What is the difference between internal and external sources of finance?
Internal sources is finance which comes mainly frown own funds, profits and depreciation The main internal sources of finance for sole proprietors are as follows; · Owner's funds · Selling personal assets · Profits · Depreciation External sources is capital obtained from financial institutions, such as banks, and from individuals willing to provide finance. The main external sources of finance for sole proprietors are as follows; · Bank loans · Mortgage loans · Grants and loans · Hiring and Leasing
11 people found this useful
Internal is a concern, activity or process inside or "within" an entity (e.g. internal medicine, internal combustion ). External is applied to forces or influences outs…ide the entity (e.g. external symptoms, external hard drives ). Internal and external are another way of saying inside and outside.
Internal business finance is departmental charges for productionand such. External business finance concerns transactions that makemoney for the business outside of the organi…zation, such as sales. Both this financial terms have great impact onrunning business. They are the key and most important differencebetween these two funding options. When a company uses internalfinance, it takes advantage of existing supplies of capital fromprofits and other sources. External finance involves the use ofmoney new to the company, from outside sources, to fund plannedactivities. External finance requires either going into debt orgiving up control and flexibility.
External financing is when a department helps another departmentmeet their production numbers. External financing is when someentity external to the company helps the company …meets theirfinancial obligations. For a more definitive example, a corporationhas the ability to sell shares of its own stock to currentstockholders or to the public in general. This is money transferedinto the company using its own internal finances. If the samecorporation decides to sell bonds on the open market, that is anexternal source of funds and is external financing.
Internal information is the kind of information that is obtained internally such as accounts receivable information, financial statements etc. On the other hand external infor…mation is the type of information that is obtained from external means such as competitor business model, customer's credit rating etc. .
Sixty percent of corporations through the selling of new securities uses external funds as sources of financing whereas only forty percent of funds are raised internally.
Following are the major differences: Exposure to ForeignExchange: The most significant difference is of foreigncurrency exposure. Currency exposure impacts almost all the ar…easof an international business starting from your purchase fromsuppliers, selling to customers, investing in plant and machinery,fund raising etc. Wherever you need money, currency exposure willcome into play and as we know it well that there is no businesstransaction without money. Macro BusinessEnvironment: An international business is exposed toaltogether a different economic and political environment. Alltrade policies are different in different countries. Financialmanager has to critically analyze the policies to make out thefeasibility and profitability of their business propositions. Onecountry may have business friendly policies and other may not. Legal and TaxEnvironment: The other important aspect to look at is thelegal and tax front of a country. Tax impacts directly to yourproduct costs or net profits i.e. 'the bottom line' for which thewhole story is written. International finance manager will look atthe taxation structure to find out whether the business which isfeasible in his home country is workable in the foreign country ornot. Different group ofStakeholders: It is not only the money which alongmatters, there are other things which carry greater importance viz.the group of suppliers, customers, lenders, shareholders etc. Whythese group of people matter? It is because they carry altogether adifferent culture, a different set of values and most importantlythe language also may be different. When you are dealing with thosestakeholders, you have no clue about their likes and dislikes. Abusiness is driven by these stakeholders and keeping them happy isall you need. Foreign ExchangeDerivatives: Since, it is inevitable to expose to the riskof foreign exchange in a multinational business. Knowledge offorwards, futures, options and swaps is invariably required. Afinancial manager has to be strong enough to calculate the costimpact of hedging the risk with the help of different derivativeinstruments while taking any financial decisions. Different Standards ofReporting: If the business has presence in say US andIndia, the books of accounts need to be maintained in US GAAP andIGAAP. . It is not surprising to know that the booking of assets has adifferent treatment in one country compared to other. Managing thereporting task is another big difference. The financial manager orhis team needs to be familiar with accounting standards ofdifferent countries. Capital Management: In an MNC, the financial managers have ample options of raising thecapital. More number of options creates more challenge with respectto selection of right source of capital to ensure thelowest possible cost of capital. There may be such more points ofdifference between international and domestic financial management.Mentioned above are list of major differences. We need to considereach of them before taking any decision involving multinationalfinancial environment.
Internal is inside the organism. External is the surroundings and stuff that happens outside the organism
Internal means it is contained inside something; external means it comes from outside.
Internal documentation is the one in which various information regarding the program is enlisted in the program itself i.e. in the form of comments. On the contrary, external …documentation is the one that is prepared separately to inform the users about the system.
Fertilization in animals refers to the point where a sperm meets an egg. External fertilization means the sperm and eggs meet outside the animals, usually in the water. So a m…ale and female fish can swim alongside each other and while the female releases her eggs the male will release his sperm. Certain male fish have a specialized fin shaped like a tube. They stick that in a pore in the female and put their sperm into the female. The sperm fertilizes the eggs inside the female. That is called internal fertilization. Fish use both internal and external fertilization depending on the type of fish.
in company or business, internal stake holders means the actual owners, employees and other realted people, where as external stakeholders are those are are directly impacted …by the busines and inclusdes, regulators, social orgainizations, the government etc.
In any Company there are Internal Factors affecting the company and External Factors affecting the company. Internal Factors are Management Descisions on what sort of business… the company is in, quality of services or stock sold by the company. External Factors affecting the company include the Global Financial Crisis, government policies, and central bank interest rates.
Internal audit requires to ensure that internal controls inorganization works properly while the sole purpose for extrnalaudit is to check whether financial statements represe…nts true andfair business activities.
ÃInternal control. â¢Allows motivated individuals and groups to exercise self-discipline in fulfilling job expectations.. ÃExternal control. â¢Occurs through …personal supervision and the use of formal administrative systems..
According to 'williamgairdner.com', Internal Freedom refers to the first and most basic type of freedom is embodied by the chap in jail. He has all his internal freedom, but n…o liberty. All normal human beings are born and remain free in the most important sense that they are forever and at every conscious moment freely-choosing beings, and every life is a delicate tapestry of millions of such personal choices, for better or worse. We cannot escape this kind of freedom even if we try, for we must then freely choose among means of escape, and so on. From this perspective we are condemned to be free, for even choosing not to choose is a choice. Internal freedom is of the greatest personal intimacy and secretiveness, indeed it is the hidden core of our being and unknowable by others. It distinguishes human beings from the animal kingdom, and from each other, and is the basis on which we are able to become moral - or a-moral, or immoral - beings. That is why some people call this moral freedom. But this kind of freedom is not in itself moral. Rather, it is the unique capacity we have to become moral or immoral according to how we use our freedom. while External Freedom refers to This refers to the normal and common freedoms expected in daily life, in most countries, throughout history. It is sometimes described as freedom from , because it implies immunity from undue interference by authority, especially by government. It is also sometimes called "negative freedom," meaning freedom to do anything not forbidden by the laws (in contrast to a totalitarian system that says you may only do what is permitted by the laws). Many in the Western tradition consider this, in combination with Political Freedom, explained next, to be the most important kind of freedom.
Inside and outside
An external source of data is a connection to an external data baseand contains data that does not change much. The difference ofinternal source of data is data that can chang…e because it comesfrom sources inside an organization including inventorytransactions, purchase orders, and sales.