What is self-financing? Definition and principles

Let's try to find out what self-financing is. This is a special economic category that expresses relations in the sphere of distribution, production, consumption, and the exchange of products. Many beginning entrepreneurs are trying to understand what is self-financing and how to use this economic term in their activities. In conditions of transition of the country's economy to a market option, this parameter is an important economic concept.

Features of cost accounting

This is a form of economic relations, materialinterest and responsibility between enterprises and the state, between the base company and its structural divisions, between enterprises, and also within the organization.

The introduction of cost accounting assumes rational management of the economy, recoupment of incurred costs, implementation of the economy regime, guaranteed profitability of the organization.

Essence of economic calculation

It is in the aggregate of funds andmechanism, thanks to which there is a final result - full-fledged production management. It is the full cost-accounting on the basis of commodity-money relations that guarantees the compliance of the resources of agricultural enterprises with the results of their direct activity. The system of such relations reflects the constant movement of resources, the renewal of the circulation of the company's funds. Arguing that such a self-financing, we note that he expresses the production relations that develop on the basis of financial and material resources in companies of all forms of ownership.

The scale of cost accounting

This term refers to the whole sphereindustrial relations, built on the basis of terms: money, value, commodity, cost, price, profit. The conditions of cost accounting are as follows: within the company there is interaction of economic categories according to existing laws in this area. It should be noted that the organization combines labor and means of production, in this connection, and directly the process of manufacturing products. The enterprise can include all the basic principles of cost accounting.

Features of agricultural organizations

The main development of cost accounting for such companies is determined by important principles:

• self-financing and cost recovery of costs incurred;
• state regulation of the economy, as well as the collective self-government;
• the material interest of individual workers for the result of production;
• control of the financial activities of the organization.

Self-financing involves covering allexpenses by the company at the expense of personal financial resources. The company's revenue from the sale of its products should be enough for the accumulation and consumption fund. The state has the right to regulate such market parameters as tax and interest rates, tariffs. By controlling their level, it gets the opportunity to create optimal conditions for the sale and production of goods.

How to make cost effective accounting

It will be effective if, besidesThe principles mentioned above, each member of the workforce will fulfill the duties assigned to it. If the employee has no personal material interest, there will be no question of any effectiveness. The company should have a special incentive system for employees. It includes a variety of bonuses, additional payments at the end of the year, financial assistance. Only with the relationship between labor productivity and decent wages will the worker be interested in the result, and the company will be able to count on substantial profits.

Interesting Facts

In addition to material interest, andfactors such as responsibility for the expenditure of monetary resources. Responsibility for the use of material and financial resources should be provided. In reality, this principle implies a comparison of costs with the results of economic activity at each stage of production. Under constant control of the "ruble", full cost accounting of state enterprises is realized.

The importance of the financial and banking system for cost accounting

It is the financial authorities that carry out constantcontrol of timely payment of taxes by state and private enterprises. The use of credit sanctions by banking institutions stimulates the heads of organizations to seek the option of efficiently using all available resources. Such methods of influence on enterprises as repayment, targeted use of loans, urgency, allow banks to influence the circulation and manufacture of goods, timely identify and propose ways to eliminate losses of mismanagement, overhead costs, check accounts. Many companies are afraid of cost accounting, understanding that it has a mass of “pitfalls”. This system is constantly being modernized, developing, keeping up with the changes taking place in the domestic and world economy. So what is cost accounting? This is a complex system in which all elements are interconnected.

Varieties of cost accounting

There is a unit of cost accounting on the formorganizations on-farm and general. The first option involves economic relations with the state or other companies of individual farms. On-farm calculation is associated with relationships in the enterprise itself, for example, between separate divisions. Among the currently prevailing business methods, the leading positions belong to three calculation options: commercial, intra-firm, and economic.

Economic accounting is distributed todayfor enterprises that are fully or to a greater extent owned by the state. Its task is to ensure the effective operation of the organization, aimed at full payback of expenses, as well as dynamic development.

Commercial settlement operates in enterprisesall types of property, aimed at obtaining the maximum material profit. Commercial structures can rely on state aid, cash loan or transfer. Cost accounting in this case depends on the volume of products, as well as the degree of independence (financial independence) of the company.

To recover the costs incurred by the ownersCompanies are looking for ways to reduce financial, material, labor resources. A feature of this option of cost accounting is the provision of operational autonomy to branches and divisions.

Intra-company calculation arose as a kind of financial relationship within the company. His task is to create a full, balanced activity of all branches of the company.

The interrelation of these three models is carried out by means of an economic mechanism.

Elements of the cost accounting mechanism

These include the following components:

• the system of planning, incentives, responsibility;
• subsystem containing information, property, legal support;
• subsystem, including cooperation, organization, specialization.

Conclusion

Cost accounting provides stably operatingcompanies full cost recovery, stable income. The company should receive such income that would fully cover the costs of production and have a good profit. The organization has a real opportunity for complete independence in its business activities. The company itself plans to sell, manufacture, hire workers, manage the property. Any self-supporting enterprise has its own bank account, a complete accounting system.

Every company has its current account inbank, can get in banks and other credit institutions loans. It also has its own balance sheet and a complete accounting system. In case of improper performance by employees of their duties, financial responsibility is assumed. If the enterprise does not fulfill the production plan, if its quality deteriorates, it releases discarded products, or if the equipment and material resources are not efficiently used, the company's revenues are significantly reduced. As a result, relations with customers, banks, suppliers of raw materials deteriorate, problems arise in the payment of taxes, and in the payment of wages to employees. The results can be disastrous for the company, from administrative fines to complete bankruptcy.