Finance course of lectures. Lectures on finance - course of lectures
Irina Vasilievna Borodushko, Evelina Karlovna Vasilyeva, Nikolai Nikolaevich Kuzin
Finance. 2nd edition
Introduction
The discipline “Finance” refers to those areas of economic knowledge that affect almost all areas of economic relations. This determines the exceptional breadth and diversity of topics, conceptual approaches, forms and methods in structuring and presenting the book’s material. An important factor is also the need for constant updating of materials, dictated by the intensity of transformation processes in the financial and economic sphere and its ongoing reform in the Russian Federation.
Quite an extensive educational and methodological literature on financial disciplines, published in recent years, includes both fundamental works (mainly encyclopedic in orientation, covering all aspects of financial science and practice) and publications of a narrower thematic focus.
The proposed short course of lectures on the discipline “Finance” has a specific target orientation to provide textbooks on the discipline “Finance” to students studying at higher educational institutions in economic specialties: “Accounting, Analysis and Audit”, “Organization Management”, “Taxes” and taxation”, etc.
In preparing this second, revised and expanded, edition of the textbook, considerable attention was paid to the issues of determining the budget strategy for the medium term and the transition to the formation of the federal budget for a 3-year period. The main innovations in the field of budget policy and the budget process, formulated in the budget message of the President of the Russian Federation of 2007 to the Federal Assembly of the Russian Federation “On budget policy in 2008–2010,” are revealed. and the Federal Law “On Amendments to the Budget Code of the Russian Federation” adopted in April 2007.
When studying the discipline “Finance”, it is recommended that you familiarize yourself with the latest publications on the issues under consideration in the following periodicals: “Finance”, “Financial Control”, “Economic Issues”, “Money and Credit”, “Financial Bulletin”, “Economist”, “Russian Economic Journal", "Rossiyskaya Gazeta", "Russian Business Newspaper". It is also advisable to study the annual budget messages of the President of the Russian Federation to the Federal Assembly of the Russian Federation and the “Russian Statistical Yearbook” published annually by Rosstat (section containing a system of financial indicators).
In general, the book is presented in a concise style, which allows, with a limited volume, to reveal all the most important aspects of the organization, functioning of public finances and their management. Another feature of this course of lectures is the authors’ desire to update information, that is, not to ignore the latest changes in the organization of finance, in their legal regulation, and in socio-economic factors affecting the financial sector. The possibilities of using controlling as a method of information and analytical support for decision-making in the field of public financial management are also identified.
ESSENCE AND FUNCTIONS OF FINANCE
The category “finance” can be considered from two positions: 1) in the material sense, as a set of funds of funds and 2) as a set of social relations. In the first case, finance acts as a tool for the distribution and redistribution of national income and GDP, as well as as a tool for controlling the flow of funds. In the second approach, finance is considered as a special form of social relations that develop in the sphere of movement of centralized and decentralized funds. In a market economy, public finance is an instrument of state policy and state regulation of economic systems.
The most important properties of finance are defined as their characteristics. The main features of finance are expressed as follows:
1) finance acts as monetary relations arising from the formation, distribution, use, redistribution and accumulation of funds;
2) the distributive nature of monetary relations is associated with the movement of real money;
3) the movement of funds is, as a rule, one-way (unidirectional) in nature;
4) finance as monetary relations have the form of centralized and decentralized funds;
5) finance acts as a necessary mechanism (through taxes and government financing) of the reproduction process in the economy;
6) finance is one of the instruments of public administration, ensuring that the state fulfills its functions and tasks.
The listed signs of finance constitute the necessary conditions for the implementation of finance functions. The main functions of finance are:
1) the function of distribution and redistribution of national income at the federal, regional and local levels in the form of interterritorial, intersectoral, intrasectoral and intra-economic movement of finances;
2) the control function of finance, ensuring verification of compliance with legislation in the field of finance and fulfillment of financial obligations;
3) the regulatory function of finance, consisting in the organization of financial relations and the influence of the state on the development of the economy through financial levers.
The functioning of finance is based on the following basic principles:
1) the principle of federalism, which implies a harmonious combination of interests in the field of financial relations at the federal and territorial levels;
2) the principle of unity of finance, meaning the unity of the regulatory framework, as well as the functioning of a single monetary system, a single credit system, a single tax system; financial accounting should be unified;
3) the principle of equality of subjects of the Russian Federation in the sphere of financial relations;
4) the principle of balance, meaning the correspondence of income and expenses, timely fulfillment of monetary obligations;
5) the principle of target orientation, implemented in commercial structures as ensuring profitability, profitability, and in public finance - as the mobilization of income in the form of taxes, fees and non-tax revenues and the distribution of financial resources in accordance with the approved parameters;
6) the principle of diversifying sources of financing and investment of resources, ensuring maneuverability and reducing financial risks;
7) the principle of strategic orientation of finance, which involves the development of long-term programs for the development of finance. A specific form of implementation of this principle was the principle of 3-year financial planning, adopted in 2007, which will extend its effect to other areas (to the activities of Gazprom, to planning the state defense order, etc.);
8) the principle of openness and transparency associated with ensuring publicity, i.e. accessibility, of financial information;
9) the principle of delimitation of powers and jurisdiction in the field of financial activities between the legislative, executive and judicial authorities;
10) the principle of a scientific approach to the organization of finance, meaning that the financial system should be based on scientifically based methodology;
11) the principle of economy and rationality, which requires the efficiency of financial activities in all areas and at all levels;
12) the principle of controllability of financial flows, which presupposes the inadmissibility of shadow financial flows and the proper fulfillment of financial obligations.
The listed principles of financial functioning should form the basis for the formation and management of financial resources. Financial resources are understood as the totality of funds at the disposal of subjects of financial relations. The entities that have them are the state, local governments, enterprises, organizations, and households.
The following types of financial resources are distinguished:
1) own funds;
2) mobilization funds;
3) funds received through redistribution. Certain types of entities that have financial resources have their own special composition of financial resources.
By own means are: at the level of the state and local governments - income of state and municipal enterprises and income from foreign economic activity; at the level of economic entities - profit; at the population level - wages, bonuses, wage supplements, social payments, income from business activities, from participation in profits, from transactions with personal property, pensions, benefits, scholarships.
Mobilization means are: at the state level - state credit, issue of funds, income from the issue of securities; at the municipal level - municipal loan, etc.; at the level of economic entities – bank loan, etc.
Funds received through redistribution represented: at the level of the state and municipalities - mandatory payments; at the level of business entities and households - interest, dividends on securities; at the household level - by receipts of funds from credit and financial transactions.
As an independent concept, there is the category “financial resources of the country”. These include: the part of GDP represented by the gross profit of the economy; contributions to state off-budget social funds; taxes on production and imports; taxes on individuals; household savings and loans received from foreign countries.
The role of finance in the Russian economy is determined by the fact that finance is one of the main mechanisms: the development of market institutions, strengthening the federal foundations of the state structure, ensuring economic efficiency and social justice, stimulating the investment activity of enterprises, improving the banking system, globalizing economic relations, forming domestic and international capital markets, improving the quality of life of citizens.
In general, the state of the country's economy is determined primarily by the state of the financial system. In modern Russia, the most pressing problems in the field of finance are:
1) providing the real sector of the economy with the necessary financial and credit resources;
2) transition to a medium-term budget planning system;
3) achieving a balanced budget of all levels and state extra-budgetary funds;
4) improvement of the tax system;
5) increasing the efficiency of use of state, municipal and private property;
6) improving fiscal federalism;
7) ensuring the unity of monetary and financial policies;
8) strengthening financial control;
9) development of the insurance system;
10) active involvement of population savings in money circulation;
11) integration into the global financial system on an equal basis, etc.
FINANCIAL SYSTEM OF THE RUSSIAN FEDERATION
Modern financial science presents various approaches to the interpretation of the concept of “financial system”. The most common of them is the definition of the financial system as a set of financial relations arising in connection with the formation, redistribution and use of funds from the state, business entities, and households.
The origins of the financial system lie in the real economic system, consisting of active and interacting participants in the reproduction process and commodity-market relations. The formation and development of the national-state financial system is carried out by state and municipal bodies and is aimed at:
1) the formation of uniform rules and procedures for the formation of finance, instruments and mechanisms for the movement of finance, as well as legal, institutional and organizational support for finance;
2) regulation of macroeconomic processes through investment, scientific and technical, tax, budget, and monetary policies;
3) state support for national business, creating the necessary conditions for the inclusion of national business in international economic and financial relations;
4) carrying out a comprehensive social policy and ensuring social stability;
5) financing of government programs, projects at the federal and regional levels.
The financial system has a complex multi-level structure and is divided into separate subsystems. The financial system includes centralized finance (state finance, municipal finance) and decentralized finance (organizational finance and household finance). State and municipal finances are represented by: the federal budget, budgets of the constituent entities of the Russian Federation, municipal budgets and extra-budgetary funds (Pension Fund, Mandatory Medical Insurance Fund, Social Insurance Fund).
The basis of the financial system is centralized finance, where the predominant share of the state’s financial resources is formed. Among decentralized finance, the key place belongs to the finance of commercial organizations. Here material wealth is created, goods are produced, services are provided, and profit is generated, which is the main source of production and social development of society. Decentralized finance is the money of business entities and households.
The financial system as a form of organizing monetary relations includes three interconnected subsystems that ensure the formation and use of financial resources:
State and local governments;
Business entities;
Population.
Each of the subsystems has specific forms and methods of formation and use of financial resources, its own functional purpose and financial mechanism, focused on achieving the own goals of each of the subjects of economic relations.
Financial subsystems can also be considered in the context of individual links in the institutional structure of society: finances of government structures, finances of amateur economic entities.
Finances of government structures include state and municipal finances. They reflect the formation of income and expenses of government bodies: federal, constituent entities of the Russian Federation and local self-government. Thus, in general, the finances of government structures are three-level, that is, they consist of federal, regional and local finances. At each level, an appropriate budget is formed. Local finances are divided into finances of individual types of settlements and districts.
The federal budget of the Russian Federation is the most important link in the country’s financial system. The federal budget reflects income and expenses that are organically related to macroeconomic indicators, the volume of taxes and the objectives of the state's financial policy. Regional (85 constituent entities of the Russian Federation) and local budgets (about 29 thousand district, city, town and village budgets) have a similar structure.
For the purposes of planning budgetary resources, a consolidated budget is drawn up, which is a set of budgets of the budgetary system of the Russian Federation in the corresponding territory (with the exception of the budgets of state extra-budgetary funds) without taking into account interbudgetary transfers between these budgets. The finances of government structures also include extra-budgetary funds that are created by federal and regional government bodies, as well as local governments, to accumulate funds in them that are spent strictly for their intended purpose. The state extra-budgetary funds include: the Pension Fund of the Russian Federation, the Social Insurance Fund of the Russian Federation, the Compulsory Medical Insurance Fund of the Russian Federation.
Government finances also include government loans. It refers to credit relations between the state, legal entities and individuals, in which the state acts primarily as a borrower.
The finances of amateur economic entities consist of the finances of commercial organizations, the finances of non-profit organizations and the finances of the population (or households).
FINANCIAL POLICY IN THE RUSSIAN FEDERATION
The state, in the process of its functioning, carries out political activities in various spheres of public life, including in the field of finance.
The financial policy of the state is understood as a set of measures aimed at mobilizing financial resources, their distribution and effective use for the state to perform its functions. Financial policy includes a set of targeted actions by government agencies to use finances. The content of financial policy is: diagnostics of the current state and ongoing changes in the financial system; justification and formation of strategy, goals and objectives for financial development; tactics, methods and tools for achieving established public finance goals. Financial policy is implemented through budget, tax, monetary, credit, investment, customs, innovation, scientific and technical policies.
Financial strategy is a long-term course of financial policy, designed for the long term and providing for the solution of large-scale problems in the financial sector. Financial tactics are methods for solving financial problems in the most important areas of financial strategy.
Financial policy should help solve the main problems facing the state in the field of mobilization and effective use of financial resources; it is aimed at regulating economic and social processes through financial levers. Financial policy is focused on stimulating advanced areas of development of productive forces, individual territories and sectors of the economy, and regulating relations with the global financial system.
The main objectives of financial policy in the Russian Federation are:
1) providing conditions for the formation of optimal volumes and structure of financial resources;
2) ensuring the rational distribution and use of financial resources at the federal, regional and local levels;
3) rational distribution of financial resources, taking into account the degree of priority of various socio-economic spheres;
4) creation and improvement of the mechanism of financial stability and financial independence of the state;
5) creation of an effective system of public financial management.
Financial policy has a specific character in each specific area of regulation of financial relations. Accordingly, the following types of financial policies are distinguished: budgetary, tax, monetary, customs, investment, policy in the field of international finance, etc.
Financial policy is developed jointly by a number of government institutions. Priority in its development belongs to the President of the Russian Federation, who, in his annual messages to the Federal Assembly, determines the main directions of financial policy for the current year and for the future. The Federal Assembly considers and approves the main provisions in the field of financial policy. Executive authorities are responsible for implementing the state's financial policy.
Financial policy is a complex concept consisting of three structural elements:
1) developing the concept of financial policy, i.e. determining the main goals and objectives of the state in the field of financial management;
2) creating a financial mechanism for implementing financial policy;
3) management of financial activities, which consists in regulating financial relations, determining the sources and directions of use of the state’s financial resources.
In the structure of financial policy, a special role belongs to the financial mechanism, which represents a system of state-established methods, methods, tools and levers of influence on economic and social processes. These elements of the financial mechanism are used in the distribution and redistribution of financial resources.
Specific elements of the financial mechanism include methods of GDP distribution, forms of cash savings, types of payments, principles and directions for the use of public financial resources, etc. All elements of the financial mechanism can be divided into two groups depending on the way they influence financial relations:
Financial support, which can be provided in several forms: self-financing, lending and non-repayable financing;
Financial regulation, which consists in regulating (through taxes, payments, deductions) distribution relations in society as a whole, in sectors of the national economy, in enterprises of various forms of ownership, for example, the tax method, payments, deductions.
According to their technological features, the elements of the financial mechanism are divided into a number of groups:
1) creation of conditions and prerequisites for regulating the financial system;
2) legal regulation of financial relations;
3) methods of financial forecasting and planning;
4) the procedure for the formation and use of centralized and decentralized funds of funds;
5) organization of the budget system;
6) organization of the securities market;
7) state financial control;
8) state regulation of enterprise finance;
9) other elements of the financial mechanism.
Financial policy has certain guidelines in time and space. Significant changes in the areas of economic, social and political life of society are always accompanied by a corresponding transformation of financial policy. In conditions of significant territorial differentiation of the socio-economic situation, adaptation of financial policy to specific local conditions is also required. An example of the relevance of taking into account the regional factor in the formation of financial policy is the instruction of the President of the Russian Federation (Budget Address, 2007) regarding the socio-economic development of the Far East and Transbaikalia: it is necessary to use all available instruments of state financial policy in order to form and implement a federal target program, aimed at ensuring the rapid development of these regions. In particular, the task is to attract private capital to co-finance this program. A special system of tax and customs tariff policies should be developed to stimulate investment in these regions.
FINANCIAL MANAGEMENT
4.1. The essence and methods of financial management
Management is understood as a conscious, purposeful influence of the subject of management on the object of management using a set of techniques and methods, carried out to achieve the intended goals. Let's consider the general procedure for managing finances.
In financial management processes, management objects are understood as types of financial relations associated with the formation of monetary income, accumulation and their use. The subjects of management are the organizational structures that carry out management: in public finance – state and municipal bodies; in the finances of economic entities - special services, financial apparatus; in household finance – the households themselves.
Specifying the essence of financial management, we must point out that it includes a number of main areas of management activity: development of a program of action, organizational function, administrative function, coordination of the actions of performers, monitoring the implementation of decisions made.
The financial management process can be viewed as the following series of sequential procedures:
1) development of rules for financial activities and their improvement;
2) financial activities, including financial forecasting, drawing up and execution of financial plans;
3) monitoring compliance with current regulations in the financial sector.
When managing finances, it is necessary to use special methods of influencing financial relations. Management methods are understood as ways and means of achieving goals.
Methods of state (municipal) financial management have a number of specific features:
1) they are used by subjects of executive power as a means of implementing the competence assigned to them;
2) with their help the governing will of the state is realized;
3) through them, direct and reverse connections are made between the subject of management and the object of management in the field of finance;
4) the choice of specific methods of control influence on financial relations is directly dependent on the characteristics of the control object (for example, departmental affiliation);
5) they are mandatory, which is ensured by means of their legal regulation.
Financial management methods are divided into two groups: indirect and direct. Economic (indirect) methods consist in the creation by the state of conditions that either stimulate a certain type of behavior of managed objects (for example, the provision of tax benefits and discounts), or create restrictive prerequisites in the form of complicating procedures, increasing tariffs, and so on. There are various schemes for providing tax benefits and discounts. Special tax discounts are provided, for example, for capital investments in R&D, which should stimulate the innovative activity of enterprises.
Specific forms of application of indirect methods of public financial management can be the following: creating and maintaining a competitive environment in the domestic market and limiting market monopolization; protection of contractual relations between market entities, ensuring the stable functioning of settlement and payment relations in the financial sector; promoting the development of insurance and business risk insurance; promoting the development of the capital market, etc.
Direct methods financial management are methods of direct administrative influence on the financial activities of business entities. The main feature of direct methods is the unilateral government influence of the subject of management on the objects of management. A characteristic feature of direct management methods is control over established requirements and rules of financial and economic activity. Among the various methods of direct regulation of relations in the financial and economic sphere, the most significant are: licensing business activities, establishing quotas for the production of certain goods, determining maximum prices for a limited range of goods and services; application of financial sanctions against violators of financial discipline, etc.
4.2. Controlling as a tool for managing public finances
In modern conditions of accelerating economic development, political confrontations and fierce market competition, in which both business entities and entire states and regions of the world are involved, traditional methods and tools of management in all spheres and at all levels of public life and in areas of financial management including. This gave rise to new theories and concepts of management. New technologies and new management mechanisms are emerging.
Of particular importance is financial control in the sphere of public administration, which, in conditions of increasing risks (political, economic, financial, environmental), the spread of terrorism and other threats, should take on fundamentally new forms and qualities. To do this, it is important to expand self-control while reducing external control, ensure the priority of the preventive orientation while limiting the “punitive” orientation, strengthen the partnership principles and information-analytical orientation in the relationship between the object and the subject of control activities.
In practice, this means the need to form a new concept of state control. Moreover, within the framework of the methodological and organizational foundations of traditional control, the formation of a new control model would be a difficult task. A more effective way of reorganizing control, which in business processes is called engineering, would be a radical change in the very foundations of a particular object or process. The form of traditional control must, of course, be preserved, but only as one of the structural elements of the new control system.
In all of the above, there is essentially nothing new, because such a management tool, called controlling, is already successfully and widely used in the management of companies in the West and is beginning to be mastered in Russia.
Controlling at enterprises is a comprehensive and flexible system that provides methodological, information and analytical support for management activities. The goal of controlling is to produce, integrate and analyze large flows of the most diverse information and, on this basis, design possible solutions to economic, financial and communication problems. A properly organized controlling system can radically improve the quality of management decisions and ensure business efficiency.
The above brief description of controlling in enterprises shows that it facilitates the solution of problems that are common in all areas of management - at enterprises, in regions, at the industry level, and across the national economy. Consequently, the task is to determine the directions for adapting the controlling method to the conditions and goals of public economic management.
The main function of controlling is to ensure integration into a unified system of operations for economic analysis, monitoring, information support, planning, control, and forecasting. Taken together, these operations ensure the receipt, processing and synthesis of information necessary for the development, adoption and execution of management decisions.
A unique property of controlling is its ability to ensure the successful functioning of economic systems in the long term based on:
Adaptation of strategic goals to global trends in the development of the external environment;
Coordination of operational plans with the strategic development plan based on the priority of the strategic plan;
Coordination of operational plans for various industries and areas of the economy;
Creating a system for monitoring the process of implementing plans, adjusting their content and implementation deadlines;
Improving the organizational structure of economic management.
The main factors determining the relevance of introducing controlling into the system of state regulation of the economy are:
Instability of both external and internal conditions for the functioning of the economy;
The need to search for more effective and improved methods of public administration;
The need to improve and qualitatively change the organization and methodology of information support for government bodies;
Low information content of data generated within the framework of the traditional financial accounting system, state and departmental statistics;
Insufficient level of interaction, consistency and coordination in the activities of various government bodies, departments, and services.
The use of controlling as a tool of scientific management presupposes the preliminary formation of theoretical foundations and methodology, including the development of the concept of controlling. The concept of controlling is understood as a holistic, formalized idea of controlling that links together all structural elements as a management subsystem designed to ensure the effectiveness of management decisions and contribute to the optimization of the business strategy and policy of the management system.
The most mature and complete interpretation of the essence of controlling is expressed in the concept in which controlling, oriented to the future in accordance with the set strategic goals and target programs, is used as a tool for eliminating bottlenecks in the economy. With this understanding of controlling, it can be involved at all stages of the management process.
The main principle of controlling is a systematic approach, which involves methodological and information support for all areas of activity of the management system. The synergistic effect obtained with a systematic approach to organizing controlling also plays a significant role. Important principles of controlling are also complexity, scientific validity, efficiency, feedback, etc.
The main system-forming property of controlling is its orientation not to the past, but to the future. Let us note in passing that this is one of the fundamental differences between controlling and control. This orientation “prescribes” to him the possibility of aggregating information, since the development of optimal management decisions is difficult without complete information covering all connections and relationships in which the functioning of economic systems is realized.
Future orientation determines the high importance of planning and forecasting in the controlling system. Trend characteristics of dynamics for previous periods are valuable primarily as basic information for drawing up forecasts and plans.
The next system-forming property of controlling is its approach to all issues from the standpoint of the unity of quantitative and qualitative aspects. Only taken together are they capable of providing complete knowledge about the object or process being studied.
The system-forming property of controlling is also the combination of strategic and operational controlling, which is determined by the structure of the tasks of managing the economic system and corresponds to it.
An essential system-forming property of controlling is the study of both the internal and external environment of the control object, since any economic system is an open system, that is, it has an extensive network of external connections and relationships.
A mandatory system-forming property of controlling is its effectiveness, since only under this condition is its existence economically (and not only economically) justified. This is one of the fundamental differences between controlling and many other structural elements of the management system. Only such controlling is necessary that is effective when the useful result exceeds the costs of its organization.
The systemic properties of controlling provide the opportunity to implement a fairly complex set of its functions, among which the most significant in relation to the field of public administration could be:
1) consulting activities in the field of methods of working with information and expert assessments based on objective indicators;
2) designing a comprehensive system of indicators that assess the efficiency of the economic system and measure the influence of internal and external factors on the result of activity;
3) information support for government entities;
4) optimization of information flows and improvement of information and communication technologies;
5) accounting and control activities;
6) mutual agreement of strategic plans and target programs for socio-economic development;
7) comparison of planned and actual indicators and determination of acceptable limits of deviations from specified parameters, analysis of the causes of deviations;
8) development of proposals for eliminating and preventing deviations of actual results from planned indicators;
9) information and analytical activities aimed at identifying the main trends and prospects for the development of the economy of the country and region.
Thus, controlling would be able to provide methodological and information support for the main functions of public administration, including the definition and justification of goals, the formation of current and strategic plans, monitoring the implementation of plans and their adjustments, etc. This set of controlling functions is relevant from the point of view of implementing the budgetary strategy in general and is especially significant in solving the task formulated in the budget message of the President of the Russian Federation to the Federal Assembly (2007) - “improving the quality of financial management in the public sector.” The main prerequisites for improving the quality of financial management are: strengthening the responsibility of executive authorities and budgetary institutions for the results of budget expenditures and improving the quality of state and municipal services; expanding the powers of these bodies; creating incentives to increase transparency and efficiency in the use of budget funds; ending the practice of petty regulation of their activities.
One of the most important controlling tools is monitoring, which has already found quite wide application in public financial management. The next task in this area is the implementation of a system for monitoring the quality of financial management of the main managers of budget funds.
A controlling system usually includes two subsystems: strategic and operational controlling. The implementation of the strategy is based on a specific list of indicators planned for the future, which are formed in the form of a strategic plan. During the implementation of the strategic plan, systematic monitoring of the compliance of actual parameters with planned ones is necessary and adjustments to the strategy must be carried out. Strategic controlling is designed to perform these functions.
Strategic goals are specified and implemented within the framework of operational management of economic systems. Accordingly, strategic controlling finds its applied embodiment in operational controlling. The unity of strategic and operational controlling lies in a common methodological basis. At the same time, strategic and operational controlling each have their own specific tools, which must be comparable and comply with common methodological principles. This mandatory condition provides the possibility of aggregation, comparative analysis and differentiation of information arrays in the course of economic analysis.
Operational controlling is capable of providing methodological and information-analytical support for the processes of operational planning, control, accounting and reporting at the industry, regional and federal levels.
The role of controlling in the formation of strategic and operational goals of public administration can be realized in two aspects.
The first aspect is theoretical and methodological, which consists in the fact that management goals determine the very need to create a controlling system. The whole point of controlling activities is high-quality, comprehensive methodological support for achieving management goals. The more complex the goals of managing an economic system and the methods for achieving them, the more urgent the need to create controlling.
The second aspect is operational, consisting in the use of controlling as a tool for implementing each management function.
The following five functions (stages, phases, stages) of management can be distinguished:
1) determining the goals and objectives (strategic and operational) of managing the economic system;
2) planning and forecasting of development;
3) information complex management, monitoring, accounting, economic analysis;
4) control and audit;
5) adoption and implementation of management decisions.
This list of management functions is only one of the possible options, since any division of a single and continuous management process is conditional and largely subjective. Various levels of granularity of control functions are possible. In certain types of economic systems (industry, region, municipality, etc.), organizational separation of the functional units of the controlling service would be required.
The highest quality and most timely information is generated in the course of controlling activities. The application of controlling requires the use of the most modern and effective methods and tools. In the future, if the effectiveness of financial management based on controlling is realized, the scientific development of a number of organizational and methodological issues will be required. The most pressing methodological problems include:
1) determining the specifics of controlling when used in the institutional environment that is characteristic of each element of the Russian financial system;
2) defining the role of controlling as a subsystem in the financial management system;
3) characteristics of financial controlling functions in the field of coordination of activities, planning, control, organization of financial flows, information and analytical work. The most important prerequisite for the creation of financial controlling is the formation of its legal framework in the order of development and expansion of the legal framework of financial control. Thus, the use of controlling as one of the financial management tools would contribute to improving the system of financial relations in the Russian economy on an innovative methodological basis.
4.3. Functions of representative authorities. President of the Russian Federation and the Central Bank of the Russian Federation in the field of financial regulation
The most important function of the Federation Council of the Russian Federation in the field of finance is (in accordance with Article 106 of the Constitution of the Russian Federation) the mandatory consideration of federal laws adopted by the State Duma on the following issues: the federal budget; federal taxes and fees; financial, currency, credit, customs regulation; money issue. A special place among these legal acts belongs to the annually adopted Federal Law “On the Federal Budget”.
The reform of the Russian financial system is being carried out in stages and its regulatory framework is being transformed accordingly. The Budget Code of the Russian Federation (BC RF) was put into effect, and treasury execution of the budget was provided for. Fundamental innovations were introduced into financial management in 2007, when decisions were made on results-oriented budget planning and the transition from annual to medium-term budget planning. The “rolling” regime of 3-year budget planning means that the budget is drawn up for the period 2008–2010, then for 2009–2011. etc.
The transition to 3-year budget planning creates the prerequisites:
Increasing the efficiency of economic regulation;
Improving the quality of public services to the population and legal entities;
Increase in the level and quality of life of the population;
Increasing the level of national security of Russia.
The transition to a 3-year budget planning procedure requires further improvement of its regulatory framework, resolution of a set of methodological and organizational issues at the federal, regional and local levels, and monitoring of the budget process in the context of medium-term budget planning.
The Federation Council has a number of committees and commissions directly or indirectly related to the function of regulating the financial sector. These include: Federation Council Budget Committee; Commission of the Federation Council for interaction with the Accounts Chamber of the Russian Federation; Federation Council Committee on Financial Markets and Monetary Circulation; Federation Council Committee on Economic Policy, Entrepreneurship and Property; Federation Council Commission on Natural Monopolies; Federation Council Committee on Local Self-Government; Committee on Agricultural and Food Policy, etc. A number of similar committees and commissions also operate at the regional level. For example, in St. Petersburg, by Decree of the Government of St. Petersburg dated August 17, 2004 No. 1385, a Commission was established to provide budget support for the implementation of investment projects by providing state guarantees to the city government. In the Leningrad Region, by Decree of the Governor of the Leningrad Region dated June 29, 2006 No. 110-pg, a Control Commission for target, result-oriented budgeting was created. The powers of this Control Commission extend to the healthcare sector of the Leningrad Region. By Decree of the Governor of the Leningrad Region dated May 24, 2006 No. 82-pg, a Commission under the Government of the Leningrad Region was formed for budget projections in the coming year and for the medium term. By Decree of the Moscow Government of November 14, 2006 No. 899-PP, a Commission for the Provision of Budget Loans was created in Moscow. In accordance with the Decree of the Moscow Government of July 8, 2003 No. 522-pp, the Competitive Financial Commission of the Moscow Government functions.
The State Duma of the Russian Federation carries out a number of responsible functions in the field of financial regulation. In accordance with Art. 103 of the Constitution of the Russian Federation, the State Duma appoints and dismisses the Chairman of the Central Bank of the Russian Federation, the Chairman of the Accounts Chamber and half of its auditors. The Deputy Chairman of the Accounts Chamber and half of its auditors are appointed by the Federation Council.
The State Duma has committees directly or indirectly related to issues of regulation of the financial system: Committee on Budget and Taxes, Committee on Credit Institutions and Financial Markets, Committee on Economic Policy and Entrepreneurship, Committee on Property and other committees.
The highest permanent state body of financial control is the Accounts Chamber of the Russian Federation, formed by the Federal Assembly of the Russian Federation and reporting to it. The Accounts Chamber performs exclusively control functions in the field of finance, which will be discussed in lecture 6.
The President of the Russian Federation, in accordance with the Constitution of the Russian Federation and federal laws, determines the main directions of the state’s domestic and foreign policy and the structure of federal executive bodies. The President of the Russian Federation forms the Presidential Administration, which includes a number of departments that, along with other issues, resolve a number of core tasks in the field of financial regulation. In particular, the Presidential Administration carries out the following activities:
1) in the field of communication with international financial organizations;
2) on the preparation of materials for the annual messages of the President of the Russian Federation to the Federal Assembly, in which significant attention is paid to issues of financial policy and improvement of the financial system;
3) on analyzing the progress of execution of the federal budget by federal executive authorities and executive authorities of constituent entities of the Russian Federation;
4) on the preparation of proposals to the President of the Russian Federation on the expenditure of funds from the reserve fund of the President of the Russian Federation;
5) on a comprehensive analysis of interbudgetary relations and preparation of proposals to the President of the Russian Federation for their improvement;
6) on organizing control and inspection of the activities of federal executive authorities, executive authorities of constituent entities of the Russian Federation, organizations and their leaders.
The Central Bank of the Russian Federation performs the following set of functions for regulating finance:
1) in cooperation with the Government of the Russian Federation, develops and implements a unified state monetary policy;
2) monopolistically issues cash and organizes cash circulation;
3) is the lender of last resort for credit institutions, organizes a system for their refinancing;
4) establishes the rules for making payments in the Russian Federation;
5) establishes the rules for conducting banking operations;
6) carries out servicing of budget accounts at all levels of the budget system of the Russian Federation, unless otherwise established by federal laws, through settlements on behalf of authorized executive authorities and state extra-budgetary funds, which are entrusted with organizing the execution and execution of budgets;
7) carries out effective management of gold and foreign exchange reserves of the Bank of Russia;
8) exercises supervision over the activities of credit institutions and banking groups;
9) organizes and carries out currency regulation and currency control in accordance with the legislation of the Russian Federation;
10) establishes and publishes official exchange rates of foreign currencies in relation to the ruble;
11) takes part in the development of the forecast of the balance of payments of the Russian Federation and organizes the compilation of the balance of payments of the Russian Federation;
12) conducts analysis and forecasting of the state of the Russian economy as a whole and by region, primarily monetary, monetary, financial and price relations, publishes relevant materials and statistical data.
4.5. Powers of federal executive authorities in the field of financial management
The leading role in financial management belongs to the Ministry of Finance and the Ministry of Economic Development and Trade, which are the main implementers and coordinators in this area. Let us next consider the main functions (powers) of these departments. The control functions of services and agencies in the field of finance require special consideration, and we will address them in Lecture 6.
The Ministry of Finance of the Russian Federation (Ministry of Finance of Russia) is a federal executive body that carries out the functions of developing state policy and legal regulation in the areas of: budgetary, tax, insurance, foreign exchange, banking, public debt, auditing, accounting and financial reporting; production, processing and circulation of precious metals and precious stones; customs payments, determination of the customs value of goods and vehicles; investing funds to finance the funded part of the labor pension; organizing and conducting lotteries; production and circulation of security printed products; financial support of the public service; combating the legalization of proceeds from crime and the financing of terrorism.
The Ministry of Finance of the Russian Federation submits to the Government of the Russian Federation draft federal laws, regulatory legal acts of the President of the Russian Federation and the Government of the Russian Federation. The Ministry adopts normative legal acts defining the procedure for:
Formation of reporting on the execution of the federal budget, budgets of state extra-budgetary funds, budgets of the budget system of the Russian Federation and the consolidated budget of the Russian Federation;
Maintaining a consolidated budget list of the federal budget;
Application of the budget classification of the Russian Federation;
Determining the conditions for including insurance organizations in the register of insurance organizations whose insurance contracts can be accepted as security for the payment of customs duties;
Control of the customs value of goods and vehicles (together with the Federal Customs Service);
Maintaining the state debt book of the Russian Federation and transferring information from the state debt book of a constituent entity of the Russian Federation and the municipal debt book to the Ministry of Finance of the Russian Federation;
Maintaining accounting records and preparing financial statements;
Determination of prices for precious metals, as well as products made from them, purchased into the State Fund of Precious Metals and Precious Stones of the Russian Federation and sold from it.
The mandate of the Ministry of Finance includes extensive activities to determine the forms of a number of documents. The forms of tax returns and the procedure for filling them out are determined. In the field of customs affairs, samples of such documents as the form of a customs receipt order, on the basis of which the payment of customs duties is made, the form of a request for payment of customs duties, the form of a decision to collect customs duties in an indisputable manner from funds held in the payer's bank accounts, are accepted. .
The Ministry of Finance develops forms of reports on the results of the issue of federal government securities, determines the conditions for the issue and circulation of federal government securities and makes decisions on the issue of individual issues of federal government securities.
In the field of insurance, the Ministry of Finance establishes requirements for indicators of the financial stability of insurers, and also determines the forms of accounting and reporting of insurers.
The Ministry of Finance of the Russian Federation has broad powers in the management of the state budget of Russia. The Ministry of Finance draws up a draft federal budget, approves and maintains a consolidated budget list of the federal budget, submits reports to the Government of the Russian Federation on the execution of the federal budget and the consolidated budget of the Russian Federation, manages in the prescribed manner the funds of the Stabilization Fund of the Russian Federation (reorganized by creating the Reserve Fund and the Fund for Future Generations). Along with practical activities in managing the state budget, the Ministry of Finance carries out a lot of methodological work, including methodological guidance in the field of budget planning and methodological support for cash services by federal treasury authorities for the budgets of constituent entities of the Russian Federation and local budgets.
A number of responsible functions are performed by the Ministry of Finance in the area of organizing the budget process. These include:
Monitoring of the budget sector by the main managers of federal budget funds;
Conclusion on behalf of the Russian Federation of an agreement on the provision of state guarantees of the Russian Federation and an agreement to ensure the recourse claims of the guarantor;
Management of the state debt of the Russian Federation in accordance with the established procedure;
Maintaining the state debt book of the Russian Federation and recording information on debt obligations reflected in the relevant debt books of the constituent entities of the Russian Federation and municipalities;
Performing the functions of an issuer of government securities;
Maintaining state registration of the conditions of issue and circulation of government securities of constituent entities of the Russian Federation and municipal securities;
Ensuring the provision of budget loans and budget credits within the limit of funds approved by the Federal Law “On the Federal Budget” for the next financial year, and in the manner established by the Government of the Russian Federation;
Conducting negotiations in accordance with the established procedure and signing on behalf of the Government of the Russian Federation multilateral agreements with debtors and creditors within the framework of the Paris Club;
Collection, processing and analysis of information on the state of state and municipal finances;
Organization of transfers of interbudgetary transfers from the federal budget to the budgets of constituent entities of the Russian Federation and municipalities;
Coordination of decisions of the Pension Fund of the Russian Federation on the volume and structure of allocation of insurance contributions.
The Ministry of Finance of the Russian Federation coordinates and controls the activities of a number of services under its jurisdiction. These services are: the Federal Tax Service, the Federal Insurance Supervision Service, the Federal Financial and Budgetary Supervision Service, the Federal Financial Monitoring Service and the Federal Treasury.
The Federal Tax Service (FTS of Russia) is a federal executive body that exercises control and supervision functions over:
Compliance with the legislation of the Russian Federation on taxes and fees;
Correct calculation, completeness and timely payment of taxes and fees to the relevant budget in cases provided for by the legislation of the Russian Federation;
The correctness of calculation, completeness and timeliness of other obligatory payments being entered into the relevant budget;
Compliance with the currency legislation of the Russian Federation within the competence of the tax authorities;
Production and circulation of ethyl alcohol, alcohol-containing, alcoholic and tobacco products.
The Federal Tax Service is an authorized federal executive body that performs the functions of a currency control agent within the competence of the tax authorities. The Federal Tax Service carries out state registration of legal entities, individuals as individual entrepreneurs and peasant (farm) farms. The Service is an authorized federal executive body that ensures representation in bankruptcy cases and bankruptcy procedures of claims for the payment of mandatory payments and claims of the Russian Federation for monetary obligations. The Federal Tax Service keeps records of all taxpayers.
The Federal Insurance Supervision Service carries out control and supervision functions in the field of insurance activities. The Federal Insurance Supervision Service makes decisions on the issuance or refusal to issue, cancellation, restriction, suspension, renewal and revocation of licenses to insurance business entities; conducts certification of insurance actuaries; maintains a unified state register of insurance entities and a register of associations of insurance entities. The Federal Service calculates the amount (quota) of foreign capital participation in the authorized capitals of insurance organizations.
The Federal Service for Financial and Budgetary Supervision carries out the functions of control and supervision in the financial and budgetary sphere, as well as the functions of a currency control authority. By Order of the Government of the Russian Federation dated July 30, 2004 No. 1024-r, the Federal Service for Financial and Budgetary Supervision was transferred to the control and audit bodies and territorial bodies for currency control of the Ministry of Finance of the Russian Federation. The Federal Service for Financial and Budgetary Supervision exercises control and supervision over: the use of federal budget funds, funds from state extra-budgetary funds, as well as material assets in federal ownership; for compliance by residents and non-residents (with the exception of credit organizations and currency exchanges) with currency legislation; for compliance with the requirements of budget legislation, etc.
The Federal Service for Financial Monitoring carries out the functions of:
Anti-money laundering;
Identifying and suppressing terrorist financing;
Coordination of the activities of other federal executive authorities in this area;
Monitoring the implementation of the Federal Law of August 7, 2001 No. 115-FZ (based on the order of the Ministry of Finance of December 26, 2006 No. 183n) by organizations carrying out transactions with funds or other property, in the scope of which there are no supervisory authorities. In this way, control was streamlined and the provision of information was ensured in the field of gambling, the purchase and sale of real estate, the activities of pawnshops and leasing companies, which were very attractive for laundering criminal proceeds.
The main forms of inspections of organizations by the Federal Financial Monitoring Service are desk and field control operations. At the same time, strict compliance with the rules for the protection of confidential official, banking, tax, commercial and other information from disclosure, loss, distortion, leakage, destruction, and illegal use is ensured.
The Federal Financial Monitoring Service interacts in the prescribed manner and within the established scope of activity with the Central Bank of the Russian Federation, with the competent authorities of foreign states, with government bodies, with organizations, with officials and citizens of foreign states both in the Russian Federation and abroad.
The Federal Treasury (Treasury of Russia) carries out the functions of ensuring the execution of the federal budget, cash services for the execution of budgets of the budget system of the Russian Federation, preliminary and current control over the conduct of transactions with federal budget funds by the main managers, administrators and recipients of federal budget funds. The Federal Treasury exercises the following powers:
Communicates to the main managers, administrators and recipients of federal budget funds the indicators of the consolidated budget schedule, limits of budget obligations and funding volumes;
Keeps records of operations on cash execution of the federal budget;
Opens accounts in the Central Bank of the Russian Federation and credit organizations to account for federal budget funds and other funds in accordance with the legislation of the Russian Federation, establishes regimes for federal budget accounts;
Opens and maintains personal accounts of the main managers, administrators and recipients of federal budget funds;
Maintains a consolidated register of the main managers, administrators and recipients of federal budget funds;
Keeps records of indicators of the consolidated budget schedule of the federal budget, limits of budget obligations and their changes;
Compiles and submits to the Ministry of Finance of the Russian Federation operational information and reporting on the execution of the federal budget, reporting on the execution of the consolidated budget of the Russian Federation;
Receives from the main managers of federal budget funds, executive authorities of constituent entities of the Russian Federation, state extra-budgetary funds and local governments the materials necessary for reporting on the execution of the federal budget and the consolidated budget of the Russian Federation.
The Federal Treasury distributes income from the payment of federal taxes and fees between the budgets of the budget system of the Russian Federation in accordance with the legislation of the Russian Federation. The task of the Federal Treasury is forecasting, cash planning of federal budget funds and management of operations on the single account of the federal budget. The Treasury provides cash services for the execution of budgets of the budget system of the Russian Federation, confirms monetary obligations of the federal budget and issues a permitting inscription for the right to carry out federal budget expenditures within the allocated limits of budget obligations.
The Federal Treasury ensures cash payments from the budgets of the budget system of the Russian Federation on behalf of and on behalf of the relevant bodies collecting budget revenues, or recipients of funds from these budgets, whose personal accounts are duly opened with the Federal Treasury. The activities of the Federal Treasury are also aimed at creating conditions for compliance with standards for the distribution of income between the budgets of the budget system of the Russian Federation and effective control over the targeted nature of federal budget expenditures, subsidies and subventions allocated to regional and local budgets.
The Federal Tax Service, the Federal Insurance Supervision Service, the Federal Service for Financial and Budgetary Supervision, the Federal Service for Financial Monitoring and the Federal Treasury do not have the right to carry out legal regulation in the established field of activity, except in cases established by decrees of the President of the Russian Federation and decrees of the Government of the Russian Federation.
The Ministry of Economic Development and Trade of the Russian Federation (Ministry of Economic Development of Russia) is a federal executive body that carries out the functions of developing state policy and legal regulation in the areas of:
Analysis and forecasting of socio-economic development;
Development of entrepreneurial activity, including medium and small businesses;
Trade;
Property relations;
Insolvency (bankruptcy);
Financial recovery of organizations;
Economic development of constituent entities of the Russian Federation and municipalities;
Investment activities, including the use of funds from the Investment Fund of the Russian Federation;
Formation of interstate and federal target programs;
Mobilization preparation of the Russian economy;
Creation and operation of special economic zones on the territory of the Russian Federation, etc.
The Ministry of Economic Development has broad powers in the field of law-making activities; it adopts regulations defining:
1) the list and procedure for determining indicators of economic efficiency of the activities of federal state unitary enterprises and open joint-stock companies, the shares of which are in federal ownership;
3) the procedure for preparing decisions on the conditions for privatization of property complexes of unitary enterprises;
4) a deflator coefficient corresponding to the index of changes in consumer prices for goods (work, services) in the Russian Federation;
5) other issues in the established scope of activity of the ministry and subordinate federal services and federal agencies.
Another area of activity of the Ministry of Economic Development in the field of legal regulation of the country’s economy is the preparation of opinions on draft regulations governing relations in business activities and on draft federal target programs.
The Ministry of Economic Development carries out extensive and varied activities on monitoring and economic analysis of socio-economic processes. The Ministry monitors the content and quality of consolidated financial balances for the Russian Federation, constituent entities and regions of the Russian Federation, industries and sectors of the economy.
The development of state forecasts of socio-economic development for the short, medium and long term is also a function of the Ministry of Economic Development. These forecasts are developed for all levels and sectors of the economy: for the Russian Federation, for constituent entities and regions of the Russian Federation, for municipalities, for industries and sectors of the economy. Forecast calculations of general economic indicators of the system of national accounts are carried out.
The Ministry of Economic Development coordinates and controls the activities of services and agencies under its jurisdiction. These services and agencies include: Federal Agency for State Reserves, Federal Agency for Real Estate Cadastre, Federal Agency for Federal Property Management, Federal Agency for Management of Special Economic Zones. The Ministry also coordinates the activities of the Russian Federal Property Fund.
The Federal Agency for State Reserves is a federal executive body that carries out the functions of providing public services and managing state property in the field of managing the state material reserve. The Federal Agency organizes the formation, placement, storage and maintenance of inventories of material assets of the state material reserve and their departmental protection; carries out management of the state material reserve system.
The Federal Real Estate Cadastre Agency is a federal executive body responsible for managing state property and providing government services in the field of maintaining cadastres of real estate, land management, inventory of urban planning activities, state cadastral valuation of land and state land monitoring, as well as state land control .
The Federal Agency for Federal Property Management (Rosimushchestvo) is a federal executive body that performs the functions of managing federal property, including in the field of land relations, providing public services and law enforcement functions in the field of property and land relations. The Federal Agency has, in the manner and within the limits determined by federal laws, acts of the President of the Russian Federation and the Government of the Russian Federation, the powers of the owner in relation to the following types of property:
Property of federal state unitary enterprises;
Property of federal government agencies;
Shares (shares) of joint-stock (business) companies and other property, including that constituting the state treasury of the Russian Federation.
The Federal Property Management Agency, as an owner, also carries out actions to transfer federal property to legal entities and individuals, and to privatize (alienate) federal property.
The Federal Property Management Agency performs a number of functions for accounting and management of federal property, including:
Accounting for federal property;
Maintaining a register of federal property;
Organization of property valuation;
Determining the terms of contracts for the assessment of federal property;
Preparation of draft forecast plans (programs) for the privatization of federal property;
Drawing up a report on the results of privatization of federal property;
Preparation of information on the results of privatization of property of constituent entities of the Russian Federation and municipal property;
Making decisions on the reorganization of federal state unitary enterprises in the form of mergers and acquisitions, as well as on their liquidation.
The Federal Agency for the Management of Special Economic Zones carries out functions for the provision of public services and law enforcement functions in the field of management of special economic zones, functions for monitoring the implementation of agreements on the implementation of industrial-production, technology-implementation and tourist-recreational activities in special economic zones. The Federal Agency assists the Ministry of Economic Development and Trade of the Russian Federation in the selection, control and monitoring of investment projects implemented at the expense of the Investment Fund of the Russian Federation.
The services and agencies whose functions and powers were reviewed (Federal Agency for State Reserves, Federal Agency for Real Estate Cadastre, Federal Agency for Federal Property Management, Federal Agency for Management of Special Economic Zones) do not have rights in the field of law-making activities. They do not have the right to carry out legal regulation in the established field of activity, except in cases established by decrees of the President of the Russian Federation and decrees of the Government of the Russian Federation.
The specialized state institution under the Government of the Russian Federation “Russian Federal Property Fund” is a federal state institution that carries out the functions of:
Creation of an effective system for the sale of federal property;
Promoting the transformation of property relations and increasing the efficiency of circulation of objects of civil rights in the Russian Federation;
Creating conditions for the effective functioning of the system of forced foreclosure on the property of debtors, including the collection of debt on mandatory payments to budgets and state extra-budgetary funds.
4.6. Local financial management
In the implementation of the functions of local governments, a large role belongs to the financial component. The main links in the local finance system are the local budget and the finances of municipal enterprises.
Municipal financial management is a process that includes the stages of planning, operational management and control. The subjects of management are local government bodies. The object of management is the totality of monetary relations within the municipality.
The effectiveness of local financial management is determined by the level of self-organization of local communities, the quality of the activities of local governments and the regulatory influence of federal and regional government bodies. Government bodies indirectly influence the financial management of a municipality, mainly in the form of legal regulation of issues regarding the limits of financial independence of municipalities, the procedure for budgeting and taxation, and ensuring the balance of local budgets. Government bodies provide methodological and information support to the process of local financial management and send significant interbudgetary transfers to municipalities. Due to the peculiarities of local budget management, this process is sometimes called “municipal financial management”.
The uniqueness of the revenue structure of municipal budgets lies in the significant share of interbudgetary transfers. The structure of expenses is determined by the need for costs associated with financial support when resolving issues of local importance and certain state powers delegated to local governments for execution. The main areas of spending local budget funds are costs for the implementation of social policy measures, education, healthcare and sports, culture, housing and communal services, maintenance of local government bodies, etc.
FINANCIAL PLANNING AND FORECASTING
5.1. Financial and socio-economic forecasts as the basis for the formation of a financial plan
Financial forecasting is closely related to the financial planning process. Forecasts serve as the basis for drawing up financial plans and targeted development programs for the coming periods.
The general concept of economic forecasting is formulated as follows: a forecast is a scientifically based hypothesis about the likely future state of the economic system and economic objects and indicators characterizing this state. The information base for forecasting consists of the results of scientific research, containing quantitative and qualitative data on trends and factors in the development of the financial sector. The financial forecast is a guideline for drawing up financial plans. When developing a forecast, specific financial management tasks are not set, and the characteristics of the future state of the financial system are not determined in all details. Forecasted indicators provide only an approximate assessment of the future; their accuracy is tested by time.
An important methodological principle of economic, including financial, forecasting is the variability of scenarios of macroeconomic forecast conditions. Thus, several forecast options are developed, usually three: high (optimistic), medium (most likely) and low (pessimistic). At the same time, the main factors influencing the development trajectory in the future are: the scale of inflation, the unemployment rate, the investment climate, the level of income of the population, etc.
Financial forecasting is multi-level; forecasts are developed at the levels of the Russian Federation, constituent entities of the Russian Federation and municipalities. Regional forecasts contain information on the expected scale of territorial differentiation of the main macroeconomic indicators. These forecasts make it possible to determine which regions may turn out to be “donors” in the future and which ones – subsidized ones.
Financial forecasts are a necessary element and at the same time a stage in the development of financial policy. Through financial policy, financial levers and incentives are activated, the mobilization of cash revenues into the state budget and their rational use for national needs are ensured.
The financial forecasting methodology provides for the autonomous development of a federal forecast in the center and regional forecasts in the constituent entities of the Russian Federation. Regional forecasts are sent to the Ministry of Economic Development. The negative side of the current practice is the lack of balance between federal and regional forecasts.
When drawing up financial forecasts, they are guided by the provisions of the Federal Law “On State Forecasting and Programs of Socio-Economic Development of the Russian Federation” adopted in 1995, which defines the goals and content of the system of state forecasts of socio-economic development of the Russian Federation and programs of socio-economic development of the Russian Federation, as well as the general the procedure for developing these forecasts and programs. To date, significant forecasting experience has been accumulated, and therefore it would be advisable to make clarifications and additions to the above law. Currently, work is underway on the draft Federal Law “On State Forecasting, Indicative Planning and Programs for the Social and Economic Development of the Russian Federation.”
The most relevant provisions for the practice of financial forecasting are the provisions of the federal law on state forecasting given below. State forecasting of socio-economic development of the Russian Federation is a system of scientifically based ideas about the directions of socio-economic development of the Russian Federation, based on the laws of market management. The results of state forecasting of the socio-economic development of the Russian Federation are used by the legislative and executive authorities of the Russian Federation when making specific decisions in the field of socio-economic policy of the state.
Forecasts for the country's socio-economic development are developed based on the results of a comprehensive analysis, which includes the following areas of research:
1) assessment of the demographic situation;
2) characteristics of scientific and technical potential;
3) determination of the volume and structure of accumulated national wealth;
4) features of the social structure of society;
5) assessment of the external situation of the Russian Federation;
6) state of natural resources.
For each area of analysis, the current situation, dynamics over past years and prospects for changes in the future are assessed. Of all the listed areas of research, the most difficult is the analysis of the prospects for changes in Russia’s external situation due to the increased uncertainty of trends and factors in the foreign economic situation.
Forecasts of socio-economic development are developed for the Russian Federation as a whole, for national economic complexes and sectors of the economy, and for regions.
Forecasts of socio-economic development contain quantitative indicators and qualitative characteristics of the development of the macroeconomic situation, economic structure, scientific and technological development, foreign economic activity, dynamics of production and consumption, level and quality of life, environmental situation, social structure. The forecast provides an assessment of the future state of the education, healthcare and social security systems.
The Government of the Russian Federation ensures the development of state forecasts for the socio-economic development of the Russian Federation for the long, medium and short term. The forecast for the development of the public sector of the economy is highlighted separately. The socio-economic development forecast is being developed:
For the long term – once every 5 years for a 10-year period;
For the medium term - for a period of 3 to 5 years and is adjusted annually;
For the short term – annually.
The Russian Ministry of Economic Development is developing a general forecast of the country's socio-economic development for 3 years, containing basic macroeconomic indicators of economic and social development. In the forecast of socio-economic development of Russia for 2008–2010, adopted in 2007. along with many others, the following indicators are presented: a decrease in the inflation rate by 2010 to 5–6%, GDP growth by an average of 6% per year, an increase in real wages by 12% per year, an increase in the share of the “average” over 3 years class" in the population from 20 to 35%, an increase in the average pension over 3 years by 40% and their achievement of the subsistence level, a reduction in the share of the population with incomes below the subsistence level over a 3-year period from 16.3 to 10.7% . An alarming situation is expected in the state of the Pension Fund: by 2010, the fund's deficit will amount to 0.6% of GDP. Indicators of the amount of raw material revenues, exchange rates, prices for hydrocarbon raw materials, the volume of revenues from VAT, etc. are also forecast.
Typical directions and subjects of state forecasting are: compliance with the necessary proportions of expanded reproduction, ensuring the development of key areas of the economy and solving social problems; implementation of national investment and scientific-technical policy; formation of interstate foreign economic relations; creation of reserves for the implementation of fundamental targeted programs and localization of emergency situations; ensuring the country's defense capability.
In addition to socio-economic forecasts, financial forecasts are also developed as a basis for drawing up financial plans. They contain either assessments of the prospects for the development of the financial system as a whole, or characteristics of its individual elements or private blocks of financial indicators. The financial forecast can be presented both as one of the sections of the socio-economic forecast, and in the form of an independent forecast development. An example of an independent financial forecast is a quarterly forecast of federal budget revenues. For example, in Art. 4 of the Federal Law “On the Federal Budget for 2007” it is stated that federal government bodies - administrators of federal budget revenues and other administrators of budget funds - are required to “submit quarterly, before the 10th day of the month preceding the first month of the quarter, to the Ministry of Finance of the Russian Federation, respectively, a forecast of monthly revenue receipts and a forecast of monthly attraction and repayment of funds sources of internal and external financial deficit of the federal budget for the next quarter.”
Socio-economic and financial planning is carried out not only at the federal, but also at the regional level. Thus, in the Leningrad region in 2003, a procedure for preparing forecast and analytical materials on the socio-economic development of the Leningrad region was developed and approved. This ensured the most complete analysis of the state of sectors of the economy and the social sphere, as well as improving the quality of development of forecasts for the socio-economic development of the Leningrad region. When developing a short-term forecast, the Committee on Economics and Investments of the Leningrad Region solves the following tasks:
Based on regulatory legal acts of the Government of the Russian Federation and in accordance with materials received from the Ministry of Economic Development of Russia, prepares an order of the governor of the Leningrad region on the development of a forecast and provides the sectoral executive authorities of the Leningrad region, which are the developers of the forecast for the socio-economic development of industries (directions), and also economic services of municipalities with the necessary methodological materials and forms;
Together with Petrostat, it clarifies the basic data on the indicators necessary to develop the forecast and brings them to the attention of the sectoral executive authorities of the Leningrad region.
Sectoral executive authorities of the Leningrad Region in accordance with the deadlines established by the order of the Governor of the Leningrad Region:
Carry out a comprehensive analysis of the state of affairs in industries, determine the main trends in their development;
Notes
Cm. Ashmarina E. M. Modern financial system of the Russian Federation // State and law. 2004. No. 6, as well as educational literature: Abramova M. I., Alexandrova L. S. Finance and credit. M.: Jurisprudence, 2004; Sergienko L.V. Finance and the real sector. M.: Finance and Statistics, 2004; Vakhrin P.I., Neshitoy A.S. Finance. M.: Dashkov and Co., 2004; Finance / Ed. G. B. Polyak. 2nd ed. M.: UNITA-DANA, 2004; Finance / Ed. S. I. Lushina. 2nd ed. M.: Economist, 2003; Finance / Ed. V.V. Kovaleva. 2nd ed. M.: Welby, Prospekt, 2005; Myslyaeva I. N. State and municipal finances. 2nd ed., revised. and additional M.: INFRA-M, 2007; Romanovsky M. V., Vrublevskaya O. V., Sabanti B. M. Finance. 2nd ed. M., Yurayt, 2006; Shulyak P. N., Belotelova N. P. Finance. 3rd ed. M.: Dashkov and Co., 2002.
Improving financial control can, in our opinion, be most effective when using controlling methods (see section 4.2).
Federal Law of the Russian Federation “On the Accounts Chamber of the Russian Federation” dated January 11, 1995 No. 4-FZ (with subsequent amendments and additions) // Social Protection of the Russian Federation dated January 16, 1995 No. 3, Art. 167.
Federal Law of the Russian Federation “On the Central Bank of the Russian Federation (Bank of Russia)” dated July 15, 2002 No. 86-FZ (with subsequent amendments and additions) // SZ RF dated July 15, 2002 No. 28, Art. 2790.
Federal Constitutional Law of the Russian Federation “On the Government of the Russian Federation” dated December 17, 1997 No. 2-FKZ (with subsequent amendments and additions) // Law of the Russian Federation dated December 22, 1997 No. 51, Art. 5712. Decree of the Government of the Russian Federation “On the Regulations of the Government of the Russian Federation and the Regulations on the Staff of the Government of the Russian Federation” dated June 1, 2004 No. 260 // SZ RF dated June 7, 2004 No. 23, art. 2313.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Antimonopoly Service” dated June 30, 2004 No. 331 // SZ RF dated August 2, 2004 No. 31, art. 3259.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Service for Financial Markets” dated June 30, 2004 No. 317 // Federal Law of the Russian Federation dated July 5, 2004 No. 27, art. 2780.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Tariff Service” dated June 30, 2004 No. 332 // Federal Law of the Russian Federation dated July 5, 2004 No. 29, art. 3049.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal State Statistics Service” dated June 30, 2004 No. 399 // Social Protection of the Russian Federation dated September 9, 2004 No. 32, art. 3346.
Decree of the Government of the Russian Federation “On the Federal Customs Service” dated July 26, 2006 No. 459 // SZ RF dated August 7, 2006 No. 32 art. 3569.
Decree of the Government of the Russian Federation “On the Ministry of Finance of the Russian Federation” dated July 30, 2004 No. 329 (with subsequent amendments and additions) // Social Protection of the Russian Federation dated August 2, 2004 No. 31, Art. 3258.
Decree of the Government of the Russian Federation “On approval of the regulations on the Federal Tax Service” dated September 30, 2004 No. 506 (with subsequent amendments and additions) // Social Protection of the Russian Federation dated October 4, 2004 No. 40, Art. 3961.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Insurance Supervision Service” dated July 30, 2004 No. 148 // Social Protection of the Russian Federation dated April 12, 2004 No. 28, art. 2904.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Service for Financial and Budgetary Supervision” dated June 15, 2004 No. 278 // Federal Law of the Russian Federation dated June 21, 2004 No. 25, Art. 2561.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Service for Financial Monitoring” dated June 23, 2004 No. 307 // Social Protection of the Russian Federation dated June 28, 2004 No. 26, Art. 2676; Federal Law “On Combating the Legalization (Laundering) of Proceeds from Crime and the Financing of Terrorism” dated August 7, 2001 No. 115/FZ; Order of the Ministry of Finance of Russia dated December 26, 2006 “On approval of the Regulations on the procedure for the Federal Service for Financial Monitoring to exercise control over the implementation of the Federal Law “On Anti-Money Laundering” by organizations carrying out transactions with funds or other property in the field of activity of which there are no supervisory authorities laundering) proceeds from crime and financing of terrorism” dated August 7, 2001 No. 115/FZ” No. 183n.
Decree of the Government of the Russian Federation “On the Federal Treasury” dated December 1, 2004 No. 703 (with subsequent amendments and additions) // Social Protection of the Russian Federation dated December 6, 2004 No. 49, Art. 4908.
Decree of the Government of the Russian Federation “Regulations on the Ministry of Economic Development and Trade of the Russian Federation” dated August 27, 2004 No. 443 (with subsequent amendments and additions) // Social Protection of the Russian Federation dated September 6, 2004 No. 36, Art. 3670.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Agency for State Reserves” dated July 23, 2004 No. 373 (with subsequent amendments and additions) // SZ RF dated August 2, 2004 No. 31, Art. 3263.
Decree of the Government of the Russian Federation “On approval of the Regulations on the Federal Real Estate Cadastre Agency” dated August 19, 2004 No. 418 // SZ RF dated August 23, 2004 No. 34, Art. 3554.
Decree of the Government of the Russian Federation “On the Federal Agency for Federal Property Management” dated November 27, 2004 No. 691 // Federal Law of the Russian Federation dated December 6, 2004 No. 49, Art. 4897.
Decree of the Government of the Russian Federation “On the Federal Agency for the Management of Special Economic Zones” dated August 19, 2005 No. 530 (with subsequent amendments and additions) // SZ RF dated August 29, 2005 No. 35, Art. 3611.
Decree of the Government of the Russian Federation “On the Russian Federal Property Fund” dated December 25, 2002 No. 925 (with subsequent amendments and additions) // Federal Law of the Russian Federation dated December 30, 2002 No. 52. Part II, Art. 5229.
Federal Law “On State Forecasting and Programs for Social and Economic Development of the Russian Federation” dated July 20, 1995 No. 115-FZ // SZ RF dated July 24, 1995 No. 30, Art. 2871.
Decree of the Governor of the Leningrad Region “On the procedure for the work of sectoral executive authorities of the Leningrad Region in analyzing and forecasting the socio-economic development of the territory” dated April 8, 2003 No. 56-pg. (The text of the resolution was not officially published).
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Name: Finance - Lecture notes.
The lecture notes meet the requirements of the State educational standard for higher professional education. Accessibility and brevity of presentation allow you to quickly and easily gain basic knowledge on the subject, prepare for and successfully pass tests and exams. The content, functions, socio-economic essence of finance, the monetary system of Russia, the importance of the budget in the development of the economy and social sphere, the current state of extra-budgetary redistribution of financial resources, as well as the finances of economic entities and much more are considered.
For students of economic universities and colleges, as well as those who independently study this subject.
1. The emergence of finance
Finance appeared simultaneously with the emergence of the state during the stratification of society into classes. With the decomposition of feudalism and the development in its depths of the capitalist mode of production, monetary income and expenses of the state began to acquire increasing importance.
In the early stages of the development of the state, there was no distinction between the resources of the state and the resources of its head.
With the allocation of the state treasury and its complete separation from the property of the monarch (XVI-XVII centuries), the concepts of public finance, state budget, and state credit arise.
Public finance served as a powerful lever for the initial accumulation of capital.
Government loans and taxes were widely used to create the first capitalist enterprises. An important role in the creation of initial capital belonged to the system of protectionism, which allowed the first capitalists to set high prices for manufactured industrial products and receive high profits, which were largely used to expand production.
CONTENT
LECTURE No. 1. The essence and functions of finance 3
1. The emergence of finance 3
2. The essence of finance 5
3. Functions of finance 6
4. The relationship of finance with other categories 7
5. Financial management 9
6. Financial policy 10
LECTURE No. 2. Financial system 12
1. General characteristics of the financial system 12
2. Financial support 13
3. Financial mechanism 15
LECTURE No. 3. Financial management and financial control 19
1. The essence of the concept of “financial management” 19
2. Financial management bodies 21
3. Financial planning 22
4. Financial and audit control 23
LECTURE No. 4. Socio-economic essence of finance. Essence, functions and types of money 28
1. The concept of “finance”, their economic essence 28
2. Money: its necessity and origin 29
3. Functions of money and the role of money in the reproduction process 30
4. Forms and types of money 33
LECTURE No. 5. Money turnover. Monetary system of Russia 35
1. Cash turnover, principles of its organization and structure 35
2. General characteristics of the monetary system 37
3. The law of monetary circulation 38
4. Cash income and expenses of the population 39
5. Inflation, its essence and types 40
LECTURE No. 6. State budget and budget system of the Russian Federation 43
1. Socio-economic essence of the state budget 43
2. Classification of state budget revenues 45
3. State budget expenses, their types 46
4. Budget deficit 47
LECTURE No. 7. Off-budget funds 49
LECTURE No. 8. State loan 53
1. Socio-economic essence of state credit 53
2. Public debt, content and main forms 54
3. Public credit management 56
LECTURE No. 9. Leasing 59
1. Leasing as a special form of rental relations 59
2. Leasing is an effective form of selling finished products 66
LECTURE No. 10. Enterprise finance 71
1. Functions and essence of enterprise finance 71
2. The principle of organizing the finances of an enterprise 73
LECTURE No. 11. Assessing the effectiveness of business activities 75
1. Assessment tasks and performance indicators of entrepreneurial activity 75
2. Assessment of solvency, financial stability and investment attractiveness of agricultural enterprises 78
LECTURE No. 12. Movement of financial resources 83
1. Management of the movement of financial resources and capital of the enterprise 83
2. Financial transactions 84
LECTURE No. 13. Insurance 91
1. Economic content of insurance 91
2. Insurance classification 94
3. Insurance market and its structure 98
LECTURE No. 14. Financial control 106
1. Financial control - forms and methods of implementation 106
2. State financial control in the Russian Federation 113
3. Non-state financial control 122
LECTURE No. 15. Property and personal insurance. Liability Insurance
1. Property insurance 127
2. Personal insurance 130
3. Liability insurance 133
LECTURE No. 16. Activities of insurance organizations in the transition to a market at 137
1. Insurance market 137
2. Economic fundamentals of the insurance business 143
3. Organization of insurance 151
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MINISTRY OF EDUCATION AND SCIENCE OF THE RUSSIAN FEDERATION
FEDERAL AGENCY FOR EDUCATION
Kemerovo Institute (branch) of the State Educational Institution of Higher Professional Education "RGTEU"
Department of Banking
Finance and credit Course of lectures
Kemerovo – 2010
The essence and functions of money, their types and features
Money- This is a product of a special kind, acting as a universal equivalent.
The role of money can be any goods that acquire social use value, i.e. the ability to exchange for any other goods and services. These products are used:
to express the value of other goods,
as a means to pay for other goods and services and make payments,
for the accumulation of social wealth.
At different times, salt, shells, livestock, furs, and even huge stone discs acted as money. Since about the 15th century, gold (less often silver) has been used everywhere as money. Regardless of which product serves as the universal equivalent, money in essence is not a thing, but an economic category. That is why, as commodity-money relations developed in society, it became possible to replace gold money with paper money, which has a paltry real value compared to its face value. The following stories are known forms of money:
1. Full (or actual) money- this is money, the nominal value of which basically corresponds to the value of the metal it contains (gold and silver in bars and coins).
2. Paper money (or maternity money, or symbolic money)– these are nominal signs of value, representatives of value that do not possess it. Modern billon (i.e., change) coins also belong to nominal values.
Types of paper money:
1. Paper money in the narrow sense of the word (treasury notes) are banknotes with a forced exchange rate, usually not exchangeable for metal, issued by the state instead of full-fledged money in order to cover the budget deficit.
2. Credit money is paper tokens of value that arose instead of gold on the basis of credit transactions (bill, check, banknote, bank deposits, electronic money).
Treasury notes were issued by the state in order to cover its expenses through the issue income - the difference between the face value of issued paper money and the cost of printing it. Currently, treasury bills are practically not used in any state, but modern money, which is paper in the broad sense of the word, has largely retained the properties of treasury bills. If modern money is issued into circulation to cover the state budget deficit, in this case they are, in essence, no different from treasury notes.
Centralization of banknote issue in the hands of a few of the most reliable banks at the beginning of the 20th century. led to the fact that banks began to issue money into circulation when performing credit operations, and not when discounting bills. This meant that money began to enter circulation not in the form of commercial, but in the form of bank lending. At this stage, credit money fully retained its connection with gold.
Since 1914, the process of gold losing its functions as money begins - the process of its demonetization begins, which ended by 1976. From this moment we can talk about the emergence of modern money.
Modern money is a type of credit money characterized by the following features:
modern money has lost its connection with gold;
come into circulation through bank lending;
can turn into paper in the narrow sense of the word if they are used unproductively.
The rapid development of check turnover in the 50-70s of the 19th century led to a sharp increase in the costs of processing checks, the reduction of which became possible thanks to the introduction of automated systems for maintaining current accounts and the replacement of checks with bank cards. A bank card is a means of making non-cash payments through bank accounts in electronic form or a means of receiving cash at a bank (a means of turning electronic money into cash). This is a material carrier of information about the movement of non-cash money across accounts or the transformation of non-cash money into cash. This medium itself can be made of any material; modern cards are usually plastic with a magnetic stripe or with a built-in microcircuit (chip). An independent type of money is not a bank card, but information about a quantitatively defined monetary obligation. These obligations are the so-called electronic money, which can be considered as virtual information money, the money of the future.
Electronic money is a perpetual monetary obligation of the issuer to bearer, issued into circulation both instead of traditional credit money at the disposal of the issuer, and in the form of a loan provided by the issuer.
Thus, modern money is a type of credit money, a transitional form from credit money that cannot be exchanged for gold to electronic money, which exists only in non-cash form in the form of information stored on a special device (on the hard drive of a personal computer, or a microprocessor card). Electronic money functions as a payment instrument that has the properties of both cash and deposit money. What they have in common with cash is the possibility of making payments bypassing the banking system, and with traditional deposit instruments (bank cards, checks) - the possibility of making non-cash payments through accounts opened with credit institutions.
The essence of money, like any other economic category, is manifested in their functions. In internal circulation, money functions as:
measure of value (or unit of account)- this function is implemented using price, i.e. in the pricing process or when evaluating goods on the market;
medium of exchange (or medium of exchange)- money functions primarily in retail trade as a means of purchase when purchasing goods for cash;
instrument of payment(some economists include this function in the function of a medium of exchange) money is used as a general means of purchase and payment when paying for goods shipped or purchased on credit, as well as when making payments of a non-commodity nature;
means of creating treasures, accumulations and savings(reserve value) - only gold acts as a treasure, absolute social wealth; paper money has never performed this function, and credit money is saved by the population and accumulated by business entities only through the credit system or the stock exchange;
world money- synthesize all the functions discussed above, but in international circulation. Sometimes they are separated into an independent function. The transition to credit money not redeemable for gold has led to the fact that the functions of money have now undergone some changes.
Money circulation: essence, cash and non-cash circulation
The movement of money when they perform their functions in cash and non-cash forms in the internal circulation of the country ismonetary th turnover , ormoney turnover . In other words, money circulation is a constantly repeating circulation of cash and non-cash money. The subjects involved in the money circulation process are individuals, business entities and government bodies that carry out various transactions and use money to purchase goods and pay for various services. Banks and non-bank credit organizations occupy a special place in the sphere of money circulation.
Structure of money turnover reflects the connections between its various elements. These elements can be distinguished based on their various criteria:
Firstly, since money circulation is a continuous process of money performing its functions, we can distinguish settlement-money turnover and financial and credit.
Secondly, since cash and non-cash money are used in circulation, the money turnover itself is divided into cash and non-cashprivate.
Settlement and money circulation is carried out when money performs the functions of a medium of exchange and a means of payment in the commodity market. In financial and credit circulation, money performs the function of a means of payment, but necessarily of a non-commodity nature, or a means of accumulation and savings; money performed the function of a measure of value before entering money circulation when setting prices for goods and services. Therefore, the function of the measure of value does not in any way affect the structure of money turnover, but it directly determines its value (the amount of money in circulation).
When modern money is released into circulation, the primary issue is non-cash, i.e. money initially appears as entries in correspondent accounts at central banks. Moreover, the higher the level of development of social production in a country, the greater the role non-cash payments play in the structure of money circulation.
Non-cash turnover - this is the movement of money through the internal circulation of the country by transferring it to accounts in credit institutions or offsetting mutual claims. Non-cash money turnover covers settlements between:
enterprises, institutions and organizations of various forms of ownership that have current accounts in credit institutions;
legal entities and credit institutions for obtaining and repaying loans;
legal entities and the population for the payment of wages, income from securities;
individuals and legal entities and government authorities when paying taxes, fees and other obligatory payments and when receiving budget funds.
The volume of non-cash turnover depends on the size of GDP, price levels, taxes, production structure, the cost of tangible and intangible assets, assets and factors of production traded on the market, interest rates on loans and deposits, etc. In economically developed countries, cash turnover is more than 95 % is carried out in the form of non-cash payments.
Cash turnover - that the movement of cash (banknotes and coins) is about the internal circulation of the country during the circulation of goods and making payments of a non-commodity nature. RCCs at the territorial main departments of the Bank of Russia form a working cash desk for accepting and issuing cash, as well as reserve funds of bank notes and coins. The stocks of unissued banknotes and coins in the BR vaults represent reserve funds. The balance of cash in the working cash register is limited. If the established limit is exceeded, excess cash is transferred from the working cash register to reserve funds. The Bank of Russia establishes the amount of reserve funds based on the size of the working cash register, the volume of cash turnover, and storage conditions.
Lecture No. 1.doc
LECTURE No. 1.Subject: The essence of finance, its functions and role.
The course “General Theory of Finance” studies theoretical issues of the essence of finance, the main trends in their development; links of the financial system, their role in the process of expanded reproduction; financial policy; financial management; financial control; the most important financial categories (budget and budget structure, local finance, insurance) in countries with developed market economies and in the conditions of transition to market relations.
The subject of study is financial and monetary relations associated with the formation, distribution and use of centralized and decentralized funds of state funds, enterprises of various forms of ownership, investment and other funds.
Finance represents economic relations associated with the formation, distribution and use of centralized and decentralized funds of funds in order to perform the functions and tasks of the state and ensure conditions for expanded reproduction.
Centralized finance refers to economic monetary relations associated with the formation and use of state funds accumulated in the state budget system and government extra-budgetary funds; decentralized finance refers to monetary relations that mediate the circulation of enterprise monetary funds.
Finance is an integral part of monetary relations, therefore their role and significance depend on the place monetary relations occupy in economic relations. However, not all monetary relations express financial relations. Finance differs from money both in content and in the functions performed. Money is a universal equivalent, with the help of which, first of all, the labor costs of associated producers are measured, and finance is an economic instrument for the distribution and redistribution of gross domestic product (GDP) and national income, an instrument for controlling the formation and use of funds of funds . Their main purpose is to ensure, through the formation of cash income and funds, not only the needs of the state and enterprises for funds, but also control over the expenditure of financial resources.
Finance expresses the monetary relations that arise between: enterprises in the process of acquiring inventory, selling products and services; enterprises and higher organizations when creating centralized funds of funds and their distribution; the state and enterprises when they pay taxes to the budget system and finance expenses; by the state and citizens when they make taxes and voluntary payments; enterprises, citizens and extra-budgetary funds when making payments and receiving resources; individual parts of the budget system; property and personal insurance authorities, enterprises, the population when paying insurance premiums and compensation for damage, upon the occurrence of an insured event; as well as monetary relations that mediate the circulation of enterprise funds.
The main material source of monetary income and funds is the country's national income - the newly created value or the value of the gross domestic product minus the tools and means of production consumed in the production process. The volume of national income determines the possibilities of meeting national needs and expanding social production. It is by taking into account the size of the national income and its individual parts - the consumption fund and the accumulation fund - that the proportions of economic development and its structure are determined. This is why all countries attach importance to national income statistics.
Without the participation of finance, national income cannot be distributed. Finance is an integral link between the creation and use of national income. Finance, influencing production, distribution and consumption, is objective in nature. They express a certain sphere of production relations and belong to the basic category.
In terms of its material content, finance is targeted funds of funds, which together represent the financial resources of the country. The main condition for the growth of financial resources is an increase in national income. Finance and financial resources are not identical concepts. Financial resources by themselves do not define the essence of finance, do not reveal their internal content and social purpose. Financial science studies not resources as such, but social relations that arise on the basis of the formation, distribution and use of resources; it explores the patterns of development of financial relations.
Although finance belongs to the basic category, it largely depends on the financial policies pursued by governments.
Finance is primarily a distribution category. With their help, secondary distribution or redistribution of national income is carried out. The socio-economic essence of financial relations lies in the study of the question - at the expense of whom the state receives financial resources and in whose interests it uses these funds.
Large redistribution processes take place in the sphere of credit relations. Finance and credit are interrelated categories. In combination, they ensure the circulation of enterprise funds on an expanded basis. In Ukraine, credit resources are attracted to cover the budget deficit.
^ Credit is the movement of a loan fund carried out through the banking system and special financial and credit institutions. Banks accumulate free funds of enterprises and the population and transfer them on the basis of security, repayment, payment and urgency to enterprises that need them. The main difference between credit relations and financial relations is that the loan must be returned to the creditor within a specified period with the payment of predetermined interest, while finance expresses a unilateral and gratuitous movement of value.
The essence of finance is manifested in its functions. Finance performs two main functions: distribution and control. These functions are carried out by finance at the same time. Each financial transaction means the distribution of social product and national income and control over this distribution.
The distribution function manifests itself in the distribution of national income, when the so-called basic or primary income is created. Their amount is equal to national income. Basic income are formed during the distribution of national income among participants in material production. They are divided into two groups: the first group is the wages of workers, office workers, the income of farmers, peasants employed in the sphere of material production; the second group is the income of enterprises in the sphere of material production.
However, primary incomes do not yet form public monetary funds sufficient for the development of priority sectors of the national economy, ensuring the country's defense capability, and satisfying the material and cultural needs of the population. Further distribution or redistribution of national income is necessary.
The redistribution of national income is associated with: inter-sectoral and territorial redistribution of funds in the interests of the most efficient and rational use of income and savings of enterprises and organizations; the presence, along with the production non-production sphere, in which national income is not created (education, health care, social insurance and social security, management); redistribution of income between different social groups of the population. As a result of redistribution, secondary or derivative incomes are formed. These include income received in non-productive sectors, taxes (personal income tax, etc.). Secondary incomes serve to form the final proportions of the use of national income.
By actively participating in the distribution and redistribution of national income, finance contributes to the transformation of the proportions that arose during the primary distribution of national income into the proportion of its final use. The income created during such redistribution must ensure correspondence between material and financial resources and, above all, between the size of monetary funds and their structure, on the one hand, and the volume and structure of means of production and consumer goods, on the other.
The redistribution of national income in Ukraine occurs in the interests of structural restructuring of the national economy, the development of priority sectors of the economy (agriculture, transport, energy, conversion of military production), in favor of the least affluent segments of the population (pensioners, students, single and large mothers) .
Thus, the redistribution of national income occurs between the production and non-production spheres of the national economy, sectors of material production, individual regions of the country, forms of property, classes and social groups of the population. The ultimate goal of the distribution and redistribution of national income and gross domestic product (GDP), accomplished with the help of finance, is to develop the productive forces, create market structures of the economy, strengthen the state, and ensure a high quality of life for the general population. At the same time, the role of finance is subordinated to the tasks of increasing the material interest of workers and teams of enterprises and organizations in improving financial and economic activities, achieving the best results at the lowest cost.
Finance also performs a control function. Being an instrument for the formation and use of monetary income and funds, they objectively reflect the course of the distribution process. Control function manifests itself in control over the distribution of GDP among the relevant funds and their expenditure for their intended purpose.
In the context of the transition to market relations, financial control is aimed at ensuring the dynamic development of public and private production, accelerating scientific and technological progress, and comprehensively improving the quality of work in all levels of the national economy. It covers production and non-production areas. Aimed at increasing economic stimulation, rational and thrifty spending of material, labor, financial resources and natural resources, reducing unproductive expenses and losses, curbing mismanagement and waste.
One of the important tasks of financial control is checking strict compliance with legislation on financial issues, timeliness and completeness of fulfillment of financial obligations to the budget system, tax service, banks, as well as mutual obligations of enterprises and organizations for settlements and payments.
The control function of finance is also manifested through the multifaceted activities of financial authorities. Employees of the financial system and the tax service exercise financial control in the process of financial planning, during the execution of the revenue and expenditure parts of the budget system. In the conditions of development of market relations, the directions of control work, forms and methods of financial control change significantly.
The distribution and control functions of finance are implemented through a financial mechanism, which is part of the economic mechanism. Financial mechanism includes a set of organizational forms of financial relations in the national economy, the procedure for the formation and use of centralized and decentralized funds of funds, methods of financial planning, forms of financial and financial system management, financial legislation. In the context of deepening market reforms, a qualitatively new financial mechanism is being applied. This concerns the relationship of enterprises and the population with the budget system, extra-budgetary funds, property and personal insurance bodies, etc.
Expanded reproduction includes the continuous renewal and expansion of production assets, the growth of gross domestic product (GDP) and its main part - national income, reproduction of the labor force and production relations. It is carried out using commodity-money, financial and credit relations. An important role in the reproduction of all components of GDP belongs to government finance and enterprise finance.
The state influences the reproduction process through the financing of individual enterprises and sectors of the national economy, social events and tax policy.
In the context of deepening market reforms, a restructuring of the entire system of financial relations in the national economy is taking place. Public finances, primarily the budget system, through the appropriate allocation of funds, must ensure structural restructuring of the economy, acceleration of scientific and technological progress, increased production efficiency and, on this basis, an increase in the living standards of the people.
At the expense of centralized funds, the needs of expanded reproduction are met macro level, intersectoral and territorial redistribution of resources is being carried out to equalize the level of economic and social development of individual regions.
