Internal Sources of Financing Companies on the Basis of Static and Dynamic Indicators: Comparative Analysis

Radica Pavlović, Rajko Bukvić (r.bukvic@mail.ru) and Aleksandar Gajić

MPRA Paper from University Library of Munich, Germany

Abstract: The Republic of Serbia is characterized by unsatisfactory macroeconomic environment (high degree of illiquidity, high inflation rate, rising unemployment, decline in the level of capacity utilization, followed by the process of globalization, deregulation and liberalization of the market with all its negative connotations to the growth and development of our country). Under such conditions where there is a shortage of liquid assets the financial capital has moved from the real to the financial sector, which led companies to over-indebtedness and shutdown of their own capacities. Therefore, capital investments largely depend on internal sources of financing and the ability of companies to internally generate funds for investments. In this regard emphasis is placed on the difference in the assessment of the investment ability of companies based on internal sources of financing measured using static and dynamic indicators in order to prove the necessity of applying dynamic coefficients which unfortunately are not present in our domestic practice.

Keywords: dynamic analysis; investments; financing (search for similar items in EconPapers)
JEL-codes: G17 G31 G32 M40 (search for similar items in EconPapers)
Date: 2015, Revised 2015
New Economics Papers: this item is included in nep-cfn and nep-tra
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