Regulating Aspects of Dividend Policy in the Business Sector of Georgia (სადივიდენდო პოლიტიკის რეგულირების მექანიზმები საქართველოს ბიზნესსექტორში)

Abstract

The paper considers and analyses the dividend policy issues in the business sector of the economy of Georgia where the role and importance of dividend policy for business entities are discussed, the entrepreneural and taxation asspects of dividend distribution are considered, the specificity of profit utilization is underlined, the active and passive dividend policy directions are analysed, the factors impacted on dividend policy of the business entities are presented, the peculiarities of both private and state enterprises dividend approaches are charachterised. Among the financial decisions of any business entity a dividend policy and the relevant decision is of utmost importance due to its cpecificity and complexity as the dividend distribution mechanism impacts upon a market value as well as future operation. A dividend policy depends on the financial results of a company and reflects the process of financial results distribution. Therefore the dividend distribution decision is a sphere of operating responsibility of financial managers. The process of the dividend distribution and utilization is regulated by entreprenueral and taxation legislations in Georgia. Partly it is related to an “Estonian” model of taxation. It should be undelined that the main form of dividend payment remains the cash dividends and the key methods are the percentage and the fixed ones that is determined of the lack of e����cient capital market operation in the country. Herewith, the specific rule is instituted concerning the state enterprises dividend distribution. Accordingly, the proper implementation of dividend policy in business sector requires analysis of factors e����ected on dividend decisions, perfection of inner corporate approaches, taking into consideration of entreprenueral-taxation aspects and correct usage of analitycal instruments of dividends assessment.