Financial structures refer to the way an organization finances its operations and growth through various sources of funds. This includes a mix of debt, such as loans and bonds, and equity, which involves selling shares of the company. The balance between these sources can significantly impact a company's financial health and risk profile. A well-defined financial structure helps businesses manage their capital effectively, ensuring they have enough resources to invest in opportunities while maintaining stability. Key components of financial structures include capital structure, cost of capital, and financial leverage, all of which play a crucial role in strategic decision-making.