Capital Structure

Definition: Capital structure, as its name itself signifies, is the composition of the capital employed by the firm from various sources of finance. It comprises of both owners capital (i.e. equity capital and preferred capital) and debt capital. The capital structure of the firm represents its investment and financing strategy. While deciding the ideal capital…

Read more

Treasury Management

Definition: Treasury Management can be understood as the planning, organizing and controlling holding, funds and working capital of the enterprise in order to make the best possible use of the funds, maintain firm’s liquidity, reduce the overall cost of funds, and mitigate operational and financial risk. It covers working capital management, currency management, corporate finance…

Read more

Types of Issue of Shares

Definition: A share is that smallest part, into which the overall capital of the company is divided. Issue of shares is a process through which the company allocates fresh shares to the new or existing shareholders. The issue of shares is made to both individuals, institutions or body corporates. Types of Issue of Shares There…

Read more

Shares

Definition: Shares can be described as the financial instrument issued by the company to raise funds from the general public. A share represents fractional ownership in a body corporate. Thus, a share is the smallest unit of the company’s overall net worth. In a joint stock company, the capital is divided into very small units,…

Read more

Private Equity

Definition: Private Equity firms are described as the investment fund companies that invest in the capital of the enterprise so as to acquire a strategic stake in it, once it is set up as a successful unit. The capital injected by private equity firms in a company which forms a part of their equity capital…

Read more

Lease

Definition: Lease is a financial arrangement, wherein one party (lessor) allows another party (lessee) to use the capital asset or equipment for a definite period, in return for an adequate consideration, i.e. lease rental charges. In this contract, the lessee need not buy or own the asset in order to use it, because it is…

Read more

Insurance

Definition: Insurance refers to a contractual arrangement in which one party, i.e. insurance company or the insurer, agrees to compensate the loss or damage sustained to another party, i.e. the insured, by paying a definite amount, in exchange for an adequate consideration called as premium. It is often represented by an insurance policy, wherein the…

Read more

Promissory Note

Definition: A Promissory Note, as the name itself gives a brief description, is a legal financial instrument issued by one party, promising to pay the debt owed to another party. It is a written negotiable instrument duly signed by the maker that contains an unconditional promise to pay the stated sum of money to a…

Read more

Financial Management

Definition: As the name itself gives a brief description, financial management is the management of firm’s financial resources, in relation to its acquisition and application. It is that branch of management, which deals with the procuring, financing and managing business assets, to achieve the objectives of the concern. Aspects of Financial Management The two aspects…

Read more

Bill of Exchange

Definition: Bill of Exchange, can be understood as a written negotiable instrument, that carries an unconditional order to pay a specified sum of money to a designated person or the holder of the instrument, as directed in the instrument by the maker. The bill of exchange is either payable on demand, or after a specified…

Read more