Finanse, Rynki Finansowe, Ubezpieczenia

Purpose – The main aim of the study is to evaluate the use of share repurchase by small and medium-sized enterprises, as a basic tool of their dividend policy. This subject constitutes one of the basic problem of the modern theory of corporate finance – identifying the most important determinants of dividend policy. Design/Methodology/approach – The chief analysis of the study was the review of the contemporary (domestic and foreign) literature on the theory of dividends. The variety of dividend policy tools has been analyzed and compared. There has also been a survey concerning the applying of dividend policy instruments – mainly classical dividends and share repurchase – in small and medium sized enterprises. Findings – The survey results indicate that the large variety of instruments are used in small and medium- sized enterprises as a tools of investor’s payments policy. The share repurchase could be treated as the main instrument of payment, or as a subsidiary tool to support regular, cash dividend. Originality/value – The general conclusion from the study, concerns the practical implications of the use of share repurchase in the smaller entities. The analysis of the benefits and drawbacks of this in strument, leads to the conclusion, that share repurchase is an instrument of high suitability not only for big companies but also for small and medium-sized enterprises.