Economics: the essence of the concept
Currently, the term “economics” is used quite often in everyday life. But due to the nature of the term itself, confusion sometimes arises. The fact is that, having originated in the times of Ancient Greece, this term has somewhat changed its original meaning. Initially, this was the name for the art of housekeeping (housekeeping) or managing one's estate.
Later, when the formation of sciences began, the theoretical foundations of science and economic development were laid. The formation of economic theory began more actively in the era of the formation of capitalist relations. At the same time, the meaning of the term “economy” took shape in the sense of designating an economic complex. Therefore, today we are dealing with the dual meaning of the word “economy”:
- Economics is a social science that studies the features and patterns of development of the processes of production, distribution and consumption of material and spiritual goods.
- An economy is a set of enterprises and institutions that are responsible for the production, exchange, sale, distribution and consumption of various goods and servicing these processes.
Economy serves as the material basis for the development of human society. After all, it is thanks to economic activity that goods are created to satisfy various human needs. Like any complex system, the economy has its own characteristics of organization and structure. The economy changes over time. The structure has both sectoral and spatial characteristics.
Territorial structure is the distribution (location) of enterprises across the territory of a country or region. The sectoral structure of the economy is its division into separate sectors.
Industries are associations of enterprises that produce approximately homogeneous products or perform similar operations.
Industries are distinguished relatively arbitrarily. Their number in the country’s economic complex and their share in the gross domestic product depends on many factors:
- natural conditions and resources;
- number and distribution of population;
- historical conditions;
- social processes both in the country itself and in neighboring countries;
- the level of economic development of the country and its neighbors.
Traditionally, the country’s economic complex is conventionally divided into several macro-sectors. And they, in turn, are divided into branches of a lower order. The largest macro-sectors are considered to be industry, agriculture, transport and communications, construction, and non-production spheres.
Concept of financial relations
An important component of the economy in general and its non-productive sphere in particular is finance. They are the basis for the functioning of the economy, the key to ensuring that the state fulfills its functions.
Definition 1
Finance refers to the movement of cash flows.
Finance is the result of the formation and development of monetary relations in a certain socio-economic situation.
The emergence and formation of finance is influenced by the following circumstances and conditions (factors):
- formation of the institution of ownership of resources, goods and services, means of production;
- formation of a system of legal and property relations in society;
- the role of the state in regulating social and economic relations;
- social stratification of society and the formation of social psychology and social consciousness;
- the size of the population's income.
It is the question of income that is one of the key issues in the formation of financial relations. Indeed, in the process of realizing their income, each member of society can achieve the fulfillment of their interests.
Definition 2
Financial relations are economic relations between business entities associated with the creation, distribution and application (use) of funds to meet the existing needs of these entities (individual citizens, organizations, enterprises and states).
The role of financial relations in the economy
Financial relations arise in the process of interaction of economic entities with each other in the course of business. Their character is determined by the dominant property rights in society and the nature of monetary relations. The main regulator of financial relations is the regulatory (legislative) framework formed and operating in a given state at a given time.
In other words, the formation and development of financial relations is influenced by the economic system dominant in a given society. Due to the wide variety of factors influencing the emergence and formation of financial relations, the role of money in society and the formation of public consciousness, there is a wide variety of types of financial relations.
Economists identify the following main groups:
- relations between independent economic entities of various forms of ownership on issues of formation and distribution of profit (income, revenue);
- relations between independent economic entities during transactions with securities (stocks, bonds, bills, etc.);
- relations between an enterprise and its employees;
- relations within the workforce based on employment contracts;
- relations of the main enterprise with subsidiaries and branches;
- relations of legal entities with the budget, extra-budgetary funds and fiscal authorities of the state;
- relations of business entities with credit and financial institutions (banks, investment and insurance companies, various funds).
Financial relations are derived from economic relations and are closely related to them. If economic relations were initially formed in the process of production of natural products, then the next step is the redistribution of these products. Commodity and money exchange is formed. Therefore, financial relations can be called redistributive. But for their emergence it is necessary to achieve a certain level of economic development (the emergence of money, a certain amount of volume of the product produced, public interest of the state in the direction and nature of cash flows). The stronger the role of the state, the brighter the features of financial relations in society appear.
The role of finance of business entities:
1. servicing the circulation of funds, i.e. change of forms of ownership. (In the process of such a circulation, the monetary form of value turns into a commodity form, and after the completion of the production process and sale of finished products, the commodity form of value again appears in its original monetary form, that is, in the form of revenue);
2. Proceeds from the sale of goods after taxes are distributed to the fund for the allocation of material costs, including depreciation, payroll, and net income in the form of profit.
3. There is a redistribution of net income into payments to the budget and profit, which remains at the disposal of the enterprise;
4. The profit lagging behind the enterprise is used for consumption funds, savings, reserve fund and other purposes that are provided for in the financial plan;
5. Monitoring compliance between material and monetary resources in the process of individual financial circulation.
Features of finance of production cooperatives
A production cooperative is a voluntary association of citizens on the basis of membership to carry out joint production or other economic activities, based on their personal labor or other participation and the pooling of property shares. Basically, this form of activity is typical for the production, processing, marketing of industrial, agricultural and other products, trade, consumer services, performance of work and provision of services. The number of members of the cooperative should not be less than five. By the time of registration of the cooperative, each member is obliged to make at least 10% of his share contribution, and the rest - within a year.
The main document is the Charter.
The property of the cooperative is divided into shares of its members in accordance with the charter. The profit received is distributed among the members of the cooperative in accordance with their labor participation (unless a different procedure is specified in the charter). Members of the cooperative bear subsidiary liability for its obligations in the amount and manner provided for by the charter of the cooperative. Let us note that the cooperative has the right to create indivisible funds at the expense of a certain part of the property. The decision to form these funds must be made unanimously by the members of the cooperative. The charter must define the purposes of their use.
Vicarious liability - 1) the right to collect an uncollected debt from another obligated person if the first person cannot pay it; 2) additional liability imposed on members, for example, of a general partnership, who are jointly and severally liable, in conditions where the main defendant is unable to pay the debt.
indivisible fund - part of the property of an enterprise that is not subject to distribution among shareholders and the procedure for the formation and use of which is determined by the charter of the consumer company or union.
The essence and functions of profit
Profit is the ultimate goal and driving force of government in a market economy. Profit is calculated as the remainder after deducting expenses for production and sales volume.
In conditional market ek - ke profit of a single organization yavl. the most important indicator for evaluating an organization. At the same time, the profit is a source of well-being for any organization and a guarantee of its further development. Making a profit allows you not only to maintain the production capacity of a commercial organization, but also to satisfy various social needs. interests.
That. the desire to make a profit and increase it. a powerful production factor. organizations. The creation and distribution of profit is determined by its most important functions:
1. Profit as a measure of economic efficiency. d organizations.
2. Profit as avg – in incentives…..
At the same time, in the market. conditions profit yavl. the main source of accumulation, expansion of households. d – ti. If the role of profit in households. Since the organization is predetermined by its functional purpose, it is manifested in the use of categories derived from it, such as:
1. Share of profits aimed at expanding the organization;
2. A share of profit aimed at accruing income to its participants and owners.
3. Share of profits aimed at forming various reserves.
Factors influencing the amount of profit.
Factors of internal and external influence:
1. Technological
2. Managerial
Knowledge of factors allows you to consciously and purposefully make organizational and management decisions and create favorable conditions. to implement profit increase programs.
The use of internal influence factors to increase profits is entirely a phenomenon. the prerogative of managing the organization and the corresponding object of management accounting.
It is impossible to take into account all factors. This is due to the fact that the magnitude of these indicators is strongly influenced by numerous external factors. Among them it is customary to highlight:
Market – opportunistic
Household – legal
Administrative - command
At their core, these are regulators of production, the actions of which can be are aimed both at increasing the profits of organizations and at reducing them. Households are of particular importance. – legal regulation of profit.
That. the formation of profit of organizations is adjusted by the influence of the state through the tax mechanism and pricing policy and a number of other factors.
There are 4 main zones of eco. state of any organization:
1. When there is profit and growing;
2. When there is profit and it is stable
3. When there is profit, but it decreases
4. When there is no profit and there is. lesion.
To determine the eq. the state of the organization requires a forecasting process. At the same time, the main tool for forecasting social – eco. processes are simulated models.
Construction of various simulation models based on the use of the corresponding allowable factor. provided hands - to the computer - and resp. grandees.
Such modeling is also carried out according to BU data.
Simulation modeling is a research method in which the system under study is replaced by a model that describes the real system with sufficient accuracy, with which experiments are carried out in order to obtain information about this system.
Profit distribution
Creating profit creates (generates) complex economies. relationship regarding its distribution. These relationships are formed by m/d commerce. org - tion as a household. subject on the one hand and a number of other subjects on the other.
For example, the relationship between the organization and employees regarding wages.
Relations with the government regarding relations with the budget.
In the present relationship com. org - tions as households. the subject regarding the distribution of profits is for the most part formed not by the state, but is regulated by the economy. e – the organization itself. This is where the main specific feature of the company’s profit manifests itself. org – tions.
With the help of their profits, organizations participate in the formation of the state. budgets of various levels, in social. programs of their regions.
Within the organization itself, profit reflects all economic activity. processes.
Profit distribution process:
1. Distribution of m/d of state - vom and com.org - mi.
2. Distribution of the part of profit remaining at the disposal of the organization only by the owners; m/d owners and labor collective.
Profit distribution m/d state. and com. org is carried out through the state system. regulation, where criteria and conditions are determined. work of all subjects of relations.
Such a distribution is usually accompanied by a direct withdrawal of part of the profit in the form of taxes and fees in the state budget.
In turn, the distribution of profits remains. at the disposal of the organization depends on the specific social - political. situation and regulation. state - vom.
Such regulation may be carried out in a strict or indirect form, or may not be implemented at all.
All this happens depending on the sphere of activity, on the org. Forms and forms of ownership of the organization.
Methods of profit distribution m.b. administrative and economic, as well as combined with each other.
In the 80s. last century received. profit was distributed according to 3 bases. directions:
1. Based on income balances. and expenses organizations were included in the state budget established. payments;
2. After making payments, the profit was directed to satisfy the needs of the organization, including the creation of a fund. eq. incentives and to cover losses from the operation of housing and communal services within strict standards.
3. Transfer of part of the profit according to the relevant standards to a higher authority.
After this, the free balance of profit was calculated in the form of the difference m/d with the total amount of profit and transferred. payment. and deductions.
Such a distribution system wore an emergency. harsh character and deprived the enterprise of many economic incentives. d – ti.
Currently Time, profit distribution will be carried out according to 4 principles. directions:
1. First of all, enterprises direct income to pay taxes and fees to the budget. systems
At the same time, with t.z. organization and its owners, such payments are essentially yavl. one of the types of expenses.
2. Mandatory contributions (to the reserve fund or other funds similar in purpose)
The difference between m/d profit and payments to the budget. syst. and reserves represented. represents the profit remaining at the disposal of the organization.
3. Its distribution for the payment of income to the participating organization.
4. Accumulation of profit as financial. ensuring growth in financial farm volumes. d – ti.
In the distribution of profits through the state system. regulation must control the correctness and completeness of information affecting the amount of payments to the budget at the expense of profits in combination with incentives. the impact of regulation itself on other organizations.
This task is usually solved through the correct and reasonable application of legislation in practice. and regulations governing d -ty com. org – tion.
This fully applies to the regulatory regulation of the accounting system and profit distribution.
At the same time, the distribution of profits within the company. structures occurs depending on the rel – va factors. First of all, it depends on the plans of the commercial organization itself accordingly. directions:
1. Development of pr-va; 2. Stimulating staff; 3. Personal consumption of organizational participants.
Control over the distribution of profits in practice is carried out with assistance. Providing appropriate reporting.
In modern conventional BU fin. results and distributed profits are aimed at forming indicators in the interests of owners, creditors and investors, that is, it should promote the interests of entrepreneurs.
Net proceeds from the sale of goods and services, minus VAT, excise taxes and other obligatory payments
Variable costs (raw materials costs, labor costs, variable overhead costs)
Earnings before depreciation, interest and taxes (synonyms: gross margin, contribution margin)
Depreciation charges for industrial purposes
Gross profit (syn:margin profit)
Managerial or administrative. Selling expenses or sales expenses Product expenses
Profit before interest and taxes (operating profit)
Fixed financial expenses or interest, payments and leasing payments
Profit before taxes
Taxes and other obligatory payments
Net profit – profit belonging to owners
Dividends on preferred shares
Profit attributable to the holder of ordinary shares
Mandatory contributions to reserve capital
Profit available and distributed to holders of ordinary shares
Reinvested
← Undistributed Dividends as usual
Requirements for analytical information
Primary requirements:
1. Usefulness.
2. Relevance.
3. Credibility.
4. Neutrality.
5. Clarity.
6. Comparability.
1. Usefulness.
The usefulness of information means the ability to use it to make informed decisions when making commercial transactions.
2. Relevance.
Relevance of information confirms that the information is relevant and influences the decision made by the manufacturer. Information is considered relevant if it provides opportunities for technical, retrospective and predictive analysis, that is, the development of future decisions by the manufacturer. Relevance also presupposes the timeliness of receipt of the necessary information within the established time frame, otherwise its significance is lost.
3. Credibility.
It is determined by its veracity, as well as the ability to verify the documentary validity, as well as the neutrality of the data. Information is considered truthful if it does not contain errors or biased assessments, and does not embellish life events.
4. Neutrality
It assumes that accounting reporting does not depend on the interests of any one group of producers, while each user can receive the interests in full from the reporting form.
5. Clarity.
The principle of understandability means that users can understand the content of financial statements without special professional training.
6. Comparability.
The principle of comparability, the consistency of using accounting methods at a given enterprise is preserved and thereby ensures the comparability of data on the company’s activities for a number of reporting periods.
Basic principles:
1. The principle of double entry. It is ensured that each business transaction is recorded twice, the debit of one account and the credit of another.
2. The principle of the economic unit of accounting. The economic unit presented in the reporting is separated from its owner and other economic entities.
3. The principle of periodicity. The enterprise periodically reports to interested organizations on the results of its economic activities for certain periods (quarterly).
4. The principle of a functioning enterprise is that the enterprise will continue economic activity for a sufficiently long time and will not be liquidated in the near future.
5. The principle of monetary valuation. Indicates using the money meter as the standard one. In practice, the following assessment methods are used:
a) actual cost - the initial amount of money paid or accrued during the production or purchase of assets or when accounting for liabilities.
b) technical or replacement cost is the amount of cash or cash equivalents that must currently be paid to replace any assets.
c) technical market value is the amount of money that can be obtained as a result of the sale of assets at market prices or when they are liquidated.
d) residual value - the original cost of budget assets minus accrued depreciation.
e) net realizable value - the amount of cash that must be received or paid to sell assets even at a price minus sales costs at a discounted value (the present value of cash receipts at the selected discount rate, taking into account alternative investment options).
6. The accrual method, which allows the accountant to decide to which reporting period to attribute the relevant expenses and income. This method assumes that revenues relate to the period in which the GP is shipped to the buyer, regardless of the time of receipt of cash proceeds to the supplier's account. This method is an alternative to the cash register.
Principles of financial reporting:
1. The principle of matching the income of the reporting period with the expenses of this period. It means that in a given reporting period only those expenses that determined the receipt of income for the upcoming period are shown. If it is difficult to establish a clear boundary between individual types of income and expenses, then expenses are distributed between several reporting periods based on some distribution base.
2. The principle of optimal cost-benefit ratio. It means that the costs of developing reporting should be reasonably related to the benefits received by the enterprise from providing information to interested users.
3. The principle of prudence suggests that the company’s reports should not allow overestimation of assets, property and profits and also understatement of estimates and liabilities. All this also means that an organization needs less reason to account for potential losses or damages than to deny potential profits. One of the characteristic features of this principle is the rule of minimizing the valuation of assets, whether at cost or at real price.
4. The principle of confidentiality requires that reporting information does not contain information that could harm the competitive position of the enterprise in the product market. This requirement applies to the publication of reporting by joint stock companies, which, under current legislation, are required to provide reporting to a wide range of users. Based on various economic principles, all reporting information is systematized into separate consolidated items, which in world practice are called elements of financial reporting. They include assets, liabilities, equity, income, expenses, profit and loss. The first three elements of reporting characterize the enterprise’s funds and the sources of their formation as of a certain date. The rest characterize transactions and events of economic activity that affected the position of the organization during the reporting period and the overall change in assets, required and total capital.
Financial risks
Any entrepreneurial activity in a market economy is associated with a certain entrepreneurial risk. In the practice of financial analysis, business risk is understood as the probability (threat) of an enterprise losing part of its resources, losing income, or incurring additional expenses as a result of its activities. Main types of risks:
Production risk is a risk caused by purely production factors: manufacturing defects, failure to fulfill the production program, accidents, etc. The reasons for its occurrence: a possible decrease in production volumes, an increase in material costs, employee dissatisfaction, and managerial mistakes.
Commercial (marketing) risk is a risk caused by uncertainty of demand: non-sale of goods or lost profits from the absence of goods when there is demand for them arises in the process of selling goods and services or their acquisition. The reasons for its occurrence: a decrease in the volume of product sales, an increase in the purchase price of material resources, an unforeseen decrease in the volume of purchases, an increase in distribution costs, economic fluctuations and changes in customer tastes, the actions of competitors;
Financial risk is the danger of losing an organization’s funds when carrying out operations on the financial market and when managing its own and borrowed funds in order to optimally balance them. Reasons for its occurrence: dependence on creditors, simultaneous placement of large funds in one project. Financial risks include:
Financial stability risk – risks arising in the process of managing the financial resources of an enterprise and ensuring its stable financial position. It is divided into:
A) liquidity risk - the risk that arises in the process of the enterprise’s activities and characterizes the value of assets to quickly turn into cash to fulfill financial obligations. This is a risk associated with the consequences of possible losses: - the inability of assets to quickly change into cash: - when selling financial assets due to changes in the assessment of their quality and assessment needs.
B) Risk of business activity - it is associated with the efficiency of use of funds and optimal rates of development.
C) Capital structure risk – the risk of losses from a possible change in the capital structure, i.e. in the ratio of equity and borrowed funds.
D) profitability risk – the risk of changes in the profitability of business activities.
Credit risk is the danger of losing an organization’s funds as a result of non-repayment of the loan amount and interest on it;
Interest rate risk is the danger of losing an organization’s funds due to the excess of interest on attracted sources over interest on placed funds;
Currency risk is the danger of losing an organization’s funds due to changes in exchange rates;
The risk of lost profits is the danger of losing an organization’s funds as a result of indirect damage from events. For example, when selling goods on credit, failure to comply with the terms of payment for their cost on time leads to an increase in accounts receivable. The immobilization of an organization's funds into accounts receivable can be assessed by the amount of lost profits, i.e. the amount of lost income due to more profitable placement of these funds. Based on the classification of factors that determine financial risks, it is customary to distinguish systematic and unsystematic (special) risks.
Tax – the danger of losses due to changes in the tax law.
Investor – risk associated with capital investments.
Systematic risk is caused by the action of diverse factors common to all economic entities. This is a decrease in business activity, inflation, changes in bank interest rates, tax and customs rates, the introduction of restrictions on business transactions, etc. They are typical for all types of investments and are determined by the state of the market as a whole.
Unsystematic risk is caused by the action of factors that are completely dependent on the activities of the business entity itself. This is the loss of markets for goods due to deterioration in their quality, ineffective pricing policy, low level of marketing analysis, as well as a decrease in sales profitability and return on capital, a decrease in the liquidity of assets and balance sheets, and an increase in accounts receivable.
The level of systematic risk is relatively the same for different business entities; the level of unsystematic risk varies greatly even among organizations comparable in scale, scope of activity and other general characteristics.
Immobilization is the use of working capital other than for its intended purpose.
37. Types and contents of enterprise budgets.
An organization's budget is a calendar plan of an organization's income and expenses, formulated for decision-making, planning and control in the process of managing the company's activities. The organization's budget is drawn up in physical and/or monetary terms and determines the company's need for resources necessary to obtain projected income.
There are two main types of budget:
The operating budget includes a budget of income and expenses, the basis for the development of which is the following budgets: production budget, budget for sales of products, other income, costs of materials and energy, budget for wages, depreciation, general and general production expenses, budget for tax expenses (depending on the tax, it may be included in general business expenses).
The financial budget consists of three financial documents:
income statement forecast
cash flow statement forecast
balance sheet forecast
The two main, “ideologically” different types of budgets include budgets built on the “bottom-up” and “top-down” principles.
The first option involves collecting and filtering budget information from performers to lower-level managers and then to company management. With this approach, a lot of effort and time, as a rule, is spent on coordinating the budgets of individual structural units. In addition, quite often the indicators presented “from below” are greatly changed by managers in the process of approving the budget, which, if the decision is unfounded or there is insufficient argumentation, can cause a negative reaction from subordinates. In the future, this situation often leads to a decrease in confidence and attention to the budget process on the part of lower-level managers, which is expressed in carelessly prepared data or deliberately inflating numbers in the initial versions of the budget.
The second approach requires the company's management to have a clear understanding of the main features of the organization and the ability to form a realistic forecast at least for the period under review. Top-down budgeting ensures that departmental budgets are consistent and allows you to set benchmarks for sales, expenses, etc. to evaluate the performance of responsibility centers.
There are several more options for classifying budgets:
Long-term and short-term budgets. Long-term (from six months to 1 year) and short-term (week, 10 days, month, quarter). At the same time, long-term budgets are primary in relation to short-term ones, because it is on their basis that the short-term budget is drawn up.
Line-item budgets - provide for a strict limit on the amount for each expense item, without the possibility of transferring to another item
Budgets with a temporary period - at the end of the budget period, the balance of funds is not carried over to the next period.
Flexible and static budgets
In the static type of budget most often used in Russia, the numbers are found regardless of production volumes, etc., while when drawing up a flexible budget, expenses are made dependent on a certain parameter, usually characterizing the volume of production or sales.
Successive budgets and budgets with a zero level. A zero-level budget is a budget that is drawn up anew each time, “from scratch.” In contrast, a succession budget has something of a template, to which the next budgeting only makes adjustments to reflect ongoing changes in comparison with the established process.
The finances of an organization are an independent sphere of the country’s financial system, covering a wide range of monetary relations that are associated with the formation and use of capital, income and cash funds in the process of circulation of enterprise funds.
It is in this area of the country’s financial system that the bulk of income is formed, which will subsequently, through various channels, be redistributed in the country’s national economic complex. And naturally it serves as the main source of economic growth and social development of society.
An enterprise is an economic entity created to organize business activities.
The economic goal of the enterprise is to make a profit and meet public needs.
Entrepreneurial activity in its content includes the production and sale of products, performance of work, provision of services, and various operations on the stock market.
In the process of economic activity, an enterprise interacts with various economic agents.
The material basis of an enterprise’s finances is the circulation of capital, which in the conditions of commodity-money relations takes the form of money circulation.
The finances of an enterprise are a set of objectively determined economic relations of an enterprise that have a distributive nature, a monetary form of expression and are expressed in income, various receipts, and savings that are formed by business entities for the purpose of ensuring production activities.
System of financial relations of the organization
Financial relations of enterprises, depending on their content, can be grouped into areas:
1. This is the relationship between the founders at the time of organization of the enterprise regarding the formation of the authorized capital;
2. Relations between the enterprises themselves related to the production and sale of products are relations between suppliers, buyers, contractors and other economic entities;
4. These are the relationships between various departments within the enterprise;
5. Between the enterprise and employees. May arise when distributing income received, when placing securities, when paying dividends, and when paying wages;
6. Between the enterprise and a higher organization. (within the holding). This group of relations can arise in the formation, distribution and use of resources received to finance targeted programs, for research and for the implementation of investment projects;
7. Between the enterprise and the state. (Payment of taxes, contributions to extra-budgetary funds, penalties, fines)
8. Relations between the enterprise and the banking system. (purchase and sale of currency, repayment/provision of loans.);
9. Relations between the enterprise and insurance companies (for property insurance);
10. Relations between the enterprise and investment institutions regarding the placement of investments.
Financial relations require the presence of groups of interested parties:
1. Creditors. Interested in the stable financial condition of the company, which allows you to repay the loan in a timely manner:
Banks that issue loans of varying terms for investment projects or to compensate for the lack of their own working capital.
The company's suppliers are creditors in the event of no advance payment from the buyer
Buyers of products who credit the seller for the amount of prepayment of goods;
Participants in the debt securities market (Banks, financial companies, mutual funds, state pension funds, other enterprises and individuals.);
4. Owners of enterprises (They are interested in preserving and increasing the value of the enterprise’s deposits, accruing income);
5. Enterprise employees. (part of their interest is of a credit nature regarding worked but not paid wages, taxes, contributions to the pension fund, etc.). Among the employees, it is necessary to identify managers who are personally interested in the state and position of the company in the market. Managers, as a rule, are also co-owners of the company, giving them the right to receive dividends;
6. The state is interested in receiving taxes; relations can be bilateral (for example, in the case of financing from the budget or extra-budgetary funds).
In the process of economic activity of an enterprise, specific types of economic relations may arise that are associated with the insolvency of the organization.
The role of finance of business entities.
TOPIC: ESSENCE AND FUNCTIONS OF FINANCE
1. The evolution of finance in the process of development of commodity-money relations. The socio-economic essence and role of finance in the system of monetary relations of a market economy.
2. Characteristics of finance functions.
4. Formation of financial resources.
5. Types of financial relations
6. The concept of the financial system, characteristics of its spheres and links
1. The evolution of finance in the process of development of commodity-money relations. Socio-economic essence of finance.
The concept of “finance” is often identified with the concept of “money” (for example...), in reality this is not so, although without money there can be no finance. To better understand this issue, consider the category of “finance” in historical development
The term “finance” arose in the 13th-15th centuries. in the trading cities of Italy. By this time, money, commodity-money relations and statehood had long existed, so this term originally meant any monetary payment. Subsequently, with the development of commodity-money relations, the term becomes internationally widespread and begins to be used as a concept associated with system of monetary relations between the population and the state regarding the formation of state funds of funds.
Based on this definition, we can highlight the main provisions of this concept - a system of monetary relations, two subjects of relations as a result of which the formation of state funds occurs, where funds are accumulated.
Therefore, this term reflected:
Firstly, monetary relations between two entities, where money served as the material basis for the existence and functioning of finance;
Secondly, the subjects (population and state) had different rights in the process of these relations; one of them, namely the state, had special powers;
Thirdly, in the process of these relations, a national fund of funds was formed - the budget - initially, and subsequently other extra-budgetary funds of funds.
Fourthly, the regular flow of funds into the budget was ensured by taxes, fees and other payments, which were of a state-compulsory nature; this was achieved through the legal activities of the state and the creation of an appropriate fiscal apparatus. If we talk about today's Russia, then this is the activity of tax inspectorates and the police.
SO, finance is always a monetary relationship, but monetary relationships may not be financial relationships. For example, one citizen lent money to another, do monetary relations arise in this case? Yes, they do arise. But these are not financial relations, since the state does not regulate these relations, does not delve into them, and does not impose its own rules of behavior. These relationships are equal, partners are equal in rights and responsibilities. The same can be said about the relationship between citizens and store clerks, i.e. relationships arising in retail trade.
Thus, Finance is always monetary relations, but not all monetary relations are financial. From this we can assume that finance has such characteristics that they can be unmistakably distinguished from a number of other possible monetary relations. The main feature is that financial relations are carried out on the basis of state regulations, and non-financial relations are not regulated by such acts; the subjects of such relations themselves determine the proportions of exchange and its conditions.
A distinctive feature is that finance is always mediated by legal acts regulating monetary relations.
Based on the above, we can formulate a general definition of finance.
Finance is a set of monetary relations organized by the state, during which the formation and use of national funds of funds are carried out to solve economic, social and political problems.
HISTORY OF DEVELOPMENT
The emergence of finance dates back to the 13th-15th centuries; therefore, finance is a historical category, since it has stages of emergence and development, in addition, we noted that the state always participates in financial relations, therefore finance appeared simultaneously with the emergence of the state and changed with it. Hence, the essence of finance, the patterns of its development, the scope and role in the process of social production are determined by the nature and functions of the state.
In pre-capitalist societies, most of the needs of the state were satisfied by establishing various kinds of in-kind duties and fees. The monetary economy was small and limited, the national fund of funds - the budget - was small, the main part of which (2/3 of the budget) was spent on military purposes, so it did not have a practical impact on the economy.
Subsequently, the formation and use of the budget began to be sustainable and systematic. Systems of state revenues and expenditures with a certain composition, structure and legislative support began to emerge. Over the course of many centuries, states have identified four stable directions for spending money:
· For military purposes,
· Management,
· Support of certain sectors of the economy,
· Social needs. Moreover, the last 2 directions remained insignificant
The system of generating government revenues has become more defined and stable. Taxes in cash replaced taxes in kind.
At the same time, this historical stage was characterized by the narrowness of the financial system, since it consisted of one link - the budgetary one, and the number of financial relations was limited, since they were all related to the formation and use of the budget.
The peculiarity is the narrowness of the financial system, because it consisted of one link - the budget.
As commodity-money relations develop and statehood becomes established, the need arises for new national funds of funds and, accordingly, for new groups of monetary relations regarding their formation and use. Under capitalism, when commodity-money relations acquired an all-encompassing character, finance began to express economic relations in connection with the formation, distribution and use of funds of funds in the process of distribution and redistribution of national income and the entire gross social product.
In the twentieth century (especially after the Second World War), a qualitatively new development of financial relations took place. The volume of state budgets has increased and began to be expressed in billions of national currencies. In all countries, a significant part of the ND has been nationalized; the state has become the owner and manager of up to 50% of its volume. Having huge amounts of funds at their disposal (there is an accumulation of funds not only from the budget, but also from extra-budgetary funds), states began to have a great influence on the reproduction process.
The democratization of public life in a developed market economy has led to the fact that in a number of small countries in Western Europe (Sweden, Norway, etc.) (costs for social purposes have become one of the main ones. This is how the concept of the “Swedish model of socialism” arose.
Expenditures on state intervention in the economy have undergone significant development: state capital investments in the electric power industry, coal, gas and other industries have increased, to support agriculture - one of the most supported sectors of the economy. In the main capitalist countries, the nuclear industry was created at the expense of public funds. The costs of scientific and technical progress have increased sharply (up to 50% of the total costs for these purposes). The state began to actively help its country's monopolies in intense competition in the world market by providing export bonuses to export firms. New government spending has appeared on environmental protection, overcoming the economic backwardness of certain regions, and providing subsidies and loans to developing countries.
Intervention in the reproduction process and the sphere of social relations is carried out not only at the national, but also at the interstate level) (for example, EU countries)
Thus, after the Second World War, the scope of financial relations expanded sharply. The following have received significant development:
· Local (regional) finances,
· Off-budget special government funds,
· Enterprise finance - in countries with developed market economies, the main organizational and legal form has become joint stock companies . Issue of shares is a powerful form of capital mobilization, it allows you to transform funds into productive investments. Shares, bonds, and bank loans significantly expand the growth opportunities for corporations. Without this, they would be forced to be self-financing, developing at the expense of their own, relatively limited funds. Moreover, given that corporate finance serve the circulation of huge funds of funds , the issues of the most effective management of enterprise funds become extremely important.
SO Another important conclusion follows from the above – financial relations cover two areas. The first includes economic monetary relations associated with the formation and use of centralized state monetary funds accumulated in the state budget system and government extra-budgetary funds. The second area is in which economic monetary relations mediate the circulation of funds of enterprises.
Now, having additional information about finance, we can give another clarifying definition of finance.
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.
Money is a universal equivalent, with the help of which the labor costs of producers are primarily measured. Finance is an economic instrument for the distribution and redistribution of income, a means of control over the formation and use of funds.
When defining the category of finance, the expression “finance is economic monetary relations", which has a very specific content.
Financial monetary relations arise between:
· Enterprises in the process of purchasing inventory, selling products and services;
· Enterprises and higher organizations when creating centralized funds and their distribution;
· The state and enterprises when the latter pay taxes to the budget system and finance expenses;
· The state and citizens when they make taxes and voluntary payments; enterprises, citizens and extra-budgetary funds when making payments and receiving resources;
· Separate links of the budget system;
· Insurance organizations, enterprises and the population when paying insurance premiums and compensation for damage upon the occurrence of an insured event, etc.
The totality of funds at the disposal of the population, business entities, the state, and local governments constitute financial resources. The sources of financial resources are:
· At the level of business entities: profit depreciation, sale of securities, bank loan, interest, dividends;
· At the population level: wages, bonuses, allowances, social payments, pensions, benefits, scholarships, consumer loans, income from business activities;
· At the level of the state, local governments: income from state and municipal enterprises, income from the privatization of state and municipal property, income from foreign economic activity, tax income, state and municipal credit, issue of money and income from the issue of securities.
The main material source of monetary funds is the country’s ND – newly created value, therefore an increase in ND is the main condition for the growth of financial resources.
It is taking into account the size of the ND that determines the pace and proportions of economic development, as well as the possibilities of expanded social reproduction.
The socio-economic essence of finance lies in researching and answering the following questions: at the expense of whom or what does this or that economic entity, citizen, state, local government body generate its financial resources and how and in whose interests these funds of funds are used.
2. Characteristics of finance functions
The essence of finance is manifested in its functions, which are understood as the “work” performed by finance.
Finance performs three main functions:
· Distribution;
· Stimulating;
· Control;
Distribution function of finance.
As was established earlier, the purpose of public finance is to mobilize and use monetary funds that ensure that the state fulfills its constitutional functions. Since the main material source of monetary funds is ND, it will mainly be subject to distribution.
The distribution function of finance includes primary and secondary distribution (redistribution). The social product created in the country is subject to distribution and redistribution (as is known, the main macroeconomic indicator of the results of the functioning of the economy is recognized GDP ), as well as its components , and above all - ND .
Primary distribution means that after a product is created in the sphere of material production, it is distributed among its participants. (Part of the total social product is intended to replace used objects and tools of labor - simple reproduction. The remaining part - income - is distributed among workers - expanded production).
In the process of primary distribution, basic, or primary incomes are created, their amount is equal to ND. Basic income is formed by distributing income only among participants in material production; they are divided into two groups: 1) salary (income) workers (farmers, etc.) 2) enterprise income.
However, the distribution of ND is not limited only to its distribution among those who created it, i.e. among participants in material production. The fact is that the state also has other industries and spheres, primarily the non-production sphere, where ND is not created; however, it is obliged to take care of their development, which means to allocate funds for this. Such areas include the development of priority areas of the national economy, ensuring the country's defense capability, education, healthcare, management, social insurance and welfare, maintaining depressed regions, etc.
Along with the material sphere of production, the state has a non-production sphere, the participants of which are not directly involved in production, but create the prerequisites for its normal development (teachers, doctors, scientists, officials, military personnel, cultural figures, students, etc.). In addition, society also consists of minors and incompetent persons. They should all receive a certain share of the created product. Consequently, the state is obliged to support the non-productive sphere through the allocation of funds.
In order to carry out monetary expenses, the state, with the help of financial instruments (taxes, budget), withdraws part of the income created in the sphere of material production and directs it to other spheres, implementing further distribution or redistribution of ND. As a result of secondary distribution, secondary or derivative income is formed.
At the stage of redistribution, the leading place belongs to the state, since only it is able to solve problems of national importance (for example, issues of the country’s defense capability, support for backward regions, etc.)
Thus, the redistribution of income occurs between the production and non-production spheres of the national economy, sectors of material production, individual regions of the country, and social groups of the population.
The redistribution of income in the Russian Federation occurs in the interests of the development of priority sectors of the economy, as well as in favor of the least affluent segments of the population.
essence Stimulating function of finance boils down to the fact that the state, with the help of a system of financial levers, influences the development of business entities, industries, regions in the direction desired by society. As we now know, finance is involved in the process of creating monetary income, as well as in the process of their distribution; by skillfully managing monetary income, the state can influence the economy of the country. So
Through the distribution of funds, the state stimulates or restrains the development of certain socio-economic processes. For these purposes, the state uses, first of all, the following financial levers:
· Budget (Funds from the budget of a particular industry, a complex of industries or an individual enterprise may or may not be allocated)
· Prices and tariffs (And in a market economy, the state, as is known, intervenes in the pricing process, sets tariffs /fuel and energy complex, transport, etc./, which affect the financial condition of companies. For example, the price of grain can be set high, profitable for the manufacturer, or it can be low, at the level of enterprise costs, or even lower. In this case, the agricultural enterprise will suffer losses and there can be no talk of any additional incentives.)
· Taxes (this is the most powerful financial tool for stimulating economic activity. Low taxes can stimulate production and, on the contrary, excessively high taxes can undermine it).
· Export-import duties, tariffs ( By manipulating their level, the state stimulates or de-stimulates export-import operations, supports national producers, strengthens the competitive position of domestic enterprises in world markets, and fills the budget).
This is not a complete list of the levers that are used by the state, however, from the above it is clear what a strong impact the use of the above examples can have on the development of production or any field of activity.
Control function of finance carried out during any financial transaction aimed at the formation or use of funds.
It cannot be said that control is carried out only after the distribution process has occurred or any socio-economic process has been stimulated. All functions operate simultaneously and in a coordinated manner. Financial processes begin, last and end, and control is required at each of these stages. Respectively financial control is divided into preliminary, current and subsequent – before, during and after the operation.
The activities of all participants in financial relations are subject to financial control, therefore financial control is carried out both at the micro and macro levels. Its subject at the macro level is the distribution of GDP, ND among the relevant funds and their expenditure for their intended purpose. At the micro level – rational use of material, labor, natural and financial resources.
Financial control can be nationwide (carried out by federal legislative and executive authorities: Accounts Chamber, Ministry of Finance, Central Bank, etc.), departmental (KRU, tax authorities, etc.), intra-economic, public and independent (audit).
3. The role of finance in the process of GDP reproduction
The prerequisites for financial relationships in the national economic system are:
The law of growth in the efficiency of economic activity is universal and determines the emergence of all social institutions (including the state);
The functions of the main participants in the economic system have social significance;
From the point of view of participants in the use of the redistributed share of society's income, an assessment of financial efficiency is necessary.
The main economic agents whose income is redistributed through finance are the following:
Private business - producers of material and intangible goods;
The population is the consumer of these values;
The state as an institution that creates conditions for the population and maximizes the utility of private business.
The main relationships between them can be described using macroeconomic indicators:
Gross Domestic Product (GDP - the current value of all final products (goods and services) produced during a certain period of time (mainly a year) in the country);
National income (ND - the value newly created during the year, which is calculated as part of GDP based on income minus depreciation and indirect taxes);
Inflation (sustainable growth in the average level of prices for goods and services in the economy,%);
Budget balance of all levels of government (the ratio of income and expenses of the budget system, which manifests itself either in a deficit - when expenses exceed income, or in a surplus - when income exceeds expenses);
Current account balance (the ratio of total accounts payable and receivable in the national economy);
Consumer and deferred demand of the population (corresponding to the part of national income that is spent on consumption and the part of it that is saved);
Balance of trade and payments (the result of transactions of national economic entities with the outside world), etc.
The goal of development of the economic system is to maximize (GDP, ND) or minimize (inflation, deficit) macroeconomic indicators. This goal is achieved through finance.
The main relationships between economic entities in the country regarding the redistribution of GDP can be described using a macroeconomic identity (the identity of national accounts - a system of interrelated statistical indicators, built in the form of a set of accounts and tables to obtain a complete picture of the country's economic activity):
G - Government Spending.
In a closed economy (in which more than 80% of GDP is produced and consumed within the country), the value of goods and services produced is equal to the sum of the expenditures of national economic entities: households (consumer expenditures), private firms (investment expenditures) and the government (government expenditures).
In an open economy, C, I, and G represent spending on all goods and services, including those produced in other countries. In this case, the main macroeconomic identity takes into account export-import operations:
Y=C + I+ G+ (Ex - Im),
where Y is GDP by expenditure (Gross Domestic Product);
C - household consumer expenditures (Consumption);
I - investment expenses of private business (Investment);
G - government spending (Government Spending);
Ex-Im - trade balance: if exports exceed imports, this difference is positive, if imports are greater than exports, it is negative.
In accordance with this formula, the annual cost of goods and services produced in the country (Y = GDP on the left side of the formula) is equal to the expenses of national economic agents (C + I + G) for all goods and services produced in the country plus net exports (Ex - Im) , which will be deducted if there is a negative balance of foreign trade and added if the country’s exports exceed its imports.
In other words, if, other things being equal, the state redistributes a share of GDP in its favor using finance and spends it ineffectively, then this deprives households and private businesses of the opportunity to use this share of GDP more efficiently.
The impact of government spending is reflected in all components of the macroeconomic identity: both consumer spending and investment in the economy. For a deeper understanding of these interdependencies, let us describe the right side of the macroeconomic identity. The consumption function has the form C= a + b(l- t)D,
where a is a constant characterizing a certain volume of consumption regardless of income;
b is the marginal propensity to consume;
t - income tax rate;
D is household income.
Net exports (the difference between exports and imports) are determined as follows: X=g-mY,
where g is a constant;
m is the coefficient of GDP, it means the marginal propensity to import and shows that an increase in GDP by one ruble corresponds to imports of m rubles.
From this formula it is obvious that with unchanged exports, net exports decrease by m rubles. When comparing the functions of net exports and consumption, the following analogies arise: both net exports and consumption depend on income, but for every ruble of income growth, net exports decrease by m rubles, and consumption increases by b rubles (marginal propensity to consume).
Based on this we can conclude about direct dependence government spending from:
GDP volume;
Income tax revenues;
Marginal propensity to consume and interest rate;
Marginal propensity to import;
And inverse relationship from:
The marginal propensity of consumers to save;
Consumption constants;
Autonomous investments (depreciation).
In economic systems, when forming expenses in conditions of limited income, business entities always make a choice. In other words, when planning certain purchases, any economic entity, for example the population, distributes its income accordingly: the acquisition of some thing means a missed opportunity to buy another necessary thing.
Government revenues from the point of view of tax payments of business entities and budget expenditures to meet their needs for certain goods and services can significantly adjust the choice of individual business entities. The point is that due to limited resources (income, production capacity, natural factors in the country, etc.) n.) nothing of a certain value can be acquired without losing the opportunity to have something else. Consequently, by spending a certain part of their income on paying taxes, the population and enterprises lose part of their income, which could be spent on purchasing something they need - some goods or services. Based on the macroeconomic identity, we can definitely conclude that only those financial relationships are effective, as a result of which the expanded reproduction of GDP and income in real terms is carried out, i.e. the physical volume of goods and services produced increases in the current year compared to the previous year, taking into account inflation.
4. Formation of financial resources
Financial resources are a complex economic category that cannot be completely identified with cash. It is not easy to identify a clear criterion on the basis of which it is possible to establish quantitative boundaries of financial resources and characterize their difference from cash.
When determining the essence of financial resources, it is advisable to proceed from their functional purpose in the process of expanded reproduction of GDP and income. This process is characterized by the movement of commodity and money supply and consists of several stages, at each of which commodity and cash flows correspond to each other in different ways.
At the initial stage of movement (production) of GDP and the final stage (its use), cash flows mediate commodity flows. At the stage of distribution and redistribution, the monetary form of GDP acquires relatively independent movement, since it is at these stages that financial relations arise. As a result, various monetary funds are formed, they are regrouped and final income is formed. This is how the volume and structure of national production and the needs of the national economy are coordinated, which in practice is calculated as GDP in terms of expenses and GDP in terms of income.
Part of the money turnover is strictly coordinated with commodity circulation, since it is realized as a result of the exchange of equivalents expressed in commodity form (from the seller) and money (from the buyer). When exchanging equivalents, there are no conditions for material and financial imbalance in society.
Another part of the money turnover is related to the needs of expanded reproduction of GDP. They are provided in the process of its distribution and redistribution with the help of finance. This part of the cash flow represents financial flows, i.e. movement of those funds that can be spent on the development of the national economy and meeting national and social needs.
As we have already noted, a specific feature of financial flows (as opposed to cash flows) lies in their non-equivalent nature. It is finance, in the process of distribution and redistribution of GDP, that generates the independent movement of money, which is where the prerequisites for the material and financial imbalance of the national economy lie.
Thus, financial resources are a quantitative characteristic of the financial result of the reproduction process for a certain period. These are the funds that can be legitimately used to replace retired fixed assets, industrial and non-productive accumulation, and collective consumption. This macroeconomic indicator is of a balance sheet nature, since it can be presented as the sum of both income and expenses
As accumulation funds of funds that are formed as a result of the production, distribution and redistribution of gross domestic product;
As final income, i.e. funds intended for exchange for goods and services;
As those incomes that have material (real) coverage, since they are generated as a result of the sale of goods and services;
As sources of formation of these incomes (component elements) - depreciation, profit, tax income, non-tax
income, capital transfers, target budget funds, state extra-budgetary social funds, other revenues;
As the final financial result of the reproduction process, since they are used to finance capital investments and major repairs of fixed assets, increase working capital, purchase equipment and durable items for budgetary organizations, costs for social and cultural events, science, defense, maintenance of government bodies and management and etc.
It is unlawful to include short-term credit resources in financial resources, since their formation is not associated with the creation of new material wealth, but occurs as a result of the redistribution of financial resources.
Savings of the population in the form of an increase in deposits in commercial banks, by their economic essence, serve as a source of financial resources, since in the material aspect (from the point of view of the correspondence of the effective demand of the population and the resources of the product supply and the volume of paid services) they correspond to material resources equal to the deferred demand in ND.
So, the country’s financial resources form part of the gross domestic product and can be presented as the sum of the following indicators of the system of national accounts (SNA) - a system of interrelated statistical indicators, built in the form of a set of accounts and tables to obtain a complete picture of the country’s economic activity): gross profit of the economy , contributions to state extra-budgetary social funds, taxes on production and imports, taxes on individuals, household savings, loans received from foreign countries.
Thus, with the help of financial resources, that part of the gross domestic product is allocated that can be aimed at expanding the socio-economic system as a whole. With their help, the part of the produced GDP is distinguished between the part corresponding to the current costs of materials and labor consumed in the production process, and the fund for the expanded reproduction of production factors, including labor. From this point of view, it is legitimate to include society’s expenses on healthcare, education, social policy, etc. in the expanded reproduction fund.
Financial resources are an objective macroeconomic category, the content of which is determined by the conditions of material and financial balance of the economy. The equality of receipt and expenditure of financial resources indicates that the effective demand of enterprises and organizations, formed as a result of financing the costs of developing the national economy and the functioning of government institutions, has material coverage, since it corresponds to the created financial resources. Therefore, the condition of material and financial balance can be presented as the correspondence of the amount of financial resources to the volume of material goods and as the balance equality of their receipts and expenditures.
The economy can develop effectively and sustainably only if the basic macroeconomic proportion (between consumption and accumulation) corresponds to the natural level, determined by the socio-economic conditions of social production (development of productive forces, specific needs of society, etc.). In this case, the proportions of GDP redistribution are consistent with the proportions of its primary distribution and lead to the formation of final income that corresponds to the structure of its use, i.e. ensure a balance between material and financial aspects of national production.
5. Types of financial relations
Financial relations are the relations of its two opposite sides.
Type of financial relationship is the entire set of conditions under which value is transferred from one market participant to another.
The initial types of financial relations are divided depending on the method of their formation and the nationality of financial resources.
Financial relations are based on the processes of formation and use of primary and secondary income of market participants. Primary incomes are formed as a result of distribution relations. Secondary incomes are generated as a result of redistribution relations.
Financial relations are divided according to the method of formation (occurrence) of financial income (expenses) into relations of distribution and relations of redistribution.
Relationship distribution there are relationships associated with the formation of primary income from sales proceeds. These relations, on the one hand, represent the division of the market participant’s gross income into costs and his own (production) net income. On the other hand, there is a division of costs into gross and net incomes of other market participants.
Redistributive relations are associated with the further movement (transfer) of net income between market participants. The transfer of net income can occur with or without its subsequent return, i.e. irrevocably. The transfer of net income may be for a fee or free of charge. The combination of these methods of transferring net income has four options: transfer with return for a fee and free of charge, transfer without return for a fee and free of charge.
Division of financial relations depending on from nationality net income is their division into national and international finance.
Logically, redistribution relations follow distribution relations. However, in practice, both groups of relations often take place simultaneously, since the process of redistribution involves not only income from sales, but also non-operating income. As a result, a closed chain of distribution and redistribution relations arises. Financial relations are always the unity of relations of distribution and redistribution.
Main groups of distribution relations. Distribution relations consist of two groups.
Firstly, this is the division of the market participant’s gross income into costs and his own, or production, net income, which includes profit and depreciation charges.
Secondly, this is the division of costs into gross and net incomes of other market participants, which include wages, rent payments and indirect taxes to the state.
From a formal point of view, the relations for the distribution of sales proceeds are quite simple, since they come down to only three groups of relations and the proportions associated with them:
· between a commercial organization and its employees, or the proportion between profit and wages of employees;
· between a commercial organization and the owners of land and natural resources, or the proportion between profits and payments to these owners (rent payments);
· between a commercial organization and the state on the payment of taxes included in gross income (indirect taxes), or the proportion between gross income and the amount of indirect taxes included in it.
However, these groups of proportions are not at all equivalent. The first proportion has a pronounced social character and is manifested in the possible confrontation between the interests of a commercial organization and the interests of its employees. The struggle for higher wages is an initial concomitant phenomenon in the development of a market economy.
The second proportion has to do with the nature of ownership of land and natural resources. If the land with its resources is the property of a commercial organization, then rent payments remain its property, which is expressed in an increase in profit margins above its industry average. In this case, nature acts as a free source of additional profit.
INTRODUCTION
CHAPTER 1. THEORETICAL FOUNDATIONS OF ORGANIZATION OF FINANCIAL RELATIONS OF ENTERPRISES
1 Essence, functions and principles of organizing enterprise finance
2 Organization of financial relations of enterprises
3 Financial relations of the organization with the budget and extra-budgetary funds
CHAPTER 2. FINANCIAL RELATIONS OF THE ENTERPRISE OJSC ROSTELECOM
1 Characteristics of the activities of the enterprise OJSC Rostelecom
2 Financial relations of OJSC Rostelecom with other enterprises
CHAPTER 3. WAYS TO IMPROVE FINANCIAL RELATIONS OF ENTERPRISES
CONCLUSION
BIBLIOGRAPHY
APPLICATION
INTRODUCTION
A market economy presupposes the formation and development of enterprises of various organizational and legal forms, based on different types of private property, the emergence of new owners - both individual citizens and labor collectives of enterprises. A type of economic activity has emerged called entrepreneurship - this is an economic activity, i.e. activities related to the production and sale of products, performance of work, provision of services or sale of goods needed by the consumer. It is regular in nature and is distinguished, firstly, by freedom in choosing directions and methods of activity, independence in decision-making (of course, within the framework of laws and moral norms), and secondly, by responsibility for decisions made and their consequences. Thirdly, this type of activity does not exclude risk, losses and bankruptcies. Finally, entrepreneurship is clearly focused on making a profit, which, in conditions of developed competition, ensures the satisfaction of social needs. This is the most important prerequisite and reason for interest in the results of financial and economic activities. The implementation of this principle in reality depends not only on the independence granted to enterprises and the need to finance their expenses without government support, but also on the share of profit that remains at the disposal of the enterprise after paying taxes. In addition, it is necessary to create an economic environment in which it is profitable to produce goods, make a profit, and reduce costs.
It is worth noting that by financing an enterprise we mean attracting the capital necessary for the acquisition of fixed and working capital of the enterprise, in other words, covering the need for capital.
In turn, the financial relations of an enterprise arise when, on a monetary basis, the formation of the enterprise’s own funds, its income, the attraction of borrowed sources of financing economic activities, the distribution of income generated as a result of these activities, and their use for the development of the enterprise.
The topic of this course work is relevant, since enterprises carry out their relationships through financial relations, and financial relations underlie the formation of the enterprise’s own capital.
The main purpose of this course work is studying the features of financial relations of enterprises and the principles of their organization. To achieve this goal, it is necessary to solve the following tasks: The work consists of two chapters, each of which is divided into structural elements - paragraphs, as well as an introduction, conclusion and list of references. The work uses both scientific literature and media publications and Internet data, which are reflected in the list of sources used. When writing this work, the works of such authors as: A.N. Gavrilova, V.V. Kovalev, N.V. Kolchina, A.I. Polozhentseva and others, as well as periodical literature and official websites. CHAPTER 1. THEORETICAL FOUNDATIONS OF ORGANIZATION OF FINANCIAL RELATIONS OF ENTERPRISES
.1 Essence, functions and principles of organization of enterprise finance
Finance is a specific area of economic relations determined by the movement of money. They are based on the processes occurring as a result of the creation, distribution, exchange and use of gross domestic product and national income. An organization (enterprise) (French organization, from the Latin organiso - I give a harmonious appearance) is an independent economic entity that has the rights of a legal entity, producing products, goods, providing services, performing work, engaging in various types of economic activities, the purpose of which is to ensure social needs, making profit and increasing capital. It is worth saying that an organization (enterprise) can carry out any of the types of entrepreneurial activities or all types at the same time. In the process of entrepreneurial activity, organizations have certain economic relations with their counterparties: suppliers and customers; partners in joint activities; unions and associations; financial and credit system, etc., accompanied by cash flow. The material basis of finance is money. However, a necessary condition for the emergence of finance is the real movement of funds: their accumulation, expenditure and use at all levels of management. It is due to mutual settlements between economic entities, with the budgetary and credit systems, in the process of which centralized and decentralized funds of funds are created and used. The finances of organizations (enterprises) are a set of monetary relations that mediate economic relations associated with the organization of production and sales of products, performance of work, provision of services, formation of financial resources, and implementation of investment activities. As an economic category, finance of organizations (enterprises) is a system of financial or monetary relations that arise in the process of forming fixed and working capital, funds of the organization's funds and their use. They are distributive and redistributive in nature and have a direct impact on the reproduction process. The movement of income of organizations is accompanied by the formation of their financial relations with other economic entities. All financial relations of enterprises can be combined into four groups: - with other enterprises and organizations; within the enterprise; within associations of enterprises and organizations; with the financial and credit system of the state. Financial relations with other enterprises and organizations Include relationships with suppliers, buyers, construction, installation and transport organizations, post and telegraph, foreign trade and other organizations, customs, and foreign companies. This is the largest group in terms of cash payments. The relations of enterprises with each other are connected with the sale of finished products and the acquisition of material assets for economic activities. The role of this group is primary, since it is in the sphere of material production that national income is created, enterprises receive revenue from the sale of products and profit. financial relations between the founders at the time of creation of the organization during the formation of the authorized capital, as well as during the distribution of dividends; financial relations between organizations in the process of production and sales of products, creating added value; these are primarily financial relations between suppliers and consumers; Financial relations within the enterprise Includes relationships between branches, workshops, departments, teams, etc., as well as relationships with employees and owners. Relations between divisions of the enterprise are associated with payment for work and services, distribution of profits, working capital, etc. Their role is to establish certain incentives and financial responsibility for the high-quality fulfillment of accepted obligations. Their volume is determined by the degree of financial independence of structural divisions. Relations with workers and employees include the payment of wages, bonuses, benefits, dividends on shares, financial assistance, as well as the collection of money for damage caused and the withholding of taxes. financial relations between the organization and the personnel employed in it in the form of wages, bonuses, and the provision of social benefits; Financial relations within associations of enterprises and organizations Financial relations within associations of enterprises and organizations are the relations of enterprises with a parent organization, within financial and industrial groups, as well as a holding company. Financial relations of enterprises with higher organizations constitute relations regarding the formation and use of centralized monetary funds, which in conditions of market relations are an objective necessity. This is especially true for financing investments, replenishing working capital, financing import operations, scientific research, including marketing. Intra-industry redistribution of funds, as a rule, on a repayable basis, plays an important role in financial management and contributes to the optimization of enterprise funds. financial relations between an organization and its divisions when distributing resources, as well as between organizations within a financial and industrial group, holding, union or association of which the organization is a member; such relationships are usually associated with internal redistribution of funds or financing of corporate events; Relations with the financial and credit system of the state Relations with the financial and credit system of the state are diverse. This system includes the following links: budget, credit, insurance, and the stock market. Relations with budgets of various levels and with extra-budgetary funds are associated with the transfer of taxes and deductions. Financial relations of enterprises with banks are built in relation to both the storage of funds in banks, the organization of non-cash payments, and the receipt and repayment of short-term and long-term loans. The organization of non-cash payments has a direct impact on the financial position of enterprises. Credit is a source of formation of working capital, expansion of production, its rhythm, improvement of product quality, and helps eliminate temporary financial difficulties of enterprises. Banks currently provide enterprises with a number of so-called non-traditional services: leasing, factoring, forfeiting, trust. At the same time, there may be independent companies specializing in performing these functions, with which enterprises have direct relationships, bypassing the bank. Financial relations of enterprises with the stock market involve transactions with securities. financial relations between the organization and the financial system of the state when withdrawing part of the primary income in the form of taxes and fees, as well as when receiving allocations from the budget; financial relations between an organization and other participants in the financial system. Relationships with banks arise when organizing non-cash payments, obtaining and repaying short-term and long-term loans, as well as receiving banking services. Relations with the insurance component of the financial system occur in the insurance of property, commercial and entrepreneurial risks, and compulsory insurance of employees. Relations with stock market participants - when placing temporarily free funds in securities, as well as carrying out privatization. Types of financial relations by degree of obligation From a mandatory point of view, all financial relations of an organization should be classified into: voluntary; voluntary-compulsory; forced. Voluntary-compulsory financial relations are relations into which organizations enter voluntarily and are then forced to fulfill accepted obligations or conditions for the formation of relations with other legal entities. An example of such relations can be financial relations within a group, holding, association, union, since they are regulated by internal documents adopted voluntarily. Such relations also include financial relations when organizing interaction with counterparties (suppliers and contractors), the terms of which are reflected in contractual obligations. In market conditions, the choice of a counterparty and the legal norms of interaction with it are carried out voluntarily, but sanctions for violation of voluntarily accepted contractual obligations are already of a compulsory nature. The implementation of responsibility for obligations is expressed in the payment of fines and penalties for violation of the terms of contracts, compensation by personnel for material damage caused by their actions. Compulsory financial relations of an organization arise when fulfilling tax obligations, conducting non-cash payments (settlements between legal entities in cash are limited), compulsory professional liability insurance (for example, in auditing and construction activities), compulsory insurance of certain categories of employees or property defined by state legal acts. Open joint stock companies are required to enter into relationships with participants and organizers of the stock market. Each of the listed groups of financial relations has its own characteristics and scope of application. However, they are all bilateral in nature and their material basis is the organization’s income. 1.2 Organization of financial relations of enterprises financial relationship budget fund Financial relations of enterprises - a system of relationships with government bodies, the tax system, budgets, banks and other credit institutions, insurance companies and so on, as well as monetary relations expressing the formation and use of monetary funds in the process of circulation of enterprise resources, the formation of its cash income and savings . Financial relations are divided into internal and external. Internal financial relations: formation of the authorized capital of business entities; relations with employees regarding the payment of wages. financial relations with its own structural divisions relations within production associations and relations of the enterprise with its subsidiaries. External financial relations relations with other business entities in the process of generating and distributing revenue (intangible relations); fines, penalties, penalties; - rental relations; issue and sale of securities; Team work; commercial lending; The organization of finances of business entities is carried out on the basis of a number of principles that correspond to the essence of entrepreneurial activity in market conditions: Economic independence. The implementation of this principle is ensured by the fact that an economic entity, regardless of its form of ownership, independently determines the directions of its expenses and the sources of their financing, guided by the desire to maximize profits. Self-financing. This principle means full recoupment of the costs of production and sales of products, investing in the development of production at the expense of one’s own funds and, if necessary, bank and commercial loans. The implementation of this principle is one of the main conditions for entrepreneurial activity, ensuring the competitiveness of the enterprise. Material liability. It means the presence of a certain system of responsibility for the conduct and results of business activities. Financial methods for implementing this principle are different for individual enterprises, their managers and employees of the enterprise. Material interest. This principle is objectively predetermined by the main goal of entrepreneurial activity - making a profit. Ensuring financial reserves. This principle is associated with the need to form financial reserves to support entrepreneurial activity. The principle of financial control. The implementation of this principle at the enterprise level provides for such an organization of finances that provides the possibility of implementing intra-company financial control on the basis of internal analysis and audit. Thus, the finances of organizations are the main link of the financial system. Enterprise finance is a set of monetary or financial relations that arise among business entities regarding the formation of actual and (or) potential funds of funds, their distribution and use for the needs of production and consumption. All principles of organizing the finances of economic entities are in development and for their implementation in each specific economic situation, their own forms and methods are used, corresponding to the level of development of productive forces and production relations. In modern economic conditions, commercial banks are becoming an important element of the market infrastructure. Since commercial banks are created and operate in the form of limited liability partnerships or joint stock companies, their activities are possible only if they receive their own profit. Thus, the relationship between enterprises and banks is built taking into account mutual interests and should benefit both parties. Relations between an organization and a bank arise regarding settlement, cash and credit services, as well as in connection with the emergence of new services characteristic of a market economy. An important feature of these relations is their contractual nature. The initiative to conclude agreements comes from the enterprise, which independently selects a bank for its settlement, cash and credit services. For settlement services, the company enters into a bank account agreement with the bank, which is necessary for organizing non-cash payments. In accordance with the agreement, the bank opens current and other accounts for the enterprise as a client, credits them with funds received both from the enterprise and to the enterprise, and debits amounts from the enterprise's account on its instructions to the accounts of suppliers, creditors, relevant budgetary and extra-budgetary funds. In addition, the bank undertakes to accept cash from the client company and issue it or on its instructions, and pay interest for storing money in accounts. The main account of an enterprise as a legal entity is a current account. An enterprise has the right to open several current accounts in different banks. The proceeds from the sale of products (works, services) are credited to the current account, and settlements are made on the obligations of the enterprise. The organization has the right to open other accounts - current, loan, foreign currency - in any quantity in different banks. A settlement sub-account is opened for an enterprise that has separate structural divisions outside its location. At their location, bank accounts are opened in the name of the enterprise. Since the settlement subaccount has an auxiliary meaning, revenue from the division is accumulated on it for subsequent transfer to the main settlement account of the enterprise. Current accounts are opened for branches, divisions and other non-self-supporting divisions of the enterprise. They carry out limited settlement transactions related mainly to wages and administrative expenses. When you open a current foreign currency account at a bank, a transit foreign currency account is automatically opened, into which foreign currency transfers from the foreign economic activities of the enterprise are received. After selling part of the foreign currency proceeds, the balance of foreign currency funds is transferred to the current account. In the process of settlement and cash services, certain financial relations develop between the enterprise and the bank, accompanied by the movement of funds and affecting the formation of income of the enterprise and the bank. Many banks charge fees for processing customer accounts and conducting settlement and cash transactions to recoup the costs of conducting them. Others, to attract clients, open current accounts for free. Each bank pays a certain fee to the latter for storing the funds of enterprises (with the exception of a transit currency account). The amount of the fee is set by mutual agreement if we are talking about a current account. The company places temporarily available funds into time deposit accounts on the terms of the bank, which sets interest on deposits depending on the period of storage of money. The organization's expenses for paying for bank services are included in the cost of products (works, services), income received from storing funds in bank accounts is taken into account as part of the enterprise's balance sheet profit as non-operating income. Banks do not have the right to control an enterprise’s settlements with the budget, other enterprises, or other non-cash payments, although they are carried out in established forms. However, the bank bears a certain responsibility for compliance with the rules of settlement discipline, which is established by regulations of the Central Bank of the Russian Federation and is determined by agreements between the enterprise and the commercial bank. For untimely or incorrect debiting of funds from the accounts of the enterprise, as well as for untimely or incorrect crediting of funds received by the enterprise, it has the right to demand that the bank pay a fine in its favor in the amount of 0.5% of these amounts for each day of delay. The agreement between the bank and the enterprise may also provide for other (additional) forms of liability. The responsibility of enterprises to the bank is established in bank account and deposit agreements, and loan agreements. Let us note that the role of credit in ensuring the normal functioning of an enterprise in modern conditions is certainly important. Bank loans are the most important source of providing financial resources to the needs of enterprises related to the production and sale of products. Temporary need for funds especially often arises in enterprises where there are seasonal fluctuations in production and sales volumes. But it can arise as a result of a temporary gap between the receipt of sources of certain types of costs and the need for funds for this purpose, for example, for repair work. Associations and industrial enterprises operating in self-financing conditions are credited based on the totality of material inventories and production costs. The general principle of checking loan collateral is as follows. The actual debt is compared with the amount of the excess paid balance of inventories of valuables and production costs within the plan and goods shipped in the amount of their balance on the balance sheet. In practice, checking the security of a bank institution is carried out simultaneously based on the totality of inventories and costs and goods shipped. If the debt exceeds the planned amount of the loan, the bank institution, together with the enterprise, considers the reasons that caused the excess need for a loan. A decision may be made to provide a loan for temporary needs for the full or partial amount of excess inventory and production costs, as well as goods shipped. If these measures make it possible to bring the debt to the planned period, then the bank institution can provide a loan for temporary needs. If it is impossible to bring the loan debt to the planned level within the established time frame, as well as in the event of overdue debt on bank loans, a lending limitation is introduced within the planned loan amount. If the planned loan amount is exceeded due to the above-plan growth of goods shipped, the payment terms of which have not yet arrived, they are accepted for lending without restrictions on the amount and period. In this case, the bank does not apply sanctions. When checking, balances of work in progress, finished products and goods shipped are accepted for credit at actual cost, but not higher than planned, and all other inventories and costs - according to balance sheet valuation. The cost of inventories is reduced by the amount of depreciation of valuables, a reserve to cover future expenses or losses, as well as trade discounts if goods are recorded on the balance sheet at retail or wholesale prices. The bank can provide loans for expenses in fixed assets if the enterprise lacks incentive funds. Analysis of the relationship between an enterprise and a bank on such loans consists of checking the intended use of loans and the effectiveness of activities carried out using them. Lending is a method of repayable financing of an enterprise. It is a traditional banking service. An enterprise has the right to receive a loan both from the bank where its current account is opened and from any other bank. Lending is carried out on the basis of a loan agreement, which defines the rights and obligations of the parties, as well as liability for violation of the terms of the agreement, taking into account the nature of the loan provided and the financial condition of the borrower enterprise. Depending on the nature of the enterprise's needs for borrowed funds, there are short-term loans (up to a year), medium-term loans (from one to three years) and long-term loans (over three years). For the use of a loan, which must be repaid within the period established by the agreement, the company pays interest to the bank. Interest rates depend on the period of use of borrowed capital, taking into account supply and demand. Interest rates may vary from bank to bank. The practice of Russian banks in the field of lending indicates that their activity in this area almost entirely consists of short-term loans concentrated in the field of trade and purchasing business. Basically, borrowed funds are aimed at intermediary operations, which are characterized by rapid turnover of funds and high profits. Since banks provide lending on a commercial basis, the principles of lending are the security of the loan, targeted nature, urgency, payment and repayment of the loan. In this case, this determines the preferences of specific types of credit operations and their overwhelming numerical superiority. Relations with the financial and credit system are diverse. First of all, these are relations with budgets of various levels and extra-budgetary funds associated with the transfer of taxes and deductions. The Russian tax system is imperfect and does not contribute to normal production activities. World experience shows that it is possible to reduce high inflation rates only through supporting production and developing investment. Tax, as well as credit and customs policies should be aimed mainly at this. In particular, in many countries some or all of the increase in production is not subject to taxes. This is beneficial for both the enterprise and the state, since taxes from such enterprises are received in full, and after a year they increase sharply. Relations with the insurance sector of the financial system consist of transfers of funds for social and medical insurance, as well as insurance of enterprise property. Financial relations of enterprises with banks are built both in terms of organizing non-cash payments and when receiving and repaying short-term and long-term loans. The organization of non-cash payments has a direct impact on the financial position of enterprises. Credit is a source of formation of working capital, expansion of production, its rhythm, improvement of product quality, and helps eliminate temporary financial difficulties of enterprises. Currently, there are a number of problems in the relations of enterprises with banks. The practice of non-cash payments is primitive: prepayment, barter, cash, large non-payments. Credit is very expensive, so its share in the formation of working capital of enterprises is very low (on average no more than 10%). Long-term loans for financing investments are practically not used. Non-traditional banking services have also not been developed. 1.3 Financial relations of the organization with the budget and extra-budgetary funds
Monetary relations between the state and the enterprise arise in the process of economic activity, since this activity is aimed at making a profit. There is a mobilization of funds for the needs of the state through taxation. The integral tax system of the Russian Federation has been in effect since 1992. In terms of the totality and structure of the taxes included in it, the forms and methods of its construction, the existing tax system does not meet the modern tasks of financial policy. This tax mechanism is characterized by a fiscal focus, and the stimulating function of taxes in this situation is not realized. In other words, tax methods do not ensure the development of entrepreneurship. In practice, shortcomings and contradictions of existing laws are revealed. The state taxation system has a significant impact on business activities. The tax burden may be such that even a normally functioning enterprise will not have funds left not only for expanding production, but also for simple reproduction. The multiplicity of taxes, tax rates and benefits, unclear wording of legislation and regulations make it difficult for taxpayers to pay taxes correctly. Responsibility in tax legislation, however, is established quite strictly. Despite the fact that most of the violations are associated with insufficient awareness of taxpayers about the current tax legislation and the changes occurring in it, essentially no explanatory work is being carried out in this direction. A positive effect of the taxation system on enterprises is possible, but this requires certain conditions. Speaking about specific conditions, we can define the following: a reasonable tax burden that does not deprive the enterprise of sources of financing for the expansion of production and reproduction processes; optimal amount of taxes levied; simple procedure for their calculation and collection; the same taxation system for enterprises of all forms of ownership. All these conditions are necessary for the development of those enterprises in whose activities society is interested. A flexible tax system can facilitate this process with the help of tax incentives. Taxes are classified by types and objects of taxation. Federal taxes, taxes of constituent entities of the Federation, local taxes have been established - a total of 40 types. The objects of taxation are: profit, income, property of enterprises, the cost of goods of a certain type, certain types of activities, financial transactions, added value of products, works and services, use of natural resources. There are three types of taxation: progressive - the higher the income, the disproportionately large part of it is withdrawn in the form of taxes; the proportional system assumes the same share of tax in income, regardless of their size; Regressive taxation involves reducing the tax rate as income increases. In practice, all three types of taxation occur. Corporate income taxes are most often calculated on a progressive scale. As a rule, enterprises act as taxpayers and only some of them receive subsidies and allocations for capital investments from the budget. For example, these are enterprises of the agro-industrial complex and the coal industry. Financing comes from the republican budget within the framework of targeted government programs and investments (financing of defense enterprises) or through special funds, such as the Entrepreneurship Support Fund. The system of state extra-budgetary funds operates in parallel with the budget. This system consists of funds for production and social purposes, accumulating significant financial resources. The volume of these resources in relation to consolidated budget revenues is at least half of the latter. Of these, most are transferred to centralized extra-budgetary funds. Extra-budgetary funds for production purposes include funds for financing sectoral and inter-sectoral research and development and activities for the development of new types of products, created in ministries, departments, concerns, associations through contributions from enterprises in the amount of up to 1.5% of the cost of production. The most significant funds go to social funds. These include: Pension Fund Social Insurance Fund Employment Fund Compulsory health insurance fund. CHAPTER 2. FINANCIAL RELATIONS OF THE ENTERPRISE OJSC ROSTELECOM
.1 Characteristics of the activities of the enterprise OJSC Rostelecom
Open joint-stock company of long-distance and international electrical communications "Rostelecom" (hereinafter also referred to as OJSC "Rostelecom", Rostelecom or the Company) - the national telecommunications company of Russia - is the largest Russian operator in the communications industry. In its current form, the Company has existed since April 2011, when the national long-distance operator Rostelecom was joined by interregional communication companies OJSC CenterTelecom, OJSC NWT, OJSC UTK, OJSC VolgaTelecom, OJSC Uralsvyazinform, OJSC Sibirtelecom ", OJSC Dalsvyaz and OJSC Dagsvyazinform (hereinafter referred to as MRK and Dagsvyazinform). The United Company continued its activities under the Rostelecom brand, which, according to the ROMIR research holding, is one of the strongest national brands and is included in the Top 10 in terms of the level of trust of the Russian population. Today Rostelecom owns a set of state licenses that allow it to provide a wide range of telecommunications services in all regions of the Russian Federation. The company has the largest backbone communication network with a total length of about 500 thousand km and a unique access infrastructure (“last mile”) to 35 million Russian households and corporations. At the same time, in order to provide its customers with unhindered access to a wide range of new telecommunications services throughout the country, Rostelecom intends to actively further develop and modernize its own infrastructure. Today Rostelecom is a key player both in its traditional markets of local and long-distance communications, and in new promising segments such as broadband Internet access, pay TV, etc. The company also occupies a strong position in the regional cellular communication markets of the Urals, Siberia, the Volga region and the Far East. In addition, Rostelecom has become the undisputed leader in the telecommunications services market for Russian government bodies of all levels, government agencies and organizations. 2.2 Financial relationships of OJSC Rostelecom with other enterprises
In the face of increasing competition in the segments of the Company's traditional services, OJSC Rostelecom is actively diversifying its business, opening new markets and developing innovative services. OJSC Rostelecom occupies a leading position in the services market. Financial relations of OJSC Rostelecom: in April 2008, the company signed an agreement on direct inter-operator interaction with the largest mobile operator in Ukraine, Kyivstar JSC. The signed agreement provides for two-way exchange of voice traffic between Ukrainian and Russian operators. In May 2008, OJSC Rostelecom entered into agreements with Home Credit and Finance Bank LLC for the provision of long-distance and international communication services and private virtual network services using IP VPN technology. The Belarusian state operator RUE Beltelecom has begun providing access to the Russian segment of the Internet at a speed of 2 Gbit/s. in June 2009, Rostelecom OJSC became one of the founders and sponsors of the new world forum ITW (International Telecommunications Week - 2008), Washington (USA), etc. Developing its financial relations already in 2011, OJSC Rostelecom cooperates with the following companies: in June, the company, together with three national foreign operators - the British company Cable & Wireless, the Iranian Telecommunications Infrastructure Company (TIC) and the Omani Oman Telecommunications Company (Omantel) - co-founded an international consortium created to organize the Europe-Persia Express fiber-optic cable system Gateway" (EPEG), which will connect Europe and the Middle East. in September, Rostelecom and 1C signed a partnership agreement on cooperation in the development of the Information Society program. in December, Rostelecom and Yota signed an agreement on the joint development and use of a 4G wireless network, etc. Based on the tabular data (Appendix 1), we can say that Rostelecom OJSC invests its funds in both commercial and non-profit organizations, receiving not only profit, but also reducing its social costs by participating in the Orbita Health Complex . As a result of all that has been said, we can conclude that the company OJSC Rostelecom provides a full range of communication and data transmission services throughout the Russian Federation. This company is designed to become a “National Champion” in the telecommunications sector in the face of increasing competition from private telecom operators. An important area of the Company’s development has been the provision of high-quality multimedia services to users. The company also focused on expanding its geographic presence in international markets and strengthening its position as a key transit route between Europe, Asia and the Middle East. In addition, significant attention was paid to improving its own backbone communication network, developing the potential of which the Company creates the basis for meeting the growing demand for modern and high-quality telecommunications products and provides users with the opportunity to access Rostelecom services in all regions of the country. During 2011, the Company did not receive government support, including in the form of subsidies. CHAPTER 3. WAYS TO IMPROVE FINANCIAL RELATIONS OF ENTERPRISES
In a developed market economy, the most important are the financial relations of enterprises that arise both within the enterprise and with budgetary and extra-budgetary funds, banks, insurance, exchanges, various funds, as well as with other enterprises and organizations. The basis of financial relations is money. Financial relations with other enterprises and organizations include relations with suppliers, buyers, construction, installation and transport organizations, post and telegraph, foreign trade and other organizations, customs, enterprises, organizations and firms of foreign countries. The largest group in terms of the volume of cash payments is the relations of enterprises with each other related to the sale of finished products and the acquisition of material assets for economic activities. The role of this group of financial relations is primary, because It is in the sphere of material production that national income is created, enterprises receive revenue from the sale of products and profit. The organization of these relationships has a direct impact on the final results of production activities. Financial relations within an enterprise include relations between branches, workshops, departments, teams, etc., as well as relations with workers and employees. Relations between divisions of the enterprise are associated with payment for work and services, distribution of profits, working capital, etc. Their role is to establish certain incentives and financial responsibility for the high-quality fulfillment of accepted obligations. Relations with workers and employees include the payment of wages, bonuses, benefits, dividends on shares, financial assistance, as well as the collection of money for damage caused and the withholding of taxes. Financial relations of enterprises with higher organizations include relations regarding the formation and use of centralized funds, which in conditions of market relations are an objective necessity. This is especially true for financing investments, replenishing working capital, financing import operations, scientific research, incl. and marketing. Relations with the financial and credit system are diverse, first of all, these are relations with budgets of various levels and extra-budgetary funds associated with the transfer of taxes and deductions. Relations with the insurance sector of the financial system consist of transfers of funds for social and medical insurance, as well as insurance of enterprise property. Financial relations of enterprises with banks are built both in terms of organizing non-cash payments and in relation to obtaining and repaying short-term and long-term loans. The organization of non-cash payments has a direct impact on the financial position of enterprises. Credit is a source of formation of working capital, expansion of production, its rhythm, improvement of product quality, and helps eliminate temporary financial difficulties of enterprises. Financial relations of enterprises with the stock market involve transactions with securities. The most important aspect of the financial activity of enterprises is the formation and use of various funds. Through them, economic activities are provided with the necessary funds. as well as expanded reproduction; financing scientific and technological progress; development and implementation of new technology; economic incentives; settlements with the budget, banks. These include: authorized capital; Extra capital; Reserve capital; accumulation fund; consumption fund; currency board; fund for paying wages; fund for payments to the budget; other funds. The main ways to strengthen the financial relations of enterprises are related to the optimization of the funds they use and the elimination of their deficit. The most important direction for their improvement is the development and implementation of the strategic financial policy of the enterprise. The main indicator of the financial relations of an enterprise is the availability of funds on the basis of which the enterprise promptly pays off with suppliers, the budget, banks, creates the necessary funds, and satisfies other needs. This demonstrates the financial control of the enterprise. Financial relations at enterprises are carried out by the financial department. The main task of employees of financial services of an enterprise is the most complete practical implementation of finance functions. This is, first of all, strengthening the financial position of the enterprise by increasing its profitability; increasing profits by increasing labor productivity, reducing product costs, improving product quality, and introducing scientific and technological advances. An important place in the activities of the financial service is occupied by the distribution of cash income and profit; correct organization of payments for finished products and constant monitoring of the implementation of the plan for the sale of products and profits; timeliness of payments to the budget; organizing relationships with banks, correct settlements with workers and employees, monitoring compliance with working capital standards. Currently, financial relations between enterprises are very developed, but to make these relations more effective, the following measures can be proposed: organization of working capital in accordance with existing requirements in order to optimize financial condition; optimization of enterprise costs based on dividing them into variables and constants and analysis of the interaction and relationship “costs - revenue - profit”; optimization of profit distribution and selection of the most effective dividend policy; wider introduction of commercial credit and bill circulation in order to optimize sources of funds and impact on the banking system; use of leasing relations for the purpose of production development; optimization of the property structure and sources of its formation in order to prevent an unsatisfactory balance sheet structure; development and implementation of the strategic financial policy of the enterprise. It is important that the company does not experience financial difficulties. Based on OJSC Rostelecom, we can say that the financial condition of the enterprise is favorable, it is solvent, financially stable and profitable, in some cases making a profit is not the main thing for it. However, for greater efficiency of financial relations and financial results, an enterprise needs to: improve the quality of the service provided, which will significantly improve its demand and competitiveness; introduce new types of services, expand the range of services provided; constantly improve the professionalism and qualifications of personnel, etc.; strict compliance with concluded contracts for the performance of work; increasing the volume of production of work performed due to more complete use of its production capacities. Thus, we can conclude that financial relations play a significant role in a market economy, as well as in the formation of an enterprise’s own capital. The basis of financial relations is money. CONCLUSION
Finance refers to the system of education, distribution and use of monetary resources in the process of social production. Finance occupies a special place in economic relations; it always appears in monetary form, has a distributive nature and reflects the formation and use of various types of income and savings of economic entities in the sphere of material production, the state and participants in the non-productive sphere. Financial relations permeate all economic activity and exist objectively, but have specific forms of manifestation that correspond to the nature of production relations in society. In modern conditions, the forms of financial relations are changing significantly. The formation of the market and entrepreneurship in Russia involves not only the privatization of enterprises, the development of competition and foreign economic relations of enterprises, but also the financial recovery of the national economy and the creation of an adequate system of financial relations. Enterprise finance, being part of the general system of financial relations, reflects the process of formation, distribution and use of income at enterprises in various sectors of the national economy and is closely related to entrepreneurship, since an enterprise is a form of entrepreneurial activity. All these financial relations arise in the process of formation and movement (distribution, redistribution and use) of capital, income, funds, reserves and other sources of funds of the enterprise, i.e. its financial resources. It is cash flows and financial resources that are the direct objects of financial management of an enterprise. An important methodological factor is the determination of the principles of organization and functioning of enterprise finance, which is necessary to identify the directions of influence of enterprise finance on the development of the business sector of the economy, and to develop criteria for its functioning. The basic principles of organizing the finances of enterprises are: economic independence of the organization; self-sufficiency and self-financing; material interest; material liability; provision of financial reserves. All these principles are in constant development, and for their implementation in each specific economic situation, their own forms and methods are used, corresponding to the state of the productive forces and production relations in society. The purpose of the course work research was to consider the issue of financial relations of enterprises and the principles of their organization. The following tasks were set: study the theoretical foundations of organizing financial relations of enterprises consider the financial relations of the enterprise OJSC Rostelecom suggest ways to improve the organization of financial relations between enterprises When writing a course work on the topic “Financial relations of enterprises and the principles of their organization,” the set tasks and goals were achieved, and ways to improve the financial relations of enterprises were proposed. BIBLIOGRAPHY
1. Gavrilova A.N. Finance of organizations (enterprises): textbook / A.N. Gavrilova, A.A. Popova.-4th ed.-M.: KNORUS, 2010.-606 p. Kovalev V.V. Financial management course: textbook / V.V. Kovalev -2nd ed., revised. and additional - Moscow: Prospekt, 2011. - 480 p. Kovaleva A.M., Firm finance: textbook / A.M., Kovaleva, M.G. Lapusta, L.G. Skamai - M.: Infra - M, 2003, 316 p. Kolchina N.V. Enterprise finance: a textbook for universities / N.V. Kolchina, G.B. Polyak, L.P. Pavlova.-2nd ed., revised. and additional - M.: UNITY-DANA, 2002.-687 p. Sorvina, O.V. Strategy and tactics for managing production costs of an enterprise / O.V. Sorvina // Finance and credit-2012. -No. 24-s. 10-21. Sheremet A.D. Enterprise finance: management and analysis / A.D. Sheremet, A.F. Ivanova-M.: KNORUS, 2005.- 308 p. Sheremet A.D. Methodology of financial analysis/A.D. Sheremet, R.S. Saifulin - INFRA-M Publishing House, 2000.-200 p. Shulyak P.N. Enterprise finance / P.N. Shulyak - M., 2005.- 340 p. 10. Yashin, S.N. Formation of tools for assessing the level of financial condition of enterprises for the implementation of innovative activities / S.N. Yashin, Yu.S. Soldatova // Finance and credit-2012. -No. 24-s. 2-9. APPLICATION
Table 1. Participation of OJSC Rostelecom in commercial and non-profit organizations Name of the organization Statutory type of activity Purpose of participation Cost of financial investments, thousand rubles Revenue thousand rubles Net profit (loss), thousand rubles “Nizhny Novgorod Cellular Communications” Cellular communication services of the GSM standard Obtaining additional income and developing new types of activities. 3,669,044.996 904,891.001 231,372.00 "Orbita Health Complex" Health services Participation in the Company allows reducing social expenses of OJSC Rostelecom 550 924.96314 763.0047 502.00 "Moscow Center for New Telecommunication Technologies" Provision of communication services Attracting traffic from corporate clients to the network of OJSC Rostelecom »5 190.00726 557.0032 351.00" Bashin-form "The provision of fixed communication services and the provision of communication services in the territory of the Republic of Bashkortostan4 722 165.075 873 535.00700 180.00" Volgograd-GSM "Coatal service, GSM 900/1800 MHz Obtaining additional income and developing new types of activities. 2,325,093.891 772,948.00336 171.00 “Recreational and preventive complex “Svyazist” Providing services for sanatorium and resort treatment of citizens Participation in the Company allows reducing social expenses of OJSC Rostelecom 873,216.54153 919.002 024.00
