Financial support for the development of small private firms: Theory and practice

Аnzhela Nikolaieva and V. Demchuk

E-Forum Working Papers, 2020, vol. 10, issue 3, 70-78

Abstract: The article examines the economic essence of the definition of «financial security of the enterprise». It is substantiated that the financial support of the enterprise is considered by scientists mainly in the context of the components (methods, functions) of the financial (financial and credit) mechanism, and is associated with the mobilization and use of financial resources. The authors summarize their own vision of the essence of this definition, as the activity of the business entity associated with the mobilization of financial resources from internal and external sources, their distribution and effective use to ensure the smooth running of the enterprise and finance its development. Factors influencing the financial support of the activities and development of small enterprises, taking into account the specifics of their activities, are selected, which are grouped into six groups: the scale of activity; production process; assets, management; personnel; stability. The main forms of financial support for business entities in modern business conditions are self-financing, bank lending, leasing financing, investing, budget financing, financing from various monetary funds. It has been established that the main sources of financing for small private transport companies are their own funds, including retained earnings and current liabilities and collateral. The loan capital of such firms is mainly short-term and consists of accounts payable and other current liabilities, which can be attributed to stable liabilities. The modern conditions of financial support for the development of small private transport enterprises in Ukraine are analyzed. The criteria for making financial decisions, as well as the advantages and disadvantages of using various forms of financing the renewal of fixed assets of private transport companies are identified

Keywords: financing; financial support; financial resources; equity; loan capital; small business (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:cuc:eforum:v:10:y:2020:i:3:p:70-78

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