Financial Resources

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Financial Resources

Introduction

There are many ways for a Public Limited Company to obtain finance,

but like anything you don't get the services for nothing, you have to

pay back that money plus other kinds of charges. Before you can apply

for finance you need to show some kind of information, like daily cash

ledgers, monthly management accounts or yearly budgets from your

organisation.

This report shows a formation of a cash budget, plus what PLC's have

to pay back to their lenders and obtaining and using financial

information.

Public Limited Companies (P.L.C) and their costs of finance

A P.L.C is a company that is included in the private sector, the

investor has some degree of responsibility and the company has a

separate legal identity. An example of a PLC is Woolworths PLC.

Public Limited Companies is in a better position of raising capital

than other companies due to the high standards of the companies so

therefore investors and creditors are more willing to offer finance,

but what are the costs of obtained financial resource?

There are many possible sources of finance available for a PLC:

* Suppliers,

* banks,

* factoring,

* leasing and hire purchase companies,

* government grants and loans,

* venture capital institutions,

* public share issues via the stock exchange

www.revisionnotes.co.uk

Even though there are many potential sources of finance I am only

going to look at 3 of the above and to show you what the costs are for

obtaining the finance.

SHARES

One form of finance is shares. Large PLC's has shares on the stock

market and anyone can buy into them. For the smaller PLC's there is

the alternate investors market (AIM) it works similar to the stock

exchange.

The company whose shares are on the stock market as to pay the

customer back something in return, due to them buying the company

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