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Presentation, Ekaterina Kornienko
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Presentation, Ekaterina Kornienko


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  • 1. “ The improvement of the efficiency of public financial control in Russia: problems and solutions”
  • 2. Definition of public financial control.
    • public financial control:
    • an activity of public and municipal authorities and organizations, which is regulated by statutory acts;
    • includes inspections of timeliness and accuracy of financial planning, management of public costs and expenses in relation to budgetary amounts;
    • is supposed to promote legitimacy in financial and economic activities and to prevent mismanagement and wastefulness, which slow down economic development of any country.
  • 3. Principles of public financial control :
    • Principle of legitimacy (all financial activities must be regulated by rules and laws; it is especially important for financial control);
    • Principle of publicity (all citizens must have access to the information about results of financial audits and inspections; they must receive information about all statutory acts passed in this sphere);
    • Principle of federalism (division of powers in the financial sphere between the federal government and its entities is an important element of financial control);
    • Principle of planning (the financial system must be based on a number of legislative acts, containing planning).
  • 4. Forms of public financial control :
    • According to the timing:
    • 1) The fact;
    • 2) Concomitant;
    • 3) After the fact
    • According to the authorities that carry it out:
    • 1) Public:
    • - Departmental (implemented by the Accounts Chamber, the Department of financial control, the Ministry of Finance, The Bank of Russia);
    • - Non-departmental (carried out by the controling divisions of ministries and agencies).
    • 2) Non-governmental (includes independent auditing control, civic financial control, insurance financial control, legal financial control and some other types)
  • 5. Evolution of public financial control:
    • 1) 1654 – special Accounting Office ( inspected the distribution of remuneration to people);
    • 2) 1699 - special Chancery (responsible for analyzing information about allocation of funds and different items of expenditure);
    • 3) The first part of the 19th century – introduction of the ministerial system. The Ministry of Finance became the most important authority in the system of financial control;
    • 4) Soviet times - the system of People’s Comissariats. The People’s Comissariat of public control was responsible for all financial inspections;
    • 5) The breakup of the Soviet Union - abolishment of some public control authorities;
    • 6) Since 1996 appeared a number of new control authorities, some legislative acts were passed (President’s Decree № 1095 from the 25th of July 1996 “On the measures of provision of public financial control in the Russian Federation”).
  • 6. Current system of public financial control:
    • 1 ) The Accounts Chamber - regulates the legality and timeliness of the use of public funds by various financial institutions, estimates validity of federal budgets and off-budget funds;
    • 2) President of the Russian Federation - issues decrees, concerning financial sphere, signs federal laws, appoints the Minister of Finance, offers candidatures on the post of the Chairman of the Bank of Russia and of the Accounts Chamber;
    • 3) The Federal Treasury - conducts enforcement functions connected with the execution of the federal budget; provides the fact and concomitant control over financial operations involving public funds and implements some other activities;
    • 4) The Federal agency of fiscal oversight - implements control over the usage of budgetary and off-budgetary funds, oversees residents’ and non-residents’ compliance with currency laws and acts concerning currency regulation and examines execution of budget legislation by financial control authorities;
    • 5) The Federal Financial Monitoring Agency - prevents the legalisation from criminal revenues and the financing of terrorism and coordinates activities in this sphere by other executive authorities.
  • 7. Reasons for falling efficiency of public financial control:
    • 1)Liberal economic reforms;
    • 2) Development of the market economy;
    • 3) Privatisation of property;
    • 4) Increasing number of economic crimes (illegal privatization, embezzlement and misappropriation of public funds, corruption )
  • 8. Problems of public financial control:
    • 1) Absence of a single system of public financial control (no documents containing methodological bases of public financial control );
    • 2) A bulky system of public financial control authorities;
    • 3) Lack of coordination in the work of public financial control authorities;
    • 4) Crossover in the functions of public financial control authorities; visible and non-visible duplication in their work.
  • 9. Possible solutions to the problems of public financial control:
    • 1) Formation of appropriate normative base (passage of a Federal Law);
    • 2) Limitation of a number of public financial control authorities;
    • 3) Development of public financial control in the subjects of the Russian Federation;
    • 4) Reorganization of the Accounts Chamber;
    • 5) Introduction of result-orientation in the sphere of public financial control;
    • 6) Improvement of control over financial institutions.