European Journal of Business and Management www.iiste.org ISSN 2222-1905 (Paper) ISSN 2222-2839 (Online) Vol.9, No.1, 2017 71 SOURCES OF BUSINESS FINANCING Vesna Grozdanovska (Corresponding author) University St. Kliment Ohridski Bitola, Republic of Maceodnia e-mail: grozdanovskavesna@yahoo.com Nikolche Jankulovski University St. Kliment Ohridski Bitola, Republic of Maceodnia e-mail: nikolcejankulovski@yahoo.com Katerina Bojkovska University St. Kliment Ohridski Bitola, Republic of Maceodnia e-mail: katerina_petkovska_bt@yahoo.com Abstract Many financial sources on the marketplace are designed to fit the needs of the small, large, new and established businesses. In order for business to grow, companies need sufficient funding for projects, making purchases and expanding operations to make them more efficient and profitable.Business finance is available in multiple forms, including long-term loans, short-term loans and equipment financing.The term loan is very popular for many companies in need of money for expansion, acquisition, or working capital and can also be used for refinancing. This type of business finance loan is usually repaid over a period of time based on the useful life cycle of the assets that need to be purchased. Keywords: business, financing, sources, investment Introduction Financing business is a complex process that enables planning, provision and use of the necessary funds for the ongoing development and operations. Depending on how business entities provide cash to fund current and work in progress, funding appears as: self-financing, financing for a cost of third party, lending, specific forms of financing, factoring financing, finance leasing arrangements and financing franchising arrangements. Some fundings are short-term and must be repaid within one year. Other sources of business financing are long-term and should be returned within several years. The sources of funding can beinternal and external. Internal sources of business financing, are means belonging to the internal company’s funds. External sources of business financing may include using funds from new business partners or issuing shares and bonds that create long-term liabilities. Different types of loans are considered as external sources of business financing. Internal sources of financing of assets of the business such as own funds, working capital, retained profits and funds from the sale of property. 1. Self-financing Self-financing of business includes the processes and procedures that the company provides funding from own resources, without obligation to return them. Self- financing of business is one of the most significant source of funding for business, especially at the beginning. Self-financing occurs in two variants, namely: 2 • self-financing from internal sources and • self-financing from external sources. Internal sources of means for business financing, are created by the business entity with their operating. Those sources of business financing appear as amortization, payment of the principal of long-term investments, long- term provisions, charged to the total revenue and accumulated net profit. - Amortizationis an economic phenomenon which express the cost of fixed assets in the process of reproduction. - Payment of principal long-term placements is the business entity whichsometimes if there is a surplus of funds from the bank account can excess to place and borrow for a period exceeding one year with interest - Accumulated net profit is net financial result that the business entity has realized during the business year. 2 Б.Трајкоски, Деловни финансии со финансиски менаџмент, Прилеп 2002 година