Pomiar kondycji finansowej jednostek samorządu lokalnego – kwerenda międzynarodowa
The measurement of local authorities’ financial condition – the international literature search query

Summary/Abstract: The assessment of local authorities’ financial condition is crucial to develop knowledge in thefield of public finance, to identify mechanisms explaining the relations between particular componentsof local authorities’ financial condition, to determine potential ways of finance optimizationand to meet the need for information of a broad group of stakeholders. The measurement of financialcondition allows for the assessment of financial security understood as the ability to ensure the continuityin the implementation of basic own tasks and to maintain financial credibility related to thepayment of current and future financial obligations.The aim of this article was to undertake a critical review of the definitions and methods to assessthe financial condition of local authorities collected during the review of international literature.Various methods of measuring the financial condition of local authorities, which allow to carry outcomparative studies and to determine the spatial trends of its assessment, were summarized in thearticle.The variety of financial condition depictions encountered in the literature depends on the purposeand adopted definition and also on the spatial extent and availability of statistical data. A commonpractice is to use the concept of measuring the financial condition proposed by the CanadianInstitute of Chartered Accountants or the International City/County Management Association. Theanalysis of international literature, complemented by the achievements of Polish authors, led tothe identification of two basic approaches to measuring the financial condition of local authorities:1) many empirical measures 2) composite index. The primary sector of interest in this article isthe second approach, which adapts different methods of creating a multivariate index of financialcondition (composite index), on the basis of which it is possible to relatively measure the level ofthe financial situation.

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