Formation of the financial structure of the enterprise. Financial structure Principles of management of the Central Federal District

September 29, 2014

Formation of the financial structure of an enterprise is the most important stage of the entire process of establishing budget management. A transparent financial structure of a company is the basis not only for building the budgeting unit itself, but also for creating a general management accounting system. What are the basic principles of its construction?

We will look at what types of financial structures are most often used when developing budget management systems for modern business companies. In addition, we will be interested in how the process of forming the financial structure of an enterprise can be helped by the use of the application software solution “AstroSoft: Budgeting”. Before this, however, it is necessary to explain how the organizational and financial management structures of companies are related to each other in modern business realities.

When forming the financial system of an enterprise, the organizational structure can be its basis, but practice shows that they often do not coincide. The reasons for these differences lie mainly in the following:

  • The organizational and financial structure have different sources of formation. If the development of the first of them is based on the functional specialization of divisions, then in the second case, such a basis is the financial and economic relationships between the central federal districts that are part of the company;
  • The organizational structure shows the hierarchy of managerial subordination, while the financial structure reflects the structure of responsibility for the implementation of certain economic indicators;
  • A noticeable influence on these differences is often exerted by the various “political” and personal aspirations of division managers, as well as the peculiarities and specifics of the business of the budgeted company.

It is believed that the financial and organizational structures of an enterprise should not differ radically from each other. If this is so, then this fact may be the reason for the poor controllability of the budgeted company. Maximum compliance of one structure with another will help to avoid this.

As a rule, when building an organizational management structure, companies use a linear-functional approach. It involves the allocation of divisions in accordance with the functions that they perform (for example, a retail store, a wholesale sales department, accounting, etc.). Much less common are companies that implement a different approach - a matrix one. This is explained, first of all, by the fact that matrix structures are noticeably more difficult to implement and manage. The difficulties are caused by the need to introduce “double subordination” in the divisions of such an organization, and this requires a high level of training and managerial qualifications of its managers.

Thus, in modern business practice there are two types of financial structures:

  • Linear-functional
  • Matrix.

Let's look at how they are implemented.

Linear-functional structure

When forming the financial structure of an enterprise according to a linear-functional principle, the so-called Financial Responsibility Centers (FRC). This stage includes a detailed description of the functions of the budgeted units, from which, after analysis, it will be possible to obtain the composition of budget items for each of the allocated central federal districts. In addition, from the analysis of the division’s functionality, it will become clear what type of central financial district it should be classified as.

The following types of central financial institutions are distinguished:

  • Cost Center (CZ). This is a division that is responsible for performing certain functions, and the head of which is responsible for the expenses of this central budget in accordance with the approved cost budget. For example, accounting service, legal department, administrative office, warehouse, etc. The head of the Cost Center must ensure the implementation of its functionality without exceeding the approved budget;
  • Income Center (RC). As a rule, selling divisions are identified as CDs, whose managers are responsible for the amount of revenue of a given central financial district. In addition, they may be responsible for the expenses of a given Revenue Center within the approved budget;
  • Profit Center (CP). Units whose managers are vested with the authority to make decisions that affect the profit of a given central financial district are identified as CPUs. In other words, these are the divisions that generate the company's profit. For example, stand-alone stores or remote branches of the main enterprise;
  • Marginal Profit Center (CPC). An example of such a central financial department is a division that is responsible for sales of its product line. For example, the sales department of licensed software of a computer company. Such types of central financial institutions can be identified in those structures where a certain product group or sales region is considered as a budgeting object;
  • Investment Center (CI). Such a central financial institution is identified when the area of ​​responsibility of its manager lies in the efficiency of the company’s investments.

When forming the financial structure of an enterprise, the following should be taken into account: the manager of the central financial district may be responsible for the implementation of only those financial indicators that he has the authority to influence. For example, it would be incorrect to consider a supermarket as a profit center if its managers do not have the power to influence the level of purchase prices of the goods sold. This condition is completely obvious at first glance, but in practice it is often misunderstood.

The complex hierarchy of divisions that are part of linear-functional organizational structures, as well as the variety of tasks facing them, leads to the need to form a multi-level financial structure of a budgeted enterprise.

Experts working in the field of budget management recommend that when forming the financial structure of an enterprise, the following levels of the hierarchy of the Central Federal District are distinguished:

  • Zero level– the company (holding) as a whole. As a rule, this Central Federal District is considered the center of investment. The General Director, whose responsibilities include managing the entire structure, is responsible for the effectiveness of its investments;
  • First level– separate enterprises as part of a budgeted holding. As a rule, these are profit centers. Their managers are responsible for maximizing the financial results of this CFD;
  • Second level– divisions within the first level Central Federal District (separate enterprises). Typically, these are cost centers whose managers are responsible for performing the functions entrusted to them and adhering to the approved cost budget.

An example of a financial structure based on the linear-functional principle is presented below.

Fig 1. An example of the formation of the financial structure of an enterprise according to the linear-functional principle

In this example, the company as a whole is a zero-level financial center. In the structure under consideration, it is considered a profit center and a cost center. At the same time, the administrative and managerial apparatus of the company, which itself is a cost center (CC), may include a division whose main functionality is the calculation and assessment of the economic efficiency of the company’s investments. If this division is created, it will be another first-level central office within the entire presented structure.

Table 1. Composition of the central financial district of the company from our example

CFO hierarchy level CFD briefly Structure object
Zero level CFD CI, CPU Company as a whole
First level central financial district Central lock
  • Administrative and managerial apparatus
  • Legal service
  • Human Resource department
First level central financial district CD Wholesale sales department
First level central financial district CPU Regional office A, B
Second-level central financial district CD Store A, B
Second-level central financial district Central lock Advertising department A, B
Second-level central financial district Central lock Warehouse complex A, B
Second-level central financial district Central lock Accounting service A, B

Matrix approach

When forming the financial structure of an enterprise based on a matrix approach, in addition to the Central Federal District, the so-called FCOs are functional centers of responsibility. They are responsible for the “end-to-end” management of certain functions of the budgeted structure. For example, a personnel directorate, the functionality of which may be (including) monitoring the compliance of the level of remuneration of workers with the amount of salaries that has developed today in the labor market of a given region. Or a product manager of his product line, who is responsible for the amount of marginal profit for a given product group, obtained as a result of the work of all selling divisions of the company.

In such cases, it is customary to rank FCOs in accordance with the level of responsibility assigned to them:

  • FCO with full responsibility. Such units have powers sufficient for regular planning, management, coordination and control of the activities of budgeted units according to the list of parameters reporting to this FCO. They coordinate the preparation of the respective budgets by the Central Federal District and monitor their implementation;
  • FCO with partial liability. Such units have the authority to set standards and monitor their implementation only for a certain part of the budgeted indicators. For example, a product manager in his work can set retail sales prices (what is on the price tag), but does not have the authority to prohibit the sale of products from his group at a discount;
  • FCO monitoring. Such departments only have the ability to monitor the business process of fulfilling the budgeted parameter. If they do not agree with the work of the CFO in this area, they can appeal to senior management with a corresponding request. This level seems to be the initial one, from which a given unit and its manager can begin their advancement to hierarchically more significant positions in the company.

Below we will look at an example that will illustrate the formation of the financial structure of an enterprise in accordance with the matrix approach described above. In addition, we will show how using AstroSoft: Budgeting can make this process easier.

Let’s say that a trading company with an extensive network of regional branches operates in the Russian furniture market. In this example, it does not matter of fundamental importance where exactly its central office is located - it could be St. Petersburg, Moscow or any other Russian city. The Mebel company, in addition to the sales division in St. Petersburg (DP SPb), has two regional branches - sales departments for the Moscow and southern regions (DPM and DPYUR, respectively). The company structure has divisions that are responsible for full legal and accounting support of all sales departments. There is a HR Directorate, whose area of ​​responsibility includes coordinating the actions of regional HR managers (on site), as well as monitoring the size of the payroll of all divisions of the company.

Product managers of the company's two main product lines - "Bedroom Sets" (SG) and "Living Rooms" (GK) - set and control retail sales prices for the products of their group for all the company's stores. They do not determine wholesale prices, but only conduct periodic monitoring of offers in each of the regional sales markets and make recommendations on their level.

In accordance with the principles of constructing a matrix financial structure, which were discussed above, its detailed graphical representation can be given:

Fig 2. An example of the formation of the financial structure of an enterprise according to the matrix principle

If a company uses the “AstroSoft: Budgeting” program to automate budget management, then to form the presented financial structure, the manager responsible for this must refer to the “Organizations” and “CFD” directories. The financial structure of the enterprise in the program is represented by the triad “Group – Organization – Central Federal District”, where the Group is the highest level of the hierarchy, and the Central Federal District is the lowest.

Fig.3. Application software solution “AstroSoft: budgeting”, Element of the directory “Organizations”

In our example, information about legal entities corresponding to the regional departments of the company (DP St. Petersburg, DP Moscow, DP Southern Region and Management Company) is entered into the “Organizations” directory. Their totality forms the highest level in the hierarchy of the financial structure being formed. Then you need to enter into the system information about the Central Federal District for each of the organizations included in the structure:

Fig.4. Application software solution "AstroSoft: Budgeting", Directory "Organizations" and Directory "CFD"

The functional centers of responsibility (FRC) of the matrix structure under consideration (Product Managers of the SG, GC, Legal and Accounting Services and the HR Directorate) are entered into the system as part of the “Management Company” organization. In the process of further work on each of them, corresponding budgets will be formed, which, after coordination and approval, will become the key budget documents of the company.

After setting up the directories “Organizations” and “CFD”, the formation of the financial structure of the enterprise, as well as its reflection in the information system under consideration, can be considered complete. Subsequent actions related to the formation of the main budget forms (BDR, BDDS, BBL and operating budgets) for each of the organizations will be discussed in further publications.

A well-organized and understandable financial structure is the basis for the competent implementation of budget management in any enterprise. Regardless of the type of activity, it makes it possible to build a reliable and transparent business management system. A system that will allow company managers to more accurately predict and plan both the current work of its divisions and the possible economic difficulties that they may encounter in the near future. A budget management system, which is based on the competent formation of the financial structure of an enterprise, will help it not only avoid these difficulties, but also reach another, qualitatively new level of its development.

Material prepared

Kalinchenko Pavel

Business Analyst, ACS Department, AstroSoft Company

Plenipotentiary Representative of the President of the Russian Federation in the Central Federal District. Previously, he served as assistant to the President of the Russian Federation. The post of plenipotentiary representative of the head of state in the Central Federal District has remained vacant since May 18, 2018: Alexey Gordeev, who had headed the representative office since 2017, was appointed Deputy Prime Minister of the Russian Federation.

Igor Olegovich Shchegolev was born on November 10, 1965 in the city of Vinnitsa, Ukrainian SSR (now Ukraine).

In 1988, he graduated from the translation department of the Moscow State Institute of Foreign Languages ​​named after M. Thorez (now the Moscow State Linguistic University) and the department of German studies from the Karl Marx University of Leipzig (GDR).

In 1988, he joined the Telegraph Agency of the Soviet Union (TASS) as editor of the Main Editorial Office of Foreign Information. Since 1991, he worked as an editor and then as a senior editor of the United Editorial Office of European Countries of the Information Telegraph Agency of Russia (ITAR-TASS).

From 1993 to 1997 - own correspondent for ITAR-TASS in Paris.

In 1997, he headed the editorial office for European countries at ITAR-TASS, then became deputy head of the news agency's news service.

In June 1998, he was appointed Deputy Head of the Government Information Department of the Government of the Russian Federation. In September of the same year, he became press secretary of Russian Prime Minister Yevgeny Primakov.

From October 23, 1998 to May 22, 1999, he headed the Government Information Department of the Government of the Russian Federation (the office was headed by Evgeny Primakov).

In 1999-2000 - advisor to the Prime Minister of the Russian Federation Sergei Stepashin, then from August 1999 - to Vladimir Putin.

In 2000, he moved to work in the Administration of the President of the Russian Federation, where from January 4 he headed the Office of the Press Service of the Head of State.

From December 29, 2001 to May 12, 2008 - Head of the Protocol of Russian President Vladimir Putin (replacing Vladimir Rakhmanin in this post).

From May 12, 2008 to May 21, 2012, he served as Minister of Communications and Mass Communications of the Russian Federation in the government of Vladimir Putin. Replaced Leonid Reiman in this post.

On May 21, 2012, he returned to work in the Administration of the President of the Russian Federation as an assistant to the President of the Russian Federation Vladimir Putin. Supervised information technology issues.

Member of the board of directors of OJSC Svyazinvest (2010-2011).

The total amount of declared annual income for 2017 was 7 million 103 thousand rubles, spouses - 93 thousand rubles.

Active State Councilor of the Russian Federation, 1st class (2000).

Speaks English, German and French.

Married. His wife, Rimma Shchegoleva, a teacher of German, was an associate professor at the German language department of the All-Russian Academy of Foreign Trade under the Ministry of Economic Development of the Russian Federation. Son - Svyatoslav Shchegolev, producer of the RT television company.

The main task of construction financial structure- this is the distribution of responsibilities and powers between managers for managing income, expenses, assets, liabilities and capital of the company. The financial structure is the basis for the implementation of management accounting, budgeting, as well as an effective system for motivating company personnel.

Financial structure is a set of financial responsibility centers (FRC).

Center for Financial Responsibility (FRC)- this is an element of the financial structure of a company that carries out business operations in accordance with its budget and has the necessary resources and powers for this.

Financial and organizational structures are closely related, but may not be the same. Each budget period begins with updating the financial structure in order to correctly distribute powers and responsibilities. Often a change in financial structure leads to changes in the organizational structure.

How to build a financial structure?

1. Describe the business processes and functions of the departments: sales, procurement, logistics, production, accounting, human resources, etc. to determine items of income and expenses that may be affected by certain divisions;

2. Classify financial responsibility centers depending on the powers and responsibilities of the heads of the Central Federal District;

3. Determine the hierarchy of responsibility centers and their relationships.

Hierarchy of responsibility centers in the financial structure

As a rule, the financial structure has several levels of subordination.

The first level CFO is the holding as a whole. This is usually an investment center, the management of which is the responsibility of the CEO of the management company.

The second-level central financial district is an independent enterprise within a holding company. Typically these are profit centers (eg branches).

Third-level central financial departments are divisions of enterprises included in the holding (for example, sales department, purchasing department, finance department).

The fourth-level financial departments are departments of divisions of enterprises included in the holding (for example, accounting and financial departments in the financial department).

Heads of the Central Federal District are responsible for the implementation of assigned tasks and must have the necessary powers and resources for this. Depending on the powers and responsibilities of managers, a structural unit can be a cost center, an income center, a profit center, or an investment center.

Types of financial responsibility centers:

Cost center- this is a department whose head is responsible for fulfilling assigned tasks within the allocated cost budget (for example, human resources, accounting, administration).

Revenue Center- a division whose head, within the allocated cost budget, is responsible for the amount of income.

Profit Center- a division whose head is responsible for profit and has the authority to both reduce costs and increase revenues.

Investment Center- a division whose head has the authority of the head of the profit center, and is also responsible for the level and efficiency of investments.

The head of the Central Federal District is responsible for:

  • timeliness of formation of plans and budgets of the Central Federal District;
  • validity of plans and budgets of the Central Federal District;
  • achieving benchmark performance indicators for the Central Federal District;
  • justification for the expenditure of resources arising in the course of the activities of the Central Federal District;
  • maintaining management accounting within the Central Federal District and generating reports;
  • quality (reliability and unambiguity) of planned and reporting information of the Central Federal District.

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As part of the budgeting system, various types of financial responsibility centers (FRC) are being introduced: CD, TsZ, TsMD, TsP, CI. In relation to various types of financial financial institutions, the Company's management applies various principles of financial management, taking into account the specifics of these types of financial institutions.

Principles of management of the Central Federal District

Basic principles of financial management applicable to different financial districts:

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  1. CZ (cost center) – optimization of the costs it produces. The management and personnel of the central plant are motivated to minimize costs and save budgets.
  2. CD (income center) – maximizing the income it generates. The management and staff of the CD are motivated to maximize income. At the same time, the CD also has its own costs associated with generating income.
  3. MCI (marginal income center) – maximizing the marginal income it generates (the difference between the center’s income and its direct costs). At the same time, CMD also has its own costs associated with obtaining marginal income.
  4. CPU (profit center) – maximizing profits from the activities of the CPU. The management and personnel of the CPU are motivated to achieve specified profitability/loss ratios. The emphasis of the Company's management is shifting from operational control of the activities of the CPU, its expenses and income to control of the financial results of the CPU. CPUs are not completely independent, because The Company's management may impose restrictions on their activities.

The status of the Central Federal District is assigned to each direction owned by the Company. The structure of the Central Federal District of the Company has different levels that are in a relationship of subordination to each other. Thus, third-level central financial districts are aggregated into second-level central federal districts, which, in turn, are aggregated into first-level central federal districts.

Responsibility of the heads of the Central Federal District

  1. Heads of the Central Federal District in the budgeting process are responsible for: the accuracy and timeliness of providing planning and reporting information to the economic department (ED); for the implementation of budgets, fulfillment of the imputed performance indicators of the Central Federal District.
  2. Heads of the Central Federal District in the budgeting process are obliged to: seek and offer opportunities for using internal production reserves, saving the expenditure side of budgets, and increasing the revenue side of budgets.
  3. Heads of the Central Federal District in the budgeting process have the right to: put forward proposals for improving the budgeting process, receive information from the heads of other Central Federal Districts and the Financial Director for drawing up budgets.
  4. The heads of the Central Federal District present and defend budgets before the Chairman of the Budget Committee.

Mislavsky A.V. Head of the accounting systems design department of the management technologies and accounting systems design department of AKG RBS CJSC
Double entry No. 10 - 10/04/2005

Formation of the financial structure of an enterprise, namely the identification of financial responsibility centers (FRCs), is the first step towards creating a budgeting system. Each division of the company contributes to the final financial result of the company (in the form of raising income or making expenses) and must be responsible for its actions: plan, report on results. It is on the delegation of responsibility that the budgeting process is built.

The advantages of the transition to management in the Central Federal District are obvious. By dividing responsibility between departments, we determine who is actually responsible for what in the enterprise, we get the opportunity to evaluate the results and quickly coordinate the actions of departments, create a competent system of motivating employees to complete assigned tasks. The attention of the head of the department is concentrated on the performance indicators of the center entrusted to him, the efficiency and validity of making management decisions increases. Senior management, on the contrary, frees up time to complete strategic tasks.

There are different centers

If we proceed from the understanding of budgeting as a management technology, and budgets as a management tool, the enterprise in this case will be an object of management.

A commercial enterprise as an object of management in its simplest form can be considered as a combination of current activities (creation and sale of products, works or services) and investment ones. Current activities involve expenses (purchase of raw materials or finished products, production, sales costs) and income (revenue) from the sale of products, work or services. The difference between current income and expenses is defined as the profit (or loss) from current activities.

Responsibility for income in a commercial company, as a rule, rests with the sales division (sales department or trading house). Costs are borne by all departments, but to a greater extent by the supply (purchasing) department, production departments, and warehouses. Profit in most cases is determined for the entire enterprise, and decisions on its use are made by the company's management.

Thus, the activity of an enterprise as a management object can be divided into separate processes: procurement, production, sales, investment. Accordingly, the structural units that manage these processes can be considered as centers of responsibility for their implementation.

Based on the above functions, we will define four main (1) types of responsibility centers:

  • revenue center;
  • cost center;
  • profit center;
  • investment center

In practice, there are many more types of responsibility centers (for example, marginal income centers, responsible for marginal profit, or venture centers, responsible for the company's innovative activities).

Let's look at the main types of central financial institutions in more detail.

Revenue center is a structural unit responsible for the sales activities of the company. Its effectiveness is determined by maximizing the company's income within the resources allocated for these purposes. The question may arise: isn’t the division responsible for sales the center of costs for selling products (promotions, salaries of sales managers, etc.)? Of course, it is possible to define the sales division as a cost center, but taking into account their insignificant share in comparison with the amount of income (which is the income of the entire enterprise), we will still refer to it as an income center. The budget management tools for this type of central financial district are the Sales Budget and the Sales Cost Estimate (the purpose, structure of these documents and the procedure for working with them will be discussed in the following publications).

A cost center is a structural unit responsible for performing a certain amount of work (production task) within the framework of the resources allocated for these purposes. As a rule, most divisions of the company belong to this type of central financial district. First of all, production (workshops of main and auxiliary production, service departments). At the same time, the cost center may also have income (for example, revenue from the sale of external services by a transport division), but if their value is insignificant, and the provision of these services is not the main business of the company, the Central Federal District is defined as a cost center. The budget management tools for this type of central financial district are the Production Budget (production program) and the Cost Budget (or Cost Estimate). Purchasing centers and administrative cost centers can be distinguished as a type of cost centers.

  • A purchasing center is a type of cost center; it is responsible for the timely and full supply of the enterprise with the necessary material resources within the limits allocated for these purposes. Such responsibility centers include, for example, purchasing departments. The budget management tools for this type of central financial district are the Procurement Budget (may include transportation costs) and the Cost Estimate.
  • A management cost center is a type of cost center; it is responsible for the quality performance of management functions. This type includes the company's management apparatus, in most cases without dividing it into structural components (directorates, departments). The budgetary management tool for this type of central federal district is the Estimate of Management Costs.

A profit center is a structural unit (or the company as a whole) responsible for the financial result of current activities. In most cases, company management is responsible for current profit (or loss). In some cases, a company may have profit centers responsible for the financial results of a particular type of activity. The profit center may contain income centers and cost centers that are lower in the hierarchy. The budget management tool for this type of central financial district (not counting the Budgets of sales, purchases, costs) is the Budget of Income and Expenses (BDR).

Investment center is a structural unit (or the company as a whole) responsible for the effectiveness of investment activities. A traditional misconception is to define the investment center as the unit involved in planning and controlling investment activities (for example, investment management). The fact is that the final investment decisions are made by the company's management and bear full responsibility for them. The budget management tool for this type of central financial district is the Investment Budget, as well as the Forecast Balance Sheet (or Budget on the Balance Sheet). On an enterprise-wide scale, as a rule, the investment center coincides with the profit center and, in this case, the responsibility center is defined as the profit and investment center.

Thus, the type of financial reporting center determines the rights and responsibilities of a structural unit for the financial indicators assigned to it, which are an integral part of the financial result of the company as a whole.

A set of interconnected and subordinate centers of responsibility represents the financial structure of the company, which is based on the organizational and functional structure, but does not always coincide with it. Several divisions of a company can be defined as one central financial district (for example, management services can be defined as a cost center headed by the head of the company), at the same time, several central financial districts can be allocated within one structural unit (for example, within a trading house a wholesale trade income center and a foreign economic activity income center can be distinguished separately). When identifying a center of financial responsibility, it is necessary to take into account the possibility of clearly defining the list of products, works or services provided to external clients or internal structural units. The center of financial responsibility is characterized by financial independence, that is, its head must be able to determine and manage the financial result of the Central Federal District. The activities of the responsibility center are planned and controlled through a system of key indicators.

"Key" retreat

The purpose of this article is not a full description of the system of key performance indicators of the Central Federal District, so we will only briefly define them.

The key indicators for the income center are sales volumes, cash receipts, the state of accounts receivable, the volume of costs associated with the sale of products, for own maintenance, etc.

The key indicators of the cost center are the volume of work performed (production tasks), quality indicators for production, the amount and structure of costs for production and its cost, indicators of the efficiency of using means of production and labor resources, etc.

The activity of the profit center is assessed by all of the above indicators, as well as by indicators of financial and economic efficiency of current activities: profitability, working capital structure, return on assets, etc.

In addition to those indicated, indicators of the profit and investment center include indicators of the effectiveness of investment activities (payback period, ROI) and the financial condition of the enterprise as a whole (such as coefficients of financial independence and sustainability, etc.).

The system of key performance indicators of the Central Federal District serves as the basis for building a budget model. Some of them can be directly included in budget forms (for example, a revenue target), some are not directly related to budget indicators (for example, profitability). When using top-down budgeting, performance indicators also serve as the basis for the formation of budget targets. In any case, when determining key performance indicators, it must be taken into account that they must have a numerical value, be unambiguous and be contained in accounting systems.

Step by step

Returning to the topic of financial responsibility centers, we will determine the main stages of the formation of a financial structure.

First, it is necessary to determine the investment center, that is, the division responsible for the efficient use of profits received as part of current activities. In practice, in most cases, the enterprise itself as a whole is designated as the investment center, since only its management determines the investment policy, structure and amount of fixed assets and controls the financial condition of the company as a whole. Responsibility for the activities of the enterprise also includes control of current activities, therefore most often this center is defined as a center for profit and investment.

The profit and investment center includes dedicated income centers and cost centers. If there are structural divisions responsible for the financial results of certain types of business (for example, manufacturing enterprises that are part of a holding company, have separate sales markets, their own suppliers, independently determine the pricing policy, but do not make decisions on investing the profit received as a result of current activities), profit centers are formed along with income centers and cost centers. Profit centers can be formed not only on the basis of a separate structural unit, but also as part of several structural units of various divisions of the company, located within the same technological or product chain. Further, within such a profit center, its own subordinate income centers and cost centers are distinguished. The subsequent allocation of centers depends on the complexity of the organizational structure and the need for delegation of authority (for example, cost centers lower in structure can be allocated as part of a cost center). An example of such a structure is shown in Fig. 1.


Rice. 1 Complex subordinate structure of the Central Federal District

Thus, a hierarchy of financial responsibility centers is built, which determines the financial structure of the company. The formed set of responsibility centers and their hierarchy is fixed by an internal regulatory document - “Regulations on the financial structure of the company”, which includes a description of the types of financial financial institutions, their composition and hierarchy, the powers of managers, the procedure for calculating (planning and accounting) financial results of activities based on the use of the system key indicators. This document is developed by the financial director (or a department reporting to him) and approved by the general director (president) of the company. Heads of structural divisions are given the right to make proposals for changes and additions to this document.

To summarize, it can be noted that we have considered only one of several components of budget management technology - management by financial responsibility centers. Other important components are: a system of key performance indicators of the Central Federal District, a budget model (the composition and relationship of indicators of budget forms), budget regulations, methods of plan-fact and factor analysis of budget execution, and others. We will talk about them in detail in the next issues of the magazine.