Running Header: Financial Resources and Their Management Name: Topic: Managing Financial Resources Date Module Section One - Sources of Finance (LO1 and LO2) Opportunity in business world is good for both of you and your twin brothers who just left the university and plan to engage in a small-time consultancy business. Making a decision on the kind of legal forms you will use to start-up must shield you a better understanding of the pros and cons if you are trying to make up your mind on choosing a business structure of being a sole trader as your twin brother as your employee, or make a business partnership with him…
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The advantages of being a sole trader make a business owner easy to start and run his business, no retirement for registration but it has boundless liability for debts, greater personal assets are at risks and many business taxes to settle. You may find lack of credibility when it comes to marketplace, hard to attract loans and investments and get it more difficult to sell your business. You need to consider that business imply lasts based on the lifetime of the sole trader. Thus, if you want to start up your business as a sole trader, it is good to search for company office and secure the Intellectual Property Office to make sure that the name you want for your business is not existing and protected by other business owner/s. Partnership, on the other hand encourages you and your brother to run together in the business that you both are trying to venture. Each of you shares responsibility in running the consultancy business, shares equally on profits or loss unless otherwise stated in your terms and agreement. Both of you are liable within the partnership. Your partnership with your brother gives full advantages which requires no pay for income tax and it distributes the partnership income to the partners and both of you will pay the business tax on their own share. The partnership in business structure you plan involves no registration between you and your brother and it offers wide-range to share the costs of business operation costs such as those people who operates to share a joint office. The disadvantages of this type of business form includes the partners liable for debts acquired by any of you, partnership conflicts may arise, possible complicating issues such as when their partner dies, or leave the partnership and personal assets are also at risk. Since you are the more business oriented compared to your brother and he is undoubtedly a little more technically gifted than you, the good blending or combination of your effort and his skill make both of you best to invest and make a partnership on your business. It offers the quality steps a long way your business works also the contribution of your brother’s work to make both of you successful in your business consultancy, besides the combination of your heads as engineers surely will make you reach your successful business venture. Possible financial sources for your business are: Own Capital Partnership is the form of structure of your business together with your brother so own capital is the common source of finance, especially for startup is money from the individuals who are forming the business. Advantage: Own capital is a costless form of finance, but carries the risk of the money being lost. Disadvantages: The money once mismanage is totally lost and considered a personal endeavor which can affect business operations adding to liabilities.
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The Systems for Managing Financial Resources in BUPA 5 Task 2 6 2.1. Diverse Sources of Income for BUPA 6 2.2. The Factors That May Influence the Availability of Financial Resources in BUPA 7 2.3. Different Types of Budget Expenditure in BUPA 7 2.4. Decisions about Expenditure that could be made in BUPA 8 References 10 Task 1 1.1.
Tesco PLC. Tesco offers a wide variety of food products, non-food products and also clothing through its 2,318 stores, with 326,000 employees around the European, American and Asian markets. The company provides its customers with financial services too (Datamonitor, 2004).
It was found that he could not get more than 50% finance from the bank. Then the promoter had to search for different kind of private investor. Among these the venture capitalists and the angel investors are found as the best persons to approach. After considering all the factors the promoter has chosen to approach an angel investor, which is easily available in United Kingdom.
By using the credit policy, an organisation sells its goods on credit to the customers. And after a certain period of time, the customers are required to pay back the credit amount to the organisation. But, sometimes, there are certain customers who are either unwilling to pay back money to the organisation.
Therefore, the company can opt for debentures, bank loans and selling it shares as effective long term financing methods (Higgins, 2008). Debentures can be a useful form of long term financing. Debentures are a type of loan stocks.
For present case the author is going to learn about how business entities can be able to source their finances, manage their finances so that they can meet their financial obligation. Secondly, the discussion is going to touch on the assessment of various implications of the different sources of finances for the business.
it is not a public listed Company then C and C hydraulics may decide to opt for IPO (Initial Public Offering) option to raise the capital in order to meet their fund requirements for the Company expansion into new sectors. This is the most effective mean to generate finance and
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