Functions of corporate finance and principles of their organization. Principles of Organization of Finance of Corporations (Organizations)

The principles of organizing the finances of enterprises and corporations are closely related to the goals and objectives of their activities, determined by the constituent documents. The principles of organizing finance include:

    self-regulation economic activity;

    self-sufficiency and self-financing;

    division of sources of formation of working capital into own and borrowed;

    availability of financial reserves.

Self-regulation principle is to provide enterprises (corporations) with full independence in making and implementing decisions on production and scientific and technical development, based on the available material, labor and financial resources. An enterprise (corporation) directly plans its activities and determines development prospects based on the demand for manufactured products (services). The basis of operational and current plans make up agreements (contracts) concluded with consumers of products (services) and suppliers of material resources. Financial plans are designed to provide monetary resources activities provided for in production plans (business plans), as well as guarantee the interests budget system the state.

To attract additional financial resources, corporations issue emission securities(stocks and bonds) and participate in stock exchanges.

Self-sufficiency principle assumes that the funds invested in the development of the corporation should pay off at the expense of profits and other own financial resources. These funds are designed to provide a minimum of regulatory economic efficiency owned by the enterprise (corporation) equity capital. With self-sufficiency, it finances simple reproduction from its own sources and brings taxes to the budget system. The implementation of this principle in practice requires the profitable operation of all enterprises and the elimination of losses.

Unlike self-sufficiency, self-financing assumes not only profitable work, but also the formation of commercial basis financial resources that provide not only simple, but also extended reproduction, as well as revenues of the budgetary system.

The development of the principle of self-financing involves strengthening the material responsibility of enterprises (corporations) for compliance with contractual obligations, credit settlement and tax disciplines. Payment of penalties for violation of the terms of business contracts, as well as compensation for damages caused to other organizations does not relieve the enterprise (without the consent of consumers) from fulfilling its obligations to supply products (works, services).

Division of sources of formation of working capital into own and borrowed is determined by the peculiarities of technology and organization of production in certain sectors of the economy. In industries with a seasonal nature of production, the share of borrowed sources of the formation of working capital is increasing.

In industries with a non-seasonal nature of production (heavy industry, transport, communications), own circulating assets prevail in the composition of the sources of the formation of working capital.

Formation of financial reserves it is necessary to ensure the stable operation of enterprises (corporations) in the face of possible fluctuations in market conditions, increased material responsibility for failure to fulfill their obligations to partners.

V joint stock companies financial reserves are formed by law from net profit. In other business entities, their formation is regulated by constituent documents.

The implementation of these principles in practice should be carried out in the development of financial policy and organization of the financial management system of an economic entity. In this case, it is advisable to take into account:

    scope of activity (commercial and non-commercial activity);

    types (directions) of activity (export, import);

    industry affiliation (industry, Agriculture, transport, construction, trade, etc.);

    organizational and legal forms of entrepreneurial activity.

Compliance with these principles in practice ensures the financial stability and profitability of enterprises (corporations).

The principles of organizing the finances of enterprises and corporations are closely related to the goals and objectives of their activities, determined by the constituent documents.

The principles of organizing finance are as follows:
Self-regulation of economic activity.
Self-sufficiency and self-financing.
Separation of sources of formation of working capital for own and borrowed.
Availability of financial reserves.

The principle of self-regulation is to provide enterprises (corporations) with complete independence in making and implementing decisions on production and scientific and technological development based on the available material, labor and financial resources.

An enterprise (corporation) directly plans its activities and determines development prospects based on the demand for manufactured products (services). The basis of operational and current plans are agreements (contracts) concluded with consumers of products (services) and suppliers of material resources. Financial plans are designed to provide financial resources for the activities provided for in production plans(business plans), as well as guarantee the interests of the state budget system. The replenishment of working capital is carried out mainly at the expense of their own financial resources (net profit), and, if necessary, at the expense of borrowed and attracted funds.

To attract additional financial resources, corporations issue equity securities (stocks and bonds) and participate in stock exchanges.

The principle of self-sufficiency assumes that the funds invested in the development of the corporation will be recouped through net profit and depreciation charges. These funds are designed to provide a minimum of standard economic efficiency of the equity capital owned by the enterprise (corporation).

With self-sufficiency, the enterprise finances simple reproduction from its own sources and introduces taxes into the budget system. The implementation of this principle in practice requires the profitable operation of all enterprises and the elimination of losses.

Unlike self-sufficiency, self-financing implies not only profitable work, but also the formation on a commercial basis of financial resources that provide not only simple, but also expanded reproduction, as well as incomes of the budget system. The principle of self-financing implies strengthening the material responsibility of enterprises (corporations) for compliance with contractual obligations, credit settlement and tax discipline. Payment of penalties for violation of the terms of business contracts, as well as compensation for damages caused to other organizations does not relieve the enterprise (without the consent of consumers) from fulfilling its obligations to supply products (works, services).

To implement the principle of self-financing, a number of conditions must be met:
accumulation of equity capital in an amount sufficient to cover costs not only for the current, but also for investment activities;
choice of rational directions for capital investment;
constant renewal of fixed assets;
flexible response to the needs of the commodity and financial markets.

Let's consider these conditions in more detail. The content of the first condition is to isolate Money to finance current and investment activities. These funds are concentrated in the settlement accounts of an economic entity until their further distribution. From the standpoint of financial management, it is important to periodize cash, that is, it is not distributed according to the time it is in real turnover for short-term and long-term funds.

The second condition implies the definition of such ways of capital investment that lead to the strengthening of the financial state of the enterprise and an increase in its competitiveness in the commodity and financial markets... Compliance with this condition is associated with the assessment of the level of self-financing, the development of criteria for such an assessment, with the analysis of capital flows by the types of activities of the enterprise.

The third condition for self-financing is to ensure the normal process of renewal of fixed capital. The increase in the value of fixed assets as a result of their revaluation is beneficial for the enterprise, since it does not make any additional payments in the form of dividends and interest, and the amount of equity capital increases.

The fourth condition for self-financing involves the implementation of such a financial policy, under which the enterprise can function normally in conditions of fierce competition in the commodity and financial markets. This policy is aimed at reducing the costs of production and circulation and increasing profits. Self-financing based on high yen contributes to an increase in the money supply and becomes a generator of inflationary processes in the national economy. Therefore, in order to increase the level of self-financing, business entities are obliged to clearly respond to the market needs for relevant goods (services). The mechanism for responding to market needs presupposes specialization, diversification and concentration of production. The orientation of this mechanism should be linked to the tax, price and investment policy of the state. Applying the principle of self-financing is important factor preventing the bankruptcy of an economic entity and creates an opportunity for effective use financial management.

The division of sources for the formation of working capital into own and borrowed funds is determined by the peculiarities of technology and organization of production in certain sectors of the economy. In sectors with a seasonal nature of production, the share of borrowed sources for the formation of working capital (trade, food industry, agriculture, etc.). In sectors with a non-seasonal nature of production (heavy industry, transport, communications), own circulating assets prevail in the composition of the sources of the formation of working capital.

The formation of financial reserves is necessary to ensure the stable operation of enterprises (corporations) in conditions of possible fluctuations market conditions, increased financial responsibility for failure to fulfill their obligations to partners. In joint-stock companies, financial reserves are formed by law from net profit. In other business entities, their formation is regulated by constituent documents.

The implementation of these principles in practice should be carried out in the development of financial policy and organization of the financial management system of economic entities. It should be borne in mind:
scope of activity (commercial and non-commercial activity);
types (directions) of activity (export, import);
industry affiliation (industry, agriculture, transport, construction, trade, etc.);
organizational and legal forms of entrepreneurial activity.

Compliance with these principles in practice ensures financial stability, solvency, profitability and business activity of enterprises (corporations).

The organization of corporate finance is based on the principles of a market economy, which include:

    economic and legal independence of enterprises;

    economic efficiency of activities;

    financial control;

    financial incentives;

    material liability.

On the basis of these principles, each organization builds its own economic mechanism:

    carries out economic and legal activities independently(within the framework of the law and responsibility). The enterprise independently forms the production program, selects suppliers, consumers and intermediaries, sets prices for products and services, disposes of its products, resources and income;

    expenses are carried out at the expense of income and, as a rule, provides not only payback, but also profitability;

    guarantees financial responsibility for obligations with their separate property;

    provides material interest workers in the results of labor.

    The principle of self-government or economic independence. Assumes that the organization, regardless of the organizational and legal form of management, determines its economic activity, the direction of investment of funds in order to make a profit. The state determines certain aspects of the activities of enterprises (depreciation policy, regulates relations with budgets of different levels, extra-budgetary funds, etc.).

    Self-financing principle. Means full return on production costs and product sales, investing in the development of production at the expense of their own funds and, if necessary, bank and commercial loans. The implementation of this principle ensures the competitiveness of the enterprise (in developed countries specific gravity own funds reaches 70% or more).

    The principle of material interest. Means interest in the results of activities, as an individual and the enterprise as a whole. At the level of individual employees, the implementation of this principle should be ensured by decent wages and incentive payments, as well as income from bonds and shares of the enterprise. For an enterprise, this principle is expressed in the achievement of the main goal of entrepreneurial activity - making a profit and can be realized as a result of the state's implementation of an optimal tax, budget, antimonopoly, and customs policy.

    The principle of material responsibility. It means the presence of a certain system of responsibility for the results of economic activity and the procedure for its conduct. In accordance with Russian legislation, enterprises that violate contractual obligations, settlement discipline, allow late loan repayment, bill repayment, violation of tax legislation, pay fines, fines, and penalties. In case of ineffectiveness of activity, the bankruptcy procedure can be applied to the enterprise. For individual workers in case of dishonest performance of duties, a system of fines, deprivation of bonuses, and dismissal may be applied. For enterprise managers, the implementation of this principle can be carried out through a system of penalties for violation of the tax and labor codes by the enterprise.

    The principle of ensuring financial reserves. It is associated with the need to form financial reserves to ensure uninterrupted economic activity, since it is associated with various risks due to possible fluctuations in market conditions. Financial reserves can be formed by enterprises of all organizational and legal forms from profits. It is advisable to keep these funds in liquid forms so that they generate income and, if necessary, can be easily converted into cash capital.

The principles of organizing the finances of enterprises and corporations are closely related to the goals and objectives of their activities,
The principles of organizing corporate finance include the following:
1) self-regulation of economic activity;
2) self-sufficiency and self-financing:
CORPORATE FINANCE
3) dividing the sources of formation of working capital into own and borrowed ones:
4) availability of financial reserves.
The principle of self-regulation is to provide enterprises (corporations) with complete independence in making and implementing decisions on production and scientific and technological development based on the available material, labor and financial resources.
An enterprise (corporation) directly plans its activities and determines development prospects based on the demand for manufactured products (services). The basis of operational and current plans are agreements (contracts). concluded with consumers of products (services) and suppliers of material resources. Financial plans are designed to provide financial resources for the activities provided for in production plans (business plans), as well as to guarantee the interests of the state budget system. The replenishment of working capital is carried out mainly at the expense of their own financial resources (net profit), and, if necessary, at the expense of borrowed and attracted funds.
To attract additional financial resources, corporations issue equity securities (stocks and bonds) and participate in stock exchanges.
The principle of self-sufficiency assumes that the funds invested in the development of the corporation will be recouped through net profit and depreciation charges. These funds are designed to provide a minimum of standard economic efficiency of the equity capital owned by the enterprise (corporation).
With self-sufficiency, the enterprise finances simple reproduction from its own sources and introduces taxes into the budget system. The implementation of this principle in practice requires the profitable operation of all enterprises.
or elimination of losses.
As opposed to self-sufficiency, self-financing
assumes not only profitable work, but also the formation
financial resources on a commercial basis, providing
providing not only simple, but also extended reproduction
production, as well as revenues of the budgetary system. Principle
self-financing involves strengthening material
responsibility of enterprises (corporations) for compliance
contractual obligations, credit settlement and tax
discipline. Payment of penalties for violation of the conditions
viy of economic contracts, as well as compensation for
losses to other organizations are not exempted
removal (without the consent of consumers) from the fulfillment of obligations
for the supply of products (works, services).
To implement the principle of self-financing, no
a number of conditions must be met:
accumulation of equity capital in the amount, sufficient
accurate to cover costs not only for the current, but
and on investment activities;
the choice of rational directions for investing
fed;
constant renewal of fixed assets;
flexible response to the needs of the commodity and financial markets.
Let's consider these conditions in more detail. The content of the first condition is the separation of cash. funds for financing current and investment activities. These funds are concentrated in the settlement accounts of an economic entity until their further distribution. From the standpoint of financial management, it is important to periodize cash, that is, to distribute it in terms of time spent in real turnover into short-term and long-term funds.
The second condition implies the definition of such ways of capital investment that lead to strengthening financial condition enterprises and increasing its competitiveness in the commodity and financial markets. Compliance with this condition is associated with the assessment of the level of self-financing, the development of criteria for such an assessment, with the analysis of capital flows by the types of activities of the enterprise.
CHAPTER 1, Corporate Finance: The Basics of Organization. *
CORPORATE FINANCE
The third condition for self-financing is to provide
maintaining the normal process of updating the main capital
tala. Increase in the value of property, plant and equipment as a result
their revaluation is beneficial for the enterprise, since at the same time
do not make any additional payments in the form of di-
vidends and interest, and the amount of equity capital increased
changes.
The fourth condition for self-financing involves
implementation of such a financial policy in which
the enterprise can function normally in conditions
fierce competition in the product and financial markets. Ta-
which policy is aimed at reducing production costs
and circulation and to increase profits. Self-financing,
based on high prices, helps to increase
money supply and becomes a generator of inflationary
processes in the national economy. Therefore, to increase
the level of self-financing, business entities are obliged
we are committed to respond clearly to the needs of the market in accordance with
products (services). Demand response mechanism
market position implies specialization, diversification
and concentration of production. Orientation of this mechanism
should be linked to tax, price and investment
state policy. Application of the principle of self-financing
banking is an important factor in preventing bank
business entity and creates an opportunity for
effective use of financial management.
Division of sources of formation of circulating assets
for own and borrowed is determined by the characteristics of technical
nology and organization of production in certain industries
farms. In industries with a seasonal nature of production
the share of borrowed sources of formation of turnover increases
funds (trade, food industry, agriculture
economy, etc.). In industries with a non-seasonal nature of production
leadership (heavy industry, transport, communications) in the composition
all sources of formation of working capital prevail
with * | own circulating assets.
The formation of financial reserves is necessary to ensure the stable operation of enterprises (corporations) in the face of possible fluctuations in market conditions, increased material responsibility for failure to fulfill their obligations to partners. In joint-stock companies, financial reserves are formed in accordance with the charter of the enterprise from net profit.
The implementation of these principles in practice should be carried out in the development of financial policy and organization of the financial management system of economic entities. It should be borne in mind:
scope of activity (commercial and non-commercial activity);
types (directions) of activity (export, import); industry affiliation (industry, agriculture, transport, construction, trade, etc.);
organizational and legal forms of entrepreneurial activity.
Compliance with these principles in practice ensures financial stability, solvency, profitability and business activity of enterprises (corporations).

The organization of corporate finance is designed to ensure the sufficiency of financial resources in the amount necessary for the implementation of uninterrupted production, economic, commercial and possible investment activities.

At the stage of formation, the initial formation of financial resources occurs through the formation authorized capital, as a rule, at the expense of the owners of the corporation. As sources for the formation of the aggregate amount of the authorized capital, the following can be involved: own funds entrepreneur, share capital, shares of third-party organizations, long-term bank loan, funds of other potential participants. In the future, the sufficiency of financial resources and the stability of the financial position are ensured through compliance with basic principles of corporate finance organization, representing strict requirements for building a dependency system financial indicators, proportions and ratios, guarantees and obligations, incentives and responsibility for the results achieved.

An important principle of organizing corporate finance is financial independence. This means that the corporation not only independently determines its focus in the relevant market segment, but also bears full responsibility for financial results management, its production, commercial and social development... The Corporation makes independent decisions, implementing its investment policy, and acts as a full-fledged participant in the stock market. Financial independence cannot be called unlimited, since the state has the right to introduce certain legislative restrictions into the activities of economic entities, introduce regulations on certain types of activities, etc. For example, relations with budgets of various levels, extra-budgetary funds, in terms of state tax policy are regulated by law.

Financial independence necessitates the following principle of organizing corporate finance - the principle of self-financing. This means the requirement for economic and investment activities, all costs associated with production and sales, payments to the budget and compulsory deductions from profit and cost, the costs of expanded reproduction to be provided at the expense of profit and other own sources. This principle is one of the main conditions for organized business activity, economic survival in a market environment. The main own sources organizations (corporations) are retained earnings and depreciation. At the same time, it should be noted that the implementation of large investment projects usually cannot be limited by its own funds, but the effectiveness of the project in this case provides for subsequent reimbursement of possible borrowing.

The presence of core and investment activities requires finance mandatory differentiation of funds, serving the turnover of resources for each of them, - the funds assigned to the main activity cannot be used for the needs of capital construction, and vice versa. This primarily applies to working capital, since the diversion of funds from the main activity is fraught with disruption of the cycle at each stage. On the other hand, the diversion of funds envisaged for investment in current current assets, will not only lead to the disruption of planned targets in capital construction, but may also mean a slowdown in turnover, the emergence of excess stocks, a decrease in control over the efficiency of the use of material resources.

The principle of organizing corporate finance is the need to ensure the safety of working capital. Only in this case is the continuity of their turnover ensured, and, consequently, the uninterrupted circulation of current assets. Failure to meet this condition means loss financial sustainability, deterioration of solvency, violation operating cycle, entails other negative consequences in the financial and economic activities of the organization.

The requirement for a certain system of responsibility for the results of economic activities is due to the principle of material responsibility. This principle operates both inside and outside the corporation. In case of violation of contractual obligations, payment and settlement discipline, untimely return of bank loans, tax legislation, the business entity is obliged to pay fines, penalties, and forfeit. As a last resort, bankruptcy proceedings can be applied to such an organization. The principle of material responsibility imposes specific requirements on the employees of the organization if they do not properly perform job responsibilities... In this case, we are talking about reducing or canceling bonus payments, collecting fines, cash payments, etc.

Insofar as entrepreneurial activity is always associated with risks, in order to minimize them, it becomes necessary to create special monetary funds and reserves. The risk of non-return of monetary investments threatens not only the loss of its own working capital, a slowdown in the rate of turnover of assets, but also a violation production process and even the complete bankruptcy of the organization. As a rule, financial reserves are formed from the profit remaining at the disposal of an economic entity. Formation of financial reserves, effective management them and their rational use constitute one of the most important aspects of financial activity and stand out as a principle of organizing finance.

Effective organization and use of corporate finance is possible only with proper formulation of effective control over financial and economic activities. In this realizes itself control function of finance. In a corporation, such control is primarily entrusted to structural subdivision responsible for financial management (finance department, financial management, financial management, accounting, treasury, etc.). Control is exercised over the timeliness and completeness of the formation of monetary funds, receipt of proceeds, planned and targeted use of financial resources, compliance with standards and financial indicators adopted in terms of plan. In addition, control over the use of financial resources can be exercised by external organizations: a higher-level structure, tax authorities, a credit institution, etc. The obligation to carry out control ensures the opening of existing reserves to reduce costs and increase financial results.

The sound organization of corporate finance not only ensures sustainable financial position, but also helps to optimize the movement of commodity and cash flows between counterparties, maintaining at a sufficient level the volume of working capital necessary for the uninterrupted maintenance of production and commercial activities... Scientifically grounded organization of finance is the basis for the development of an effective financial management mechanism based on daily monitoring of the financial condition, the set strategic goals of the corporation and determining the ways to achieve them.

 

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