STATE FINANCIAL CONTROL: THE ESSENCE AND SYNTHESIS OF VIEWS
KURIANOV Viktor – Ph.D. student, V. N. Karazin Kharkiv National University (61002, Kharkiv,
Myronosytska str, 1, e-mail: firstname.lastname@example.org).
This paper presents an overview of foreign and domestic research, on issues and modernization of the system of state financial control. The need to develop a conceptual categorical base of the state financial control of Ukraine in accordance with the international standard, have been identified. Since, "state financial control" synthesizes a number of complementary concepts such as "control", "financial control" and general idea of public functions; the given concepts have been classified. Thus, "control" is defined by modern scholars in three directions: a phenomenon or a process; management element; system. The diversity of approaches does not so much reflect the desire to give a universal notion of the term "control", but is a consequence of considering this category through the prism of various scientific areas - managerial, philosophical, analytical, legal, cybernetics, etc. Of course, the definition of any term (especially such multi-faceted as control) cannot contain its exhaustive characteristics. However, it has to characterize certain features, essence, purpose and directions of realization. "Financial control" and "state financial control" are classified by common categories: function, system and institution. On the basis of the classification of categorical concepts, the hierarchy of the investigated category has been composed, which has a horizontal (from single to special, to general) and vertical development (from abstract to concrete), that is, it has the form of an imaginary pyramid. This pyramid includes three levels: level of control, level of financial control and level of state financial control. Each level has its own structural elements, which in turn are characterized by positive and negative features.
The first segment is control as a process or phenomenon, it recorded only activity, since control cannot be inactive, but hasn't goal, and characterized as mechanistic process and one-time operation, which not repeated. The second segment is control as a management element that is characterized by the frequency of control activities, and plays a leading role in the management process, but does not reveal the internal structure and its hierarchy. The third segment - control as a monitoring system, has a certain periodicity, structure and tools, but control occurs after the completion of a process, that is, post factum.
The categories "control as a process or phenomenon" and "management element" formulate the function of finance. This segment exists on the edge of control and financial control and is a transition from one level to another. This segment has all the characteristics of "control", which is aimed at regulating finances, but in the category it has not the system itself, it only points to it, but does not reveal it. The segment of financial control is a supervisory system, characterized by certain structural subdivisions and a system of control bodies and types of control (planned, current, reporting, internal, external), but at this level, the concept is abstract as there are household finances, corporate finance, public finances, etc., and thus there is no complete system, because there is a certain gap between the public sector and the private sector and certain units are not hierarchically connected.
The function of finance evolves into the function of government. It is a point of transition from the level of financial control to the level of state financial control. After all, the government's goal is to ensure the social and economic development of society, by distributing the gross domestic product among all sectors of the economy and controlling its use, and therefore, in this category, the elements of management, control instruments and its mechanism are laid down, but because of its main purpose, does not expose in the full extent the essence of the system of state financial control, it is superficial. Because at this stage the system combines in itself - state bodies of control and bodies of formation and distribution of public finances. At the level of public financial control, the first segment of this category is a complete system that synthesizes the notion of state function and supervisory system, combines them and formulates an integral system of public financial control with a hierarchy of its elements, bodies of state financial control and their structural divisions and accountability, reveals its essence and purpose. But at this stage, this category is more theoretical, and does not have significance power for the country as an institution. Thus, the last stage, and the stage of evolution, is the institution of state financial control. This improves the complete system of state financial control via institutional infrastructure, namely the legislative consolidation of the state financial control as an institution, i.e. the introduction of the direction of economic science in practice, with certain rules and laws, and gives control over the infrastructure of public finances.
It has been determined that in English literature use the term "government auditing" instead "state financial control". But they are similar in content and usage. In the Ukrainian legal normative documents "audit" is used too, but it has several interpretations and options. And the source of this problem is the incorrect translations of the main documents of INTOSAI and at first of the Lima Declaration of Guiding Principles of Auditing. Thus, the definition has been equated.
The result of this research is the formulated author's definition of the category of "state financial control". State financial control is an institution of the public sector of the economy, based on the principle of delegation of authority, having a certain internal structure (the hierarchical system of state financial control bodies, and systematizing them for the established types of control) and the external form of manifestation in the form of performance of specific functions. The first function is control over the formation, consumption and preservation of public funds and public property; the second function is the analysis and control over the effective management of these public resources by the objects of control that they manage; the third function is bringing to justice for violating and committing unlawful actions against public resources, within the legal framework. The main objective of the state financial control is to ensure the effective functioning of the public sector of the economy, to stimulate socio-economic development of society, to make it impossible to assimilate, steal and ineffective use of public resources.
The author's proposed definition differs from another that harmoniously synthesizes all the characteristics of the conceptual categories "control" and "financial control" and comprehensively reveals the essence of the term "state financial control". The theoretical value of the research is to develop a logical chain of evolution of the concepts of "control", "financial control" and "state financial control", which creates a dialectical impetus for further scientific development of these categories. The methodological significance of the research is contained in the substantiation of the institutional nature of the state financial control, which creates the grounds for applying the methods of institutional analysis for this definition. The practical utility of the scientific research is carried out in accordance with international norms and all the functions entrusted to the state financial control and the full expose of the state financial control as an institution and the direction of economic science.
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