Types of financial resources of an enterprise: description, forms and classification

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:55

Each enterprise attracts different types of financial resources to carry out its activities. They differ in their characteristics. Therefore, each organization conducts a constant analysis of the ratio of financial sources, as well as the effectiveness of their use. This allows you to eliminate adverse factors that hinder development. The main types of financial resources will be discussed below.

Definition

In the economic activity of any enterprise, different types of financial resources are used. These are sources of cash and cash equivalents that are mobilized by the company to carry out its activities. They are accumulated in certain funds, directed to certain areas of activity.

The funds owned by the enterprise are directed to the development of its production, as well as the maintenance of facilities that belong to the category of non-production sphere. Part of the resources is directed to consumption. Also, some money is in the reserve fund.

Sourcesreceipts of such resources may be different financial receipts. They are provided by the owners of the organization at the time of its foundation. Also, financial resources are borrowed funds of investors, credit organizations. They also take part in the main activities of the company. By attracting additional sources of funding, the organization receives new, additional opportunities.

Formation of resources of a commercial organization

Existing types of financial resources of the enterprise are needed to ensure the activities of a commercial organization. At their expense, not only the main production activity is carried out, but also its expansion and development.

Initially, the financial resources of such companies are formed when they are created. This is the authorized capital, which consists of the shares of the owners. Each of them contributes a certain part of the money, property or other valuables, which will subsequently allow the company to carry out its activities.

The authorized capital allows you to create the base that will later be able to guarantee the fulfillment of production programs, obligations to the owners.

After the first year of operation, the enterprise may have a profit. It is distributed, directing a part to the development of the organization. Also, various third-party sources can be involved for this. These can be loans, government loans, gratuitous or paid assistance from investors, etc.

Non-Profit Resources

Types of financialThe resources of non-profit organizations are also varied. They are formed from savings, income, which are directed to achieve the main goal of the company's existence. These include the entrance fees of the organization's members, as well as their membership fees.

Income of a non-profit organization may be generated as a result of entrepreneurial or other activities. Also, revenues can come from budget funds, as well as as gratuitous assistance provided by private and legal entities.

These funds can be used to pay employees, rent premises, transport, and purchase the necessary equipment. Also, these funds are used to make payments to the budget, extra-budgetary state funds. Sources of resources can be directed to major repairs or the acquisition of buildings and structures.

Public finances

It is worth noting separately the important function of the existing types of public financial resources. They are made up of income from the economic activities of various entities. They have a significant impact on the indicators of state power. About 56% of GDP is financial resources.

Revenues to budgetary and non-budgetary funds are formed as a result of the production activities of companies, as well as the distribution and redistribution of the domestic social product, income at the macro level. The financial resources of the state havemonetary expression. They are distributed according to social and industrial needs.

The retirement of various fixed assets is compensated at the expense of the country's financial sources, national needs are met, including ensuring the expansion of production activities. The more resources go to the state funds, the more efficiently the subjects of its economic activity carry out their work. This allows us to accelerate economic growth and improve the well-being of the population.

Resource structure

Considering the types of financial resources of the state, it is worth noting that they are significantly influenced by the results of economic activities of individual entities. Therefore, the state is interested in creating conditions for productive production activities of companies.

Their financial resources consist of own and borrowed funds. The state regulates the procedure for the formation of such funds, as well as their ratio. For each specific industry, certain standards apply. This reduces the risk of losing the financial stability of the organization, and also creates the minimum necessary conditions for productive activity.

Special consideration requires the ratio of the company's own and borrowed funds. There is an optimum level at which its activity will be most effective. The complete absence of borrowed funds in the balance sheet significantly increases the stability of the company, but at the same time reduces the efficiency of the use of its capital.

Main Ingredients

There are different sources and types of financial resources. They differ in a number of characteristics.

Own sources of funding can be external and internal. The first category of income includes additional contributions to the authorized capital or re-issues of shares, budget subsidies, as well as reallocated funds.

Internal sources of equity are the contribution of the founders of the company during its organization, retained earnings (remains after payments to shareholders or owners). This group also includes depreciation and other sources.

Borrowed sources are formed from long-term and short-term bank loans, commercial loans, bonds.

Own sources

The main type of financial resources in the enterprise is equity capital. It makes up the bulk of all funds. This fund is formed from several sources. The main one is the authorized capital. This is the base that allows the company to organize all processes for profit. The amount of authorized capital is determined in accordance with the form of organization of the enterprise.

When a company has been operating for more than a year, a part of the net profit is added to its own sources, which remains in the enterprise after paying shares to shareholders and owners. In some years, all net profit can be directed to the further development of the company. However, the payment of dividends and shares must still take place. Otherwise, the value of the organization may decrease.

Depreciation deductions are also a significant fund. This fund is created to compensate for the depreciation of equipment, intangible assets. This is necessary for the modernization of the technical base, the use of modern equipment. The company receives this income in the course of sales. Depreciation is included in the cost of production.

Borrowed sources

Existing types of financial resources of the organization can be not only own, but also borrowed. They can come from credit institutions, investors, as well as from budget funds. Not all companies receive the last of these sources. The state finances only strategically important industries and enterprises.

Loan capital is received from different organizations on a paid basis. The company undertakes to return this capital with interest. This is a reward for the use of borrowed funds. Not every company can get such financing. Investors are interested in investing only in profitable areas, stable companies.

The amount of borrowed funds in the capital structure should correspond to the peculiarities of the enterprise. It is calculated separately for each organization. At the same time, possible risks and the expected amount of profit from attracting such investments are taken into account.

Ratio of financial sources

All forms and types of financial resources of an enterprise are displayed in its financial statements. They arepresented in Form No. 1 "Balance". All financial sources are in liabilities. They are divided into 3 sections. This is equity, as well as long-term and short-term loans.

The active side of the balance reflects information about what property was financed with these funds. These are non-current and revolving funds. The efficiency of the enterprise largely depends on the correct organization of the balance sheet structure. Therefore, during the analysis of the organization's activities, these indicators are constantly evaluated.

The company must have its own sources of funding. They should make up the majority of the balance. However, without borrowed capital, the activity of the organization is considered insufficiently effective. It is believed that an organization that operates only at its own expense loses certain benefits. By attracting paid resources, it can develop new areas of production, stimulating an increase in net profit.

Distribution function

Existing forms and types of financial resources perform several functions. The main ones are the distribution, control and maintenance of the enterprise. Therefore, the choice and structure of the company's funds must be treated responsibly.

The distribution function is to form all the necessary funds. Financial resources participate in the distribution of income, receipts of funds. This allows timely and full fulfillment of all obligations to creditors, contractors, personnel and the state budget.

Control function

Existing types of financial resources also perform a control function. It allows you to track the financial condition of the organization, identify factors that hinder development and eliminate them. Based on the system of indicators, which are evaluated by the analytical department, it is possible to establish whether resources are used efficiently, how much profit the company receives from its own and borrowed sources of financing.

Service function

Existing types of financial resources of the organization also perform a service function. It is also called reproduction. Financial resources allow the process of income movement (primary, secondary and final). They must move continuously to ensure the normal operation of the organization.

This function allows you to ensure the company's solvency, fulfill obligations to counterparties, suppliers, creditors, etc.

The listed functions are closely interconnected. Service is impossible without revenue sharing. The control function allows you to properly organize the movement of flows.

Having considered the types of financial resources, as well as their features, it is possible to determine their main functions and purpose.