Financial system- this is a set of different spheres of financial relations, characterized by the peculiarities of the formation and use of funds of funds and a different role in other reproduction.

The financial system is a unified system because it is based on a single source of resources - national income. The division of the financial system into separate links is due to the peculiarities of the functioning of economic entities of society, differences in the methods of distribution and use of funds.

The functioning of all links is subordinated to a common goals - mobilization of financial resources and their further distribution and redistribution.

Rice. 3.1. Links of the financial system of the Russian Federation

The financial system of the Russian Federation includes the following links financial relations:

· state budget system;

· off-budget special funds;

· state loan;

· insurance funds;

· finance of enterprises of various forms of ownership.

Consequently, the Russian financial system consists of three large areas: general government finance, finance of business entities and insurance finance (Fig. 3.1).

National finance - these are centralized funds of funds that are created through the distribution and redistribution of national income created in the sphere of material production. The main purpose of this area is the centralization of funds to regulate the economy and solve social problems at the level of the national economy.

Finance of business entities- these are decentralized funds of funds that are formed from the cash income and savings of the enterprises themselves. The predominant share of the state's financial resources is formed here. Part of these resources is redistributed to budget revenues at all levels and to extra-budgetary funds. A key place among them belongs to the finance of commercial enterprises.

Insurance allocated to a separate group due to the specifics of insurance relations, including the mechanism for the formation of funds of insurance organizations, their use by methods different from those used in other areas of financial relations.

The process of accumulation and placement of financial resources carried out in the financial management system of the country and business entities is directly related to the functioning of financial markets and institutions.

If the task of financial institutions is to ensure the most efficient movement of funds from owners to borrowers, then the task of financial markets is to organize trade in financial assets and liabilities between buyers and sellers of financial resources. Solving this problem is complicated by a number of objective reasons, since it is necessary to take into account the different interests of market participants, risks of fulfilling obligations, etc.

Buyers and sellers in financial markets are households, enterprises, and the state. 4. PUBLIC FINANCE 1. State budget and taxes

The state budget- the largest link in state finance, which is a form of formation and expenditure of funds that ensure the functioning of state power. The objective nature of budgetary relations is due to the fact that a certain part of the national income necessary to solve the tasks assigned to the state should be concentrated in the hands of the state.

Economic essence The budget is expressed in the system of financial relations between the state, self-government bodies, economic entities and the population on issues of life support for the activities of the state as a whole.

Social essence The budget is determined, on the one hand, by the level of the tax burden for certain groups of the population and economic entities, and on the other hand, by the direction of use of budget funds.

From a legal point of view A budget is a document that takes the form of a law, a legal act, on the basis of which funds of funds are formed and spent to perform national functions, the functions of constituent entities of the Russian Federation and local governments.

The state budget is a special form of redistribution relations associated with the separation of part of the national income in the hands of the state in order to use it to meet the needs of the entire society. With the help of the state budget, national income (sometimes national wealth) is redistributed between sectors of the economy, spheres of public activity, and territories of the country. In addition, through the state budget, measures are taken for state financial regulation of the economy.

The state budget performs the following functions:

· Redistribution of national income;

· State regulation and stimulation of the economy;

· Financial support for social policy;

· Control over the formation and use of a centralized fund of funds.

In the relationship between the budget and the economy and society, two main problems are traditionally solved.

The first is to ensure that when withdrawing a significant part of the added value and property of economic entities, do not deprive them of opportunities for entrepreneurship, simple and expanded reproduction. Manufacturers must have all the necessary conditions for effective business activities.

The second problem comes down to ensuring sufficient social protection for the disabled population.

Budget system - this is a set of all types of country budgets based on economic relations and legal norms.

According to the Budget Code of the Russian Federation, the budget system consists of three levels:

I federal budget and budgets of state extra-budgetary funds;

II budgets of the constituent entities of the Russian Federation and budgets of territorial state extra-budgetary funds;

III - local budgets.

Budget process- these are the procedures for developing and executing budgets.

The budget process covers four stages of budget activity: drafting budgets; review and approval of budgets; execution of budgets; drawing up a report on the execution of budgets and their approval. All stages of the budget process are interconnected and are a direct reflection of the economic life of society.

Participants in the budget process are: the President of the Russian Federation; bodies of legislative (representative) and executive power; monetary authorities; bodies of state and municipal financial control, as well as the main managers of budget funds.

Each participant in the budget process has his own tasks and budgetary powers. Control over the execution of budgets is entrusted to the treasury authorities.

Budget formation is based on government revenues.

Government revenues- This is a system of monetary relations that is associated with the formation of financial resources at the disposal of the state and state-owned enterprises. Revenues serve as the financial base of the state.

The composition of government revenues is largely determined by the methods by which the state accumulates the funds it needs. In a market economy, the main methods of mobilization are taxes, loans and emissions.

The central place in the state revenue system is occupied by taxes, acting as the main instrument for the redistribution of national income and ensuring the mobilization of a significant part of financial resources (from 80 to 90%).

Taxes represent mandatory and gratuitous payments established by law and made by the payer in a certain amount and within a certain period. The essence and role of taxes are manifested in their functions: fiscal, regulatory and control.

The ratio of financial resources of budgets depends on financial policy at each historical stage of the state’s development and is approved annually when the budget law is adopted. A large share federal budget characterized by the functions and purpose of this budget, which solves problems in the country as a whole (army, science, culture, space achievements and production). The federal budget accounts for 50% to 70% of financial resources. Territorial budget forms the resources of the region and solves territorial problems of the budgetary sector and municipal enterprises. It accounts for 20% to 50% of financial resources.

Local budgets They form the resources of a specific place of residence of the population (city, village), finance housing and communal services, preschool education, and municipal enterprises. It accounts for from 5% to 20% of financial resources.

All budgets function autonomously: local budgets with their income and expenses are not included in the territorial budgets, and the latter are not included in the federal budget.

The second most financially important method of mobilizing government revenues is loans. This is due to the presence of a gap between tax revenues and budget expenditures. The issuance of loans forms public debt. Taxes serve as the financial basis for loan repayment.

The third method of mobilizing government revenue is paper money and credit emission. This is the most unpopular method, as it leads to an increase in the excess money supply and increased inflation.

Government spending- these are monetary relations that arise at the final stage of the distribution process in connection with the use of centralized and decentralized state revenues. The content and nature of government spending are directly related to the state’s economic, social, managerial, and military (defense) functions.

Government spending is carried out in different ways: financing and through the provision of loans and credits. The main method is financing, i.e. free and irrevocable provision of funds in various forms for the implementation of relevant activities.

When using public expenditures from any sources, financial discipline, principles of legality, efficiency and expediency must be observed.

The main areas of government spending include:

Social expenses- one of the most important types of expenses, including expenses for health care, education, social security, social insurance. Approximately 3/4 of their total volume is financed from budgetary and extra-budgetary funds. In recent years, the role of local finances in covering the costs of expanding social infrastructure and maintaining educational and health care institutions has increased significantly. Expenses tend to increase due to the development of scientific and technological progress. State social spending finances activities that ensure the reproduction of the labor force, the qualifications of workers, pays unemployment benefits, etc.

Foreign economic expenses are related to the fact that the state in one way or another helps the manufacturer to break into the market. These are direct subsidies to companies from the budget, tax exemptions for exporters, provision of credit to an exporter or importer on preferential terms, export insurance, etc. This group also includes government costs for the implementation of various international treaties, cultural, scientific and other ties.

Economic costs are of great national economic importance. They contribute to the structural restructuring of social production, building up scientific and technical potential, modernizing enterprises and technical re-equipment of all sectors of the national economy. Investments play an important role. They are spent on financing infrastructure sectors (transport, communications, roads, land reclamation), which require huge capital investments. Economic expenses include

· financing of new progressive industries, such as nuclear energy and the space industry;

· financing of unprofitable industries (coal mining, agriculture);

· financing of research work, especially fundamental ones, which require a large concentration of financial resources.

National defense spending(military expenditures) are among the most important government expenditures. They include the costs of maintaining personnel; weapons; material and technical equipment; construction of military facilities; for military research and development; pension provision for military personnel and members of their families; personnel training; creation of reserves and reserves in case of war, etc. These are direct military expenses. There are also indirect military costs, i.e. expenses associated with eliminating the consequences of the war. When forming a military budget, one should take into account its irrevocable and unproductive nature. Only spending on military research and development can indirectly bring economic benefits.

Management costs– includes expenses for the maintenance of legislative and executive bodies of state power, for the maintenance of the judiciary, law enforcement agencies and the prosecutor’s office. Management costs are dominated by salaries, travel expenses, transportation and utilities, etc.

Costs for ongoing servicing of internal and external debt – arise when a government loan is used to cover a budget deficit.

The concept of "financial system" (or "financial system") is a development of the more general concept of "finance".

The financial system is a set of various spheres of financial relations, in the process of which various funds of funds are created and used.

The need to identify individual parts of the financial system is caused by the difference in the participation of numerous subjects of economic relations (state, economic entities, population) in the formation, distribution and redistribution of GDP and national income, the formation and use of funds of funds.

Each link plays its role. Each link in the financial system has its own specific forms and methods of generating and using monetary income and funds.

The country’s financial system consists of two large subsystems:

• o centralized finance;
• o decentralized finance.

The financial system of modern Russia in the most general form can be represented in the form of a structural diagram shown in Fig. 3.1 (educational and scientific literature contains other, more detailed ideas about the financial system).

Rice. 3.1.

Each link performs its own tasks, has its own organizational structure, and together they all form a unified financial system of the country.

The interaction of subsystems, units and subunits of the financial system is carried out through the mediation of institutions of the banking system, the first (upper) level of which is the Central Bank of the Russian Federation, and the second (lower) level - commercial banks and other credit institutions.

As you know, finance is closely related to money. The same close connection exists between the financial and monetary systems of the country.

Public finance (synonyms: state and municipal finance, public finance, government finance, public finance) is a system of monetary relations for the formation and use of monetary funds necessary for the state to perform its functions.

The main link of public finance is the budget system. The modern budget system of Russia is close to the structure of the budget systems of Western countries that have a federal structure. It includes three independent links: the federal budget, regional and local budgets.

The second link in public finances is extra-budgetary funds. They have a strictly intended purpose. There are off-budgetary funds for social purposes (social off-budget funds) and off-budget funds of a sectoral and intersectoral nature (economic off-budget funds).

Currently, social extra-budgetary funds operate at the federal level: the Pension Fund of the Russian Federation, the Social Insurance Fund of the Russian Federation, the Federal Compulsory Medical Insurance Fund; until 2000 (inclusive), the State Employment Fund also operated, which was abolished, and costs associated with the maintenance of employment agencies for temporarily unemployed citizens are now financed from territorial and local budgets.

In the subjects of the Federation and in municipalities, the practice of creating economic and social extra-budgetary funds has been preserved, but even at these levels in recent years their number has decreased, and the corresponding expenses began to be financed within the framework of territorial and local budgets.

State credit acts as an independent link in public finance, which represents a special sphere of financial relations, where the state acts primarily as a borrower of funds, and legal entities and individuals act as investors (depositors) in government securities.

The state borrows from the population and economic entities of its country (domestic borrowing) and from foreign countries, as well as from international financial and credit organizations (external borrowing).

Government loans are made for different purposes:

• o cover the budget deficit;
• o remove excess money supply from the money market (sterilization of the money supply).

The state can also act as an investor when borrowed funds are used for capital investments and securities (so-called portfolio or financial investments).

The state often acts as a guarantor, i.e. issues guarantees to legal entities and individuals (of course, for a fee).

The finances of economic entities are the basis of the state's financial system. Public finances are based on the financial potential of economic entities. At the same time, the finances of organizations (enterprises) are subject to regulation by state authorities and management.

Under the conditions of the administrative-command management system in the former USSR, all economic, including financial, activities were regulated by the state.

In modern Russia, state regulation of the activities of business entities is present, but it is incomparably less than in the pre-reform economy.

By determining the rules of behavior in the market, the state does not interfere in the activities of commercial organizations. In a market economy, they have financial independence, independently set prices for their products, distribute income from their sales, dispose of net profit at their own discretion, form funds for production and social development, and seek funds for investing in their assets, using resources financial markets.

The initial formation of financial resources of business entities occurs at the time of their establishment, when the authorized capital is formed through monetary and property contributions of founders and participants.

Subsequent sources of financial resources are:

• o profit from business activities (main source);
• o depreciation charges;
• o borrowing from other economic entities in the financial market.

In the economic literature, household finances are understood as household finances, which are managed by one or more persons living together or having a common budget.

Unlike the finances of economic entities, which are crucial in the creation, primary distribution and use of GDP and income, the finances of the population play a subordinate, but at the same time important role in the overall system of financial relations.

The sources of financial resources of the population are:

• o own funds earned by family members - wages, income from subsidiary farming, profit from business activities, dividends, interest;
• o funds received in the form of a loan from credit institutions.

In the composition of the population's cash income, a prominent place is occupied by

state social payments - pensions, benefits, scholarships.

In order to regulate wages and social protection of the population, in June 2000, Federal Law No. 82-FZ “On the Minimum Wage” was adopted, according to which, from June 1, 2011, the minimum wage (minimum wage) is 4,611 rubles . per month. The minimum wage is established simultaneously throughout the entire territory of the Russian Federation and cannot be lower than the subsistence level of the working population.

In accordance with the Federal Law of October 24, 1997 No. 134-Φ3 “On the subsistence minimum in the Russian Federation,” the subsistence minimum is the valuation of the consumer basket, as well as mandatory payments and fees. The consumer basket is a minimum set of food products, non-food products and services necessary to maintain human health and ensure his life.

The cost of living per capita and for the main socio-demographic groups of the population is determined quarterly on the basis of the consumer basket and data from the federal executive body for statistics on the level of consumer prices for food, non-food goods and services and expenses for mandatory payments and fees. In the fourth quarter of 2011, the cost of living for the working population was 6,710 rubles. per month, for pensioners and children - 4902 rubles. and 5993 rub. respectively. Additionally, we note that the cost of the minimum set of food products in the consumer basket in the fourth quarter of 2011 amounted to 2,263 rubles. per month.

In accordance with current legislation, if the average per capita income of a family is less than the subsistence level established in a specific constituent entity of the Russian Federation, such a family is considered low-income and has the right to receive state social assistance in the manner established by Federal Law No. 178-FZ of July 17, 1999 " On state social assistance."

The indicator of poverty in economic literature is the proportion of the population with incomes below the subsistence level. According to Rosstat, in 2011 the number of people in Russia with monetary incomes below the subsistence level was 18.1 million people, i.e. about 13% of the country's total population.

Expenditures of the population play a major role in the country's economy. Using their cash income, the population thereby ensures the formation and functioning of the market for goods and services, and the savings and cash accumulations of the population are essentially the country's investment resources. In Russia in 2011, in the structure of the use of cash income of the population, about 74% is for the purchase of goods and payment for services, a little more than 10% is for the payment of mandatory payments and contributions, and 10.3% is savings.

The monetary income of the population of our country in 2011 amounted to 35,192.6 billion rubles, of their total amount, the share of wages, including hidden wages, accounted for 67.1%, social payments - 18.2%, the share of income from entrepreneurial activities activities and from property - 9.1 and 3.6%, respectively. The presented indicators reflect the high degree of dependence of the population’s finances on the state of finances of organizations and the state and the low degree of entrepreneurial activity of the population.

The financial system is a set of financial relations between all subjects of the reproduction process, ordered in a certain way. Despite the fact that each element of the financial system has relative independence and carries out a certain set of specific functions inherent exclusively to it, all elements are in close interaction both with each other and with other systems. All components of the financial system are usually identified taking into account a number of criteria. Based on these criteria, 2 basic blocks are distinguished, each of which has its own complex internal structure (Fig. 1).

Each link of this system is distinguished by special methods of forming and using funds of funds, and also plays a different role in social reproduction.

Centralized finance is a specific instrument through which the national economy as a whole is regulated. This type of finance mobilizes resources into the budget system, and also with its help, finance is distributed between sectors of the national economy and certain economic regions.

Figure 1. Links of the financial system of the Russian Federation

Decentralized finance is intended to regulate economic as well as social relations within individual economic entities. This type forms the basis of finance. Household (population) finance is personal finance or, in other words, financial relations that arise between individuals who run a common household. A household should be distinguished from a family. Their main difference is that a household can include, in addition to relatives, people who fully or partially contribute their share to the household budget.

The first block of the financial system is centralized income, which includes certain economic elements.

The state budget is the main link of the entire financial system. The budget is usually divided into two interrelated groups of items: revenue and expenditure. The revenue side of the budget displays the sources of funds and their quantitative parameters. The expenditure part contains information about the directions and areas in which money is spent, and their quantitative parameters. The main source of formation of the state budget is taxes levied on individuals and legal entities. The government also has the right to raise additional budget revenues through the sale of bonds, certain treasury bills, and other types of tradable securities in formal financial markets.

Extra-budgetary funds are funds of the Government of the Russian Federation, as well as local authorities, which are associated with the financing of expenses not included in the state budget. The creation of such funds is associated with the need to have a certain amount of income that would not depend on items of the state budget.

In the Russian Federation there are currently about 32 extra-budgetary funds with a social and economic focus.

State credit is identified as an independent link in public finance, since it has forms of financial-credit relations that are not characteristic of other links. State credit is considered as a special form of monetary relations that arises between the state, individuals and legal entities.

Property and personal insurance funds are intended to compensate for damage that may be caused to enterprises or the population as a result of natural disasters, as well as to pay the insured person financial support upon the occurrence of a certain insured event. Insurance funds usually act as large reserves of certain investment stocks and play a vital economic and financial function.

One of the most dynamically developing parts of the financial system is the stock market, where capital circulation occurs. The stock market is a kind of platform that ensures the movement of capital into those sectors in which the level of income is the highest. The main benchmark for stock market participants is a higher level of income compared to investing money in a bank.

The second block of the financial system consists of decentralized finance, and primarily the finance of commercial enterprises and organizations.

Enterprise finance represents a certain type of economic relations that arise during the formation, distribution, and direct use of a decentralized type of income.

The third block of the financial system consists of household finance, namely economic relations that arise during the real circulation of money in the household sector. Household finances are a kind of material basis for their lives.

This type of finance is associated with estimated income, as well as expenses, within a separate economic unit of society.

Although there is a distinction between independent links in accordance with the special methods and forms used for the formation and use of monetary funds in each of them, the financial system is unified, due to the fact that it is based on an absolutely single source of resources for all links of the system, without exception.

Bibliography:

1. Berlin S.I. Theory of finance. Textbook / Berlin S.I. - M.: Prior, 2017.
2. Dadashev A.Z. Financial system of Russia / Dadashev A.Z., Chernik D.G. - M.: INFRA-M, 2015.
3. Koroleva A.V., Chubarova E.A., Stepnova O.V. The concept and essence of financial innovation // Questions of economic sciences. 2017. No. 4 (86). pp. 43-46.
4. Ruleva V.G., Stepnova O.V. The national economy of Russia: its current state and competitiveness // In the collection: The role of science in the development of society Collection of articles of the International Scientific and Practical Conference. 2015. pp. 239-241.

Financial system (FS)- a set of economic entities, the leading of which is the state, and which binds their relations regarding the formation and use of financial resources.

Financial system– is a set of different spheres of financial relations, in the process of which various funds of money are formed and used.

Financial system of the Russian Federation includes:

1. The state budget system, consisting of the federal budget, budgets of the constituent entities of the Federation and local government budgets;

2. Off-budget special funds;

3. State and bank credit (all of the above institutions are classified as
centralized finance, which is used to regulate the economy and social relations at the macro level);

4. Insurance funds (property and personal);

5. Finance of economic entities and industries related to decentralized finance, which are used to regulate and stimulate the economy and social relations at the micro level.
The system of financial bodies of the Russian Federation is headed by the Ministry of Finance of the Russian Federation, which is the executive body ensuring the implementation of a unified financial, budgetary, tax and currency policy and exercising general management of the organization of finance in the Russian Federation. The functions of financial activities are also performed by government bodies of the Russian Federation and constituent entities of the Russian Federation within the framework of the areas of management assigned to their competence. At the same time, there is a system of bodies specifically created for financial management and control in this area - this is the system of financial and credit bodies (it includes the Ministry of Finance of the Russian Federation and the financial bodies of the constituent entities of the Russian Federation).

The system of credit institutions is headed by the Central Bank of the Russian Federation, which is a government body and exercises state leadership in the field of banking activities. The Accounts Chamber of the Russian Federation is a body of financial control over the timely execution of all articles of the federal budget.

The Federal Treasury controls the implementation of budget policy as a whole. The Ministry of the Russian Federation for Taxes and Duties is part of the system of central government bodies. The customs service is a source of replenishment of the state treasury, and is headed by the State Customs Committee.

Structure of the financial system- this is the totality of its elements and connections between them.

The basis of the economic structure of the Russian Federation is the economic relations arising in it. These relations involve 4 subjects: the state; self-governing region; business entity (i.e. firm, corporation, enterprise, etc.); citizen.

By entering into relationships with each other, these entities participate in commodity-money relations, which leads to the creation of a financial system.

The financial system can be viewed from the perspective of its functions or its institutions. From a functional point of view, the financial system of a state is a set of monetary relations operating in the state. From an institutional point of view, the financial system of a state is a collection of financial institutions (i.e. banks, exchanges, etc.).

§ The financial system of the Russian Federation is a 4-block system of relatively independent components (Fig. 1).

These components include:

§ public finances;

§ territorial finances;

§ finances of business entities;

§ citizens' finances.

Where, are two-way financial ties and financial relations arising from 2 opposite cash flows.

Each component of the financial system performs its specific tasks and serves a specific group of financial relations.

There are two principles for building a financial system:

1. the principle of democratic centralism;

2. the principle of fiscal (budgetary) federalism.

In accordance with the first sign, all blocks and links of the financial system are components of one central state budget or are included in it as components with severely limited rights and competence (total state, command-administrative economy). According to the second principle, various blocks and links in the financial system are not interfered with in their rights and competence. The government with its budget is responsible for national goals and priorities, and local authorities are responsible for housing and communal services, road construction, the domestic sphere, partly education, healthcare, etc. Such financial systems are typical for countries with a market economy and a democratic state structure (the problem of vertical and horizontal inter-budgetary regulation). The state of the financial system is an important indicator of the state of the entire country's economy. FINANCIAL SYSTEM: Finance of enterprises, organizations; Insurance; Public finances.

The financial system is a collection of various funds that manage cash and non-cash financial resources. Funds are at the disposal of the state, business entities, financial institutions and households. In the process of financial activities, the state creates, redistributes and uses funds. State systems have different structures, but have a common feature - the presence of funds of financial resources.

Spheres and links of the financial system

The financial system is formed from several areas or areas of financial relations. Spheres form funds in their own way, use them and play their role in public life.

Let's consider the structure of the financial system of the Russian Federation. Based on the type of monetary relations, the Russian financial system can be divided into the following areas:

• public finances at the federal, regional and local levels
• capital of economic entities, companies of the commercial and non-commercial sector, enterprises from various sectors of the economy
• finances of banking and credit organizations
• stock market capital
• public and private insurance funds
• household finances

Based on the type of funds, two areas of finance can be distinguished:

• centralized - these are budgets, extra-budgetary, credit and insurance funds linked to a specific territory (state or municipal resources)
• decentralized - these are the finances of legal entities and individuals, industry, inter-industry funds (formed from the turnover of non-profit, commercial organizations, manufacturing enterprises and households)

Each sphere (centralized and decentralized) consists of links or constituent elements. For example, the national sphere includes such links as: the federal budget, extra-budgetary funds, state credit, finance of unitary enterprises.

Subjects of the financial system

Relations in the field of finance are distributive in nature. The distribution of value is primarily carried out by the entities. Since subjects play a major role in social production, they serve as the first criterion for classifying relations in the field of finance. In this regard, three large areas are distinguished: financial resources of enterprises, insurance organizations and government finance.

Subjects form trust funds taking into account the role they perform in social production: direct participation, insurance protection or government regulation. The scope of activity directly affects the composition and purpose of trust funds. Each of the above areas contains links that are grouped taking into account the activities of the subject.

The spheres and links are interconnected and together form a single financial system. The units carry out servicing of distribution processes at the intra-farm, intra-industry, inter-industry or inter-territorial level.

Main areas of the financial system

The country's system of monetary relations includes two main areas of finance, which play different roles in public life. Let's consider the features of financial spheres.

Centralized sphere

The centralized financial sphere includes budgets, extra-budgetary, credit and insurance funds that have a territorial reference. Public finance is represented by a 3-tier budget system. State finances are formed from tax, customs and other contributions, income from the placement of state securities, from the sale of government securities, from the sale of state property or from leasing it.

The main role is given to the federal budget, which provides financing for solutions to national problems. The country's GDP and income are redistributed through the federal budget. The budget includes target funds, and extra-budgetary funds are an independent link. Today there are three extra-budgetary fund units in the state:

• social insurance fund
• compulsory medical insurance fund
• Pension Fund

The funds have a specific purpose, are intended to provide social services to the population, and guarantee the constitutional rights of citizens.

Decentralized finance

The decentralized sphere includes the turnover of non-profit, commercial organizations, manufacturing enterprises and households. Finance of corporations and organizations is an important element of the monetary system of the Russian Federation. This is a set of financial relations between entities formed in the process of using income.

Decentralized units perform two main tasks:

• distribution function - distribution of the value of social, national income; in the process of activity, the enterprise receives revenue and reimburses the spent means of production;
• The control function involves monitoring the financial condition of companies, industries and the national economy through analysis of profits and profitability.

The control function is implemented by monitoring cash flows, monitoring compliance with the structure of funds, and regular checks on the use of financial resources. The distribution process is carried out at three main levels: the national level, the level of enterprises, companies and production teams. Decentralized finance serves as an important tool for managing, stimulating and controlling a country's economy.

State sphere of the financial system of the Russian Federation

The central element of the system of monetary relations is public finance. This is the sphere of formation, redistribution, use of state funds, municipal entities that use financial resources to solve public functions and tasks. The state distributes budget revenues among the constituent entities of the Russian Federation, municipal districts, economic sectors, areas of production, and citizens.

A simplified diagram of the structure of the financial system of the Russian Federation is presented in the form of two levels:

• main link (state finances, financial resources of commercial companies, organizations, households)
• auxiliary links (resources of banking, credit companies, insurance organizations and stock market participants)

The financial system of the Russian Federation is presented in the form of an institutional structure that includes three different levels.

Federal level	Municipal level	Level of economic entities
State Duma. Council of the Federation. Ministry of Finance of the Russian Federation (Federal Treasury, Federal Tax Service, Federal Tax Service, Budgetary Supervision and Monitoring Service). Central Bank. Accounts Chamber. Customs Service. Finance and Markets Service. Boards of extra-budgetary funds.	Local commissions on budget and finance. Finance departments. Control apparatus of the Ministry of Finance. Treasury departments. Office of the Central Bank. Regional Federal Tax Service. Counting commissions. City customs.	Financial departments. Finance Directorate. Departments.

Links of the financial and credit system

1. The state budget is a state financial plan equal in strength to legislative acts. It is approved by the Federal Assembly of the Russian Federation, is the country’s main plan for the distribution of financial resources and a tool for influencing spheres of public life. The purpose of the state budget is to maintain the functioning of the state. The budget is formed from revenues from economic entities and other specific payments. Budget expenditures include investments in various activities and financing of the state system.
2. State lending is a system of monetary relations, during which free funds from budgets and the population are mobilized and used on repayment terms.
3. Insurance funds allow compensation for losses arising as a result of force majeure circumstances.
4. The stock market is a unique type of monetary relations formed in the process of buying and selling securities, financial instruments and assets. The stock market allows you to move industry capital with higher returns.

Thus, the public finance system is a wide network of bodies and institutions that carry out government activities in the field of finance. This system is headed by the Ministry of Finance of the Russian Federation, which manages all finances in the country.

Financial system authorities

Financial resources are managed by numerous authorities.

Authority
Administration of the President of the Russian Federation	Signing the budget plan, setting goals, monetary policy objectives, using the right of veto on financial legislation and projects
Parliament of the Russian Federation	Approval of the federal budget, tax rates, fees, payments, financial legislation
Coordinating center	Financial management
Ministry of Finance of the Russian Federation	The Ministry of Finance implements financial policy, organizes and directs the work of executive bodies, develops a federal budget plan, legislative acts to regulate financial relations, etc.
Federal Tax Service and Federal Customs Service	Tax and customs authorities control the accuracy of the calculation, the completeness of the payment of tax, customs duties and other payments
FS on financial markets	Control of participants and subjects of the stock market in order to increase transfers to the budget fund
Bank of Russia	Implements monetary and financial government policies, is responsible for budget execution, controls the work of banks, financial and credit companies, microfinance organizations
Accounts Chamber	Control is necessary over compliance with financial legislation and the movement of financial resources

All public relations formed in the financial sector are controlled by government agencies.

Characteristics of the spheres of the financial system of the Russian Federation

Historically, countries have been divided into two groups based on the type of financial system:

• states where the financial sector is based on banks (Japan, some EU countries)
• countries with a system based on stock markets (USA, UK, Australia, Singapore)

This division is conditional, since both types of systems are gradually moving closer together. The classification of countries into two types allows us to see from what sources the real economic sector is financed: bank loans or securities. To determine the type of financial system, experts rely on 4 factors:

• ownership structure
• level of protection of shareholders' rights
• readiness of the country's citizens to take risks
• the power of government intervention in economic life

It is believed that the less the state intervenes in the economy, the greater the volume of the stock market and the freer the circulation of securities. The participation of government institutions in the distribution of money limits the stock market.

To assess the financial system of the Russian Federation, the following characteristics can be used:

• increased refinancing rate, lending is most accessible to entities from economic sectors with high profitability
• high degree of capital concentration
• financial resources provided by banking companies are used mostly to service short-term transactions
• a large share of barter transactions is a factor that reduces the activity of the financial sector
• deferred demand of citizens in the form of a loan with a negative rate
• there is no strong legislative protection for investments in securities, so only 0.3% of the population is ready to invest in shares

The main problem in the development of the financial resources system of the Russian Federation is that government agencies and large entrepreneurs do not support each other. Without government assistance, business cannot revive the economic and financial system.

There are a number of opportunities for the state in strengthening the credit and financial sector. Citizens' savings can become one of the main sources of financial resources for banks, the stock market and the economy. In this regard, increasing the level of income of the population is an important state task. This will be facilitated by lower income taxes. Experts recommend tax cuts rather than redistribution from citizens to companies in the real economic sector.

Increasing the attractiveness of deposits by increasing the efficiency of state insurance will attract household income to banks. In addition, the regulatory framework needs to be improved: changes to the concept of investor protection, improvement of trading rules on the stock market.

Goals of the financial system and its areas

The main goal of the modern financial system of the Russian Federation is to create conditions under which the production of the national product will be carried out with full employment and low inflation. This is ensuring macroeconomic stability.

To achieve this goal, the Russian financial system must solve the following tasks:

• increasing the efficiency of exchange of goods and services
• creation of capital in an amount corresponding to the economic needs of the economy
• turning needs into real benefits

Principles of functioning of the financial system

The basis for organizing the public finance system is the following principles:

• the principle of unity presupposes the existence of a unified financial policy, legislative and regulatory framework, and a unified methodology for generating reporting for all economic entities
• the principle of balance - is that the valuation of property of economic entities has specific sources of formation
• the principle of target orientation - is that economic and commercial financial entities are focused on making a profit
• the principle of diversifying sources of financing involves investing in various objects and types of property