The budget system of ukraine

Read and memorize the following words and word combinations:

budget	бюджет
revenue	річний прибуток
expectations	очікування
budgetary control	контроль за бюджетом
state authorities	державні влади
budgeting	фінансове планування
to denote	позначити
state legislation	законодавство держави
master budget	зведений фінансовий кошторис
operating budget	оперативний бюджет
capital budget	кошторис капіталовкладень
cash budget	бюджет грошового потоку
set	комплект, набір, напрям
computation	обчислення, підрахунок
chain	ланцюг, послідовність
transparency	прозорість
authentic information	повна інформація

The budget system of Ukraine

A budget is a detailed plan outlining the obtaining and use of financial and other resources over some given time period. A budget sets forth management's expectations for revenues and, based on those financial expectations, allocates the use of specific resources throughout the firm. It represents a plan for the future expressed in formal quantitative terms. The State Budget is a plan of obtaining and use of financial resources to provide with the functions which are carried out by the state authorities of Ukraine. The act of preparing a budget is called budgeting. The use of budgets to control activities of any organization, village, city or town, as well as a country is known as budgetary control.

The budget system of Ukraine consists of the State Budget of Ukraine, Republican Budget of Crimea, and local budgets. The totality of all budgets is called the master budget of Ukraine. The master budget of Ukraine is used to analyze and denote the principles of the state legislation of economic and social development of Ukraine. The master budget is a summary of all phases of the country's plans and goals for the future. It sets specific targets for sales, production, distribution, and financing activities.

Most firms prepare yearly budgets from short- and long-term financial forecasts. There are usually several budgets established in a firm: an operating budget, a capital budget, a cash budget, a master budget.

An operating budget is the projection of money allocation to various costs and expenses needed to run or operate the business. How much the firm will spend on supplies, travel, rent, advertising, salaries, etc. is determined in this budget.

A capital budget consists of the firm's spending plans: the purchase of such assets as property, buildings, and equipment.

A cash budget is the projected cash balance at the end of a given period (e.g. monthly, quarterly). It is important for managers in borrowing, debt repayment, cash disbursements, and short-term investment expectations.

A master budget ties in all the above mentioned budgets and summarizes the proposed financial activities of the firm.

The budget system (the order) is based on the principles of unity, completeness, authentic information, transparency (visualization) and independence of all budgets involved into the budget system of Ukraine.

The principle of unity means the existence of the single system of computation of revenues and expenses by every chain of the budget system. It is backed by the single legislation base, single set and form of documentation,

single monetary system, socio-economic policy and necessary statistic and budget information.

The principle of completeness means the reflection of all revenues and expenses in the budget.

The principle of authentic information deals with preparing the budget on the base of real indicators, adopted norms and standards.

The budget process is the order of preparing, examining, adopting budgets, using and controlling them; adopting the reports of the budgets fulfilled.

The budget year starts on January 1^st and finishes on December 31^st.

Answer the following questions:

1. Give the definition of a budget.

2. What does the budget set?

3. What is called budgeting?

4. What does the budget system of Ukraine consist of?

5. How do the most firms prepare yearly budgets?

6. What budgets are established in a firm?

7. Does the principle of authentic information deal with preparing the budget?