary allocations on a repayable basis, etc. 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 borrowing resources covers the costs of servicing the loan, financial situation The firm remains sustainable and raising debt capital is efficient. If these indicators are equal, the question arises about the advisability of attracting borrowed sources for the formation of financial resources as they do not provide additional income. In a situation where the cost of servicing accounts payable exceeds the amount of additional income from its use, a deterioration in the financial situation in the organization is inevitable.
Thus, financing based on borrowed capital is not so profitable, since lenders provide funds on the terms of repayment and payment, that is, they do not participate with their money in the equity capital of the enterprise, but act as a lender. Comparison various methods financing allows an enterprise to choose the best option for financial support for current operational activities and covering capital costs.
The organization's financial resources are generated from certain sources. Thus, it is impossible to purchase production equipment, raw materials or materials without having the funds for this. The sources of formation of the organization's financial resources are a set of sources to satisfy the need for capital for the coming period, ensuring the development of the organization. These sources are divided into internal, own and external, borrowed and attracted (see Fig. 1.). There are various classifications of sources of funds. One of the possible and most general groupings is shown in Fig. 1.
Rice. 1. Structure of the enterprise's sources of funds
The main element of the above scheme is equity. The sources of own funds are (see Figure 2.):
Authorized capital (funds from the sale of shares and share contributions of participants);
Reserves accumulated by the enterprise;
Other contributions from legal entities and individuals (targeted financing, donations, charitable contributions, etc.).
The main sources of funds raised include:
Bank loans;
Borrowed funds;
Funds from the sale of bonds and other securities;
Accounts payable.
The fundamental difference between sources of own and borrowed funds lies in legal reason-- in the event of liquidation of an enterprise, its owners have the right to that part of the enterprise's property that remains after settlements with third parties.
When creating an enterprise, contributions to its authorized capital can be cash, tangible and intangible assets. At the moment of transfer of assets in the form of a contribution to the authorized capital, ownership of them passes to the economic entity, i.e. investors lose proprietary rights to these objects.
Thus, in the event of liquidation of an enterprise or withdrawal of a participant from a company or partnership, he has the right only to compensation for his share within the residual property, but not to the return of objects transferred to him at one time in the form of a contribution to the authorized capital. The authorized capital, therefore, reflects the amount of the enterprise's obligations to investors.
The authorized capital is formed during the initial investment of funds. Its value is announced upon registration of the enterprise, and any adjustments to the size of the authorized capital (additional issue of shares, reduction of the par value of shares, making additional contributions, admitting a new participant, joining part of the profit, etc.) are allowed only in cases and in the manner provided for by the current legislation and constituent documents documents.
The formation of authorized capital may be accompanied by the formation of an additional source of funds - share premium. This source arises when, during the initial issue, shares are sold at a price above their par value. Upon receipt of these amounts, they are credited to additional capital.
Profit is the main source of funds for a dynamically developing enterprise. In the balance sheet it is present in an explicit form as retained earnings, and also in a veiled form - as funds and reserves created at the expense of profits. In a market economy, the amount of profit depends on many factors, the main one of which is the ratio of income and expenses. At the same time, the current regulatory documents provide for the possibility of certain regulation of profits by the management of the enterprise. These regulatory procedures include:
Varying the boundary for classifying assets as fixed assets;
Accelerated depreciation of fixed assets;
The applied method of depreciation of low-value and rapidly wearing items;
Procedure for valuation and amortization of intangible assets;
The procedure for assessing participants' contributions to the authorized capital;
Choosing a method for estimating inventories;
The procedure for accounting for interest on bank loans used to finance capital investments;
The procedure for creating a reserve for doubtful debts;
Procedure for attribution to cost products sold certain types of expenses;
Composition of overhead costs and method of their distribution.
Profit is the main source of reserve capital formation. This capital is intended to compensate for unexpected losses and possible losses from business activities, i.e. it is insurance in nature. The procedure for the formation of reserve capital is determined by regulatory documents regulating the activities of an enterprise of this type, as well as its charter documents.
Additional capital as a source of funds for an enterprise is formed, as a rule, as a result of the revaluation of fixed assets and other material assets. Regulatory documents prohibit its use for consumption purposes.
A specific source of funds are special purpose funds and targeted financing: gratuitously received values, as well as irrevocable and repayable government appropriations to finance non-productive activities related to the maintenance of social, cultural and public utility facilities, to finance the costs of restoring the solvency of enterprises that are fully funded by the budget, etc. First of all, the organization focuses on the use of internal sources of financing. Formation of authorized capital, its effective use, management is one of the main and most important tasks financial service organizations. Authorized capital is the main source of the organization's own funds. The amount of the authorized capital of a joint-stock company reflects the amount of shares issued by it, and of a state and municipal enterprise - the amount of the authorized capital. The authorized capital is changed by the organization, as a rule, based on the results of its work for the year after amendments were made to the constituent documents. You can increase (decrease) the authorized capital by issuing additional shares (or withdrawing a certain number of them from circulation), as well as by increasing (decreasing) the par value of old shares.
Additional capital includes:
1) results of revaluation of fixed assets;
2) share premium of the joint-stock company;
3) money received free of charge and material assets for production purposes;
4) budget allocations to finance capital investments;
5) funds to replenish working capital.
Retained profit is profit received in a certain period and not directed during its distribution for consumption by owners and staff. This part of the profit is intended for capitalization, that is, for reinvestment in production. In terms of its economic content, it is one of the forms of reserve of the organization’s own financial resources that provide it industrial development in the coming period.
NIZHNY NOVGOROD INSTITUTE OF MANAGEMENT AND BUSINESS
Department of Finance
Coursework
by discipline
Financial management
“Sources of financing of the organization, their structure and optimization”
Completed by: full-time student,
4 courses, specialty "Finance and Credit", FEF
Checked:
Nizhny Novgorod, 2010
Introduction………………………………………………………………………………….3
Chapter 1. Sources and methods of financing the organization’s activities..5
Chapter 2. Management of the organization’s own and borrowed capital…….16
Chapter 3. Optimization of the structure of funding sources entrepreneurial activity…………………………………………..27
Conclusion………………………………………………………………………………...32
List of sources and literature used………………………….34
Applications
Introduction
Sources of financing are the functioning and expected channels for obtaining financial resources, as well as a list of economic entities that can provide these financial resources. The basis of the project financing strategy is to develop financing schemes based on the individual characteristics of the project and the factors influencing it.
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 constant solvency and, therefore, financial stability;
· use own and borrowed funds with maximum profit;
· reduce the cost of financing business activities.
The relevance of this work lies in the fact that business managers are currently faced with the problem of choosing a source of financing.
Main goal course work consists in studying the main sources of financing, their types, features.
The object of research for writing this work is sources of funding.
When writing this course work, the following tasks were set:
1. Consider the main sources of financing, their essence and types;
2. Study the main methods of financing
3. Consider the financing process using the example of a real enterprise.
The work has a traditional structure and includes an introduction, a main part consisting of 3 chapters, a conclusion and a bibliography.
Chapter 1. Sources and methods of financing the organization’s activities.
Financing the economic activities of an enterprise is a set of forms and methods, principles and conditions for financial support for simple and expanded reproduction.
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.
Organizational forms of financing :
Self-financing (retained earnings, depreciation, reserve capital, additional capital, etc.).
Equity or equity financing (participation in authorized capital, purchase of shares, etc.).
Debt financing (bank loans, placement of bonds, leasing, etc.).
Budgetary financing (loans on a repayable basis from the federal, regional and local budgets, appropriations from budgets of all levels on a gratuitous basis, targeted federal investment programs, government borrowing, etc.).
Special forms of financing (project financing, venture financing, financing by attracting foreign capital).
The initial source of financing for any enterprise is authorized (share) capital (fund), which is formed from the contributions of the founders. Specific methods of forming authorized capital depend on the organizational and legal form of the enterprise. Minimum value The authorized capital on the day of registration of the company is:
In a limited liability company (LLC) - 100 minimum wages (minimum wage). Federal law dated June 19, 2000 No. 82-FZ “On minimum size wages” the minimum wage is calculated at 100 rubles;
In a closed joint-stock company (CJSC) – 100 minimum wages;
In an open joint-stock company (OJSC) - at least 1000 minimum wages.
The founders of a joint-stock or other company are required to fully contribute the authorized capital during the first year of activity.
The sources of formation of the enterprise's own financial resources are divided into external and internal sources. Internal sources include profit remaining at the disposal of the enterprise, depreciation charges from its own fixed assets used , other internal sources of financial resources. External sources include attracting additional share or equity capital, and receiving gratuitous financial assistance by the enterprise.
Own capital structure
retained earnings is a reinvested source of own funds for replacing equipment and new investments.
The profit of an enterprise depends on the ratio of income received as a result of its activities with the expenses that provided these incomes. There are gross profit, sales profit, operating profit, profit before tax (according to accounting data), taxable profit (according to tax accounting), undistributed (net) profit of the reporting period, reinvested (capitalized undistributed) profit.
The profit remaining at the disposal of the organization is a multi-purpose source of financing its needs. However, the main directions of profit distribution are accumulation and consumption, the proportions between which determine the development prospects of the enterprise.
The formation of accumulation and consumption funds, as well as other monetary funds, may be provided for by the constituent documents and adopted accounting policy enterprises, then their creation is mandatory, or the decision to direct profits to these funds is made by a meeting of shareholders on the recommendation of the board of directors (participants).
Profit is also the main source of formation of reserve capital (fund).
Reserve capital - part of the equity capital allocated from profits to cover possible losses. The source of reserve capital formation is net profit, that is, the profit remaining at the disposal of the organization.
Only joint-stock companies must create a reserve fund. The minimum size of the reserve fund is 5% of the authorized capital. In this case, the amount of annual mandatory contributions to the reserve fund cannot be less than 5% of net profit until the amount established by the company’s charter is reached.
The funds of the company's reserve fund are used:
To cover the company's losses;
Bond redemptions;
Redemption of shares of a joint stock company in the absence of other funds.
Reserve capital cannot be used for other purposes.
Depreciation charges. Depreciation is a method of reimbursing capital spent on the creation and acquisition of depreciable assets by gradually transferring the cost of fixed assets and intangible assets to manufactured products.
Depreciation functions are divided into economic And tax .
Tax depreciation is determined in accordance with the Tax Code of the Russian Federation and its role is to reduce taxable profit.
Accounting depreciation may be greater than tax depreciation depending on how it is determined under applicable accounting standards.
Depreciation charges fixed assets are included in the cost of production according to established standards to the book value of fixed assets. Fixed assets are grouped depending on their duration beneficial use, and depreciation rates are applied to the cost of each group.
For accounting purposes, there are four ways to calculate depreciation of fixed assets:
1. linear;
2. reducing balance;
3. write-off of cost based on the sum of the numbers of years of useful life;
4. write-off of cost in proportion to the volume of production.
The chosen method of calculating depreciation is fixed in the accounting policy of the organization and is applied throughout the entire service life of the fixed asset.
Additional issue of shares leads to a decrease in the property of existing shareholders, and therefore can only be done with their consent at a general meeting. If, when establishing a company, payment of shares in the amount of 50% is allowed at the time of registration, and the remaining amount - within a year, then when issuing additional shares, at least 25% of the par value of their acquisition is paid, and the remaining amount - no later than a year from the date of their placement . In accordance with the legislation of the Russian Federation, nominal
the cost of placed preferred shares should not exceed 25% of the authorized capital of the company.
Placement of securities(shares, bonds) on the primary securities market is carried out in two forms:
Through an intermediary,
By directly contacting investors, i.e. direct sale of enterprise securities to investment funds (firms) and individuals.
Disadvantages of equity financing:
An additional issue of shares is a very expensive and time-consuming process;
Emission may be accompanied by a decline market price shares of the issuing company;
There is no tax shield.
Additional capital is a specific own source of financing for the organization's enterprise. Unlike the authorized capital, it is not divided into shares (shares) and shows the common ownership of all participants (shareholders).
The formation and increase of additional capital can be carried out in the following cases:
1. Upon receipt of share premium.
2. When revaluing fixed assets.
3. If exchange rate differences arise as a result of the formation of authorized capital expressed in foreign currency.
4. When receiving targeted investment funds from the budget to finance capital investments (for non-profit organizations).
Bank loans. The loan can be provided in cash or commodity form on the terms of urgency, payment, repayment and material security.
The principal amount of debt for a loan or credit received is taken into account by the borrowing organization in accordance with the terms of the loan agreement (or credit agreement) in the amount of funds actually received or in the valuation of other things provided for in the agreement.
When considering the option of raising funds using a long-term loan, an enterprise chooses a bank that offers a lower interest rate, all other things being equal. The terms of the loan agreement are optimal for both parties if the transaction is based on market level interest rate , which allows us to equate the market value of capital received in exchange for debt and the present value of future payments on it.
The interest on the loan is determined by adding a premium to the base rate. The base rate is set by each bank individually, based on the discount rate of the Central Bank of Russia. The premium depends on the term of the loan, the quality of the collateral and the degree of credit risk associated with its provision.
As loan collateral accepted:
Pledge of property,
Surety,
State and municipal guarantees,
Assignment in favor of the bank of the borrower's claims and accounts to a third party.
Despite a number of disadvantages for the enterprise (on the one hand, the deterioration of the structure of the organization’s liabilities, the need for temporary and financial costs for the preparation of a qualified business plan, for the development loan application in a commercial bank), bank long-term lending is still one of the most effective ways of financing. For an enterprise, the presence of long-term borrowed funds among the sources of its property is positive thing, since this allows you to have raised funds for a long time. Long-term loans by Russian enterprises can be obtained from both Russian and foreign banks.
A commercial loan is a deferment of payments from one business entity to another. Forms of commercial credit - advance, prepayment, deferment and installment payment for goods and services. Used by entrepreneurs engaged in certain related activities, for example, producers-sellers and consumers-buyers of the same product. The object of a commercial loan is funds in commodity form.
The credit document when applying for a commercial loan is a bill of exchange. Commercial loans can also be made through an open account. Open account is a “bill-free” form of commercial lending, special shape settlement relations between entrepreneurs carrying out mutual deliveries, i.e. being permanent counterparties to various transactions. tactically, enterprises open credit lines to each other, within which mutual supplies are made. Investment tax credit - deferment of tax payment provided by authorities state power or tax authorities.
A bonded loan is a loan that involves the borrower issuing debt obligations in the form of bonds.
A bond is an issue-grade security that secures the right of its holder to receive from the issuer of the bond, within the period specified by it, its nominal value and the percentage of this value or other property equivalent fixed in it. Bondholders have no ownership or equity interest in the firm or institution that issued the bond.
Bonds are a constant (in value) claim on the issuer's profit (determined by the amount of periodically paid interest), as well as a fixed claim on the issuer's assets (equal to the repayment amount). Bonds typically pay interest every six months. However, there are exceptions to this rule: in some cases, the interest payment interval is reduced to one month, and very rarely the payment is made once a year. The amount of interest paid depends on the coupon.
The book value of a bond loan, as a rule, does not coincide with its market value. The assessment of the market value of bonds is based on a number of data indicated on the bond itself: official issue date, par value, maturity date, announced interest rate, interest payment date. Enterprises issuing loans strive to bring the announced interest rate on the bond as close as possible to the market rate in effect at the time the loan is issued. Changes in the market interest rate and the market value of the issuing company's loan are inversely related. If the market interest rate exceeds the announced value, then the placed bonds are sold at a discount ( discount), and in the opposite situation, it is added to their cost bonus. Joint stock companies and limited liability companies are allowed to issue bonds. According to Russian legislation, there are a number of restrictions on the issue of bonds. Depending on the volume of output and the preparedness of the enterprise for emission, it is possible to use various techniques placement of bonds.
Leasing is an extended lease agreement. The owner of the equipment (lessor) provides the user (lessee) with the opportunity to operate the equipment in exchange for regular rental payments. Leasing relationships essentially act as credit transactions, since the lessee receives for temporary use the value embodied in machinery and equipment on the terms of repayment and payment.
Chapter 2. Management of the organization’s own and borrowed capital
Managing equity capital involves managing the process of its formation, maintenance and effective use, that is, managing already formed assets. This involves both managing equity capital as a whole and managing its structural elements.
Own capital management should be preceded by a study of the effectiveness of its management in the previous period. Analysis is necessary to determine reserves for the formation of own funds.
The basis for managing an enterprise's own capital is managing the formation of its own financial resources. In order to ensure effective management By this process, the enterprise usually develops a special financial policy aimed at attracting its own financial resources from various sources in accordance with the needs of its development in the coming period.
The main objectives of equity capital management are:
Determining the appropriate amount of equity capital;
Increasing, if required, the amount of equity capital through retained earnings or additional issue of shares;
Determining the rational structure of newly issued shares;
Determination and implementation of dividend policy.
The development of a policy for the formation of an enterprise’s own financial resources is carried out according to the following main stages.
Analysis of the formation of the enterprise's own financial resources in the previous period. The purpose of such an analysis is to identify the potential for generating one’s own financial resources and its compliance with the pace of development of the enterprise.
2. Determination of the total need for own financial resources. The calculated total need covers the required amount of own financial resources generated both from internal and from external sources.
3. Estimation of the cost of raising equity capital from various sources. This assessment is carried out in the context of the main elements of equity capital formed from internal and external sources. The results of such an assessment serve as the basis for the development of management decisions regarding the selection of alternative sources for the formation of its own financial resources, ensuring an increase in the enterprise’s own capital.
4. Ensuring the maximum volume of attraction of own financial resources from internal sources.
5. Ensuring the necessary volume of attracting own financial resources from external sources. The volume of attraction of own financial resources from external sources is intended to ensure that part of them that could not be formed through internal sources of financing. If the amount of own financial resources attracted from internal sources fully meets the total need for them in the planning period, then there is no need to attract these resources from external sources.
6. Optimization of the ratio of internal and external sources of formation of own financial resources. This optimization process is based on following criteria:
Ensuring the minimum total cost of attracting own financial resources;
Ensuring that the original founders retain control of the enterprise.
Management of an enterprise's own capital also includes determining the optimal ratio between its own and borrowed financial resources.
Although the basis of any business is equity capital, in enterprises in a number of sectors of the economy the volume of borrowed funds used significantly exceeds the volume of equity capital. In this regard, managing the attraction and effective use of borrowed funds is one of the most important functions financial management aimed at ensuring the achievement of high final results of the enterprise’s economic activity.
Borrowed capital used by an enterprise characterizes in aggregate the volume of its financial liabilities (total amount of debt). These financial obligations in modern economic practice are differentiated as follows:
1. Long-term financial liabilities (borrowed capital with a term of use of more than 1 year).
2. Short-term financial liabilities (all forms of borrowed capital with a period of up to 1 year).
In the process of development of an enterprise, as its financial obligations are repaid, the need arises to attract new borrowed funds. The sources and forms of raising borrowed funds by an enterprise are very diverse. Borrowed funds are classified by purpose, source, form and period of attraction, as well as by the form of security.
Taking into account the classification of borrowed funds, methods for managing their attraction are differentiated.
Managing the attraction of borrowed funds is a targeted process of their formation from various sources and in different forms in accordance with the enterprise's needs for borrowed capital at various stages of its development.
Stages of developing a policy for attracting borrowed funds by an enterprise |
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Analysis of the attraction and use of borrowed funds in the previous period |
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Determining the goals of raising borrowed funds in the coming period |
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Determination of the maximum volume of borrowings |
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Estimation of the cost of raising borrowed capital from various sources |
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Determining the ratio of the volume of borrowed funds raised on a short-term and long-term basis |
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Determination of forms of raising borrowed funds |
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Determination of the composition of the main creditors |
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Formation effective conditions attracting loans |
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Ensuring the effective use of attracted loans |
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Ensuring timely payments for received loans |
The object of study of this course work is the open joint-stock company “Novator”.
The Novator experimental design bureau was created in December 1947 on the basis of the department of the Chief Designer of the Plant named after. M.I. Kalinin (plant No. 8) as OKB-8. The initial specialization was the development of large-caliber anti-aircraft guns. In addition to military orders, OKB Novator developed and commissioned land and sea meteorological missile systems. OKB Novator continues to actively work on creating new models of rocketry that meet the challenges of the time.
JSC Novator has an independent balance sheet, settlement and other accounts. The Company has a round seal containing its full corporate name in Russian and an indication of its location. The Company has the right to have stamps and forms with its corporate name, its own emblem, as well as duly registered trademark and other means of individualization.
Located at: 620017, Russia, Ekaterinburg, Kosmonavtov Ave., 18.
Analysis financial condition JSC OKB Novator
The analysis of the financial condition of the enterprise is carried out according to the financial statements and the profit and loss report for 2008. (Appendix 1 and Appendix 2).
Relative indicators of financial stability.
Provision ratio of own current assets:
SOS=KR-VA, where (2.1)
SOS – own working capital;
OA - current assets;
KR – capital and reserves, the result of section 3;
VA – non-current assets.
The coefficient of provision with own working capital determines the degree of security of the organization with its own working capital necessary for its financial stability, and is calculated as the ratio of the difference between own funds and adjusted non-current assets to the value of current assets.
If the value of the coefficient is greater than or equal to one, the enterprise, at the expense of its own working capital, fully provides its current assets, and has absolute financial stability. The lower the ratio, the more unstable the financial condition of the enterprise. An enterprise reaches a critical financial condition when the ratio is 10% or lower.
We can say that at the beginning of the reporting year, the company had reached a critical financial condition, since the ratio was 2.6%. which is less than 10%. But by the end of the year, it is observed that the enterprise, using its own funds, fully provides its current assets and has almost absolute stability.
Inventory coverage ratio with own working capital:
- recommended value 0.5-0.8, where (2.2)
Z – reserves.
The ratio of the provision of inventories with own sources of financing shows what part of tangible current assets is financed from own capital.
If this ratio is greater than one, then the amount of own working capital exceeds the amount of inventories and costs, and the enterprise has absolute financial stability.
This coefficient shows. That at the end of the reporting year approximately 50% of tangible current assets are financed from equity capital.
Maneuverability coefficient:
(2.3)
The ratio shows what part of equity capital is used for financing current activities, i.e. invested in current assets, and what part is capitalized, i.e. invested in non-current assets.
Permanent Asset Index:
Characterizes the share of fixed assets and non-current assets in sources of equity.
Since the agility coefficient and the index of constant prices in the family give 1, therefore, the organization does not use long-term loans and borrowings.
Autonomy ratio:
, where (2.5)
VB – balance sheet currency.
The autonomy coefficient shows the share of own funds in the total amount of funding sources. Given financial ratio allows you to assess the dependence of the enterprise on external sources of financing, i.e. the ability to carry out activities without additional borrowing capital. On the other hand, the autonomy coefficient shows how much the financial obligations of an enterprise can be covered by its own capital.
By the end of the reporting period, one can see a slight increase in this indicator, by 0.063 or 6.3%, which means that the dependence of own funds on borrowed funds has decreased, which means that there has been an increase in own funds.
Absolute independence coefficient:
, where (2.6)
DO – long-term obligations.
The ratio shows what part of the total value of the enterprise’s assets is formed from the most reliable sources of financing, i.e. does not depend on short-term borrowed funds. Essentially, this is a refined autonomy coefficient.
Financial dependency ratio (debt):
, where (2.7)
KO – short-term liabilities.
The financial dependence ratio of an enterprise means how much the assets of the enterprise are financed by borrowed funds. Too large a share of borrowed funds reduces the solvency of the enterprise, undermines its financial stability and, accordingly, reduces the confidence of counterparties in it and reduces the likelihood of obtaining a loan.
Both at the beginning and at the end of the reporting year, the enterprise has approximately the same dependence on borrowed funds. But we cannot say that the share of borrowed funds reduces the solvency of the organization.
Funding ratio:
(2.8)
The financing ratio provides the most general assessment of an organization's financial strength. It shows how much borrowed funds account for each ruble of equity capital invested in the assets of the enterprise. The growth of this indicator indicates the increasing dependence of the enterprise on borrowed capital, i.e. about some decrease in financial stability, and vice versa.
Shoulder financial leverage:
(2.9)
Financial leverage carries fundamental information for both the entrepreneur and the banker. Large leverage means significant risk for both participants in the economic process.
Investment Rate:
The investment ratio shows the extent to which non-current assets are covered by the enterprise's own capital.
By the end of the reporting year, this indicator increased by 0.172 or 17.2%, which means that equity capital began to cover non-current assets by 17.2%.
Return on equity:
, (2.11)
where Rsk is return on equity,
NPR – net profit
KR – loans and borrowings (in this case the average value is taken).
Return on equity characterizes the efficiency of using the company's own funds invested in the organization. Return on equity shows how much net profit is per ruble of equity.
For 1 ruble of own funds in 2008 there were 5.9 kopecks of net profit.
Impact of Return on Sales:
(2.12)
Driven by sales margins, return on equity decreased by 1.7%.
Chapter 3. Optimization of the structure of sources of financing for entrepreneurial activities
Optimal structure capital represents a ratio of the use of own and borrowed funds that ensures the most effective proportionality between the financial profitability ratio and the enterprise’s financial stability ratio, i.e. its market value is maximized.
The process of optimizing the capital structure of an enterprise is carried out in the following stages:
-Analysis of enterprise capital
-Assessment of the main factors determining the formation of the capital structure
-Optimization of the capital structure according to the criterion of maximizing the level of financial profitability;
-Optimization of the capital structure according to the criterion of minimizing the level of financial risks;
-Optimization of the capital structure according to the criterion of minimizing its cost.
One of the mechanisms for optimizing the capital structure of an enterprise is financial leverage, which allows you to determine the amount of borrowed funds raised by the enterprise per unit of equity capital. An indicator reflecting the level of additionally generated profit on equity capital at different shares of borrowed funds is called financial leverage effect. It is calculated using the following formula:
EGF = (1 - Sn) × (KR - Sk) × ZK/SK,
Where:
EGF- effect of financial leverage, %.
Sn- income tax rate, in decimal expression.
KR- return on assets ratio (ratio of gross profit to average asset value), %.
Sk- average interest rate for a loan, %.
ZK- the average amount of borrowed capital used.
SK- average amount of equity capital.
This formula opens up financial manager ample opportunities to determine the safe amount of borrowed funds, calculate acceptable lending conditions, ease the tax burden for an enterprise, determine the feasibility of purchasing shares of an enterprise with certain values of the differential, leverage and the level of EFR as a whole.
The question arises: “What value of EGF should we strive for?” Many Western economists believe that the golden mean is close to 30 - 50 percent, i.e. The EFR should optimally be equal to one third to half the level of the EFR of assets. Then the EDF is able to, as it were, compensate for tax withdrawals and provide its own funds with a decent return. Moreover, with such a ratio between EFR and ER, shareholder risk is significantly reduced.
When choosing sources of financing for an enterprise, you must:
determine short-term and long-term capital needs;
analyze possible changes in the composition of capital assets in order to determine their optimal structure in terms of volume and type;
ensure continued solvency and, therefore, financial stability;
use your own and borrowed funds as profitably as possible;
reduce the cost of financing business activities.
The calculated financial stability indicators for the period under review indicate that at the beginning of the reporting year, the company had reached a critical financial condition, since the working capital ratio was 2.6%, which is less than 10%. But by the end of the year, it is observed that the enterprise, using its own funds, fully provides its current assets and has almost absolute stability. At the end of the reporting year, approximately 50% of the organization's tangible current assets are financed from its own capital. At the beginning of the period, 2.3% of equity capital, and at the end, 16.4% was already invested in current assets. A low value of the agility indicator (below 50%) means that a significant part of the enterprise’s own funds is secured in immobile assets, which are less liquid, i.e. cannot be converted into cash quickly enough. Since the agility coefficient and the constant price index together give 1, therefore, the organization does not use long-term loans and borrowings. By the end of the reporting period, one can see a slight increase in the autonomy indicator, by 0.063 or 6.3%, which means that the dependence of own funds on borrowed funds has decreased, which means that there has been an increase in own funds. Both at the beginning and at the end of the reporting year, the enterprise has approximately the same dependence on borrowed funds. But we cannot say that the share of borrowed funds reduces the solvency of the organization. By the end of the reporting year, the investment indicator increased by 0.172 or 17.2%, which means that equity capital began to cover non-current assets by 17.2%.
Development using only one's own resources reduces some financial risks in business, but at the same time greatly reduces the rate of increase in the size of the business, especially revenue. On the contrary, attracting additional debt capital with the right financial strategy and quality financial management can dramatically increase the income of company owners on their invested capital. The reason is that an increase in financial resources, with proper management, leads to a proportional increase in sales and often net profit. This is especially true for small and medium-sized companies.
However, a capital structure overloaded with borrowed funds places excessively high demands on its profitability, since the probability of non-payments increases and the risks for the investor increase. In addition, the company's clients and suppliers, noticing a high share of borrowed funds, may begin to look for more reliable partners, which will lead to a drop in revenue. On the other hand, too low a share of debt capital means underutilization of a potentially cheaper source of financing than equity capital. This structure results in higher capital costs and higher return requirements for future investments.
The optimal capital structure is a ratio of own and borrowed sources that ensures the optimal ratio between the levels of..., i.e. The market value of the enterprise is maximized. When optimizing capital, every part of it must be taken into account.
Own capital is characterized by the following additional points:
1. Ease of attraction (you need a decision from the owner or without the consent of other business entities).
2. High rate of return on invested capital, because No interest is paid on funds raised.
3. Low risk of loss of financial stability and bankruptcy of the enterprise.
Disadvantages of own funds:
1. Limited volume of attraction, i.e. it is impossible to significantly expand economic activity.
2. The opportunity to increase the return on equity by attracting borrowed funds is not used.
Advantages of borrowed capital:
1. Wide possibilities for raising capital (with collateral or guarantee).
2. Increasing the financial potential of the enterprise if it is necessary to increase the volume of economic activity.
3. Ability to increase return on equity.
Disadvantages of debt capital:
1. Difficulty in attracting, because the decision depends on other economic entities.
The need for collateral or guarantees.
2. Low rate of return on assets.
3. Low financial stability of the enterprise.
Based on these features and after analyzing the enterprise JSC OKB Novator, we can conclude that if the management of the enterprise uses borrowed capital, it will have higher potential and the possibility of increasing the return on equity capital, but at the same time its financial stability will be lost. But if management decides to use equity capital as a source of financing, then financial stability, on the contrary, will be the highest, but the possibilities for profit growth will be limited.
Conclusion
Financing refers to the process of generating funds or, more broadly, the process of generating capital for an enterprise in all its forms.
Classification of funding sources varied and can be produced according to the following signs:
According to property relations, own and borrowed sources of financing are distinguished.
By type of property, state resources, funds of legal entities and individuals, and foreign sources are distinguished.
According to time characteristics, sources of financing can be divided into short-term and long-term.
As part of internal sources of formation of own financial resources. The main place belongs to the profit remaining at the disposal of the enterprise - it forms the predominant part of its own financial resources.
Depreciation charges also play a certain role in the composition of internal sources; although they do not increase the amount of equity capital of the enterprise.
Other internal sources do not play a significant role in the formation of the enterprise's own financial resources.
Among the external sources of formation of its own financial resources, the main place belongs to the attraction by the enterprise of additional share or equity capital. For individual enterprises, one of the external sources of formation of their own financial resources may be the gratuitous assistance provided to them. financial assistance(as a rule, such assistance is provided only to selected state enterprises different levels).
In the context of the transition to a market, non-traditional instruments for financing activities are beginning to be used. Russian enterprises. These include commercial loans, options, collateral transactions, factoring transactions, leasing, etc.
Currently, the financing of enterprises is in an unsatisfactory state due to the lack of own funds for self-financing, the lack of sufficient government financial support, the high cost and riskiness of innovation, the long-term nature of the payback of innovative projects and the dominance of conservative investors instead of aggressive ones. For further successful development Russian companies it is necessary to solve two problems: the first is to optimize sources of financing for the development of new projects; the second is to learn to select such innovative projects, which will bring real results even in times of crisis.
Chapter 2 of the study is devoted to the analysis of the capital structure of Novator OJSC. In general, the study is aimed at studying modern concepts capital management and their application to determine the optimization of the structure of financing sources of Novator OJSC. The conducted research allows us to formulate the conclusion that the management of the enterprise needs to consider all possible options obtaining long-term loans to improve production.
List of sources and literature used
1. Federal Law of June 19, 2000 No. 82-FZ “On the minimum wage” // Collection of legislation Russian Federation- June 26, 2000, - No. 26, - Art. 2729.
2. Kovaleva A.M., Lapusta M.G., Skamai L.G. Company finances. – M.: INFRA – M, 2007. – P. 212.
3. Sheremet A.D. Enterprise finance: management and analysis - M. Finance 2006. - P. 156
4. Stock market: Tutorial for higher educational institutions of economic profile N.I. Berzon, E.A. Buyanova, M.A. Kozhevnikov, A.V. Chalenko Moscow: Vita-Press, 2008
5. Lukasevich I.Ya. Analysis of financial transactions. Methods, models, computing techniques: – M.: Finance, UNITI, 2008. – P. 203
6. Blank I. A. Financial management: training course. – 2nd ed., revised. and additional – K..: Elga, Nika – Center, 2005. – 656 p.
7. Financial management: textbook / Ed. E.I. Shokhina. – M.: ID FBK-PRESS, 2008. – 408 p.
8. Economic analysis financial and economic activity/Ed. M.V.Melnik. – M.: Economy, 2006. – 320 p.
10. Balance sheet of JSC OKB Novator for 2008 (Form 1)
11. Profit and loss report of JSC OKB Novator for 2008 (form 2).
Kovaleva A.M., Lapusta M.G., Skamai L.G. Company finances. – M.: INFRA – M, 2007. – P. 212.
Federal Law of June 24, 2008 N 91-FZ “On Amendments to Article 1 of the Federal Law “On the Minimum Wage” [Text]// Collection of Legislation of the Russian Federation - 06/30/2008. - N 26. - Art. 3010.
Sheremet A.D. Enterprise finance: management and analysis - M. Finance 2006. - P. 156
Stock market: Textbook for higher educational institutions of economic profile N.I. Berzon, E.A. Buyanova, M.A. Kozhevnikov, A.V. Chalenko Moscow: Vita-Press, 2008
Lukasevich I.Ya. Analysis of financial transactions. Methods, models, computing techniques: – M.: Finance, UNITI, 2008. – P. 203
Financing the activities of organizations 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.
Internal financing involves the use of those financial resources, the sources of which are generated in the process of the financial and economic activities of the organization (net profit, depreciation, accounts payable, reserves for future expenses and payments, deferred income).
At external financing funds coming into the organization from the outside world are used. Sources of external financing can be founders, citizens, the state, financial and credit organizations, and non-financial organizations.
The following are distinguished: sources of funding:
· Internal sources of the enterprise (net profit, depreciation, sale or lease of unused assets).
· Raised funds (foreign investment).
· Borrowed funds (credit, leasing, bills).
· Mixed (complex, combined) financing.
Internal financing involves the use of own funds and, above all, net profit and depreciation charges.
Own capital includes:
Authorized capital (formed as a result of the contribution of the founders of the company upon its creation)
Additional capital (formed as a result of revaluation of the organization’s fixed assets)
Reserve capital (formed by deductions from the organization’s profits for subsequent unforeseen needs)
Financing from own funds has a number of advantages:
1) due to replenishment from the profit of the enterprise, 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 forgiven, 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 funding provides for the use of funds from the state, financial and credit organizations, non-financial companies and citizens: bank loans, commercial loans, i.e. borrowed funds from other organizations; funds from the issue and sale of shares and bonds of the organization; budgetary allocations on a repayable basis, etc.
Allows you to accelerate the turnover of working capital, increase the volume of business transactions, and reduce the volume of work in progress. However, it leads to the emergence of certain problems associated with the need for subsequent servicing of assumed debt obligations.
Credit - a loan in monetary or commodity form provided by the lender to the borrower on the terms of repayment, most often with the borrower paying interest for using the loan. This form of financing is the most common. Advantages of the loan:
Greater independence in the use of received funds without any special conditions;
· most often, a loan is offered by a bank that services a specific enterprise, so the process of obtaining a loan becomes very efficient.
To the disadvantages The loan may include the following:
· loan term in in rare cases exceeds 3 years, which is prohibitive for enterprises aimed at long-term profit;
· to obtain a loan, an enterprise must provide collateral, often equivalent to the amount of the loan itself;
· with this form of finance, an enterprise can use a standard depreciation scheme for purchased equipment, which obliges it to pay property tax for the entire period of use.
Leasing 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 .
· Leasing allows an enterprise that does not have significant financial resources to begin implementing a large project.
It is easier to get a leasing contract than a loan - after all, the equipment itself serves as security for the transaction. A leasing agreement is more flexible than a loan. A loan always involves limited amounts and repayment terms. When leasing, an enterprise can calculate its income and work out with the lessor an appropriate financing scheme that is convenient for it. Leasing does not increase debt on the company’s balance sheet and does not affect the ratio of equity and borrowed funds, i.e. does not reduce the enterprise’s ability to obtain additional loans. Leasing payments paid by the enterprise are entirely attributed to costs production.
33. Factors determining the structure of funding sources.
Capital any enterprise can be represented by two components: own and borrowed funds.
Included equity two main components can be distinguished: invested capital, i.e. capital invested by the owners in the enterprise, and accumulated capital, i.e. created by the enterprise in excess of what was originally advanced by the owners.
Invested capital V joint stock companies includes the par value of common and preferred shares, as well as additionally paid (in excess of the par value of the shares) capital. The first component of invested capital is represented in the balance sheet of joint-stock enterprises by authorized capital, the second - by additional capital (in terms of share premium).
Accumulated capital is reflected in the form of items arising from the distribution of net profit (reserve fund, accumulation fund, retained earnings, other similar items).
Borrowed funds represent the legal and economic obligations of the enterprise to third parties.
The amount of borrowed funds characterizes possible future withdrawals of the enterprise's funds related to previously assumed obligations. The main types of obligations of the enterprise include:
· long-term and short-term bank loans;
· long-term and short term loans;
· accounts payable of the enterprise to suppliers and contractors, resulting from a gap between the time of receipt of inventory items or consumption of services and the date of their actual payment;
· debt in settlements with the budget arising as a result of the gap between the time of accrual and the date of payment;
· debt obligations of the enterprise to its employees to pay for their labor;
· debt to authorities social insurance and provision;
· debt of the enterprise to other business counterparties.
Borrowed funds are usually classified depending on the degree of urgency of their repayment and the method of security.
By degree of urgency of repayment Liabilities are divided into long-term and current. Funds raised on a long-term basis are usually used to purchase long-term assets, while current liabilities, as a rule, are a source of working capital.
There is a whole a number of factors , affecting the capital structure, which must be taken into account when forming it:
1.rate of increase in enterprise turnover. Increased turnover growth rates also require increased financing. Therefore, with high rates of production growth, enterprises focus on increasing the share of borrowed funds in sources of financing;
2. stability of turnover dynamics. An enterprise with a stable turnover can afford a relatively larger share of borrowed funds in its liabilities;
3. level and dynamics of profitability. It has been noted that the most profitable enterprises have a relatively low share of borrowed funds on average over a long period. The enterprise generates sufficient profit to finance development and pay dividends and manages to a greater extent with its own funds;
4. asset structure. If an enterprise has significant general purpose assets, which by their very nature can serve as collateral for loans, then an increase in the share of borrowed funds in the liability structure is quite logical;
5. severity of taxation. The higher the income tax, the fewer the tax benefits, the more attractive it is for an enterprise to finance from borrowed sources due to the attribution of at least part of the interest on the loan to the cost price. Moreover, the heavier the taxes, the more painfully the enterprise feels the lack of funds and the more often it is forced to turn to credit;
34. Issuance activity of the company.
ISSUE POLICY- part of the general policy for the formation of financial resources of an enterprise, which consists in ensuring the attraction of the required volume from external sources by issuing and placing its own securities (shares, bonds, etc.) on the primary stock market. IN modern conditions Enterprises issue mainly shares for placement on the stock market.
From the perspective of financial management main goal emission policy is to attract the required amount of financial resources on the stock market in the shortest possible time.
The emission process can be represented as several blocks interacting with each other:
Primary issue
Organization of securities circulation and payment of dividends
Withdrawal of securities from circulation
The primary issue takes place when shares are placed among the founders of a joint-stock company when increasing the authorized capital, forming borrowed capital by issuing bonds. The decision to issue securities is made by the management body of the issuer, which has the authority to do so under the law and the charter of the joint-stock company.
The issue of securities includes the following stages:
Issuer's decision to issue securities
Registration of securities issue
Production of securities certificate
Placement of securities
Registration of the report on the results of the issue
The release of securities into circulation by the issuer is carried out through their placement. The placement of issue-grade securities means their alienation by the issuer to the first owners through the conclusion of civil legal transactions.
The development of an effective emission policy of an enterprise covers the following stages:
1. Research into the possibilities of effective placement of the proposed issue of shares.
Analysis of stock market conditions(exchange and over-the-counter) includes characteristics of the state of supply and demand for shares, dynamics of the price level of their quotation, sales volumes of shares of new issues and a number of other indicators.
Assessing the investment attractiveness of your shares is carried out from the perspective of taking into account the prospects for the development of the industry (in comparison with other industries), the competitiveness of manufactured products, as well as the level of indicators of its financial condition (in comparison with industry averages).
As mentioned above, the main internal sources of financing the activities of entrepreneurial firms are profit and depreciation charges. Profit how an economic category reflects the net income created in the sphere 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 of budget formation 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 individual non-profit organizations and institutions social sphere, providing financial 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, ensuring 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 the 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 the enterprise for a certain period, i.e. gross profit consists of:
– profit (loss) from sales of products, services, work performed;
– profit (loss) from other sales;
– 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 the investor when executing 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.
Income from non-operating operations also includes amounts of funds received free of charge from other enterprises in the absence of joint activities, with the exception of funds credited to authorized funds enterprises by its founders in the manner prescribed by law; funds received as gratuitous assistance (assistance) and confirmed by the appropriate certificate; funds received from foreign organizations as gratuitous assistance to Russian education, science and culture; funds received by privatized enterprises as investments as a result of investment competitions (bidding); funds transferred between the main and subsidiaries, provided that the share of the main enterprise is more than 50% in the authorized capital of the subsidiaries; funds transferred for the development of the production and non-production base within one legal entity.
Non-operating expenses include fines, penalties, penalties for violation of the terms of contracts that are recognized by the debtor enterprise; compensable losses caused by the enterprise; losses of previous years identified in the reporting year; amounts of receivables for which the statute of limitations has expired; other debts that are unrealistic to collect; exchange differences arising during the revaluation of property and liabilities denominated in foreign currency in accordance with the established procedure; losses from the write-off of previously awarded debts for theft, for which the writs of execution were returned by the court due to the insolvency of the defendant; losses from theft of material and other assets, the perpetrators of which have not been identified by court decisions; legal expenses, etc.
The total amount of profit received by the enterprise is distributed between the enterprise and the federal, regional and local budgets by paying income tax on taxable profits.
Taxable income- this is the difference between the total (gross profit - in accordance with the Federal Law "On the Profit Tax of Enterprises and Organizations" - and the amount of profit subject to income tax (on securities and from equity participation in joint ventures), as well as the amount of benefits for income tax in accordance with tax legislation, which is periodically revised.
Net profit – profit remaining at the disposal of the enterprise after paying all taxes, economic sanctions and contributions to charitable foundations.
The amount of gross profit is influenced by a combination of many factors, both dependent and independent of business activity. Important factors profit growth, depending on the activities of enterprises, are: an increase in the volume of production in accordance with contractual terms, a reduction in its cost, an increase in quality, an improvement in the range, an increase in the efficiency of use of production assets, and an increase in labor productivity.
Factors that do not depend on the activities of business firms include changes in prices for products sold, regulated government agencies, the influence of natural, geographical, transport and technical conditions on the production and sale of products, etc.
The procedure for the distribution and use of profits in a company is fixed in the company's charter, according to which companies can draw up cost estimates financed from profits, or create special-purpose funds: accumulation funds and consumption funds. The cost estimate financed from profit includes costs for production development and social needs labor collective, on financial incentive workers and charitable purposes.
Expenses associated with the development of production include expenses for research, design, engineering and technological work, financing the development and development of new types of products and technological processes, costs for improving technology and organizing production, modernizing equipment, etc. This group of expenses also includes the costs of repaying long-term bank loans and interest on them, as well as the costs of carrying out environmental protection measures, etc.
Distribution of profits for social needs includes: expenses for the operation of social facilities on the balance sheet of the company; financing the construction of non-production facilities, organization and development of subsidiary agriculture, holding recreational, cultural events, etc.
The costs of material incentives include: one-time incentives for completing production tasks, payment of bonuses, costs of providing material assistance to workers and employees, pension supplements, compensation to employees for the cost of food, etc.
An important role in the composition of internal sources of financing also plays 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.
Depreciation on leased fixed assets is carried out by the lessor (with the exception of depreciation charges made by the lessee on property under a company lease agreement, and in cases provided for in a financial lease agreement).
Depreciation on property under a company lease agreement is calculated by the lessee in the manner adopted for fixed assets owned by the organization. Depreciation of leased property is calculated by the lessor or the lessee, depending on the terms of the leasing agreement.
For fixed assets received under a donation agreement and free of charge during the privatization process, housing stock, external improvement objects and similar forestry, road facilities, specialized navigation facilities and other objects, productive livestock, buffaloes, oxen and deer, perennial plantings that have not reached operational age, as well as for purchased publications (books, brochures, etc.), depreciation is not accrued.
Objects of fixed assets whose consumer properties do not change over time are not subject to depreciation ( land plots, environmental management facilities).
Depreciation charges for an item of fixed assets begin on the 1st day of the month following the month in which this item was accepted for accounting. Depreciation charges are calculated until full repayment the value of this object or the write-off of this object from accounting in connection with the termination of ownership or other property rights. Depreciation charges for an item of fixed assets cease from the 1st day of the month following the month of full repayment of the cost of this item or write-off of this item from accounting.
According to Methodical instructions According to the accounting of fixed assets approved by the Order of the Ministry of Finance of the Russian Federation, depreciation of fixed assets can be carried out using one of the following four methods of calculating depreciation charges:
1) linear;
2) reducing balance;
3) write-off of cost based on the sum of the numbers of years of useful life;
4) write-off of cost in proportion to the volume of products (works).
The use of one of the methods for a group of homogeneous fixed assets is carried out throughout its entire useful life. The accrual of depreciation charges is not suspended during the useful life of fixed assets, except when they are under reconstruction and modernization by decision of the head of the company, and for fixed assets transferred by decision of the head of the organization to conservation for a duration that cannot be less than 3 months.
At linear method, depreciation is calculated evenly, and the annual amount of depreciation is determined from the original cost of the fixed asset and the depreciation rate calculated based on the useful life of this object.
With the method reducing balance the annual amount of depreciation charges is determined from the residual value of the fixed asset item at the beginning of the reporting year and the depreciation rate calculated based on the useful life of this item and the acceleration factor established in accordance with the legislation of the Russian Federation.
The acceleration coefficient is applied according to the list of high-tech industries and efficient types of machinery and equipment established by federal authorities executive branch. By movable property, constituting the object of financial leasing and attributable to the active part of fixed assets, an acceleration factor of no higher than 3 may be applied, in accordance with the terms of the leasing agreement.
The essence of this method is that the share of depreciation charges attributed to the cost of production will decrease with each next year operation of a fixed asset item for which depreciation is calculated using the reducing balance method.
With the method write-off of cost based on the sum of numbers of years of useful life the annual amount of depreciation charges is determined based on the original cost of the fixed asset object and the annual ratio, where the numerator is the number of years remaining until the end of the asset’s service life, and the denominator is the sum of the numbers of years of the asset’s service life.
Depreciation charges for fixed assets during the reporting year are calculated monthly, regardless of the calculation method used, in the amount of 1/12 of the calculated annual amount.
This method of calculating depreciation is preferable because it allows you to write off a large part of the cost of fixed assets at the beginning of operation, then the rate of write-off slows down, which ensures a reduction in production costs.
With the method write-off of cost in proportion to the volume of products (works) depreciation charges are calculated based on natural indicator the volume of production (work) in the reporting period and the ratio of the initial cost of the fixed asset item and the expected volume of production (work) for the entire useful life of the fixed asset item.
This method of calculating depreciation can also be used in the case of seasonal operation of equipment, if the technical documentation provides for the dependence of the service life of the equipment on the number of units of production.
In accordance with the Federal Law of June 14, 1995 No. 88-FZ “On state support of small businesses in the Russian Federation”, small businesses have the right to charge depreciation of fixed assets in an amount twice as high as the norms established for the corresponding types of fixed assets, and also write off additionally as depreciation charges up to 50% of the original cost of fixed assets with a useful life of more than 3 years.
The cost of special tools, special devices and replacement equipment is repaid only by writing off the cost in proportion to the volume of products (works, services). The cost of special tools and special devices intended for individual orders or used in mass production, is allowed to be fully repaid at the time of transfer of the corresponding tools and devices into production.
The cost of items intended for rental under a rental agreement is repaid only in a straight-line manner.
The cost of intangible assets is also repaid by calculating depreciation over the established period of their useful life. For objects for which the cost is repaid, depreciation charges are determined in one of the following ways: linear method based on the standards calculated by the organization based on their useful life; method of writing off cost in proportion to the volume of products (works, services).
For intangible assets for which it is impossible to determine the useful life, depreciation rates are established for 10 years (but not more than the life of the organization). For intangible assets received under a gift agreement and free of charge during the privatization process, acquired using budgetary allocations and other similar means(in terms of the cost attributable to the amount of these funds), and for intangible assets budgetary organizations no depreciation is charged.
Out of four provided for by law In the Russian Federation, two methods of calculating depreciation are accelerated depreciation methods: the sum of numbers of the useful life method and the declining balance method. Despite the great popularity of accelerated depreciation in world practice, it has not received proper distribution in Russia.
This is due to the fact that the use of accelerated depreciation significantly worsens the financial and economic performance of a business firm by increasing the cost of production, since in the first years of operation of the fixed assets, most of them are written off.
In accordance with part two of the Tax Code of the Russian Federation (chapter “Income Tax”), depreciable property is distributed among depreciation groups in accordance with its useful life as follows.
First group– all short-lived property with a useful life from 1 year to 2 years inclusive.
Second group– property with a useful life of more than 2 years up to 3 years inclusive.
Third group– property with a useful life of more than 3 years up to 5 years inclusive.
Fourth group– property with a useful life of over 5 years up to 7 years inclusive.
Fifth group– property with a useful life of over 7 years up to 10 years inclusive.
Sixth group– property with a useful life of over 10 years up to 15 years inclusive.
Seventh group– property with a useful life of over 15 years up to 20 years inclusive.
Eighth group– property with a useful life of over 20 years up to 25 years inclusive.
Ninth group– property with a useful life of over 25 years up to 30 years inclusive.
Tenth group– property with a useful life of over 30 years.
For other fixed assets that are not indicated in depreciation groups, the useful life is established by the enterprise in accordance with the technical conditions and recommendations of the manufacturing organizations.
For tax purposes, enterprises calculate depreciation using one of the following methods:
1) linear;
2) nonlinear.
Linear The depreciation method is applied to buildings, structures, transmission devices included in the eighth to tenth depreciation groups, regardless of the timing of putting these objects into operation. For other fixed assets, the enterprise has the right to apply one of two methods of calculating depreciation in accordance with the accounting policies adopted by the enterprise.
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