Financial Relationships of Enterprises

Financial relations at enterprises include monetary, economic relations that arise as a result of the movement of money and cash flows that are associated with the functioning of monetary funds.

Finance enterprises are the basis of the financial system throughout the country. It is enterprises that represent the main link in the economic complex of the state. They constitute an entire independent sphere of the financial system of the country.

In the field of material production, there exist and develop various financial relations, differing in character. In their composition such relatively homogeneous financial directions and monetary relations are distinguished. This is the relationship between the founders in the creation of an enterprise and in the management of its property; Between enterprises in the process of intra-corporate distribution of financial resources; Between parent enterprises and their divisions to establish liability and financial incentives; Between the enterprises connected with manufacture of production and its further realization (suppliers, buyers, etc.); Within separate financial and industrial groups, associations, holdings, which include enterprises; Relations with employees (payment of salaries, allowances, dividends, maternity aid, as well as collection for damage, taxes, between enterprises and the state during payment of taxes and payments to the budget, provision of benefits and payment of fines, between organizations and insurance companies, between enterprises and Investors, etc. Currency and financial relations arise in enterprises with foreign partners.

The largest of these groups is the group of relations between enterprises associated with general production processes, redistribution, sales of products . This includes all financial relations of organizations with buyers, suppliers, construction and installation companies, transport organizations, telegraph and mail, customs, foreign trade organizations, enterprises of foreign countries.

Relations between enterprises of this group are associated with the sale of products and the acquisition of values of the material plan for conducting economic activities. The role of this particular group of relations is primary, since it is it that creates national income. It is in the field of material production that enterprises receive revenues and profits. Financial relations in this area have a direct impact on the formation of the final results of activities.

Each of the groups mentioned above has its own specific features and a separate sphere of application. But all of them are characterized by a bilateral character. Their basis is the movement of money. Cash flows participate in the formation of the authorized capital, the cycle of funds, the formation of monetary funds, etc., begins with them.

New financial relations are developing in the area of redistribution and formation of capital in mergers and divisions of organizations. Financial relations include the processes of distribution and subsequent redistribution of domestic product and national income. Relationships occur in the process of creating, using, or distributing financial resources of individual enterprises.

The financial resources include all sources of funds that are available to the enterprise. They are constantly on the move, the turnover of funds is serviced. Financial resources are expressed in the form of money incomes, reserves, funds, capital of the enterprise.

Thus, financial relations begin their existence in the process of circulation of funds in the form of cash flows, which are generated by various activities. All relations in the field of finance are regulated by the state.