ABSTRACT
Long-term finance would be raised using government gilt-edged securities or National Savings. There are three principal sources of long-term finance: the money supplied by investors or shareholders, called share capital; the profits the company has made, called retained profit; and the money that has been borrowed, principally bank loans. There are two types of loans. There is the simple negotiated bank loan, and there are loans traded on a stock market, sometimes referred to as the corporate bond market. The amount of the loan, its duration, repayment terms and interest rate payable are all open to negotiation and may be tailored to suit the needs of the business. There are extra issues facing a buyer when trading internationally which can be summarised under the following headings of extra costs, currency risk and corporate social responsibility. Extra Costs fall into three main areas: management costs; insurance; and disruption costs.
