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Financial Terms: Financial Contracts

2011/1/7 17:01:00 32

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Economics is the most fertile soil for the establishment and development of finance.

Historically, every major discovery and breakthrough in finance has been achieved.

obvious

It reflects the track of economic development.

The emergence of institutional economics, especially the emergence of new institutional economics, has led economists to shift the focus of scarce resources and economic efficiency from "technical level" to "institutional level".

This great initiative in economics has also aroused the enthusiasm of financiers to study financial problems from the institutional level of property rights.

Since Smith and Warner put forward the title of financial contract in 1979, the research results of financial contracts in western countries have emerged one after another, but their scope of research on financial contracts is too narrow and basically defined in debt contracts.

In fact, financial management is a comprehensive management work. It should not only study the daily investment, financing and assets operation of enterprises, but also deal with the financial contracts between enterprises and all parties.

arrange

For example, the debt contract is only one aspect of financial control rights and income sharing rights based on the company's property right structure.

As the definition of financial contract, we should embody the following three points:

First, we should reflect the attribution of financial contracts.

The financial contract we studied is based on

enterprise

To study.

The two is to reflect the particularity of enterprise financial contract from other contracts.

The three is to cover the types of financial contracts formed by enterprises and various rights subjects.

According to the above analysis, the definition of financial contract is as follows: financial contract refers to a kind of right pfer relationship established by enterprises in the process of financing, in order to achieve reasonable expectations, on the basis of equality and mutual benefit with all rights subjects.

This definition reveals the following contents: the contracting parties of financial contracts are enterprises and various stakeholders. The purpose of financial contracts is to achieve reasonable expectations. The basis of financial contracts is equality and mutual benefit. The nature of financial contracts is a pfer of rights flow in the process of financial management.