Finance - Exam

Question number 1. Socio-economic essence of finance and their functions.

Finance- this is a set of monetary relations organized by the state, in the process of which the formation and use of national funds of funds for the implementation of economic, social and political tasks is carried out.

Socio-economic essence of finance consists, first of all, in ensuring regular commodity-money circulation and meeting the need for financial resources.

Finance Functions:

1. The formation of the state's cash income takes place in the sphere of material production, and the sphere of circulation only mediates these relations.

2. Distribution. In the process of production and trade, various incomes arise. However, in order to meet the development needs of society, it is necessary to redistribute part of these and other incomes. This is done by withdrawing a part of the indicated income, creating funds from these funds and spending funds for socially useful purposes: education, medicine, construction, defense, etc.

3. Control. Control over the correct accumulation and distribution of funds and resources. Therefore, finance also makes it possible to determine the most optimal ways of spending the accumulated funds, so that the needs of society are met as much as possible.

4.Regulatory is associated with government intervention through finances (government spending, taxes, public credit) in the reproduction process.

Question number 2. The system of financial relations. The concept of "financial system"

Financial system - a set of interconnected spheres and links of financial relations. the financial system is a combination of various spheres (links) of financial relations, each of which is characterized by features in the formation and use of funds of funds, a different role in social reproduction.
The financial system of economically developed states includes the following links of financial relations:

• the state budget;
• state off-budget funds;
• state credit;
• insurance funds;
• stock market;
• financial and credit system of the state;
• finances of enterprises of various forms of ownership.

Question number 3. Relationship between government functions and the composition of the system of financial relations. Communication of the territorial-administrative structure of the state and the composition of the financial system.

National defense - financing of defense spending is carried out from the federal budget by appropriating funds to the Ministry of Defense of the Russian Federation;

With the help of state targeted non-budgetary funds, a number of tasks can be solved:

provide social assistance and services to the population through the payment of cash benefits, one-time assistance;

ensure the restoration and preservation of the working capacity of a person;

· provide social services to the population by financing social infrastructure institutions;

finance pensions.

With the help of targeted state non-budgetary funds, it is possible to influence the economic development of regions by financing individual economic activities, for example, the construction of a network of public roads, etc.

Question number 4. The role of finance in expanded reproduction

Reproduction process:

1. Production - 2. Distribution - 3. Exchange - 4. Consumption

Extended reproduction includes the continuous renewal and expansion of production assets, the growth of GDP and its main part - the national income, the reproduction of the labor force and production relations. It is carried out using economic levers, commodity-money, financial and credit relations. An important role in the reproduction of all components of GDP belongs to public finance and enterprise finance.

The state influences the reproduction process through the financing of enterprises and individual sectors of the economy, spending on social purposes and tax policy.

At the expense of centralized funds, the needs of expanded reproduction at the macro level are met; intersectoral and territorial redistribution of resources is carried out to equalize the level of economic and social development of individual regions G ions.

The role of finance is especially great in the expanded reproduction of enterprises of various forms of ownership, since with their direct participation GDP is created and distributed within the enterprise and industries. Finances are an important element in the reproduction of the labor force, the cost of which, in addition to wages, also includes the costs of education, health care, and social security. Expanding the scope of social spending challenges in many respects the requirements of the scientific and technological revolution. The rapid qualitative restructuring of production requires a constant change in the professional structure of the workforce, which entails a further increase in the cost of education and retraining of personnel.

The concept and signs of finance

Finance - economic relations expressed in monetary form and arising from the distribution and redistribution of the value of the gross product and part of the value of the country's national wealth through the formation and expenditure of centralized and decentralized financial resources.

The term "finansia" originated in Italy in the 13th-15th centuries and at first denoted any monetary payment. Later, 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.

The main features of finance:

The presence of monetary relations between two entities, i.e. money is the material basis for the existence and functioning of finance (where there is no money, there can be no finance);

Subjects have different rights in the process of monetary relations: one of them (the state) has special powers:

In the process of monetary relations, a nationwide fund of funds is formed - the budget, i.e. finances are stock in nature;

The regular flow of funds to the budget cannot be ensured without giving taxes, fees and other payments a state-priority nature, which is achieved through the legal rule-making activities of the state, the creation of an appropriate fiscal apparatus.

Thus, finance is an economic relationship associated with the formation, distribution and use of funds of funds in order to perform the functions and tasks of the state, as well as to meet the social and other needs of society.

Prerequisites for the emergence of finance

The following prerequisites for the emergence of finance can be distinguished:

1. It was in Central Europe that, 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 torn away from the treasury. A nationwide fund of funds arose - a budget that the head of state could not use alone.

2. The formation and use of the budget has become systemic, i.e. there were systems of state revenues and expenditures with a certain composition, structure and legislative consolidation.

3. Taxes in cash have become predominant, whereas earlier state revenues were formed mainly through taxes in kind and labor duties

Functions of Finance

Financial relations cover two areas:

Economic monetary relations associated with the formation and use of centralized state monetary funds accumulated in the state budget system and government off-budget funds;

Economic monetary relations that mediate the circulation of decentralized monetary funds of enterprises.

Finance is an integral part of monetary relations, therefore their role and significance depend on the place monetary relations occupy in economic relations. However, not all monetary relations express financial relations.

Finance differs from money both in content and in the functions performed.

Money is a universal equivalent, with the help of which, first of all, the labor costs of associated producers are measured, and finance is an economic instrument for the distribution and redistribution of gross domestic product (GDP) and national income, an instrument for controlling the formation and use of funds of funds.

Their main purpose is to ensure not only the needs of the state and enterprises in cash, but also control over the expenditure of financial resources through the formation of cash income and funds.

Finance expresses monetary relations arising between the subjects of these relations (the state, enterprises, organizations, citizens, etc.).

The main material source of funds is the national income of the country, which is the newly created value or the value of the gross domestic product minus the tools and means of production consumed in the production process.

Finance affects production, distribution and consumption and is objective. They express a certain sphere of industrial relations and belong to the basic category, although they largely depend on the financial policy pursued by governments.

According to its material content, finance- these are trust funds of funds, which together represent the financial resources of the country, the main condition for the growth of which is an increase in national income.

The essence of finance is manifested in their functions:

Distribution

Control

distribution function manifests itself in the distribution of national income, when the so-called basic, or primary incomes are created. However, primary incomes do not yet form the monetary funds necessary for the development of the economy. Further distribution or redistribution of the national income is necessary, as a result of which secondary (production) incomes are formed. These are incomes received in non-production sectors, taxes (personal income tax, etc.). Secondary incomes serve to form the final proportions of the use of the national income.

The ultimate goal of the distribution of national income is the development of productive forces and the creation of market structures in the economy.

control function manifests itself in control over the distribution of the gross domestic product among the relevant funds and their spending for the intended purpose.

One of the important tasks of financial control is to verify the exact observance of legislation on financial matters, the timeliness and completeness of the fulfillment of financial obligations to the budget system, the tax service, banks, as well as the 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.

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

The functions of finance are implemented through the financial mechanism, which is part of the economic mechanism. The financial mechanism includes a set of organizational forms of financial relations in the national economy, the procedure for the formation and use of centralized and decentralized funds of funds, financial planning methods, forms of financial and financial system management, and financial legislation.

The role of finance in the process of expanded reproduction

Expanded reproduction includes the continuous renewal and expansion of production assets, the growth of GDP and its main part - the national income, the reproduction of the labor force and production relations. It is carried out using economic levers, commodity-money, financial and credit relations. An important role in the reproduction of all components of the GDP belongs to public finance and enterprise finance.

The role of finance can be reduced to 3 main areas:

1. Financial support for the needs of expanded reproduction means covering all costs at the expense of financial resources (own funds, borrowed or attracted sources)

2. Financial regulation of economic and social processes. Changing the growth rate of individual structural units to restructure production in accordance with the needs of society.

3 types of economic regulation:

Self-regulation, i.e. regulation of the economy by the market mechanism

State

Regulation of the economy through the finances of enterprises (the enterprise itself determines the proportions between consumption and accumulation of funds)

3. Financial incentives for the efficient use of all economic resources are carried out by the following methods:

Through efficient investment of financial resources

Through the creation of incentive funds

Through the use of fiscal incentives

Through the use of financial sanctions

Financial support of the reproduction process is the covering of reproduction costs at the expense of financial resources, accumulated by business entities and the state. Financial resources are funds that are formed at the disposal of the state, subjects of the federation, the municipality, business entities and the population, formed in the process of distribution and redistribution of part of the value of GNP.

The formation of financial resources, their rational use have great value, since financial resources are the most important monetary source of expansion of production. A decrease in the volume of financial resources may limit the possibility of a targeted impact of finance on the development of the economy, the solution of urgent economic and social problems. It leads to a reduction in the scale of investment in the production and social spheres, a decrease in the consumption fund as part of the national income used. The lack of financial resources leads to an imbalance in the natural-material and cost structure of social production, various kinds of disproportions and "uncouplings".

The volume and structure of financial resources are directly related to the level of development of production, its efficiency. The larger the scale of production and the higher its efficiency, the greater, other things being equal, the size of the mobilized and used financial resources. - In turn, the amount of financial resources invested in production creates prerequisites for its growth and improvement. Depending on where and in what volumes financial resources are directed, opportunities are formed to provide production with additional capacities. And this leads to an increase in the technical level of production, the creation of prerequisites for the growth of labor productivity in the relevant sectors of the economy.

All elements of the value of the gross social product are involved in the formation of financial resources, but the main source is the national income, and mainly that part of it which is represented by net income. It is the growth of net income and its main financial form - profit that determines the high or low growth rates of financial resources. In addition to the value of the gross domestic product, an important source of financial resources can be income from foreign economic activity, provided that it is sufficiently efficiently organized. Financial resources are also formed from a part of the national wealth involved in economic circulation (carryover balances of budget funds used to cover the expenses of the current year; reserve funds of insurance organizations; funds from the sale of the country's gold reserves; proceeds from the sale of surplus property, etc.). For the formation of financial resources, borrowed and attracted funds (bank loans, accounts payable, funds received from the issue of shares and bonds, etc.) can be used.

The variety of financial relations that arise in the process of value distribution determines the presence of different types of financial resources. The main ones are: profit, various types of taxes and fees, insurance payments, depreciation. The possibility of their growth is determined not only by the overall size of the gross domestic product, but also by its structure, the dynamics of its constituent elements.

Financial resources are necessary, first of all, for business entities. They form decentralized financial resources used on the costs of expanding production (provision of services) and meeting the socio-cultural needs of workers. Target funds formed at the expense of decentralized financial resources are directed to the maintenance and acquisition of fixed and working capital, wages, payment of taxes and fees, depreciation deductions, financing of scientific and technological achievements, environmental protection measures, meeting social needs, charitable needs; repayment of debts and payment of interest on them, formation of reserves, etc. The implementation of these costs through the use of financial resources makes it possible to provide monetary resources for the reproduction process at the micro level.

The needs of social production at the macro level are met by centralized financial resources. The forms of their use are budgetary and non-budgetary funds, the funds of which are directed to the development of the economy, financing of social and cultural events, meeting the needs of defense and management.

In recent years, the state of the country's financial resources has been characterized not only by a high degree of their centralization, but also by an acute shortage both at the macro and micro levels. In this regard, the problem of finding real reserves for the growth of financial resources has become extremely acute. The systematically increasing needs of enterprises (organizations) and the state demanded their ever greater size, meanwhile, their mobilization became more and more problematic due to the growing crisis in the economy, low production efficiency, worsening financial results of foreign economic activity and other reasons.

To ensure uninterrupted financing of reproduction costs, it is of great importance financial reserves. Financial reserves are capable of ensuring a continuous circulation of funds in social reproduction even in the event of huge losses or the occurrence of unforeseen events. Financial reserves can be created by business entities themselves at the expense of their own financial resources (self-insurance), their management structures (based on standard deductions), specialized insurance organizations (insurance method) and the state (reserve funds in budgets of different levels). The formation of large financial reserves in the hands of business entities is ineffective from an economic point of view. More appropriate is the formation of reserves by the budgetary method and the insurance method, since a higher turnover of reserved funds is achieved here.

The need for finance in the conditions of commodity-money relations is explained by the fact that finance is necessary for the distribution of the value of the social product. This process is carried out only with the help of the category of finance.

Finance deals with the distribution of value created in monetary terms. Depending on how we distribute will depend on the process of reproduction. Certain proportions are needed, and the main proportion depends on how we divide the national income.

finance and price:

price is the basis of the cost distribution of the total social product by elements, i.e., with the help of price, the primary process of forming the value of the social product takes place. Distribution relations in the field of pricing incl. in itself: 1) the relationship between jur. persons regarding the determination of the price of goods, 2) between legal entities. and physical Persons regarding the determination of tariff rates, 3) between the state and legal entities. persons on the regulation of prices for monopolists, 4) between the budget and physical. persons.

The relationship is that:

price is the basis of the financial distribution of value,

finance corrects the proportions set by prices in the conditions of the economic development of society.

The difference is that the price forms the value at the stage of production, and with the help of finance, hidden forms of ownership are converted into cash.

finance and loans:

credit - distributive relations regarding the distribution of temporarily free funds to cover certain needs

The appearance of temporarily free funds is due to the following reasons: 1) the amount of cash available exceeds the need for resources, 2) there is not enough cash to meet certain target needs and these resources must be accumulated, 3) the mismatch between the payment period and the period for receiving funds.

Relationships can be: 1) between legal entities. persons regarding a bill of exchange loan, 2) between the bank and the legal entity. person about the loan, 3) between the bank and the individual. a person regarding a loan for construction, 4) between legal entities. and physical persons regarding consumer credit, 5) between the state and legal entities. a person regarding the issuance of treasury loans, 6) between budget funds, 7) between individuals. persons regarding bills of exchange at interest, 8) between banks regarding an interbank loan.

Relationship:

complex use of financial and credit resources, if there is a lack of financial resources, the enterprise takes a loan, and if there is a surplus, it is stored in deposit accounts,

a combination of financial and credit methods of providing resources for expanded reproduction.

Differences: 1) the object of the distribution of finance is the national income of the GNP, the object of the distribution of the loan is only a part of the GNP (temporarily free funds), 2) the principles of financing are based on gratuitousness, perpetuity, irrevocable, but on a target basis and do not require any collateral, and the principles of lending are based on the principles of urgency, repayment, payment and security, 3) the purpose of finance is the formation of income, the accumulation and use of these funds for their intended purpose, and the main purpose of the loan is the accumulation of funds and their use for urgent needs in the form of loans, 4) finances have only one-way movement of value, and credit is a time-discontinuous movement of value, 5) the redistribution of credit resources occurs only between the subjects of distribution relations, and the financial distribution covers not only the subjects, but also distributes within each subject according to their intended purpose, 6) credit resources closely with are connected with cash flow and with their help, the volume of funds is regulated, finance does not have such a close relationship.

finances and salary:

salary - distribution relations regarding the distribution and redistribution of newly created value to create individual incomes in accordance with working conditions, the quantity and quality of labor expended, that is, salary is a measure of the cost of labor

The salary includes a system of relations:

between legal and physical individuals regarding the establishment of income,

between budget and legal persons regarding the formation of the payroll,

between budget and individuals for benefits and benefits.

Interrelation: 1) with the help of finance, a payroll is formed and temporarily free funds are separated from others, and on the other hand, the payroll acts as a stable source of financial resources for the formation of working capital, covering the needs of reserves, 2) as a result of the distribution of the payroll, it is formed by financial methods, and the distribution of income received carried out through the mechanism of payment of labor.

QUESTION №4 Financial resources, reserves, capital, cash funds. Concept, classification, features, functions, methods of formation, sources.

Financial resources, as an economic category, are a set of income and expenses, the essence of which is the methods and forms of income generation and directions for their use. The form of materialization of financial resources is designated-purpose funds, which are formed from own sources, borrowed and borrowed funds, part of which is subject to redistribution by the state, and part remains with the enterprise to meet its own needs. In other words, financial resources are funds at the disposal of the state, enterprises or business entities that are used to cover costs and form various funds and reserves.

The composition of financial resources varies depending on the level of management (state, industry, enterprise), on the direction of activity (commercial, non-commercial, public). In terms of composition, financial resources, despite the differences, have common features and forms.

At the income level, financial resources include:

income from core activities;

income from specialized activities;

Other income.

At the expenditure level, financial resources include:

expenses for core activities;

investment costs;

other expenses.

The main features of finance:

the monetary nature of the relationship

distributive nature of financial relations

predominantly fund character (may be fund-free distribution, but on a targeted basis)

financial relations have a state-imperious or coercive form of manifestation. Financial relations are connected with the existence of the state

financial relations use financial resources as a material carrier.

Financial sources are divided into:

1) sources that operate at the macro level (state level);

2) sources that operate at the micro level (enterprise level).

The most important source of financial resources is the value of a country's GDP, which consists of C+V+M (capital + wages + profits).

V + M - the main sources of financial resources at the macro level.

Element V, being the personal income of the worker, as a rule, wages, acts as a source of financial resources in 3 areas:

taxes (should be paid from salary);

Insurance payments;

other payments (such as trade union dues, contributions to special funds, etc.)

Thus, element V is involved in the creation of financial resources at the macro level.

Element M - surplus value, profit. It is the main source of financial resources.

Sources of financial resources at the macro level:

1. GDP (the first group of financial sources).

2. Income from foreign economic activity (now our statistical offices are moving to the system of national accounts (SNA), which helps to find GDP, NI, etc.).

3. National wealth.

4. Attracted (borrowed) resources.

Sources of financial resources at the micro level:

1. Sources of own financial resources (for example, revenue makes it possible to form the resources of the enterprise):

External economic activity of the enterprise;

- Wealth of the enterprise (machines, etc., i.e. everything that can be sold).

2. Funds of the enterprise that are equated to its own (these are the funds of the enterprise that do not belong to it, but are at its disposal):

- salary (acts in the form of stable liabilities);

- vacation money (accrued, but at the disposal of the enterprise).

3. Raised funds (these are funds that are mobilized by the enterprise in the financial market - the securities market (SM), loan capital, etc.):

- borrowed funds;

- by selling stocks and bonds.

4. Sources that enterprises receive in the order of redistribution of funds:

- from ministries, higher authorities, from the budget;

- insurance compensation (insurance is a way of redistributing funds).

Financial resources are divided into:

1) centralized (they act in the form of budgetary and extrabudgetary funds and provide for the needs of reproduction at the macro level (for example, the budget)).

2) decentralized (formed by business entities and used to expand production (or provide services) and meet the social and cultural needs of the enterprise's employees.

They are directed to the following purposes:

a) investment;

b) increase in working capital;

c) financing of scientific and technical progress;

d) carrying out environmental protection measures;

e) provision of social needs (housing stock, preschool institutions, health camps, cultural centers);

f) other similar purposes.

Efficient use of financial resources is possible only on the basis of an active financial policy of the state. National finances are organically linked with the finances of enterprises. The interconnection and interdependence of the constituent links of the financial system are due to the single essence of finance.

The basis of a unified financial system is the finances of enterprises, since they are directly involved in the process of material production. The financial resources of commercial enterprises are divided into:

own and equivalent income and receipts:

income from core activities, from financial transactions, from construction and installation works performed by the household method;

proceeds from the sold and retired property, depreciation deductions, stable liabilities, targeted receipts;

financial resources mobilized in the stock market:

sale of securities;

credit investments;

financial resources coming in the order of distribution:

insurance indemnities on the come cases;

financial resources received from higher organizations;

financial resources received on shares and equity basis;

dividends and other securities of other issuers.

expenses for replenishment of the compensation fund;

the cost of financing the renewal of production;

expenses for the formation of social funds;

indirect and direct taxes;

formation of financial reserves;

other expenses.

Financial resources of non-profit enterprises.

(budget based on estimated funding):

proceeds from the lease of premises and equipment;

gratuitous contributions from legal entities;

Other income.

salary expenses;

payment of material and equivalent costs;

settlements with legal entities for services rendered;

development, renewal, reconstruction costs;

other expenses.

Financial resources of public organizations:

entrance and membership fees;

contributions to charitable purposes;

income from business units;

income from holding paid events;

income from paid services to the population;

Other income.

expenses related to core activities;

administrative and management expenses;

funds for capital investments and repairs;

other expenses.

financial reserves. Concept, features, functions, classification and sources of education

Financial security principle. reserves - one of the principles of organizing the finances of commercial organizations and enterprises. It is dictated by the conditions of entrepreneurial activity, associated with certain risks of non-return of funds invested in the business. In market conditions, the consequences of risk fall on the entrepreneur. In addition, entrepreneurs are forced to sell their products with the risk of non-return of payment (economic struggle for the buyer). Fin. investments of the enterprise are also associated with the risk of non-return of the invested money. funds or receiving less than expected income. Direct economics may also take place. miscalculations in the development of the production program.

The implementation of this principle is the formation of fin. reserves and other similar funds that can strengthen the financial. position of the enterprise in critical moments of management.

Fin. reserves can be formed by enterprises of all organizational and legal forms of ownership from net profit, after paying taxes and other obligatory payments to the budget from it. Joint-stock companies are required to form financial. reserves in accordance with the law. In practice, due to low fin. opportunities, not all enterprises form Fin. reserves needed for their fin. sustainability.

Financial resources withdrawn from circulation form financial reserves. The procedure for the formation of reserves is determined by legislative acts, and at the level of commercial enterprises - either no more than 25% of the authorized capital or no more than 50% of the profit remaining at the disposal of the enterprise.

Reserves are used in the following cases:

replenishment of the lack of own working capital

financing of works related to discoveries, innovations

repayment of payments to the budget and extra-budgetary funds with a lack of own sources

cover for losses from natural disasters

covering various commercial risks when insurance is not possible or there is no possibility of lending

repayment of long-term loans

CAPITAL - (Latin capitalis - main) - in a broad sense, is everything that can generate income, or resources created by people for the production of goods and services.

Own capital of the enterprise is the difference between the sum of assets and the sum of external liabilities of the enterprise. It is divided into permanent (statutory) and variable. Due to the variable part, reserve and additional capital, and retained earnings are formed. Authorized capital is a part of the company's capital invested in current assets. One part forms the production funds, and the other forms the circulation funds.

Cash funds are formed from proceeds from the sale of goods, finished products and work performed.

When selling products, enterprises generate revenue and, accordingly, income. One part of this income goes to the state budget, centralized social insurance funds, and the other part remains at the disposal of enterprises for the formation of payroll funds, economic incentives and financing the costs of expanding and developing production.

Thus, finances act as an instrument of control over the correct formation, distribution and use of funds of funds in the process of production and sale of products.

The role of finance in the economy is diverse, but nevertheless, it can be reduced to three main areas:

1) financial support for the needs of expanded reproduction;

2) financial regulation of economic and social processes;

3) financial incentives for the efficient use of all types of economic resources.

1) Financial support for the needs of expanded reproduction means covering costs from financial resources. There are the following main sources of financial resources:

Own funds (authorized capital, profit, etc.);

Borrowed funds are long-term and short-term credits and loans;

Raised funds are funds that do not belong to the enterprise, but are used in its turnover (debts to the budget, employees of the enterprise, suppliers, etc.).

2) Financial regulation of economic and social processes- the second direction of the impact of finance on the development of the economy. The regulation of the economy is a change in the growth rates of individual structural units for the restructuring of production in accordance with the changing needs of society. The regulation of the economy is carried out through the redistribution of financial resources: it is enough to allocate financial resources and the pace of development of an industry or region accelerates, and vice versa, the cessation of financing can stifle any production. There are three types of economic regulation.

self-regulation;

State regulation of the economy;

Regulation of the economy through the finances of the enterprise itself.

1) Financial incentives for the efficient use of all economic resources , which is done through:

2) efficient investment of financial resources;

3) creation of incentive funds;

4) the use of budgetary incentives and financial sanctions.

3. The essence and structure of the financial system of the Russian Federation

Financial system - it is a set of blocks, links, sub-links of financial relations.

The financial system of the Russian Federation consists of three major blocks:

public finance;

local finance;

Finances of legal entities and individuals.

public finance reflect economic relations in the formation and use of centralized funds of funds intended to ensure the fulfillment by the state of its functions. Public finances include the state budget and state off-budget funds.

According to the Constitution of the Russian Federation, local self-government is separated from the state system of government. Local budgets - these are district, city, district budgets, budgets of settlements and rural settlements; district budgets - in cities.

Finances of legal entities and individuals - this is a set of economic relations for the formation and use of monetary funds of organizations, entrepreneurs, individuals, designed to ensure the process of expanded reproduction. The finances of legal entities are divided into two groups: finances of commercial and finances of non-commercial organizations. As part of the finances of individuals, it is possible to distinguish the finances of entrepreneurs who are not registered as a legal entity, and the finances of other individuals.

The financial system is not just the sum of blocks, links and sublinks, but a system that is a single whole, all the components of this system are closely interconnected by numerous types of economic ties and relations.