FINANCIAL CAPACITY OF LOCAL BUDGET AS A BASIS FOR SUSTAINABLE FUNCTIONING OF A TERRITORY
FINANCIAL CAPACITY OF LOCAL BUDGET AS A BASIS FOR SUSTAINABLE FUNCTIONING OF A TERRITORY

Summary/Abstract: The level of local budgets’ financial capacity plays an important role in sustainable socio-economic development providing to the region. Financial capacity of a local budget is capability of the local governmental bodies to exercise local budget expenditures in a timely and proper way, in full conformity with their own direct authorities and delegated authorities, in order to achieve tactical and strategic objectives of social and economic development in a region through accumulating sufficient amount of financial resources. Financial capacity of the local budget consists of three components: financial potential, financial autonomy and financial sufficiency. In the article, the authors have proposed a methodology for financial capacity of the local budget evaluating by calculating the integral index, based at coefficients usage. The proposed approach is of practical importance. It allows making an adequate analysis of the local budgets’ financial capacity in Ukraine, timely identify the problems, determine the causes of their occurrence, reserves and ways to improve efficiency of financial relations at the regional level.

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