Eight principles for financing consultants to formulate financing plans

First, the total financing revenue is greater than the total financing cost. This is a general principle that corporate finance must follow, but it is also a ma...

Jun 14,2022 | SHIRLEY

First, the total financing revenue is greater than the total financing cost. This is a general principle that corporate finance must follow, but it is also a matter of investor output. At the same time, we should consider the capital investment effect, that is, the income brought by the integration of capital use. The financing is reasonable and feasible only if the present value of the total financing income is greater than the financing cost loan computer（貸款計算機）.

Second, the scale of financing should be based on its capabilities. Enterprises should raise funds according to capital needs and reasonably determine the scale of financing. Excessive financing may lead to waste of idle funds, increase financing costs, or lead to excessive debts of enterprises, increasing debt repayment pressure and business risks; insufficient financing will affect the normal operation of enterprises' investment and financing plans and business. In addition, a reasonable financing scale should be determined according to the company's own situation, financing difficulty, cost factors, and its ability.

Third, choose financing methods carefully. Different financing methods may have a significant impact on the benefits and even future development of the enterprise. Therefore, factors such as financing cost, difficulty, and risk need to be comprehensively considered according to the nature of the financing needs of the enterprise.

Fourth, arrange the financing structure reasonably. The financing structure directly affects the asset structure of the enterprise, so the financing structure should follow the objectives of the asset structure planning, and rationally arrange the financing purpose, financing method and variety quota, which is conducive to the adjustment of the asset structure.

Fifth, seize the best financing opportunities. Changes in the macroeconomic environment at home and abroad, economic fluctuation cycles, tightening of national fiscal and monetary policies, bull or bear markets in the securities market, bullish or bearish similar products, etc., directly affect the difficulty and effect of financing Cards returned(還卡數).

6. Pay attention to the matching of deadlines. Financial products have short-term, medium-term and long-term impact on corporate cash flow is the debt maturity, namely liquidity risk. Therefore, corporate financing should arrange long-term and short-term debt matching, and implement multi-channel, multi-variety, long-term and short-term matching, commercial credit, bank credit and various loan methods to avoid centralized repayment. Secondly, it is necessary to do a good job of matching the debt maturity with the asset maturity. The types of financing should be long to long and short to short to prevent short-term financing and long-term investment. Debt maturities do not match asset maturities, leading to corporate financial crises.

Seventh, control financing risks. Corporate financing risk includes process risk and prognostic risk. The former mainly refers to the failure of financing, which cannot solve the capital needs of enterprises, and will also generate ineffective expenditures. In addition, there are bad intermediaries to defraud funds; the latter include excessive financing scale caused by excessive debt, deterioration of capital structure, maturity mismatch caused by liquidity risk, etc. The key here is to increase risk awareness and recognition and take proactive preventive measures.

Eighth, the mind controls the enterprise. Corporate financing structure is closely related to control. If equity financing is adopted, some shares will inevitably be released. If investors hold a certain percentage of shares, they can enter the board of directors or the board of supervisors to intervene in corporate decision-making; if financing is made through investment funds, the financing agreement is accompanied by gambling clauses. Once a trigger condition occurs, the right to operate can be partially or completely abandoned; if a large amount is issued Loans, loan contracts will add some restrictive clauses about major financial decisions of the business. Any situation can erode the control of the business whatsminer m30s++ for sale.

In short, before formulating a financing plan, the above eight principles should be fully considered according to the characteristics of different financing methods. Analyze the advantages and disadvantages of alternative financing methods, compare costs, and choose the appropriate financing method according to the whereabouts of financing funds.