Introduction:-
Finance is one of the most important segments of every business and everyone needs a clear title and smooth working of their finance department in their business without any crunches or hurdles.
Finance is the root and foundation of every business and each and every business is being dependent on it. Business finance refers to funds or money that is being credited in the business.
Finance is the basic requirement of every business and is required for developing business and running business as for buying assets, machinery and so on in the business one is required to have proper finances.
Principles of Business finance:-
Business finance work on following four principles which are as follows:-
- Income: Every business needs to work on its earnings and income for smooth running of business as the basic requirement of every person's life can be fulfilled by its income and only.
- Savings: For developing any business a person needs to take a cut in their expenditure as per their income so that they can do some of the savings for their business.
- Investment: For further growth in their business one needs to be assured about their investment for their business growth in terms of assets such as purchase of land and building and so on.
- Spending: Spending plays a vital role in personal life as spending should even be limited and only if a person can limit their spending with respect to their income then only then can they save and invest in their business.
Therefore, these four principles are quite important and are correlated to each other and further responsible for achieving the desired goals of business.
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Laws that are connected with business finance:-
In any country it is quite important to follow up the laws with respect to anything for safeguard and smooth running of business or lives.
There are various tribunals been set up in India for checking commercial and financial matters related to business in our country which are:-
- Debt Recovery Tribunal(DRT): When there are matters with respect to some money default or for recovery of some debt then these matters are entitled to be heard before the debt recovery tribunal. The DRT works with provisions laid down in The recovery of debts and bankruptcy act 1993 for the purpose of speedy redressal of lenders and borrowers.
- National company law tribunal(NCLT): This law is based on Insolvency and bankruptcy act 2016. It deals with matters related to operational creditors and operational debtors. It deals with the matters resulting in liquidation of the company or defaulting in some real estate money matters and so on.
- Income tax appellate tribunal: These are maintained for the purpose of issues related to income tax. We all are acquainted with paying taxes as per the income tax act in our country and default in paying the tax as per the prescribed income slab quite lead to legality. This tribunal is made for resolving issues related to Income tax law.
