HOW FINANCIAL ADMINISTRATION IS CRUCIAL FOR ECONOMIC GROWTH

Source: Public Consulting Group

The management of the finance of a state or whether Public authority endowed with taxing and spending power known as Financial administration. Efficiency and economy are two watch words of Public finance. Financial administration desire to raise, spend and account for the funds needs to fulfill the Public expenditure.

It involves the activities of “four agent executive” which needs and spend funds, that grants the funds and infuse them to particular ministries and departments of the Finance Ministry, that hold the strong bond on expenditure and audit; they will decide which fund use in what manner.

Financial administration of Government depicted as two main elements such as budgeting, financial control and fiscal & monetary policies. These elements incorporate a variety of subjects like various types of budget system, parliamentary financial control, delegation of financial powers, tax policies and tax administrative problem.

 Scope of financial Administration

Source : CFO Share

Financial administration increasing it’s magnitude and complexity. It involves the discipline of economics, political science, commerce, management, statistics, philosophy and International Relations.

Fiscal policy, economic policy, fiscal planning, monetary policy , planning and management are parts of financial Administration. Constitutional law, financial administration, economy, socio – economic development are creating relation with Public Administration. To look at Administration of Public financial institutions and Public enterpriser. Budgeting performance and management accounting. Financial accounting and management accounting, financial auditing and management auditing are the wider version of financial Administration.

Financial administration at different levels and their interest relations at federal state and local states. Regulatory financial administration for regulating financial institutions by the private sector. Promote education, training and research in financial Administration. Ensure ethics and integrity of financial administration. Corporate Financial administration experience in developed and developing society. Financial control by the legislature, executives and judiciary.

Significance of financial Administration

Financial administration role is to ensure the economic growth of a country. It is more important for developing countries which increasing it’s socio – economic and infrastructural problems like poverty, unemployment and other economic related issues. Financial administration acquiring importance in the area of financial planning, protecting funds, improves standard of living, Allocation of funds, Economic Growth and stability and taxation planning.

Nature of Financial administration

Source : Unblast.com

Financial administration capture wider spectrum of development. Financial administration based on old and new economic methods that put forward the straight method for improving the economy. Financial administration conceive as a aggregate values of generation, regulation and distribution of monetary resources which is eligible for the sustenance and growth of Public organization.

Some scholars view this as traditional perspective, emphasis upon that set of Administrative functions in a public organization which relate to an arrangement of flow of funds as well as to regulating mechanism and processes which ensure proper and productive utilisation of these funds. The core of pure theory of Public finance us that Public finance should deal with the problem of Public income, Public expenditure and public debt in more practical way without any relation to a set of values and premises of the political party in power. As per to the intellectual of modern age, financial Administration is broad concept, it is an integral part of the overall management process of public administration except only raising Public funds. It discuss three important theories of Public finance i . e the socio political theory by (Wagner Edgeworth and pigou), the functional theory of Keynesian perspective and activiting view of modern Public finance theorists.