Budget Financing

Budget Financing


the assignment by the state in accordance with the ratified budget and on a nonreturn basis of budget capital to enterprises, organizations, and institutions to carry on and develop their work.

In the socialist countries, budget financing includes estimate financing and the financing of economically accountable enterprises and organizations.

As a rule, the state budget is used to finance investments in fixed and working capital for newly built enterprises, and additional capital is also allocated to existing enterprises where their own resources are inadequate.

When they do not have enough of their own resources, enterprises which have been switched to the new conditions of economic management also make use of credit, which is paid back later from internal resources. The construction of part of new enterprises (for example, in the USSR, enterprises whose payback period for construction expenditures is not greater than five years) is also financed through these resources and through bank credits.

Estimate financing is applied to a majority of organizations in the nonproduction sphere (schools, hospitals, and so on). Expenditures to expand their work are covered entirely from the budget, and all incomes received by these organizations (if they do not go to the formation of their special capital) are withdrawn as budget income.

Budget financing is built on the following principles: the scientifically substantiated determination of the magnitude of expenditures; the release of capital for strictly defined purposes; consideration of the degree of plan fulfillment; and the audit of the correct and efficient use of the capital. (In the budget financing of enterprises and organizations on profit-and-loss accounting, the scientifically substantiated determination of the magnitude of expenditures means determining the economic necessity and efficiency of the expenditures and disclosing all internal savings reserves; with estimate financing it means developing and employing scientifically substantiated expenditure norms.)

In the capitalist countries, budget financing is done through estimate financing and involves using budget capital to cover expenditures for subsidizing monopolies, state capital investments, and development of the infrastructure; stimulating export; and maintaining the state apparatus, armed forces, and various administrative and social-cultural establishments.


References in periodicals archive ?
Mr Mramor, Minister of Finance, stated: This is the second EIB co-financing loan signed with the Ministry of Finance providing one of the most favourable sources of budget financing with long tenor at favourable costs.
During the meeting, the parliamentarians told the experts about educational and scientific system of the country and budget financing of these
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Global Banking News-June 10, 2014--Fitch says budget financing by central bank has increased vulnerability of Ghana
Belhaj Rhouma (Ennahdha) called for the need to cancel this tax, saying the "few million dinars to be mobilised will not resolve the budget financing problem.
The students in the academic year 2012/2013 must achieve a minimum of 48 ECTS credits in order to obtain state budget financing in the school year 2013/2014.
5 billion euro to Greece for budget financing and debt servicing needs.
According to the paper, the massive borrowings for budget financing not only fuelled inflation, but also took away money that could otherwise be borrowed by the private sector for business expansion leading to creation of jobs.
The country is also in talks with the World Bank on $1 billion in budget financing.
Radwan did not give details on other budget financing plans.
2- Turkish Treasury will announce figures of Consolidated Public Sector Balance, General Budget Financing figures, Central Management Budgetary Financing figures, Central Management Budget results, Central Management Foreign Debt figures and Central Management Domestic Debt figures for May 2011.
External Budget Financing Loan: The government received a total of $3.

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