Retained profit

• Profit can be retained and built up over years for investment this can work long term and short term
• Recent starters won’t be able to use this as they havent obtained that much profit yet
• Advantag- no interest needed to be paid on this type of finance
• Shareholders may object to using this source of finance and as they may wish to receive the profit as dividends and if they use this retained profit it can mean the business missing out on future investments
• once retained profit is fine that it can’t be used anywhere else in the business