Scientific and practical journal
Regional Economy

Journal Regional Economy -- re2015.03.081

Repository of Institute of Regional Research Repository of Vernadsky Library UDC 332.1:336.6
Sember, S. V., Chubar, O. H., & Mashiko, K. S. (2015). Teoretychni pidkhody do vyznachennya sutnosti finansovoyi spromozhnosti ta finansovykh resursiv terytorial'noyi hromady [Theoretical approaches to defining the essence of community’s financial capability and resources]. Rehional'na ekonomika - Regional Economy, 77(3). [in Ukrainian].
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The article is focused on exploring the financial capability and financial resources of the community. Various resources that discuss theoretical aspects of capability and its types have been reviewed; that helped us to outline the community’s financial capability as a complex figure that consists of financial and budget capabilities of general context. Budget capability depicts community’s ability to use money resources of local budget income to conduct its current authorities. The financial capability is the ability to finance the whole specter of social and economical tasks of community with help of not only funds of the community but also other incoming money flows, which might be spent on different purposes of social and economical development of the community in general and for the benefit of other people who inhabit the territory. Modern governmental and parliamentary regulations in development of local authority and decentralization, Methodology of formation of capable communities approved by The Cabinet of Ministers of Ukraine in particular, updated the issues of financial capability and financial resources of the community. Capable communities can only be formed based on financial supply of relative administrative territories. Capability passport contains the calculations of incomes of the community, including basic and reversal subsidies made up according to the paragraph 64 of The Budget Code of Ukraine. The basement of the financial capability of the community is made of financial resources – the amount of funds that are created in process of GDP allocation. These funds are spent on economical and social development of administrative units. Traditionally, local financial resources include: local budgets, financial funds of enterprises, organizations, and institutions of common ownership. The article elaborates approaches in defining the meaning and composition of community’s financial resources that include funds of local authority, enterprises and organizations of different ownership, citizens, and funds attracted via stock market and banking system. More criteria of classification of financial resources of the community have been outlined. Consequently, 9 final criteria have been mentioned. This will allow structuring these resources as well as finding and justifying new possibilities to increase the amount of financial resources on the community level. Researchers stress that when assessing the financial capability it’s necessary to take into account both resources of local budgets and other financial resources that are created within the community or attracted to one (financial resources of people and enterprises.


financial capability of the community, budget capacity, financial capacity of businesses and households, financial resources, local budgets

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