Logo en.artbmxmagazine.com

Importance of the study of financing for companies

Anonim

Before addressing the importance of Financing, we will define it as the set of financial monetary resources to carry out an economic activity, with the characteristic that it is a loan that complements own resources.

Today the behavior of Mexican companies to obtain financing is undergoing great changes, because the economic environment affects the deepest and most serious analysis of the financial structure of the company, due to the fact that the costs of resources are increasingly increase surprisingly.

Financing is a decision alternative in which companies sometimes resort to apply them in investments as a financial strategy, for this reason the financing alternative must be analyzed from its origin.

There are two sources of financing; external and on the other hand the internal ones, the internal ones are those that are generated within the company as a result of its operations, among these are the reinvested profits, contributions from the partners, sale of assets, depreciation and amortization, etc. And external ones are those that are granted by third parties such as suppliers, advance payments to clients, banks, various creditors, etc.

External sources are also known as “Financial Leverage”, it has many advantages when it is acquired and is used as a financial strategy since when a company resorts to financing, two situations can happen, the first one that the company when acquiring financing increases its profits that would be the best result that every organization wishes to achieve and the second that if the company resorts to greater leverage it runs the risk of placing its company in the hands of third parties.

For this reason, the company must analyze in detail the advantages and disadvantages of external financing as well as to use the required resource, the benefits that it will grant to the company. In such a way that financing must be chosen according to the specific needs of the company and the financial burden that it will imply to acquire.

Therefore, it is important that every company before resorting to external financing consider two things:

  1. Analyze your ability to pay, what does this mean? Analyze your ability to pay the resource I request and the interest on the loan. Risk Analysis, the risks involved in applying for a loan.

Therefore we must not forget the three most important elements of a loan.

  1. Interest rate Agreed term Amount requested

So it is important to know the full range of financing alternatives to make the best decision. The ideal is to reach even if financed profits, otherwise. We do not allow placing our company in the hands of third parties if there is an alternative of analysis and planning of which source of financing is the best option to choose.

Importance of the study of financing for companies