Finance companies associated with the movement of cash flows. Therefore, this concept is often equated with financial resources or even cash. Of course, not all monetary relations can be attributed to financial ones. This is true only in relation to those monetary relations that are carried out on the principles of irrevocability, nonequivalence and perpetuity, which is possible in the processes of formation, use, distribution of cash income and individual trust funds in the form of financial resources.
The concept and role of finance functions of the finance of the enterprise are closely related.
Enterprise finance is an economic relationship directly related to the circulation of cash flows, the use of income and funds in the production and reproduction process.
The object of finance at the enterprise are all relations of an economic nature, in which money is used and money funds are used. The subjects in these relations are enterprises, auditing organizations, extra-budgetary organizations, banks, insurance institutions, investment funds, other legal entities acting as business entities.
Financial relations include relations associated with the establishment of a statutory fund; the formation of cash income, revenue, profits, other cash funds of the enterprise and their distribution; relations between enterprises and the state on tax and other payments to the budget, and receiving subsidies; relations between enterprises in connection with investment processes, the implementation of shares, the receipt of income, the payment of penalties , etc .; relations of enterprises with banks, insurance organizations for obtaining loans, insurance payments; relations of enterprises regarding the intra-production distribution of income.
Functions of the enterprise finance are manifested through their essence in the process of reproduction. The main functions of the finance of an enterprise are: the formation of resources during production and economic activity; use and distribution of financial resources in the course of ensuring production, operational, and investment activities to ensure financial obligations arising to the budget and other business entities, banks; control over the use and formation of resources in production processes.
The functions of the finance of an enterprise manifest their internal properties during virtually all processes of an economic nature that take place in the life of the enterprise, because they are all mediated by the movement of financial resources in one direction or another.
Functions of the enterprise finance most fully reveal their essence. Most experts believe that finances are primarily characterized by two primary functions: distribution and control . These two functions interact with each other. With the help of distribution, the initial capital is formed, the gross domestic product is distributed, the cost proportions are determined in the distribution of income, the best combination of the interests of producers, the state and the enterprises themselves is ensured.
In general, finance is based on the distribution relations necessary to finance production processes. Violation of the uninterrupted turnover of funds, increased costs can lead to lower revenues, competitiveness and, consequently, financial stability. To prevent such phenomena, control functions of the organization’s finances are necessary .
The control function is responsible for the cost accounting of absolutely all costs for the production of products and their implementation, provision of services, performance of work, income generation and their use.