The transactions that an entity carries out involving income and expense items. Examples of financing activities or transactions include issuing debt securities (e.g., bonds), borrowing (obtaining loans), equity financing, repayment of equity and debt, and payment of cash dividends, etc.

Financing activities represent transactions between an entity and its lenders and owners to acquire or pay back economic resources. In other words, financing activities involve all types of acquired funding, repayment of funding, and payment of a return on investment or funds invested to the owners (shareholders, equity holders, etc.).