Sekerina Ann

Faculty of Economy

Speciality: Economy of enterprise

Theme of master's work: "Organizationally-economic mechanism of controlling of expenses on an enterprise"

The leader: Popova O. U.

Abstract

Actuality of the research theme. Crisis in Ukrainian economy has touched all its branches, mining industry is not an exception. The function effectiveness of mining enterprises determine work effectiveness of enterprises using coal as main power medium and raw materials. Therefore the most essential target for a particular enterprise nowadays, working in accordance with modern economy system, is the creation of theoretical base and based on it set of instruments, which could help modernize organizational and informational structure of an enterprise in such a way that the basic problems of its development, leading to its stable profits in future, would be solved. This demands the foundation of special expenditure managing department. This instance is called controlling department (service) in foreign practice.

An effective expenses’ controlling may meet a list of problems on an enterprise. First, managers don’t receive the objective information about coal mining expenses due to irrational organization of accountancy system. Second, it is impossible to determine the reasons of change in expenses level due to partially obsolete systematic base of analysis. Third, there is an irrational usage of all the resources as a result of absence of expenses’ controlling. Forth, system of planning, inherited from administrative-command system, doesn’t allow to distribute all kinds of resources optimally, either in time or among responsibility centers. Finally, existing informational technologies aren’t capable to organize coordinate work of mine enterprise’s sub-units due to increase of information amount, which was taken to procedure.

The adoption and development of expenses’ controlling on mine enterprises will allow to reduce the above mentioned problems.

The establishment and later development of these problems determine actuality and novelty of this research.

The degree of scientific studying of the problem. There are researches of expenses’ controlling in scientific literature. Main contribution to the research was made by foreign and state scientists R. Antony, K. Druri, R. Mann, E. Mayer, J. Forster, D. Han, S.A. Stukov, G.S. Trushina, V.A. Chernov, I.L. Shevchenko and many others. Separate questions had been taken to consideration already in the time of planning economy, which nowadays are included into sphere of controlling regulations, e.g. analysis, planning and accountancy of expenses on mine enterprises. Meanwhile the analysis of mine enterprise activity has allowed to make a conclusion, theoretical and systematic questions of mine enterprise’s controlling on the basis of expenses’ controlling remain unsolved before present. The competitiveness of mines depends on effective management of enterprises on the basis of expenses’ controlling in the mining branch, and successful solution of the rising expenses’ problem.

For that reason the goal of Master’s work is elaboration of theoretical and systematic approaches to an enterprise’s controlling on the basis of expenses’ controlling.

For this goal to be reached the following tasks must be fulfilled:

• to examine and determine the essence and contents of notions "expenses" and "controlling";
• to explore this system on example of mine enterprises;
• to value the existing systems of expenses’ controlling on mine enterprises on the basis of controlling system;
• to reveal problems and determine the approaches to introducing the elements of expenses’ controlling;
• to work out the recommendations of analysis method’s improvement by means of expenses’ controlling.

The object of research is mining branch of Ukrainian economy, e.g. mine enterprises.

The subject of research are theoretical and systemic approaches to the mine’s management improvement in the sphere of expenses on the basis of expenses’ controlling.

The methods of system, statistic and economic analysis are assumed for the solution of established goals.

The theoretical and systematic basis for the degree work: specifically-scientific methodology, represented in the works of scientists in the sphere of economic theory, economic analysis, theory of management, price formation, theory of organization, the economy of enterprise, the organization of innovation processes, organization of investment processes etc.; fundamental methodology, basing on the following principals: principal of dialectics – reflects interconditionality and paradox in the development of events, principal of determinism, composed in objectively-reasonable conditionality of events, principal of isomorphism, composed in defining the relations between objects that reflect the equality of their construction; general scientific methodology, consisting of the principal of historical method, terminological, system, cognitive and modeling principals.

Practical role of the achieved results lies in the fact that the achieved results of the research allow to:

• measure the factor of expenses’ change by means of the introduced improved system of coal extraction expenses’ analysis in the atmosphere of market economy;
• optimize and make easier the analytical work for the purpose of adoption the efficient management decisions and making exact forecasts of expenses’ change in future.

Master’s work consists of introduction, three chapters, ending, source list and supplement.

The introductory part reveals common characteristics of the research, including the substantiation of research theme’s actuality, formulation of goals and tasks of the research, definition of object and subject, revealing the scientific novelty and practical value of research, also the results of approbation and introduction of key ideas of the theme.

The essence and kinds of expenses, conception of management are revealed in the first chapter, e.g. "Theoretical basis of expenses’ controlling". Expenses’ management is the process of expenses’ regulation, finding the ways of their reducing or optimizing the sum of expenses and their structure. The subject of expenses’ controlling is the management of an enterprise. The object is represented by current expenses, needed for production and realization of products.

The controlling represents a subsystem in a results’ managing system of enterprises’ activity, standing on higher and more qualified level than those existing on an enterprise nowadays. The above mentioned system of result’s management of enterprise’s activity is subdivided into to subsystems: subsystem of controlling and subsystem of reverse connection. Subsystem of controlling is formed by the following management functions: analysis, planning, management accountancy and control. Subsystem of reverse connection is formed by functions: adoption of the decisions and organization. Management system, based on controlling, presupposes management of managing functions themselves in a definite period of time, which raises stability of management system’s functioning and creates the ability for self-control due to superstructure on the function of management of managing contours. Major task of controlling is management of income, that’s why its attention is focused on expenses, their kinds, places of emergence and principals of management.

The second chapter "Methodology of expenses’ controlling" is devoted to the introduction of expenses’ controlling on an enterprise, the factors of raising the effectiveness of economic activity, due to introduction of expenses’ controlling system, are valued.

The introduction of controlling system on an enterprise is made in three ways:

• preparatory stage (studying the current state of an enterprise, express-analysis);
• controlling introductory stage;
• automation stage (if needed).

Meanwhile, the second stage represents the following for branches:

• changes in management system;
• changes in organizational structure;
• informational torrent in the system of an enterprise;
• staff and occurring problems.

The third chapter "Recommendations of improvement of expense’s controlling mechanism" includes consideration of peculiarities of controlling system introduction on an enterprise and recommendations’ development on expenses’ controlling mechanism improvement.

The ending summarizes main results of work, systematizes conclusions and substantiates the degree of task and goal realization.

The introduction of controlling system is a complex process, including informational, technical, organizational, staff and other measures. Realization of organizational measures presupposes forming accountancy centers on an enterprise, determination of basic principals of accountancy politics, working out the account plan of management accountancy, description of technology of economical operations’ accountancy and many other actions. To realize these measures successfully one needs strictly organized algorithm of actions.