ABSTRACT
The volume of internal funds available to a company depends on the stream of gross trading profits and other current income, and on the sums distributed from this total in interest, dividends and taxation. The residue consists of two components: first, depreciation allowances which represent funds retained for the purpose of keeping capital assets in good working order (capital consumption), and second, net savings which represents funds available for adding to the stock of capital assets. In the case of industrial and commercial companies (see Chapter n for further description of this sector) the volume of internal funds available for financing working and fixed capital requirements over the post-war period has been influenced by periodic changes introduced by governments in relation to dividend payments, taxation policy and depreciation allowances. The other major influence on savings has been fluctuations in company profits associated with the regular post-war cycles.
