The Law and Corporate Finance
Corporate finance deals in the financial aspects of a company. Corporate Finance is the field of finance dealing with financial decisions that business enterprises make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to maximise corporate value while managing the firm’s financial risks.
When it comes to the law and corporate finance various sectors of the business need to comply with certain standards and regulations in order to function and operate legally and ethically.
Corporations are financed through a variety of means including stock sales and bond transactions of different varieties. Many of these transactions are tightly regulated. Similarly, many countries have their own laws regarding various types of corporate finance available under different circumstances for different types of corporations.
Types of legal aspects matters, advice or requirements can vary in corporate finance. Therefore it’s important for Attorneys, corporate legal advisors, bankers, company secretaries, financial institutions and employees. To gain a general understanding of the essential elements of the legal principles and institutions governing corporate finance at a national and international level. Some of those financial law issues may include:
– Form and content of and requirements for financial statements.
– Contract law aspects when financing a corporate transaction.
– Selected legislation
– Regulatory aspects of non-equity financing
– Debt versus equity financing
– Non-equity financing methods, including:
– Loan agreements
– Sale and lease backs
– Project financing
– Equity financing methods such as preference share funding
– Specific types of structured financing deals such as BEE and private equity structures
– Tax aspects of corporate financing
– Interest and dividends, withholding taxes and exchange control
– The importance of the solvency and liquidity test
Without the right legal routes, the chances of your corporate finance succeeding are slim to none. Whether you’re looking for capital or funds to keep your business operating, it’s important to know the best way to go about doing it legally.