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Developing the budget planning methodology at the stage of result-oriented budgeting formation in Russia

Vol. 21, Iss. 17, MAY 2015

PDF  Article PDF Version

Available online: 9 May 2015

Subject Heading: BUDGET REGULATION

JEL Classification: 

Pages: 20-28

Masterov A.I. Financial University under Government of Russian Federation, Moscow, Russian Federation
andrey-masterov@yandex.ru

Importance Negative trends are typical of the current economic situation of Russia. This causes a real problem to achieve a budgetary equilibrium. The importance of result-oriented approaches in budgetary processes is growing, thus impacting the distribution of the practice to build and execute program-based budgets. However, in Russia the program-based budgeting is only at the initial state of its development. Proper methodological support to budgeting is not available nowadays. Therefore, it is required to create necessary conditions at the State level, especially in terms of methodology.
     Objectives My objectives were to list and describe the key measures that are necessary to develop program-based budgeting; to analyze the current state of analytical support to budgetary planning and identify essential shortcomings; to describe the main characteristics of budget planning methodology and techniques used in foreign countries. Another objective was to demonstrate approaches to the cost-benefit analysis when developing program-based budgets under the cost-benefit method on the case of the marginal analysis principles.
     Methods I used the methods and principles of the systems analysis to show the areas of further improvement of the program-based budgeting in Russia through enhancing the feasibility and efficiency of planning.
     Results I present a list of key initiatives to be implemented at the government level to provide further development of program-based budgeting. I have briefly described the best practices for foreign methodology of budget planning, and listed major techniques for analytical data processing. Based on the marginal analysis principles applied in the context of the cost-benefit method, the paper describes approaches to analyzing costs and benefits during the process of program-based budget formation.
     Conclusions and Relevance I conclude that methodological support to result-oriented budgeting is one of the key conditions of its development in our country, including program classification and the methodology of perspective planning that enables to make reasonable decisions.

Keywords: program-based budget, target-oriented approach, result-oriented budgeting, analytical methods, methodology, base, alternatives, options, program, formation

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