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(Solved) Sources of Finance - Doc

   

Added on  2021-02-21

14 Pages3011 Words25 Views
FinanceEntrepreneurship
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Finance For a NewBusiness
(Solved) Sources of Finance - Doc_1

Table of ContentsINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1A) Sources of Initial Finance Needed to Setup New Business...................................................1B) Sources of Finance Needed to Run Business.........................................................................1TASK 2............................................................................................................................................2A) Sources of financial advice and guidance.............................................................................2TASK 3............................................................................................................................................3a) 12 month cash flow forecast...................................................................................................3TASK 4............................................................................................................................................3a) Purpose of budgets.................................................................................................................3b) Affordable budgets plan.........................................................................................................3TASK 5............................................................................................................................................3A) Set of final accounts..............................................................................................................3CONCLUSION ...............................................................................................................................3REFERENCES ...............................................................................................................................5
(Solved) Sources of Finance - Doc_2

INTRODUCTIONSources of Finance refers to those sources with the help of which funds are collectedfrom different sources in order to accomplish different functions of the business (Grammenos,2013). The following report is prepared to present in front of Finance Manager in Holiday Inn.The following report will make its focus on sources of initial finance needed in setting up andrunning a new business. Additionally, it will focus on sources of financial advise and guidanceavailable to companies, 12 month cash flow, purposes of budgets for new business along withpreparing affordable plans for business as well. Lastly, financial accounts will be prepared withthe help of accounting systems. TASK 1A) Sources of Initial Finance Needed to Setup New BusinessThere are different ways with the help of which finance could be acquired by anindividual or group of individuals at the time of starting new business. The description of thesesources is provided as under:Personal InvestmentThe first option which is available to an individual in order to start new business is withthe help of personal investment or the money which an individual have. Another option is alsocollateral of assets is also available with people so tart new business (Galí, 2015). Love MoneyIn the following option, the amount in order to start new business is acquired fromfamily, spouse, friends or relatives. So by taking money from these people, new business couldbe started and carried over.Venture CapitalIt refers to that capital which an individual receives in exchange of equity of theirbusiness. However, this capital is very risky in comparison to other modes of capital because theuse of this form of finance will impact upon the ownership and decision making process of theorganisation. B) Sources of Finance Needed to Run BusinessBank Loan1
(Solved) Sources of Finance - Doc_3

In the following source of funding, the capital in order to run the business is raised withthe help of getting financed from banks. Loans are taken from banks for both long term and shortterms and companies may take on the basis of their needs. Equity Share CapitalThe second option in order to run a business is with the help of equity share capital inwhich an organisation issues shares to people and receives amount from them. However,shareholders have the right to participate and influence the decision making process of thecompany which will make it complex for the owner to make effective running of the business(Hamilton and Raj, 2013). TASK 2A) Sources of financial advice and guidance.In business world, starting and building a new business is not an easy task, thus it isimportant for entrepreneur to have sufficient information and guidance that are available fromdifferent sources. Some of these are discussed below: National business support helpline: It one of the key element developed by thegovernment of UK that directly support business to gain enough knowledge regarding,signposting, diagnostic support and business improvement guidance. The interested parties cancall to get in depth advices about the latest trends, market risk, government rules and regulationwhich help them to manage their business activities in appropriate manner. Tech City UK programmes: This particular program have a range of online servicesthat are designed for sustainable growth of small businesses. New start-up can gain knowledgeand advices from online courses and events in order to develop business by reducing the riskfactors. In recent time most of the successful small starts ups are taking advantage from Techcity. Count the cost: In present time companies are focused to reduce cost and expenses toincrease profit. Small business can gain obtain the advice and support from large enterprise howto reduce cost that enables to maintain sufficient profit (Mazzucato and Penna, 2015.). It isimportant for new business to look into the cost that can lead to major expenses such as rents,utility, supplies and marketing. 2
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