COMPREHENSIVE ASSESSMENT OF FINANCIAL SUSTAINABILITY OF LOCAL BUDGETS AS AN INDICATOR OF IMPROVING THE QUALITY OF BUDGET MANAGEMENT DURING DECENTRALIZATION REFORM

Abstract

This article is devoted to the study of the dynamics of evolution of local budgets in the context of the reform of fiscal decentralization in Ukraine. In Ukraine, the local budget is considered through the prism of financial functions, it’s the basis of financial management, planning of the fiscal process and redistribution of public goods. Taking into account the United Kingdom experience in considering the local budget as a financial and forecast (planning) category and the basic principles of decentralization, we have supplemented the list of basic functions of local budgets by two other functions – prognostic and developmental. On the basis of a comprehensive analysis of the financial sustainability of the local budgets of the Khmelnitskyi region, we’ve built integral indicators of financial sustainability of the local budget and predicted their dynamics in the future, which made it possible to determine the directions of effective management of local budgets.