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Financial Management - Finance – An Introduction

Factors Influencing Financial Decisions

   Posted On :  19.06.2018 10:40 pm

There are innumerable factors that influence the financial decision. They are classified as external factors and internal factors.

Factors Influencing Financial Decisions
 
There are innumerable factors that influence the financial decision. They are classified as external factors and internal factors.

External factors


1. Capital structure

2. Capital market and money market

3. State of economy

4. Requirements of investors

5. Government policy

6. Taxation policy

7. Financial institutions / banks lending policy

Internal factors


1.6 Nature of business

2. Age of the firm

3. Size of the business

4. Extent and trend of earnings

5. Liquidity position

6. Working capital requirements

7. Composition of assets

8. Nature of risk and expected return

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