Funding Of, Of China's Enterprises

Fund raising is a major component of financial work in an enterprise. Under the present situation of fast developing economy in China, capital is badly needed by enterprises. But the environment for fund raising is not very optimistic, so the problem of lacking funds for enterprises in China is very striking. The following problems exist for the enterprises in China to make decision on fund raising issues due to contradiction between capital demands and relative insufficiency of capital. For example, economic benefits are sometimes overlooked. Cost is not properly considered. Means of fund raising are not flexible. The analysis on fund raising environment and ways of fund raising are not properly made. The raised funds can not be used effectively. Some enterprises raised funds through fraudulent act, and then lost trust by investors, resulting in obstacle in fund raising cycle. With improvement of the environment of economic development in our country, our fund raising market is gradually becoming mature, so it is necessary for our enterprises to study theory of fund raising to inject blood of capital in time for development of enterprises and for better economic benefits. This paper gives out analysis on fund raising environment of our enterprises, advantages and weakness of different ways of fund raising, and relations between fund raising cost and its risks on basis of related fund raising theory both at home and abroad and in connection with the present practical situation, to assist the enterprises of different types to choose suitable ways or combination of ways for fund raising. The paper points out that the ultimate purpose of fund raising for an enterprise is to pursue greater profit. Following the principles for fund raising, the paper describes in detail different channels and ways of fund raising. The optimum decision can be made by quantitative and qualitative analysis methods.