Functions of finance as a manifestation of their essence. Functions of finance as a manifestation of essence. Social purpose of finance. List of used literature

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Introduction

1. The essence of finance

1.1 Prerequisites for the emergence of finance

1.2 Concept and necessity of finance

1.3 Features of finance

2. Functions of finance as a manifestation of their essence

2.1 Distribution function

2.2 Control function

2.3 Other functions

3. Discussion questions about the essence and functions of finance

Conclusion

List of used literature

Introductione

Our country has created conditions for entrepreneurial activity. But the lack of economic knowledge and the ability to apply it in practice hinders economic transformation. The small number of specialists means that our budget is drawn up and accepted by people who have only a mediocre understanding of what finance is. One of the most important conditions for increasing the well-being of citizens and the entire state as a whole is increasing economic knowledge, training specialists who have deep knowledge of finance, their structure, functions and who are able to apply this knowledge in practice, the creation by the state of favorable conditions for the development of enterprises and small businesses.

The study of the essence of finance in our country is in a twofold state. On the one hand, administrative-command views are strong, on the other, market views on the essence of finance are gaining strength.

The subject of research into the essence of finance is also relevant because a clear idea of what finance is and the boundaries of its distribution has not yet been given.

IN course work the functions of finance are also discussed in detail, their general characteristics. Learning the functions is necessary to implement an effective financial activities.

The existence of controversial issues about the essence and functions of finance and disagreements about their role in the life of society indicate that this issue requires detailed study and understanding.

Consideration of the issues of the essence and necessity of finance, their specific features, functions and debatable issues of the essence and functions of finance is main goal of this work.

From the general flow of information sources, I chose the main and most important ones for myself, for example, Galitskaya S.V. “Money, credit, finance”, Leontyev V.E. “Finance”, Kovaleva A.M. “Finance”, Rodionova V.M.. “Finance”, Drobozina L.A. “Finance” and several other authors, and when writing coursework I used such magazines as “Economy Issues”, “Finance”.

1. The essence of finance

1.1 Preprerequisites for the emergence of finance

The modern world is a world of comprehensive and omnipotent commodity-money relations. They permeate the internal life of any state and its activities in the international arena.

In the process of reproduction at different levels, from the enterprise to national economy in general, funds are generated and used Money. It does not matter in what form the money appears: in the form of cash paper tokens, or in the form credit cards, or in amounts appearing in bank accounts that are generally beyond any form.

The system of education and use of funds of monetary resources involved in ensuring the reproduction process constitutes the finances of society. And the totality of economic relations that arise between the state, enterprises and organizations, industries, territories and individual citizens in connection with the movement of monetary funds forms financial relations. They are complex, diverse and resemble the circulatory system of a living organism, through which the movement of goods and services takes place, a kind of exchange of substances between the economic cells of the social organism.

Finance is a historical category. They appeared simultaneously with the emergence of the state during the stratification of society into classes. The term finansia arose in the XIII - XV centuries. in the trading cities of Italy and meant any cash payment. Subsequently, the term gained international distribution and began to be used as a concept associated with the system of monetary relations between the population and the state regarding the formation of state funds of funds. Thus, this term reflected, firstly, monetary relations between two entities, i.e. money acted as the material basis for the existence and functioning of finance (where there is no money, there can be no finance); secondly, the subjects had different rights in the process of these relations: one of them (the state) had special powers; thirdly, in the process of these relations, a national fund of funds was formed - the budget (hence, we can say that these relations were of a fund nature); fourthly, the regular flow of funds into the budget could not be ensured without giving taxes, fees and other payments a state-compulsory nature, which was achieved through the legal rule-making activities of the state and the creation of an appropriate fiscal apparatus.

The following financial prerequisites are distinguished:

First premise. IN Central Europe As a result of the first bourgeois revolutions, although monarchical regimes were preserved, the power of the monarchs was significantly curtailed, and, most importantly, the head of state (monarch) was separated from the treasury. A nationwide fund of funds arose - a budget that the head of state could not individually manage.

Second premise. The formation and use of the budget has become systematic in nature, i.e. systems emerged government revenues and expenses with a certain composition, structure and legislative support.

Third premise. Taxes in cash acquired a predominant character, whereas previously state revenues were formed mainly through taxes in kind and labor duties.

Thus, finance expresses a certain sphere of production relations and belongs to the basic category. But what is the role of the state here? Some economists, based on the fact that financial relations are fixed by the legislator in the relevant regulations determine the dominant role of the state in the formation of these relations and, therefore, classify finance as legal, i.e. superstructure category. But the point is that legal act only records the content of objectively existing economic relations, proving that finance is, first of all, an economic category (and refers to the basis) and only then a legal category, i.e. the state, in the apt expression of economist E. A. Voznesensky, “dresses” financial relations in legal form, gives them the appropriate state-authoritative form while maintaining their objectively economic character.”

However, the role of the state cannot be reduced. The state actively influences finances depending on the political structure, main objectives, current conditions and other reasons. Through its financial policy, the state can influence the economy, having both a positive and negative impact on it.

Since, undoubtedly, finance is a historical category (it has stages of emergence), we can distinguish two main stages in the development of finance.

At first, an undeveloped form of finance, when the bulk of funds (2/3) was spent on military purposes, and finance had virtually no impact on the economy. Another characteristic feature this period was narrow financial system, since it consisted of one link - the budgetary one, and the number of financial relations was limited. All of them were related to the formation and use of the budget.

As commodity-money relations developed, the need arose for new national funds of funds and, accordingly, new groups of monetary relations regarding their formation and use.

Currently, regardless of the political structure and level of economic structure of a particular state, finance has entered a new stage of its development. This is due to the multi-link nature of financial systems, the high degree of impact on the economy, and the wide variety of financial relations.

Along with traditional public finance, local finance, off-budget special government funds, finance state enterprises. Completely new areas of financial relations have emerged, such as the finance of interstate communities.

1.2 Pconcept and necessity of finance

Finance as a scientific concept is usually associated with those processes that appear on the surface of social life in various forms and are necessarily accompanied by the movement (cash or non-cash) of funds. Whether we are talking about the distribution of profits and the formation of funds for intra-economic purposes at enterprises, or the transfer tax payments in income state budget, or about depositing funds into extra-budgetary or charitable funds - in all these and similar financial transactions there is a movement of funds.

Although very noticeable, cash flow in itself does not reveal the essence of finance. To comprehend it, it is necessary to identify those general properties that characterize the internal nature of all financial phenomena.

If we ignore the numerous forms in which financial processes take place, we can see what they have in common - the underlying relationships between various participants in social production, or social relations. These relations are production (economic) in nature, since they arise directly in social production.

Economic relations are extremely diverse: they arise at all stages of the reproduction process, at all levels of management, in all spheres of social activity. At the same time, homogeneous economic relations that characterize one of the aspects of social existence, being presented in a generalized abstract form, form an economic category. Finance, expressing production relations that actually exist in society, having an objective nature and a specific social purpose, acts as an economic category.

The uniqueness of the relationships that make up the content of finance as an economic category lies in the fact that they always have a monetary form of expression.

The monetary nature of financial relations is an important feature of finance. Money is a prerequisite for the existence of finance. If there is no money, there can be no finance, because the latter is a social form conditioned by the existence of the former.

In this regard, it is unlawful to classify not only monetary, but also natural relationships as finance. The existence of natural duties in the era of feudalism, the collection of tribute by the slave state from its citizens and conquered peoples, the naturalization of social relations in conditions of disordered monetary circulation does not at all prove the natural nature of financial relationships. They talk about something else - the functioning of finance is possible only under certain conditions, the absence of which immediately narrows the scope of this category. The emergence of financial relations always makes itself felt by the real movement of funds. The absence of such movement at the stages of production and consumption of the reproduction process indicates that they are not the place where finance arises.

Real movement money occurs at the second and third stages of the reproduction process - in distribution and exchange. However, the nature of the movement of value (in its monetary form) at these stages is different, which does not allow both of their sides to be attributed to the sphere of functioning of finance.

At the second stage, the movement of value in monetary form is carried out separately from the movement of goods and is characterized by its alienation (transition from the hands of some owners to the hands of others) or the targeted isolation of each part of the value (within one owner). At the third stage, the distributed value (in monetary form) is exchanged for the commodity form, i.e. acts of purchase and sale are carried out. There is no alienation of value itself here; it only changes its form - from monetary to commodity.

Thus, at the second stage of reproduction, there is a one-way (without counter equivalent) movement of the monetary form of value; on the third - a two-way (counter) movement of values, one of which is in monetary form, and the other in commodity form.

At the third stage of the reproduction process, constantly carried out exchange transactions are serviced by two categories: firstly, money as a universal equivalent, and secondly, price. No other social instrument is required here anymore. Therefore, there is no place for finances in the exchange.

The area of origin and functioning of finance is the second stage of the reproduction process, at which the value of the social product is distributed according to its intended purpose and business entities. Therefore, an important feature of finance as an economic category is the distributive nature of financial relations.

However, this feature is not enough to fully characterize finances. The diversity of distribution relations leads to the fact that at the second stage of the reproduction process various economic categories operate: finance, credit, wage, price. Finance differs significantly from other categories operating at the stage of value distribution.

The initial sphere of emergence of financial relations is the processes of primary distribution of the value of the social product, when this value breaks down into its constituent elements and various forms are formed cash income and savings. Isolation of profit, deductions for social insurance, depreciation charges and so on. carried out with the help of finance and reflects the process of distributing value in accordance with the intended purpose of each part of it. Further redistribution of value between business entities (withdrawal of part of the profit at the disposal of the state, payment of taxes by citizens of the country, etc.) and specification of its intended use (direction of profit to capital investments, the formation of economic incentive funds from various sources) also occurs on the basis of finance. Thanks to them, various processes of redistribution of the value of the social product are carried out in all structural divisions economy (in industries material production and non-productive sphere) and at different levels of management.

The distribution and redistribution of value through finance is necessarily accompanied by the movement of funds taking a specific form of financial resources; they are formed by business entities and the state at the expense of various types of cash income, deductions and receipts, and are used for expanded reproduction, material incentives for workers, and satisfaction of social and other needs of society. Financial resources act as material carriers of financial relations. The ownership of financial resources by a specific business entity and the state makes it possible to separate them from the funds of the population and, in particular, to draw a line between finance and wages.

Potentially, financial resources are formed at the production stage, when new value is created and old value is transferred. But precisely potentially, since the worker produces not financial, but labor products in commodity form. The real formation of financial resources begins only at the distribution stage, when the value is realized and specific economic forms of realized value are identified as part of the proceeds.

The use of financial resources is carried out mainly through cash funds special intended purpose, although a non-stock form of their use is possible. Financial funds are an important component of the overall system of monetary funds functioning in the national economy. The stock form of using financial resources is objectively predetermined by the needs of expanded reproduction and has some advantages compared to the non-stock form: it allows people’s needs to be more closely linked with economic opportunities society; ensures the concentration of resources on the main directions of development of social production; makes it possible to more fully link public, collective and personal interests and thus more actively influence production.

Consideration of financial resources as material carriers of financial relations allows us to distinguish finance from the general set of categories involved in cost distribution. None of them, except finance, are characterized by such material carrier. Hence, an important specific feature of finance, which distinguishes it from other distribution categories, is that financial relations are always associated with the formation of cash income and savings, which take the form of financial resources. This feature is common to financial relations of any socio-economic formation, wherever they operate. At the same time, the forms and methods by which financial resources are generated and used changed depending on the change in the social nature of society.

Study economic essence finance, identifying the specific features of this category allows us to give the following definition.

Finance is the monetary relations that arise in the process of distribution and redistribution of the value of the gross social product and part of the national wealth in connection with the formation of cash income and savings among business entities and the state and their use for expanded reproduction, material incentives for workers, satisfaction of social and other needs of society .

As part of the relations of production, finance belongs to the economic basis; their conditionality by value distribution emphasizes the historically transitory nature of finance.

1.3 Features of finance

Finance Features:

· bank funds are issued for a certain period; under certain conditions and subject to repayment;

· financing funds are issued for specific purposes; free irrevocably.

With the help of a loan, financial resources are redistributed between enterprises, organizations and citizens.

There is a constant flow of credit resources into financial resources and vice versa. All enterprise funds are concentrated in bank accounts and are sources of bank loan funds for issuing loans. There are many similarities between credit and finance, but the main one is the widespread use of both in the circulation and reproduction process.

Finance can influence all stages of reproduction and the process as a whole. Objective prerequisites for influence are associated with two circumstances:

· finance functions in all spheres of social production (production, circulation, consumption)

· finance has the potential to be a catalyst for economic processes, which follows from the distribution function.

Distribution begins in the sphere of material production. This area includes 3 stages, where the production stage is decisive.

a) the sphere of material production thus influences the nature and scale of production;

b) the sphere of circulation, it is represented by trade. It is characterized by buying and selling processes. The consumer properties of a product do not change, but its cost does. The product is sold, the company receives revenue. Then this revenue is distributed to compensation, accumulation, and consumption funds. Financial relations precede and complete the buying and selling process.

c) the sphere of consumption, where they distinguish:

Commercial organizations;

Budgetary organizations

Currently you can find organizations mixed type, where commercial structures allocate money for budgetary organizations.

There are possibilities for using finance that arise from the economic nature of finance. Since this is a distribution category, society uses it for its own purposes. The conscious use of finance in the interests of society and its individual elements transforms finance from an objective economic category into an economic management tool.

An economic instrument is an economic category embodied in specific forms of manifestation and consciously used by society to achieve specific goals.

An economic instrument, including finance, has two principles: the first is objective (arising from the economic category), the second is subjective (a tool for implementing economic policy states).

Finance influences in two ways:

Quantitatively (characterized by the proportions of the distribution process);

Qualitatively (characterized by the impact of finance on the material interests of business entities).

The quantitative side of influence is characterized by proportions in the distribution process. Qualitative influence characterizes the impact of finance on the material interests of business entities, through various shapes organization of financial relations.

An economic incentive is an instrument that is linked to the material interests of business entities.

The conscious use of finance in social production leads to results that demonstrate the active role of finance in social production under market conditions. A general approach to assessing the results achieved with the help of finance allows us to consider the role of finance in 3 directions:

o from the position of providing the needs of expanded reproduction with the necessary financial sources;

o from the point of view of using finance to regulate the cost structure;

o from the perspective of using finance as an economic incentive.

Finance is an integral part of monetary relations, but not all monetary relations are financial.

Finance differs from money, both in content and in the functions performed. Money is a universal equivalent, with the help of which, first of all, the labor costs of associated producers are measured, and finance is an economic instrument for the distribution and redistribution of gross domestic product and national income, an instrument for controlling the formation and use of funds of funds.

The reproduction process is a set of continuously repeating cycles.

Thus, the criteria for classifying certain relationships as financial are:

1. Real cash flow, i.e. transfer from one owner to another.

2. The distributive nature of these relations.

3. Place of origin - the second stage of the reproductive process.

2. Functions of finance as a manifestation of their essence

Finance is an integral part of monetary relations, therefore their role and meaning depend on the place monetary relations occupy in economic relations. However, finance differs from money not only in content, but also in the functions performed, in which its essence is manifested. Functions refer to the “work” that finance does.

No one denies that finance is a set of monetary relations organized by the state, during which the formation and use of funds of funds is carried out. And to the question of what is the source of the formation of numerous funds at different levels, the answer, as a rule, is the same - gross domestic product. The process of GDP distribution can be carried out using financial instruments: norms, rates, tariffs, deductions, etc., established by the state.

If we talk about finance in general, then, apparently, we should assume that it performs two main functions: distribution and control.

2.1 Distributive function

The distribution function is that the financial resources of an enterprise are subject to distribution in order to fulfill monetary obligations before the budget, banks, counterparties. Its result is the formation and use of target funds of funds, maintaining an effective capital structure.

The distribution function manifests itself in the distribution of national income, when the creation of so-called basic or primary income occurs. Their sum is equal to national income. Basic incomes are formed through the distribution of national income among participants in material production. They are divided into two groups:

1) wages of workers, employees, income of farmers, peasants employed in the sphere of material production;

2) income of enterprises in the sphere of material production.

However, primary incomes do not yet form public monetary funds sufficient for the development of priority sectors of the national economy, ensuring the country's defense capability, and satisfying the material and cultural needs of the population. Further distribution or redistribution of national income is necessary, related to:

with intersectoral and territorial redistribution of funds in the interests of the most efficient and rational use of income and savings of enterprises and organizations;

the presence, along with the non-productive sphere, in which national income is not created (education, healthcare, social insurance and social Security, management);

redistribution of income between different social groups population.

As a result of redistribution, secondary or production income is formed. These include income received in non-productive sectors, taxes (income tax individuals and etc.). Secondary incomes serve to form the final proportions of the use of national income.

By actively participating in the distribution and redistribution of national income, finance contributes to the transformation of the proportions that arose during the primary distribution of national income into the proportion of its end use. The income created during such redistribution must ensure correspondence between material and financial resources and, above all, between the size of monetary funds and their structure, on the one hand, and the volume and structure of means of production and consumer goods, on the other.

The redistribution of national income in the Russian Federation occurs in the interests of structural restructuring of the national economy, the development of priority sectors of the economy (agriculture, transport, energy, conversion of military production), in favor of the least affluent segments of the population (pensioners, students, single and large mothers).

Thus, the redistribution of national income occurs between the production and non-production spheres of the national economy, sectors of material production, individual regions of the country, forms of ownership and social groups of the population.

The ultimate goal of the distribution and redistribution of national income and GDP, accomplished with the help of finance, is to develop the productive forces, create market structures of the economy, strengthen the state, and ensure a high quality of life for the general population. At the same time, the role of finance is subordinated to the tasks of increasing the material interest of workers and teams of enterprises and organizations in improving the financial and economic activity, achieving the best results at the lowest cost.

2.2 Control function

Being an instrument for the formation and use of monetary income and funds, finance objectively reflects the course of the distribution process.

The control function is manifested in control over the distribution of GDP among the relevant funds and their expenditure for their intended purpose.

In the context of the transition to market relations, financial control is aimed at ensuring the financial development of public and private production, accelerating scientific and technological progress, comprehensive improvement in the quality of work at all levels of the national economy. It covers production and non-production areas. Aimed at increasing economic stimulation, rational and thrifty use of material, labor, financial resources and natural resources, reducing unproductive expenses and losses, curbing mismanagement and waste. Thanks to control function finance, society knows how the proportions develop in the distribution of funds, how timely financial resources are available to different business entities, whether they are used economically and efficiently, etc.

One of the important tasks of financial control is checking strict compliance with legislation on financial matters, timeliness and completeness of implementation financial obligations before the budget system, tax service, banks, as well as mutual obligations of enterprises and organizations for settlements and payments.

The control function of finance is also manifested through the multifaceted activities of financial authorities.

Financial system workers and tax service exercise financial control in the process of financial planning, during the execution of revenue and expenditure parts budget system. In the conditions of development of market relations, directions test work, forms and methods of financial control are changing significantly.

Distribution and control functions are two sides of the same thing economic process. Only in their unity and close interaction can finance manifest itself as a category of value distribution.

The instrument for implementing the control function of finance is financial information. It is contained in the financial indicators available in accounting, statistical and operational reporting. Financial indicators allow you to see various aspects of the work of enterprises and evaluate the results of economic activity. Based on them, measures are taken to eliminate the identified negative aspects.

The control function, objectively inherent in finance, can be implemented with greater or less completeness, which is largely determined by the state of financial discipline in the national economy. Financial discipline is mandatory for all enterprises, organizations, institutions and officials the procedure for conducting financial management, compliance with established norms and rules, and fulfillment of financial obligations.

2.3 Other functions

In addition to the distribution and control functions, finance also performs a regulatory function. This function is associated with government intervention through finance (government spending, taxes, government credit) in the reproduction process.

Some authors do not recognize the distribution function of finance, believing that it does not express their specificity, since the processes of cost distribution are served by different economic categories. But supporters of the distribution function do not at all believe that it is generated by the very factors of the functioning of finance at the second stage of the reproduction process, but on the contrary, they associate it with the specific social purposes of finance, emphasizing that no other category operating at the stage of value distribution is so “distributive”, like finance. However, today the regulatory function in Russia is poorly developed. In market conditions, finance must perform a stabilizing function. Its content is to ensure stable conditions in economic and social relations. Of particular importance in this regard is the issue of stability of financial legislation, since without this it is impossible to implement investment policy into the production sector from private investors. Achieving stabilization is considered by the Government of the Russian Federation as a necessary condition for transition market economy towards socially oriented economic growth.

3. Discussion questions about the essence and functions of finance

Despite the long history of finance as scientific concept, their essence has not been fully revealed. The task of a more complete knowledge of the essence of finance is complicated by the fact that it is deeply hidden behind external forms its manifestations, in which various financial phenomena appear on the surface of public life.

When studying the essence of finance, a correct understanding of fundamental theoretical problems and categories is of paramount importance.

The study of the problems of the essence of finance was paid attention to by such scientists and economists as V. P. Dyachenko, A. M. Aleksandrov, E. A. Voznesensky. During the period of Russia’s transition to a market economy, such scientists and economists as V. Rodionova were engaged in research into theoretical problems in the field of finance. M., Drobozina L. A., Romanovsky M. V.

Study and correct understanding of the most important financial categories is complicated by the presence in the financial and economic literature of many different, sometimes opposing points of view on issues of their necessity, essence, content and purpose.

In the theory of finance, one of the problematic issues is the question of the need for finance in general. The study of finance was done very little and superficially. There was a simplified, formal approach to solving this problem. Thus, professors E. A. Voznesensky and A. M. Birman believed that the main condition for the emergence and functioning of finance is the state.

Most economists determined the objective necessity of finance by the presence of the state and commodity-money relations without a thorough substantiation of this position in relation to the category of finance.

“Finance does not exist outside the state”

But this is an overly simplified approach to such a category as finance. Professor V. M. Rodionova believes that the conditionality of part of financial relations by the factor of the existence of the state does not provide grounds for considering its activities as the cause that generates finance. In her opinion, a prerequisite for the functioning of finance is the availability of money, and the reason that gives rise to its appearance can be considered the needs of business entities and the state for resources that support their activities.

However, there is another factor without which finance cannot function. This is social reproduction, with its continuously repeating and interconnected cycles. Currently, almost all economists recognize the need for finance and its important role in the performance of its functions by the state.

However, the question of the essence of finance and the boundaries of its distribution remains unclear.

Some economists considered finance to be the totality of monetary resources or funds at the disposal of the state and enterprises. In the fifties, the understanding of finance as monetary relations ensuring the distribution of the total social product, national income, was established. It continues to this day.

The transition to a market economy occurs in the context of the functioning of diverse objective value categories and monetary relations that permeate all aspects of life; monetary relations mediate purchase and sale, remuneration of labor, the scope of application of free funds, various relationships with foreign countries. Here the question arises - are all monetary relations finance or is there some kind of limit to their distribution?

Economists A. M. Aleksandrov, E. A. Voznesensky and others proceeded from the fact that finance and credit, having a monetary form and providing a distribution process in social reproduction, represent a single category of “finance in the broad sense of the word.” Academician Chantlandze understood finance in an even more expanded sense, including banks, commodity prices, stock exchanges, money markets, gold, banknotes, bills, securities. And in a narrow sense, he classified only budgetary funds as finance.

Most economists believe that finance represents a special area and only part of monetary relations, which have their own specific characteristics. The main features that define the category of finance should be considered:

1. Monetary nature of financial relations

2. Distributive nature of financial relations

3. Financial relations are always associated with the formation of monetary funds that take the form of financial resources

4. Non-equivalence of distribution relations (This distinguishes finance from purchase and sale relations)

5. Irreversible and free (This distinguishes finance from credit)

Based on these signs, we can see that finance arises and functions at the second stage of the reproduction process - at the stage of distribution and redistribution of the value of the social product. It follows from this that the broad interpretation of the essence of finance is questionable. Distribution and exchange are different stages of the reproduction process, which have their own special economic forms of expression. Therefore, it is illogical to classify monetary relations of different natures that arise at different stages of reproduction into the same category - finance. Limiting the place of finance to the distribution and redistribution stage of reproduction introduces strict boundaries for the functioning of finance, but this does not mean that finance limits its action at this stage of reproduction. Finance actively influences all stages of the reproduction process through indirect factors.

One of the controversial issues is the question of qualitative characteristics that determine the specifics of finance as an economic category. The debate is mainly about whether or not to include in the definition of finance such a feature as imperativeness. Moreover, the term “imperativeness” is interpreted by scientists differently: some see in it the active role of the state in organizing financial relations, others see it as the reason that gives rise to the functioning of finance.

If imperativeness is understood as the practical activity of the state aimed at organizing financial relations, developing forms of their manifestation and use, then such use of the term does not raise objections, but does not add anything to the characterization of the essence of finance.

However, in some publications imperativeness is interpreted as an essential feature of financial relations. It is emphasized that when characterizing the category of finance, this feature cannot be avoided, since it is the state that creates new distributive financial relations, and that the direct cause of the emergence and development of finance is the activity of the state and its bodies. Such statements are unjustified, because it is not the activity of the state itself, but the objective needs of social development that give rise to the existence of finance.

The question of the functions of finance is also debatable. Many economists believe that finance performs two functions - distribution and control. Although in the literature one can find statements that finance, in addition to these two functions, also has others: production (different authors call it differently), stimulating, regulating, etc. But at the same time, the question of the functions of finance is being replaced by a question about their roles in social reproduction, since these are different, although interrelated issues. Of course, finance plays an important role in social reproduction; with its help, the efficient use of factors of production can be stimulated, cost proportions can be regulated, conditions for carrying out an economy regime can be provided, etc. However, it is inappropriate to identify these results achieved through the functioning of finance with their functions.

Some authors do not recognize the distribution function of finance, believing that it does not express their specificity, since the processes of value distribution are served by different economic categories. But supporters of the distribution function do not at all believe that it is generated by the very fact of the functioning of finance at the second stage of the reproduction process, but on the contrary, they associate it with the specific social purpose of finance, emphasizing that no other category operating at the stage of value distribution is so “distribution”, like finance.

Some economists believe that finance has three functions: the formation of funds (income), the use of funds (income) and control. However, the first two, although they actually exist, are more reminiscent of a mechanism for implementing the distribution function than an independent method of operation of the category of finance.

The presence of controversial issues necessitates further development of theoretical problems of the essence and functions of finance. A deeper knowledge of the economic nature of finance and its inherent properties will make it possible to more actively develop ways to better use this category in business practice, and to scientifically substantiate measures aimed at financial recovery economy and improving the system of financial relationships.

Conclusion

From all of the above, we can conclude that finance is an integral part of monetary relations and plays a huge role in 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. We can also say that finance is objectively necessary, as it is determined by the needs of social development. The state can, taking into account the objective need for financial relations, develop various forms of their use: introduce or cancel different kinds payments, change the forms of use of financial resources, etc. The state cannot create something that is not objectively prepared by the course of social development. It establishes only the forms of manifestation of objectively mature economic relations. Without finance, it is impossible to ensure the individual and social circulation of production assets on an expanded basis, to regulate industry and territorial structure economically, stimulate the rapid implementation of scientific and technological achievements, and satisfy other social needs.

The functions of finance were considered, namely: distribution and control - these functions are carried out by finance simultaneously. We must not forget that in addition to these two main functions, there are others: the regulatory function - it is associated with state intervention through finance in the reproduction process, the stabilization function - provides stable conditions in economic and social relations for all economic entities and citizens.

The presence of controversial issues necessitates further development of theoretical problems of the essence of finance. A deeper knowledge of the economic nature of finance and its inherent properties will make it possible to more actively develop ways to better use this category in business practice, to scientifically substantiate measures aimed at the financial recovery of the economy and the improvement of financial relationships in our country.

Thus, in the course work I tried to reveal the following issues: the prerequisites for the emergence of finance, their necessity and features, the functions of finance as a manifestation of their essence and the existence of debatable issues of the essence and functions of finance.

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1. Galitskaya S.V. "Money, credit, finance." / M., 2002.

2. Drobozina L.A. "Finance. Money turnover. Credit": Textbook for universities. - M.: Finance, UNITY, 1997.

3. Kovaleva A.A. "Finance and Credit". - Teacher allowance, M.: Finance and Statistics, 2003.

4. Leontiev V.E. "Finance. Money, credit and banks." / M., IVESEP, 2003.

5. Lavrushin O.I. "Money. Credit. Banks." / Tutorial. - Moscow 2000.

6. Rodionova V.M. "Finance. M., Finance and Statistics, 2001.

7. Sabanti B.M. “Theory of Finance.; Manager 1998

8. Chantlandze. "Issues in the theory of finance." Tbilisi, 1999

9. Directory of an enterprise financier. - 2nd edition, add. and processed - M.: Infra-M, 1999.

10. Birman A. M.; Finance in the system of cost categories; Journal of Economic Issues. 1997 No. 10

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As an economic category, finance has functions. Two main, dialectically interrelated functions can be distinguished – distribution and control, carried out simultaneously.

1. Distributive function finance is that:

through the distribution and redistribution of newly created value, national needs are met, sources of financing for the public sector of the economy are formed, and a balance of budgets and extra-budgetary funds is achieved within the framework of the unified budget system of the Russian Federation;
the newly created value is subject to distribution in order to fulfill the monetary obligations of enterprises to the budget, banks, and counterparties. Its result is the formation and use of centralized funds of funds, the maintenance of the non-productive sphere of the economy.

The main objects of implementation of the distribution function of finance are obligatory payments into the budget and extra-budgetary funds, as well as sources of financing the budget deficit. The process of redistribution of income between different levels of budgets plays a special role.

2. Control function finance is to implement control over the real ruble money turnover, in which the state is a participant, by the formation of centralized funds of funds. Ruble control has two forms:

control over changes in financial indicators, the status of payments and settlements;
control over the implementation of the financing strategy.

In the first case, a system of sanctions and rewards is applied, using coercive or incentive measures. In the second case, we are talking about the implementation of long-term financial policy, which focuses on anticipating changes and adjusting financing procedures and conditions in advance to them. Constant changes and updates in the financial system require an adequate response to this from all branches of government.

The control function of finance always has a specific form of manifestation. It can be aimed at a budget of a certain level, off-budget fund, enterprise or institution, etc.

The control function of state and municipal finances is implemented in the following main areas:

control over the correct and timely transfer of funds to centralized funds;
control over compliance with the specified parameters of centralized funds, taking into account the needs of industrial and social development;
control over the targeted and effective use of financial resources.

Many modern economists There are also other functions of finance. They are subjective in nature and serve as management tools.

Regulatory function is closely related to state intervention through finance in the reproduction process.

Stimulating function state and municipal finance is to ensure development various fields public life through a system of benefits and economic programs.

Fiscal function of finance is associated with supporting unprofitable but necessary sectors of the economy. It is carried out using many methods and techniques (investing, taxation, limiting, etc.).

The distribution function lies in the fact that the financial resources of an enterprise are subject to distribution in order to fulfill monetary obligations to the budget, banks, and counterparties. Its result is the formation and use of target funds of funds, maintaining an effective capital structure.

1) wages of workers, employees, income of farmers, peasants employed in the sphere of material production;

2) income of enterprises in the sphere of material production.

With intersectoral and territorial redistribution of funds in the interests of the most efficient and rational use of income and savings of enterprises and organizations;

Presence along with the non-productive sphere in which national income is not created (education, health care, social insurance and social security, management);

Redistribution of income between different social groups of the population.

As a result of redistribution, secondary or production income is formed. These include income received in non-productive sectors, taxes (personal income tax, etc.). Secondary incomes serve to form the final proportions of the use of national income.

By actively participating in the distribution and redistribution of national income, finance contributes to the transformation of the proportions that arose during the primary distribution of national income into the proportion of its final use. The income created during such redistribution must ensure correspondence between material and financial resources and, above all, between the size of monetary funds and their structure, on the one hand, and the volume and structure of means of production and consumer goods, on the other.

The ultimate goal of the distribution and redistribution of national income and GDP, accomplished with the help of finance, is to develop the productive forces, create market structures of the economy, strengthen the state, and ensure a high quality of life for the general population. At the same time, the role of finance is subordinated to the tasks of increasing the material interest of workers and teams of enterprises and organizations in improving financial and economic activities, achieving the best results at the lowest cost.

Being an instrument for the formation and use of monetary income and funds, finance objectively reflects the course of the distribution process.

The control function is manifested in control over the distribution of GDP among the relevant funds and their expenditure for their intended purpose.

In the context of the transition to market relations, financial control is aimed at ensuring the financial development of public and private production, accelerating scientific and technological progress, and comprehensively improving the quality of work in all levels of the national economy. It covers the production and non-production spheres, aims to increase economic stimulation, rational and thrifty use of material, labor, financial resources and natural resources, reduce unproductive expenses and losses, and curb mismanagement and waste. Thanks to the control function of finance, society knows how the proportions develop in the distribution of funds, how timely financial resources are available to different business entities, whether they are used economically and efficiently, etc.

One of the important tasks of financial control is to verify strict compliance with legislation on financial matters, timeliness and completeness of fulfillment of financial obligations to the budget system, tax service, banks, as well as mutual obligations of enterprises and organizations for settlements and payments.

The control function of finance is also manifested through the multifaceted activities of financial authorities.

Employees of the financial system and the tax service exercise financial control in the process of financial planning, during the execution of the revenue and expenditure parts of the budget system. In the conditions of development of market relations, the directions of control work, forms and methods of financial control are changing significantly.

Distribution and control functions are two sides of the same economic process. Only in their unity and close interaction can finance manifest itself as a category of value distribution.

The control function, objectively inherent in finance, can be implemented with greater or less completeness, which is largely determined by the state of financial discipline in the national economy. Financial discipline is a mandatory procedure for all enterprises, organizations, institutions and officials to conduct financial management, comply with established norms and rules, and fulfill financial obligations.

The importance of financial control is expressed in the fact that when it is carried out, it is checked, firstly, compliance with the established legal order in the process of financial activities by state and public bodies, enterprises, institutions, and secondly, economic feasibility and the effectiveness of the actions taken, their compliance with the tasks of the state.

Financial control is control over the legality of actions in the field of education and the use of funds of the state and local governments for the purpose of effective socio-economic development of the country and individual regions.

Financial control is usually considered in two aspects:

1) strictly regulated activities of specially created supervisory bodies for compliance with financial legislation and financial discipline of all economic entities;

2) an integral element of financial management and cash flows at the macro and micro levels in order to ensure the feasibility and efficiency of financial transactions.

Specific forms and methods of financial control make it possible to ensure the interests and rights of both the state and its institutions and all other economic entities; financial violations entail sanctions and fines.

Some authors do not recognize the distribution function of finance, believing that it does not express their specificity, since the processes of value distribution are served by different economic categories. But supporters of the distribution function do not at all believe that it is generated by the very factors of the functioning of finance at the second stage of the reproduction process, but on the contrary, they associate it with the specific social purposes of finance, emphasizing that no other category operating at the stage of value distribution is so “distributive”, like finance. However, today the regulatory function in Russia is poorly developed.

In market conditions, finance must perform a stabilizing function. Its content is to ensure stable conditions in economic and social relations for all economic entities and citizens. Of particular importance in this regard is the question of the stability of financial legislation, since without this it is impossible to implement investment policy in the production sector on the part of private investors. Achieving stabilization is considered by the Government of the Russian Federation as a necessary condition for the transition of a market economy to socially oriented economic growth.

1. Distributive function finance is that:

– through the distribution and redistribution of newly created value, national needs are met, sources of financing the public sector of the economy are formed, and a balance of budgets and extra-budgetary funds is achieved within the framework of the unified budget system of the Russian Federation;

– the newly created value is subject to distribution in order to fulfill the monetary obligations of enterprises to the budget, banks, and counterparties. Its result is the formation and use of centralized funds of funds, the maintenance of the non-productive sphere of the economy.

The main objects of implementation of the distribution function of finance are mandatory payments to the budget and extra-budgetary funds, as well as sources of financing the budget deficit. The process of redistribution of income between different levels of budgets plays a special role.

2. Control function finance consists in implementing ruble control over real money turnover, of which the state is a participant, and the formation of centralized funds of funds. Ruble control has two forms:

– control over changes in financial indicators, the status of payments and settlements;

– control over the implementation of the financing strategy.

In the first case, a system of sanctions and rewards is applied, using coercive or incentive measures. In the second case, we are talking about the implementation of a long-term financial policy, in which the main attention is paid to anticipating changes and adjusting the order and conditions of financing to them in advance. Constant changes and updates in the financial system require an adequate response to this from all branches of government.

The control function of finance always has a specific form of manifestation. It can be directed to a budget of a certain level, an extra-budgetary fund, an enterprise or institution, etc.

The control function of state and municipal finances is implemented in the following main areas:

1) control over the correct and timely transfer of funds to centralized funds;

2) control over compliance with the specified parameters of centralized funds of funds, taking into account the needs of industrial and social development;

3) control over the targeted and effective use of financial resources.

Many modern economists highlight other functions of finance. They are subjective in nature and serve as management tools.

Regulatory function is closely related to state intervention through finance in the reproduction process.

Stimulating function state and municipal finance is to ensure the development of various spheres of public life through a system of benefits and economic programs.

The essence of finance is manifested in its functions. Finance performs four functions: distribution, control, accumulation and regulation. In a number scientific research There are only two main functions of finance - distribution and control. "
The distribution function expresses the essence of finance as a distribution value category. The subjects are physical and legal entities. The object of distribution is gross domestic product, national wealth, national income, profit. The social purpose of finance is to distribute and redistribute the value of the object of distribution between the owners. As a result, centralized and decentralized monetary funds and various forms of financial savings are formed and used. Therefore, finance consists of the finances of the state, organizations and citizens. The national income generated among participants in material production is subject to redistribution. Financial distribution is inherently multi-stage, giving rise to various types of distribution - intra-farm, intra-industry and inter-industry.
The basis of the control function of finance is the movement of financial resources, occurring in both stock and non-stock forms. The instrument for implementing the control function of finance is financial information. It lies in the financial indicators available in operational, accounting and statistical reporting. Financial indicators allow you to see various aspects of the work of enterprises and evaluate the results of their economic activities. The basis of the con-
The concept of “financial system” is a development
| we have a more general definition - “finance”. Finance expresses economic social relations, which manifest themselves in different ways and have their own specificity in each link of the financial system. Each link of the financial system represents
¦ a certain sphere of financial relations, and the financial system as a whole is a set of various
The spheres of financial relations in the process of which funds of funds are formed and used.
The financial system is a system of forms and methods of formation, distribution and use [of funds of funds of the state and enterprises.
I The leading link in the financial system is the state budget. In terms of its material content, it is the main centralized fund of the state's funds, the main instrument for the redistribution of national income. Through this
The first link of the financial system is redistributed up to 40% of the country’s national income.
I. The main revenues of the state budget * are taxes, amounting to 90% or more I total amount his income. ¦
|The main expenses are also made from the state budget: for military purposes, intervention in the economy, maintenance of the state apparatus, social expenses, subsidies and loans.
I The second link of the financial system is local (re-
| regional) finance. They include local budgets, finances of enterprises owned by municipalities and autonomous local funds.
Behind local budgets secured secondary | ny taxes (mainly property taxes). In local budgets compared to state budgets there are more