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Financing Activities |

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| This article is part of WikiProject Definitions. Consider editing to improve it. View articles referencing this definition. |
Financing activities are all cash-generating activities which take place between a company and its investors.
A company's investors include both its shareholders and creditors. This means that financing activities not only include the issue of stock, dividend payments, and stock buy-backs, but also the taking-on of new debt and the repayment of old debt.
A company's financing activities are accounted for in the Cash Flows from Financing Activities section of their cash flow statement.
ExampleA company decides to issue new common stock. The issue of this stock is a financing activity, as the buyers of the stock are giving the company money in exchange for the promise of increasing future returns.



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