Pearson BTEC HND Unit 2: Finance and Funding Sources Report

This report delves into the crucial role of finance in the travel and tourism sector, highlighting the various funding sources essential for business operations and growth. It explores the significance of retained earnings, capital projects, and loans from financial institutions as primary funding avenues. The report also discusses venture capital, debentures, and equity shares as alternative funding options. Furthermore, it emphasizes the role of government departments and media in fostering tourism development and the protection of cultural heritage. The report concludes by underscoring the importance of appropriate funding, sourced through both public and private channels, to sustain and expand travel and tourism businesses, enabling them to attract visitors and promote various destinations effectively. The report is based on the Pearson BTEC (HND) Travel and Tourism Management Unit 2 Finance and Funding in the Travel and Tourism Sector Unit level 5 module.

Finance and Funding
Sources and distribution of funding
INTRODUCTION
Finance is the most imperative tool for the business survival. As, this requires to
operate business in an effective manner. Adequate finance is required to operate the
business in an effective manner and guide them to attain its predetermined targets.
DIFFERENT SOURCES
For a consistent growth and development of tour and travels business a concept
named funding is provided by ministry of related departments. There are many
sources those are available:
Role of cultural department, media and sports: This department helps in continuous
growth and promote valuable elements which are necessary in field of tourism
sector. These are responsible for the protection of cultural heritages and beautiful
destinations of country. It helps in taking inventive and innovative steps to
maintain such places. It helps in development of economy because of well
maintenance of dignity of these tourist places. These departments promote more
and more people for sustainable growth and protection of such heritages. Media is
also very helpful for such operations because it can bring awareness among
population towards these destinations. Media is involved in publishing and
promoting all this in newspapers as well as televisions. It will help in bringing
attention of society on this topic and it will help in developing the tourism sector
and industries. Loan from financial institutions: Loans can be taken from banks for
fulfilling fund requirements of business. Interest has to be paid on
It means a huge amount of investment made in
different projects to build them, and then modify the
projects. It is completely related to manage capital in
such a way that financial and labour both can be
handled in a proper manner to start or end any project.
It also includes acquiring a land, property on lease or
rent and purchasing new plants. For development of
tour and travels industry it is important to invest in
capital projects.
 Venture capital: Investment that is made after
analysing the project at initial stage. It helps the
tourism sectors to establish their business and meet the
needs of funds.
 Debentures: It is a part of debt capital that is raised
by any company through issuing debentures in market.
A fixed rate of interest is needed to be paid on such
raised capital.
 Equity shares: These are owners of company.
People who invests through equity shares have voting
rights also. It is called as owner's funds also.
 Retained earnings: Any company makes profits in
any financial year. Some of these profits are distributed
among owners and debt holders as interest and
dividends. But a part of these profits is retained by the
company for future needs. This part of profit is called
as retained earnings such raised fund.
From the above mentioned report, it is observed that
travel and torus is critical wellspring of fascination for
individuals by utilizing this implies individuals can
profit different zones, areas and other verifiable spots.
To keep up and work their business organization
require fitting subsidizing which is secured through
different sources like open and non-open mode.
CONCLUSIONCAPITAL PROJECTS