Sources of Finance

SOURCES OF
FINANCE
1

Table of Contents
INTRODUCTION...........................................................................................................................3
SOURCES OF FINANCE...............................................................................................................3
TYPES OF BUSINESSES:.........................................................................................................3
EXTERNAL LONG TERM SOURCE OF FINANCE...................................................................4
SOLE TRADER..........................................................................................................................4
PARTNERSHIP..........................................................................................................................5
PUBLIC LTD COMPANY.........................................................................................................6
PRIVATE LTD COMPANY.......................................................................................................6
EVALUATION BASED ON SIMILARITIES & DIFFRENCES..................................................7
SIMILARITIES & DIFFRENCES:.............................................................................................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
2

INTRODUCTION
Finance is called to be the most important factor to run a business. This report studies about the
external long term sources of finance available to various business entities such as sole
proprietors, partnership firms, private and public companies including listed companies by
analysing the similarities and differences among them (Al-ali, 2021).
SOURCES OF FINANCE
Businesses deal in various type of activities to manage its day to day operations. To manage its
functions smoothly, the business needs funding for the purchase of raw materials, business set up
and other functions. Businesses are also of different types such as sole trader, partnership firms
or companies (Damanpour, Sanchez‐Henriquez and Chiu, 2018). The funds can be available
either internally or externally to these business entities. Internal sources comes from within such
as sale of assets of the company and profits arising from the business operations. External
sources includes funding from outside sources such as loans, equity, debentures, venture capital
etc. It differs from business to business.
TYPES OF BUSINESSES:
1. SOLE TRADERS
2. PARTNESHIP FIRM
3. COMPANIES
3