FINANCIAL FACTORS AFFECTING DIVIDEND DECISIONS A company's ability to raise funds externally will have a direct impact on the level of dividends paid to shareholders. Clearly, a company that has ready access to capital markets and can raise funds conveniently and economically through a number of alternative means will have greater latitude in setting its dividend policy than a company that must rely heavily on profit retention as a source of income. financing. In essence, the key question is whether or not a company can (if the need arises) finance its dividend payments externally. Those who can are likely to set higher dividend levels than those who cannot. Two aspects that tend to work against this approach to paying dividends are the cost of financing and issuance costs. External financing of dividends can be attractive provided that the cost of financing is relatively low. However, when interest rates rise, the idea of ​​financing dividends begins to lose its appeal. Additionally, underwriting fees and other origination costs will reduce desired payout ratios because they increase the cost of financing. This is especially true when the amount of external financing involved is quite small, as IPO costs are inversely proportional to company size. and tend to increase rapidly as the size of an issue decreases.[7]CONCLUSIONFrom the article we can conclude that there are many factors that affect dividend decisions. First of all, the profitability factor. The company will consider the magnitude of profits before making a dividend decision. In addition, profitability also influences the company's future investment opportunities. Apart from this, the dividend rate is also the factor that affects the dividend decisions which is middle of paper...... These alternatives have a negative impact on the payout rate, the same applies for risk and growth. Indeed, these variables increase dependence on external financing and the associated transaction costs. The determinant of the company's target payout ratio is indicated by the percentage of shares held by the central and state governments. Last but not least, using the dividend ratio and repurchase ratio as dependent variables, we can know the determinants of the amount of corporate payouts. Retained earnings, profitability and the growth rate of total assets can influence the amount of dividend distributed. If the company has significant cash flow, it can pay more dividends. Apart from this, company size is the most important factor in determining dividend payout, as some companies have distributed a significant amount of cash through buybacks..[11]