Introduction

The issue which we are analyzing is an issue of great importance today because our country as represented by the central government intends to seek a short-term solution to economic problems affecting our people, product of financial fraud Baninter Intercontinental Bank, the solution is being channeled beams of agreements between our country and a multilateral institution.

It is nothing more and nothing less than the International Monetary Fund which we will be looking at its origins, composition, functions, objectives, characteristics, as well as its impact on economic and social framework of Dominicans over time. So that at the end of this reading, we focused not only on what is and what it represents the background, but also about the actual problem and the consequences that could result in agreements with the international body.

International Monetary Fund

It should be noted that the IMF is not a development bank, nor a world central bank, or an agency that can solve the economic crisis countries. It is rather an institution which, with its controls and seeks to maintain a stable system of buying and selling currency for foreign currency payments between countries can take place easily and without delay. In other words, the fund essentially ensures the interests of banks lending money to solve money problems or balance of payments of countries.

This institution was established with the basic objective to ensure the stability of the international monetary system, mainly through the promotion of cooperation and consultation in monetary affairs among member countries. aimed at preventing a repeat of the disastrous economic policies that helped cause the Great Depression of the thirties. Since this is responsible for ensuring the stability of the international financial system.

1 .- Origin of the IMF

The decision to establish the International Monetary Fund (IMF) was adopted at a conference in Bretton Woods in July 1944. The IMF officially began its existence on December 27, 1945, with the signing of its Charter.

The idea of creating the Fund was made in July 1944 in a United Nations Conference held in Bretton Woods, New Hampshire (USA), when representatives of 45 governments agreed to establish a general framework for economic cooperation.

2 .- Composition

The body was initially composed of 39 members, today the 182 members composed of an equal number of countries.

3 .- Functions (IMF)

1. To promote international monetary cooperation through a permanent institution to provide a mechanism for consultation and collaboration on monetary problems.
2. To facilitate the expansion and balanced growth of international trade and thus contribute to promote and maintain high levels of employment and real income and develop the productive resources of all partner countries as primary objectives of economic policy.
3. To promote exchange stability, to ensure that exchange relations between its members are ordered and avoid competitive depreciation purposes.
4. To help establish a multilateral system of payments for current account transactions made between countries and to eliminate exchange restrictions that might hinder the growth of world trade.
5. To give confidence to members by making available the resources of the Fund in a position to protect them, giving them the opportunity to correct maladjustments in their balance of payments without resorting to measures which might destroy national and international prosperity.
6. As a result of the above function, reduce the duration and intensity of the imbalance in the balance of international payment.
In other words the functions of the International Monetary Fund (IMF) would be:
a. A regulatory role of guardian or caretaker of the international monetary situation.
b. A lending role, aimed at providing financial assistance to member countries to address balance of payments problems.
c. An advisory role to provide advice and technical assistance, as well as a permanent forum for discussion of international monetary problems.

The IMF lends money to members who have trouble complying with financial obligations to other members, but only on condition that they undertake economic reforms to eliminate these difficulties for their own good and that of the entire membership.

The IMF has no effective authority over domestic economic policies of its members. Is itself a position, for example, to force a member to spend more on schools or hospitals and less on buying military aircraft or constructing grandiose presidential palaces. Can and often does, members drive to make the best use of scarce resources by curbing unproductive military spending or spending more money on health and education. Unfortunately, members can, and often do, ignoring the well-intentioned advice. In this case, the IMF can be attempted only through rational argument to persuade the members of domestic and international benefits of adopting policies favored by the membership as a whole.

Other Features

1. To promote international monetary cooperation through a permanent institution to provide a mechanism for consultation and collaboration on monetary problems.
2. To facilitate the expansion and balanced growth of international commerce and thereby contribute to promoting and maintaining high levels of employment and real income and develop the productive resources of all partner countries as primary objectives of economic policy.
3. To promote exchange stability, to ensure that exchange relations between its members are ordered and avoid competitive depreciation purposes.
4. To help establish a multilateral system of payments for current account transactions made between countries and to eliminate exchange restrictions that might hinder the growth of world trade.
5. To give confidence to members by making available the resources of the Fund in a position to protect them, giving them the opportunity to correct maladjustments in their balance of payments without resorting to measures which might destroy national and international prosperity.
6. As a result of the above function, reduce the duration and intensity of the imbalance in the balance of international payment.
In other words the functions of the International Monetary Fund (IMF) would be:
a. A regulatory role of guardian or caretaker of the international monetary situation.
b. A lending role, aimed at providing financial assistance to member countries to address balance of payments problems.
c. An advisory role to provide advice and technical assistance, as well as a permanent forum for discussion of international monetary problems

4 .- Objectives (IMF)

• To promote international monetary cooperation
Facilitate the expansion and balanced growth of international trade
Promote stability in the foreign exchange trading
Facilitate the establishment of a multilateral system of payments
· Make occasional loans to members who have difficulties in their balance of payments
· Shorten the duration and lessen the degree of disequilibrium in balances of payments of members.

Current Status

The IMF lends money to members who have trouble complying with financial obligations to other members, but only on condition that they undertake economic reforms to eliminate these difficulties for their own good and that of the entire membership.

You can, and often does, members drive to make the best use of scarce resources by curbing unproductive military spending or spending more money on health and education.

The money changing is the central point of financial contact between nations and the indispensable vehicle of world trade. Each money, be it the dollar, franc, or Gambian Dalasi or Haitian gourde, has value in terms of other moneys.

The relative values of the exchange or the world’s largest monies now fluctuate continuously, to delig
ht or misery merchants money, and newspaper reports in the financial columns of newspapers. Although the workings of the exchange market, where money (much like items such as wheat or apples) is bought and sold, can seem remote from daily life, these performances, deeply aféctenos all. Most commonly, we experience the reality of the exchange value abruptly when we travel abroad as tourists and we need to find money to buy local first before we can buy anything else. Buying currency is not only a fact of life for tourists, but also for importers, banks, governments and other institutions that have acquired currency, often in a very large scale, before they can do business abroad .

Fortunately, now widespread convertibility permits easy exchange between most of the money world’s largest. The currency has allowed almost unrestricted travel, trade and investment during the past quarter of a century and has been greatly from the cooperation of member nations to the IMF by removing restrictions on domestic funds buying and selling.

The current expectation secure money will become another in appearance to the application it difficult to imagine circumstances in which this was not the case. And it was still largely in reaction to widespread circumstances of inconvertible and exchange related problems that the international community decided 50 years ago to work these problems in a common forum which was to become the International Monetary Fund.

Credit Program (IMF)

The IMF makes its financial resources available to member countries according to number of policies and services, it should be noted that the resources available will depend on quantitative constraints related to the quota. The share of IMF member country is the amount of subscription paid by that country. For example, the 25% which is paid by the IMF. The main difference between them is the kind of needs related to the balance of payments-served and the degree of compliance is assumed. It also provides loans and grants to developing member countries that meet certain conditions.

1. Reserve tranche: this facility is not part of the policies of use of IMF credit since that is a portion of the international reserves of each member country. The use of this facility is limited to the balance of the country’s reserve tranche. This is equivalent to the amount by which that country exceeds the IMF’s holdings in the currency of that country, having reduced that portion of such holdings representative of the use of IMF credit by the member the use of the reserve tranche is subjected to the existence of financing needs balance of payments and is not formally submitted fittings of any kind.

2. Sections of Credit under the terms and conditions established, a member may make purchases of SDR (or other currency) on four credit tranches each equivalent to 25% of the quota. The three credit tranches following the first call “upper credit tranche.” The distinction between these categories reflects the aggradation of conditionality. The use of the upper reaches of credits is conditional on the adoption of specific tools that lead to the reduction of balance of payments problems in a reasonable period.

3. Agreements Stand (stand by): An agreement of this type allows a member to access the general resources of the fund, as a result of the decision taken is in meaning, in the terms and conditions contained in the decision and for a given period. Performance criteria include:

A. Limitation to fiscal deficits and government debt equity, notably in the case of external debt.
b. Adequate provision and monetary exchange.
c. Getting to impose restrictions on payments and current transfers.
d. Program response delays in external debt service to accumulate new arrears.
e. Maintaining an adequate level of international reserves.
f. Structural measures, although not necessarily, these agreements may include, in practice such measures. The expanded facility programs, however it is necessary to incorporate cutting structural policies.

Contributions and Voting

In joining the IMF, each member country contributes a certain amount of money it called a quota subscription, as a kind of credit union deposit.

Organization

Many people see the IMF as an institution of great authority and independence and assumes that decides more good economic policies for its members to follow these decisions gives the number of members, and then ensures that its members form. Nothing could be extensive indeed.

Far from being issued by the IMF, the proper number of members to the IMF dictated policies that follow. The chain of command clearly runs the governments of member countries of the IMF, not vice versa. Based on the obligations of individual members to the IMF, or provide details of working arrangements with a member, the IMF does not act out their own but as an intermediary between the wishes of the majority of the membership and the individual member country.

The link in the top of the chain of command is the Table of Governors, one from each member, and an equal number of alternative governance. As the Governors and Alternate are finance ministers or heads of central banks, they speak authoritatively for their governments.

The oddly named Interim Committee (the seventies has been subsequently) gives them advice on running the international monetary system, and joining the IMF / World Bank’s Development Committee later recommended the special needs of poorer countries. From Alternate Governors and is fully occupied with his own capital, they pick only on the occasion of annual meetings to formally allocate a group of IMF materials.

During the rest of the year, the governors communicate the wishes of their governments for the daily work of the IMF to its representatives that form the Executive Table IMF headquarters in Washington. The 24 Executive Directors, meeting three times a week at least one formal meeting, direct the implementation of policies set by member governments through the Table of Governors. Currently, eight Executive Directors represent individual countries: China, France, Germany, Japan, Russia, Saudi Arabia, the United Kingdom and the United States. Sixteen other Executive Directors each represent groups of other countries. Executive Table rarely make their decisions based on a formal vote, but relies on the formation of a general agreement among its members, a practice that minimizes confrontation on sensitive issues and promotes acceptance of the decisions finally made.

The IMF has a staff of approximately 2,600, led by a Managing Director who is also chairman of the Executive Table is set. By tradition, the Managing Director is a European, or at least one non-American. The international staff come from 122 countries and comprises mainly economists, but also statistical, research, academics, experts in public finance and taxation of contributions and financial system and linguist, writer and editor. The majority of staff members working in the Washington office of the IMF, even if one is assigned to smaller offices in Paris, Geneva, Tokyo and the United Nations in New York, or represents the IMF in temporary assignment in countries members.

Runs

If a country persistently ignore their obligations to the IMF, the remaining number of members working through the IMF can declare the member ineligible to borrow money.
Surveillance

Changing the value of equivalence to the current open exchange system may seem to imply a loss of influence by the IMF. To appreciate the current system requires greater transparency of policies of members and allows more scope for the IMF to monitor these policies.
The IMF calls this activity monitoring, which is based on the belief strong and consistent economic policies led to stable exchange rates and global economic growth and prosper.

The International Monetary Fund in the economic and social framework of the Dominicans.

The recommendations and programs of economic poli
cy of this institution have been implemented in most countries of the world, whether under neoliberal measures – in the core countries-or through well-known structural adjustment programs – in impoverished economies of the periphery, under the yoke of debt.

Far from achieving the goals of stability and economic growth, programs and recommendations of the IMF have provided the means and time required for banks and financial institutions continue extracting money from the periphery and bearing the burden of debt on the poor. They have managed to open the peripheral economies to the voracious transnational capital, deregulation, both in labor and environmental, and establish industrial bases with lower costs of production so that transnational companies can compete with benefits.

The impact on people and the environment are devastating. The level of uncertainty, poverty and exploitation that are forced every day greater numbers of people in the world is directly related to the work of these institutions often receive the unconditional support of the ruling elites of the respective countries and demonstrate so clearly, that the institutional policy at the service of the powerful industrial and financial interests. Thus we can say that our country has not been the exception because we have a story based on the International Monetary Fund assistance in the economic and resulting social unrest these incurable.

The last time the IMF intervened in the Dominican Republic was under President Salvador Jorge Blanco, almost twenty years, and these arrangements had a profound significance for the life of Dominicans. The belt-tightening caused by the economic measures of that time left a trail of deaths and economic constraints were the main reasons for a deepening of poverty. The cost of the basket and quality of life of Dominicans then arrived at the level of disaster. Fuels increased to unprecedented levels. The rise in public utility rates, freezing wages, rising prices of medicines and many more led the way people protested vehemently. Only then found their way the guns of the military, which caused hundreds of victims who still have not been counted.

However, in September 1991 signed a standby agreement for 18 months with the IMF, which concluded successfully in March 1993. The development of rapid economic variables showed positive performance. As a result of this agreement, the fiscal adjustment was approximately 5% of GDP. The result was the collapse of the exchange rate from U.S. $ 17.5 RD, to RD $ 12.5 per U.S. $, and then maintained with high stability for the rest of the decade. This may be a teaching.

The agreement now, as reported, seems to have the same ambitions, perhaps because we are close to an election contest, and these resources can have a political future, according to the convenience of those running our country today.

But the Fund has put their hands in our economy, national currency has been devalued by half in the last six months In addition, fuel prices have doubled and electricity rate remains the highest in the world. Housing construction has stagnated and interest rates in pesos multiplied ten times those for loans in dollars. Drugs have become more expensive to cause death and worsening of patients of all types, credit purchases have been suspended while the dollar prices are valid for only five days, such is the current case of the American Hardware.

While the national economy dollarization, wages remain unshaken in pesos. Inflation in the first half of 2003 and is two digits, which means that prices tend to fall any way but continue to increase. Imports remain higher than exports and nobody can deny that the outflow of dollars is greater than those who enter.

The increase in capital expenditure is the main cause for the rise in expenditure. The proceeds from the issuance of sovereign bonds in international markets and foreign loans have enabled the government to finance the expansion in spending. Creating more dependent on the state institutions, such as the Ministry of Youth, the Secretary of State for Women and a number of municipalities and provinces across the country, that result in the fiscal deficit and this turn the country’s economic imbalance.

All that has happened without the IMF has stepped on Dominican soil. With the national economy by controlling the Fund does not cut spending to pay the debt but will be further reduced social spending.

And gentlemen in their definition of social expenditures are those that include direct transfers to the public, bone development of social programs and expenditures on health and education are the main aid going to the poor in our country, will be reduced as a result of these agreements with the fund, seen this way, we must not be very smart to understand that as you say it say these agreements, affecting the most needy in our society.

Now, as we have done an analysis purely focused on the needy, we must also say that as a result of fraud made in the BANINTER billionaire, the Dominican Republic, is the need to obtain the necessary financial support to respond to the crisis left by this situation so that goes to the agency, which for many is not the best solution, but it really is the only one of which depends on the state to dissolve this problem in the short term.

1. Introduction

The Fiscal Control studies have been gaining great importance both to the advancement of financial management. It covers a broad field control of state activity in general and in particular the fiscal control is present in the system of states.

Fiscal discipline travels the world. The sustainability of public finances, there is growing consensus about it in all countries, is essential for economic and social development. But in situations such as Venezuela seems easier said than done. Reduce acute fiscal imbalances, such as that persists to date in Venezuela, not only requires political decision, but effective tools. Requires not only headlines about cuts, but rules that ensure a safe path to eliminate disturbances. In the rest of the world is increasingly the design and implementation of fiscal rules to impose clear limits on deficit spending and debt and also have well-defined decision-makers accountable and transparent.

From the standpoint of organic and functional, fiscal control, not to be confused with the acts and operations of a fiscal nature, such as handling money or property of the State, conservation, investment and internal control “, subject to scrutiny . Acts of fiscal control whether to endorse or gloss an account, fiscal departure or movement has its own entity and have no surrogate inside or outside the government. “

2. Planteaminiento the problem

Implementation of the national system of fiscal control in Venezuela. The purpose of the approach not only addresses the need to create a system of fiscal control more strategic projection, with ingredients of an economic, but above all to renew the mere formality of the review which was carried out in observance of the rule of law, by a fiscal control that emphasizes the results of fiscal management, in terms of performance and social impact (equity and environmental impact), within a context of social rule of law.

Objective specific

Will center stage for the function of fiscal control, determining the essential aspects of it, systematically and other constitutional and legal powers exercised by such bodies.

General Objectives
or elaborate on the importance and the most important features of national tax control system, highlight the specific objectives and perspectives for its analysis has Venezuela’s fiscal circumstances.
o Establish mechanisms which are main building of the tax rules.
• To analyze and evaluate the role and main characteristics of fiscal policy of the State, to know their main instruments and effects at the level of centralized administration, and the decentralized

3. Theoretical framework

Tax Control

The Fiscal Control is the set of activities carried out by competent institutions to achieve through various systems and procedures, consistency and correctness of the administration of public assets

The Fiscal Control, as a function of the state, is distributed among various entities of public law, engaged in the most varied nature, according to the structure and nature all their own. No one can imagine that only calls Audit Institutions or “Supreme Audit, carried out acts of Fiscal Control. Fiscal Control from the might of control. Already sufficiently discussed, although limited to the fiscal side, you eat discussed earlier, is the conventionally accepted term to describe the activity of the State, as soon as 7relaciona with the heritage of the community, or Treasury. This can be seen eating there is a Parliamentary Fiscal Control, as a set of legislative 6rgano activities are intended to control asset management and internal fiscal control, administrative markup to meet in addition to the control function itself, to collaborate in the development of the Administration and executive function. Also. Within the External Control can also noted the existence of Higher Institutions “ad-hoc” created especially to absorb a wide range of Public Assets Control.

The work of these entities must be framed within, super-legality (Constitutional Standards) and within the law (Laws, regulations, decrees, etc..) Dominates in our systems of government action for the Bodies of Public Power .

Dr. Allan Randolph Brewer identifies compliance with the Constitution and other “laws” with the generic name of “Principle of Legality” and tells about it in his doctoral thesis entitled “The Fundamental Institutions of Administrative Law and Jurisprudence Venezolana, “which is” the principle that all state activity must comply with the law of that State. ” Then added: “The contents of the various national laws is certainly diverse, but, however, the constitutions of most of the Western world, including Venezuela, contain an explicit statement or memos but the principle of legality. “The Constitution and the laws defining the elements of governmental authority. And they should govern its exercise. “

As a result of the said principle, all activities of the entities responsible for exercising the Fiscal Control should have constitutional or statutory legal competence itself “to carry out such activities, framed strictly within the powers granted them the norm. As is well known institutions of public law can only do what the law allows them, while those “private” can do everything that the law does not prohibit.

Within the function of control there, too, the discretionary aspects of their exercise, but it also must necessarily be limited to competition on certain assumptions and procedures, established by legislation.

The systems and procedures for the Fiscal Control, vary with the nature of the bodies that implement it. This is easy to understand terms between the structure and functioning of the Parliament complex and a simple internal control unit there are obvious differences that impact, of course, in their activities. As will be seen to make an analysis of the systems and procedures of the Fiscal Control, are different means of control that use, for example, parliaments and a control office of the Executive.

The end of the Fiscal Control are variable in terms of the intensity with which they apply these different institutions, and in response to the diversity of legislation, but it can be argued that even within these recognized differences, and discuss the various nuances that speak the “Scope of Fiscal Control”, its basic objectives are the regularity and correctness of the administration of public assets,

National Fiscal Control System

Means the National Fiscal Control System, all the organs, structures, resources and processes, integrated under the guidance of the Comptroller General of the Republic, interact coordinately to achieve the unity of management systems and procedures control that contribute to achieving the overall objectives of the various agencies and bodies subject to this Act, as well as to the proper functioning of public administration.

The control function shall be subject to planning that takes into account the concerns and requests of the bodies of the public, complaints received, the results of previous control management and administrative status, the areas of strategic interest national dimension and critical areas of the entities under their control.

The Comptroller General of the Republic is an organ of Citizen Power, which accounts for control, monitoring and control of revenues, expenditures and public goods, as well as transactions relating to them, whose actions will target conducting audits, inspections and reviews any tax agencies and entities under their control.

The Comptroller, in the exercise of their functions, verify the legality, accuracy and sincerity as well as efficiency, economy, efficiency, quality and impact of operations and management performance of agencies and entities subject to control.

Is for the Comptroller have on taxpayers and responsible, under the Tax Code, as well as other individuals, the powers specifically assigned to this Act

Nature Fiscal Control

It
is undeniable that the fiscal control has an essentially legal basis. All its activities must be framed within the legal system. Guardianship public interests and its fundamental purpose is the “Treasury”, a name accepted, by convention, to designate the state sector’s assets. Its exercise is mandated by state bodies and never to individuals, that if he ever would be unable to act in the capacity of consultants, without power to decide.

Control management bodies or authorities of the Administration is a public asset.

Declares conformity with a decision of an organ of state is a legal function and also publishes. Judge the legality and correctness of those completing the Tax Administration and pronounce judgments on it is public and as such law.

The interest protected is a public interest because the responsibility of the whole community, the state itself. Fiscal Control As state activity is within the law and conventional subdivision in the branches, it remains to Public Law. We recognize the objections that the division of law in these two branches (Public Law and Private Law), raises. We share the idea that the law is only as a product of the state or even more, closely identified with the state, but we believe useful for the purposes of study, conventionally classified as “Public Law”, that branch quo dealt with on a particular delimitation easy features the performance of state entities. For the purposes of classification, it is useful to accept this division as part of Law Unit. As no bearing on the unity of law, support other subclassifications: Constitutional, Administrative, Mining, etc.

As part of Public Law, the Fiscal Control, it can be studied by legal science, and even if its exercise is linked very closely with the Economics, Accounting, Statistics, etc.., These are just as auxiliary sciences may be other legal disciplines.

The principles of fiscal control

• The efficiency: the allocation of resources is the most convenient to maximize your results.

• The economy: that equal quality goods and services are obtained at less cost.
• The effectiveness: their results are achieved in a timely and relevant to their objectives and goals.
• The playing field: to identify the recipients of economic action and analyze the distribution of costs and benefits between economic and social sectors and between local authorities.

As for efficiency, the theoretical framework of corporate governance, applied to government, developing indicators for the purpose of efficiency. In this sense, resources are verified, the process to which they apply and the results obtained. The results are confronted with the resources used, gives us the coefficient of productivity.

There is a difference between measuring efficiency and measure effectiveness. Efficiency is a measure of the cost per unit of output. Effectiveness is a measure of the quality of that result: How to get the desired result accuracy? When we measure the effectiveness, we know what it takes to achieve a specific result. When we measure the effectiveness, we know whether our investment is worthless. There is nothing more ridiculous than to make a more effective way to stop something that should be done.

“Both efficiency and effectiveness are important. But when public organizations are beginning to measure their performance, often measured only its effectiveness … The public clearly wants an efficient government, but more effective government. The public may be pleased to spend less on education per student than the rest of the state, but if their schools are the worst in the country do not have many reasons to be happy for long … The focus on efficiency rather than effectiveness also tends to alienate employees. When governments emphasize the cost of each unit of work, often develop a culture of mask that belittles the intelligence and skill of its workers. Most employees want to be effective. Most gladly would do what was necessary to increase the impact of your organization. But if his superiors only focus on their effectiveness, as fast as they each work unit will begin to feel as if on an assembly line. “

As for the economy, for its part, seeks to determine whether the resources available, you get the maximum performance of the entity and, additionally, checks the parameter of the

minimal costs.

Equity refers to the proportionality of management, the concept of justice, equality, the socio-economic and investment income applied to meet the needs of the community.

As for the determination of equity in the entities, conceived through the plotted values, it is proposed that the principle of spending inversely proportional, the proportionality holds for existing inequalities.

Of these parameters, also called the principles of fiscal control, for highlighting the economy, through which the Comptroller may rule in qualitative terms on the use of public expenditure, as observed.

Internal control

The new Organic Law of the Comptroller General of the Republic and the National Fiscal Control System, has devoted an entire chapter to the definition and development of Internal Control of Public Administration.

On this particular need to establish some distinctions. The modern doctrine considers it an obligation of the Public Administration in its action routine, establish a primary or control internal active management, for consideration by the Administrator Act, including providing timely solutions to problems that may arise, acting under with the Constitution and Laws. In this case one can deduce that the internal control system including its integral differs from external control, under the former administration itself is done by the active and the second one being completely different on.

Under the provisions of Article 35 of the Act, the Internal Control is a system that includes the plan of organization, policies, standards and methods and procedures adopted within a body or agency subject to the law, to safeguard its resources, verify the accuracy and veracity of their financial and management information, promote efficiency, economy and quality in their operations, encourage compliance with prescribed policies and ensure compliance with its mission, objectives and goals. Act leaves no doubt about who has the responsibility to organize, establish, maintain and evaluate the internal control system, since Article 36 of the Law on comment, requires the highest authorities of each entity to implement it, adapting it to the nature, structure and purposes of the Entity.

As an additional requirement and as provided in Article 37 of the said Act and every government entity shall, within the framework of basic rules issued by the Comptroller General of the Republic, rules, procedures manuals , management indicators, performance indicators and other specific methods or instruments for the operation of internal control system.

The Article 38 of the Act provides that the Internal Control System must perform prior checking both the commitment, as payment, and ordering that prior to the acquisition of goods or services, or to the development of other contracts involving financial commitments, those responsible must ensure compliance with the following requirements: 1) the expenditure is properly charged to the appropriate budget or additional appropriations. 2) That there is available budget. 3) What safeguards have been provided necessary and sufficient to account for the obligations to be assumed by the contractor. 4) That the prices are fair and reasonable, except as otherwise provided in other laws. 5) That has complied with the terms of the Bidding Law, where necessary and other laws that may apply. Similarly, reads Article in consideration, that those responsible before proceeding to make payments, must ensure compliance with the following requirements: 1) he has complied with the laws and regulations. 2) that are appropriately charged to the budget appropriations or legally agreed to additional provisions. 3) there
is available budget. 4) They go to meet certain commitments and properly tested unless they fall advance payments to contractors or officials ordered progress under the law. 5) that correspond to actual credit holders.

So now, the administration will make its own prior, and must implement an entire organ system aimed at achieving its completion. To this end and within the Administration within Active will create internal audit units within the scope of their powers may carry out audits, inspections, audits, surveys, studies, analysis and research of all kinds and of any nature in the subject being their control, to verify the legality, accuracy, sincerity and correctness of their operations and to assess compliance and the results of the plans and administrative actions, effectiveness, efficiency, economy, quality and impact of their management. Everything Under the system envisaged in Article 41, without prejudice to the powers of audit institutions.

Only when the internal control system of the respective local authority control in advance to ensure effective and efficient, the bodies of External Fiscal Control may transfer after evaluation.

These innovations enroll in modern Venezuela, for without sacrificing any classical mode of control, management control, of merit or performance, will always be more effective and desirable than one that is limited to acts mere formality, since the exceed ever made forcefully to the letter or the role

External Control

Can not conceive a modern, democratic state, if it lacks external fiscal control bodies, not only autonomous, structurally and functionally, but shedding partisan political influences that have tainted in almost every country in the world, cleaning of their actions. The existence of strong and effective fiscal control bodies and external, is a characteristic of the modern state, in large measure the magnitude of his work reflects the health of its constitutional system.

By express mandate of Article 43 of Law of the Comptroller General of the Republic and the National Fiscal Control System, are competent to exercise fiscal control external conformity with the Constitution of the Bolivarian Republic of Venezuela, the Laws and Ordinances Municipal: 1) The Comptroller General of the Republic. 2) The State Comptroller. 3) The Comptroller of the municipalities and 4) The Comptroller of Districts and Metropolitan Districts.

The external fiscal control bodies are, unlike those doing the internal control, those who are not part of active management, reaching out of it and without any kind of subordination or dependence.

The external control involves monitoring, inspection and oversight exercised by bodies of external fiscal control over the operations of the entities under its control.

These activities should be conducted with the purpose of determining compliance with constitutional provisions, laws, regulations or other regulations governing their operations and to determine also the degree of compliance with prescribed policies in relation to heritage and safeguarding resources of those entities.

In the same way should the external fiscal control bodies to evaluate the efficiency, effectiveness, economy, quality of its operations, based on levels of management, income and other applicable techniques, also evaluating the internal control system and make recommendations for improvement.

Everything Under the provisions of Article 42 of that Act Article 46, apply without distinction to the external fiscal control bodies in the scope of their powers, shall perform audits, inspections, audits, surveys, studies , analysis and research of all kinds and of any nature in the entities or bodies under its control, to verify the legality, accuracy, truthfulness and correctness of its operations, and to assess compliance and the results of the policies and administrative actions, effectiveness, efficiency, economy, quality and impact of their management.

To ensure independence and proper functioning, the Comptroller of States, Districts, Metropolitan Districts and municipalities, shall enjoy functional autonomy, functional and administrative, also founded by the principles governing the National Fiscal Control System, referred to in Article 25 of Law Annotated.

These are: financial and budgetary independence capacity. Apolitical party. The technical nature of Fiscal Control. The opportunity in the exercise of control and presentation of results. The economy in the exercise of fiscal control. The speed, and citizen participation in the management comptroller. Concatenating these characteristics and principles, external fiscal control bodies may at last enjoy full autonomy in achieving its goals and objectives. Especially now when management control is a constitutional and legal, as the fiscal control now involves a thorough investigation for the purpose of ongoing evaluation of the activities of the entities and bodies subject to control, which in turn will allow the verification plans and programs as well as completion and outcome of government policies and decisions.

Is a right of external fiscal control bodies make organizational studies, statistical, economic and financial analysis and research of any kind, to determine the cost of public services and outcomes of administrative action, thereby able to verify effectively operating entities subject to surveillance, monitoring and control.

To this end, both officials of the Comptroller General of the Republic of the Comptroller

General and State Comptroller’s Municipal or District, accredited to perform any control action will have free access to the offices and agencies of the entities and bodies subject to their performance, access to any source or information system, records , instruments, documents and information necessary for the performance of their functions and authority to request such information and documents.

In this sense, the Law of the Comptroller General of the Republic and the National Fiscal Control System, provides in its Article 47 that the entities subject to control are required to give the representatives of the auditing firms, consultants or freelancers accredited to perform control actions, whatever the external fiscal control body specifically requested, are risk deduction of administrative responsibility.

The consolidation of the national system of fiscal control is a top priority for the new Venezuelan government, who with the pivot of popular participation, citizen control will succeed in the projects of high economic impact, financial and social, in addition to head toward the realization of excellence, transparency and good use of public resources. .

Professional Bodies of Fiscal Control

The National Fiscal Control System aims to strengthen central state capacity to implement effectively its role of government, ensure transparency and efficiency in managing public sector resources and establish accountability for the commission of irregularities the management of public entities under its control. So provided in Article 23 of the Organic Law of the Comptroller General of the Republic and the National Fiscal Control System. Make it clear that the legislature patriotic “Ultima Ratio” of the National Fiscal Control System, is to achieve optimal performance of resources by the state bodies, as well as transparency and efficiency in their management. To that end, Article 25 lays down the principles governing the National Fiscal Control System to ensure achievement of that object, and the achievement of an effective management.

Obviously it would not be viable a National Fiscal Control System, if management lacks a capable, professionalized and technical, that tends compliance with the principles that govern it. In view of such circumstances the Comptroller General of the Aragua State has created the foundation for the development of Public Management FUNDACEN Aragua State, in order to consolidate an entity that will form, train and develop human resources in a sys
tematic way and to exercise technical management and control over public assets at any level of government. To this end the foundation Specific activities for the promotion and implementation of programs and training and professional development in the areas of audit, control, management and law, linked to the management of public finances, thereby implementing seminars, courses, conferences, workshops and other activities or facilities which pedagogical purpose is of a similar nature. Also promote research in the areas of audit, control, management and law, linked to public finance and public management, in coordination with public institutions or private.

The Foundation shall assist the establishment of national plans and international cooperation in education and research in the areas already mentioned, as well as developing partnerships with other institutions and entities.

It is no secret in our country, the secular resistance to fiscal control through the work of concrete historical realities related to authoritarianism and totalitarianism, which created a sort of anti-control culture that is still fighting and must be fought for access to short time towards higher stages in the concert of nations. Fortunately, the documentary history of Venezuela preserves for posterity our strengths and weaknesses, keeping it as a reference for the consultation when making decisions. This is one of the fundamental tasks of the Foundation, and is assumed as a supreme commitment.

There can be no republic without citizens and citizenship, as there can be no management without managers. Pivot integrally taking as our foundation, not only with effort but is a true and genuine obligation on our part in finding positive solutions to our crisis, part of the solution and the answer, not chaos.

From our perspective is not just a manager who directs, in accordance with rules or statutes. It’s not just who holds powers by popular mandate, by appointment or by appointment, for conceiving and could constitute a dangerous oversimplification, perhaps containing many of the answers to our own questions about the shortcomings of public administration, as well as the private sector, not shown in our context, as successful as the country suck and need.

To reverse this trend in some form, will undoubtedly be the best reward for a foundation that builds its north on excellence and knowledge.

Fiscal policy.

The government spent through public investment, public expenditure and raises revenue through taxes on the production and circulation of goods, revenue and earnings of any other nature.

THE MONEY AND THE LEVEL OF INCOME

Money is any generally accepted medium of exchange for the payment of goods and services and repayment of debt. The real value of money is determined by their purchasing power, which in turn depends on the general price level. According to the quantity theory of money, prices are determined largely or entirely by the volume of money in circulation.

The money is seen as the cornerstone of modern economic life. The functions of money as a medium of exchange and measure of value to facilitate the exchange of goods and services and the specialization of production. Its essential characteristic is that it is generally accepted to and make payments.

The flows of goods and services, both in economic activity accompanied by the corresponding flows of money. Production decisions of enterprises and applications for domestic goods and services and companies, together determine production levels and income balance of the economy.

The demand for money is the value of the holdings of money measured in terms of their purchasing power. The purchasing power of money is measured by the amount of goods they can buy with it.

When you double the prices and national income, it also doubles the amount of money you want to have the public so that does not change its real value or purchasing power. In general, when the price level varies, but real incomes of individuals, they adjust the nominal amount (amount of money you want to have individuals and companies) who have money to maintain the same purchasing power.

MONEY MARKET AND CAPITAL

MONEY MARKET

The Central Bank designs and manages the country’s monetary policy, controlling the money supply and issuing currency units necessary for the proper functioning of the economy, but always taking into account the inflation target. This monetary policy has to be agreed with the government’s fiscal policy, the controller emits more or less money and setting interest rates.

The Central Bank controls the amount of money determining the amount of high-powered money, ie money supply controls. Because this changes the amount of money performing open market operations, changes in the amount of money produced its first effect on asset markets, mainly in the stock and bond markets. Variations in the amount of money affect interest rates, which affect, in turn, consumer spending and business, ie to aggregate demand. And the variations in aggregate demand affect the level of income.

The demand for money:

The Central Bank controls the money supply, which interacts with the demand for money to affect the economy. The main factors affecting the demand for money is the price level, interest rates and real income.

The demand for money and the price level:

The nominal money demand is the amount of pesos they want to have individuals and businesses. Since the money has to buy goods and services, the nominal quantity of money demanded changes when prices change. As the demand for money is a demand for real balances, ie the value of the holdings of money measured in terms of their purchasing power and this is measured by the amount of goods that can be bought with it.

However it is also considered the case where the Central Bank increased the amount of money, and that the public finds that it has more money than you want. Money burns the pocket and dispose of spending more. This increased spending results in higher prices, it was a good summary description of inflation in an economy is near full employment.

The demand for money and interest rates:

To examine the relationship between money demand and prices, emphasizing the fact that money is to finance spending. The relationship between money demand and the interest rate is based on the fact that individuals with money in lieu of any other asset.

The amount of money you choose to have the public, depends in part on the amount you plan to spend, but also the costs and benefits of having relatively little or a lot of money (interest). The public can have many assets instead of cash. The savings and time deposits and investment funds in the money market, along with bonds and equities, are the main assets.

The demand for money is based on the costs and benefits of having money instead of bonds. Economists see interest as the reward of saving, ie, payment is offered to encourage people to save, allowing others to access these savings.

The demand for money and real income:

The third factor is dependent on spending money. As seen above the level of spending depends on the amount of real income earning households. An increase in real income (rental value expressed on the goods you can buy with it) causes an increased level of expenditure. Since an increase in spending with no variability means that real balances is more annoying to manage the bank account, the increase in real income raises the quantity demanded of real balances.

When analyzing the three basic results, we observed that an increase in the price level alters the real money demand and increases the demand for nominal balances in the same proportion. Second, an increased opportunity cost of holding money reduces the demand for real balances. Third, an increase in real income raises the demand for real balances. These three aspects of the demand for money are important channels of monetary policy operation.

To conclude, the money market is in equilibrium when the quantity demanded of real balances is equal to that offered. Given the level of prices, the Central Bank determines the supply of real balances.

The Utility theory assumes that consumers have full information about everything that relates to their consumption decision, he knows the entire set of goods and services sold in markets, in addition to knowing the exact price they have and can not vary as a result of their actions as consumers, in addition they also know the magnitude of their income.

So, the attitude of consumer goods will be different for each, regardless of the satisfaction he sought. It follows from the idea of defining the utility as the desirable quality that becomes an asset, this utility is based on studies undertaken by the classical economists.

Adam Smith and David Ricardo, who based their reasons on the usefulness of the objects by their ability to satisfy a need.

The only way to measure the usefulness of things is to use a subjective scale of taste theoretically showing a statistical record of the utility of consumption is done. However, there are other reasons for satisfaction and also available is not exactly helpful.

Types of Utility.

The value of the assets may not ever be measured, but it can be calculated using a simple mathematical procedure, which will be developed analytically.

The point of departure is the definition of the utility that reads: “The degree of satisfaction provided by different satisfactions that a consumer uses.”

The value of an asset is calculated using mathematical formulas Total Utility (UTX), marginal utility (UMX) and Average (UPX), which show that while units are consumed for each unit of goods, the higher the value is received, although the total utility increases, the marginal decrease.

Be noted that the total profit will reach a maximum, the average normal behavior to keep the arithmetic average while the marginal is equal to zero. This is the point of saturation in the consumption, which indicates the full and complete satisfaction of a consumer.

Total Utility. (UTX)

Represents the sum of the profits obtained by a consumer to use a certain amount of goods (items).

Utility Average (UPX)

Represents an arithmetic distribution as a result of action by dividing the total income by the number of satisfactions consumed. The calculation formula is expressed:

UPX = UTX / Qx
Where:
Upx = average utility of an article.
UTX = true utility item.
Qx = Quantity of a certain commodity.

Marginal utility (UMX):

Represents the increase in the value of an item “X” to the extent that the consumer uses more than one unit satisfactor. The formula to calculate it is:

Where:
UMX Usefulness of a certain item.
UTX D = Increase or addition of the total utility of certain items.
D Qx = Increase or addition of the amount of a certain commodity.

Here is an example with the following data table:

Qx

UTX

UMX

UPX

0

0

-

-

1

10

10

10

2

18

8

9

3

24

6

8

4

28

4

7

5

30

2

6

6

30

0

5

7

28

2

4

8

24

-4

3

Here is presented the way as they apply these formulas:

In the columns of the table above are hypothetical total utility, the marginal and average individual consuming a satisfactor alternating quantities.

Is consumed and there is good insofar as it is consumed, satisfaction increases to a maximum, to continue using that property rather than contribute to satisfaction, can cause discomfort, it can be said that the satisfaction decreases, so that its marginal utility is negative.
(Remember the principle of diminishing utility).

Explanation of the table:

QX

UTX

UMX

UPX

0

0

-

-

1

10

10

10

2

18

8

9

3

24

6

8

4

28

4

7

5

30

2

6

6

30

0

5

7

28

2

4

8

24

-4

3

Column 1 shows the quantities of consumption of the good he has done a person.

Column 2 shows the cumulative total satisfaction or utility according to the quantities supplied.

Column three represents the additions that will suffer because total utility of consuming one more unit of it.

Column 4 only shows the average consumption of good

It is a figure frequently used to represent the relative distribution of a variable in a particular domain. The domain can be a set of households or persons in a region or country, for example. The study variable whose distribution may be the income of households or persons. The curve is plotted on the horizontal axis whereas the cumulative percentage of persons or households of the domain in question and the vertical axis the cumulative percentage of income.

Each point on the curve is read as a cumulative percentage of households or persons. The curve of the origin (0,0) and ends at the point (100,100). If income were perfectly equally distributed so the curve would coincide with the 45 degree line passing through the origin (eg 15% of households or the population accounts for 15% of income). If there is perfect inequality, that is, if a household or person possessed all the income, the curve would coincide with the horizontal axis to the point (100.0) where the jump point (100,100). In general, the curve is at an intermediate position between these two extremes, if a Lorenz curve is always above the other (and, therefore, is closer to the 45 degrees) we can say unambiguously that the first exhibits less inequality than the latter. This visual comparison between different distributions of geographical or temporal domain is the main use of Lorenz curves.

Example: The Lorenz curve is a graphical way to show the distribution of income in a population. It lists the cumulative percentages of population with cumulative percentage of income that this population receives. In the x-axis represents the population, “orderly” so that lower income percentiles are left and those of higher income are on the right. The vertical axis represents the income.

The graph shows the example of the representation of two imaginary countries, one in blue and red. The distribution of income in the country is more unequal than blue in the red country. In the case of the blue country, the poorest forty percent of the population receives an income of less than twenty percent of the national total. In contrast, in the red country, the poorest forty percent receives more than twenty percent of income.

The black diagonal line shows the situation of a country in which each and every one of the guys I got exactly the same income, would be absolute fairness. The closer the Lorenz curve from the diagonal, will be more equitable income distribution in that country.

Another way to observe Lorenz curve is estimating the surface area that lies between the curve and the diagonal. This surface is called the concentration area. In the graph on the left have filled the pink.

The higher the area’s wealth is more concentrated, the smaller this area is more equitable distribution of income in the country represented.

The Edgeworth box is a diagram devised by Francis Y. Edgeworth, in the late nineteenth century, useful for analyzing situations where there are only two economic actors, not a market, such as monopoly, oligopoly, and so on.

The box is constructed using the indifference curves of two individuals on two goods: those of the individual to be drawn on the basis of the standard reference point in the diagrams (“Southwest”), while the individual B originate the opposite (“Northeast”), the quantities of good 1 and 2 are located in the ordinates and abscissas, respectively. Successive lines IA and IB are the different indifference curves for each of the individuals concerned.

The case illustrates several points about the balance that can be set in such a situation, which are linked by the curve joining the Oa and Ob. When this diagram is used to study production problems considered assets then become productive factors and the series of curves IA and IB represent isoquants in this case, situations where the combination of the two factors can produce the same amount of well.

Source: Eumed.net

Resources

THE PRINCIPLE OF UTILITY IN THE ECONOMY CLASSIC

Introduction to Economics

Note: A complete course on the theories of ordinal and cardinal utility and generally all matters of economy is in http://www.eumed.net University of Malaga. (Recommended to visit).

National index of consumer prices:

Is defined as the weighted average of the assets of a specific set of goods and services consumed by families, known as the basket or market, which is converted to a time series that relates the prices of one period the prices of another period. The weights are based on the relative importance assigned to family spending, according to the level of income.

National index of producer prices:

Is defined as the price of goods and services that companies sell to other companies. This price consists of a weighted average of a set of goods and services in the wholesale markets, converted to a time series. The property considered in this index is usually divided into two categories, either according to the stage of the production process (raw materials, intermediate materials and finished goods) or according to its essence (durable or non-durable).

Source: http://www.itlp.edu.mx/publica/boletines/anteriores/b242/conceptos9.htm

For

M.C. José Trinidad de la Rosa Villorin

Note: The above address are several concepts in economics that may be useful.

Then the sidelines of a paper on the topic can be found at: http:vap/dinero.htm, it seemed very complete and I recommend you check it.

“Money is anything that members of a community are willing to accept as payment for goods and debts.”

Basic functions of money.

The basic function of money is the intermediary in the process of change. The fact that goods have a price comes from the relative values of some assets over others.

The cause of this relationship arises from the comparison of the value of assets and market contingencies. The source of these values may be the work embodied in those goods or the value given to it by individuals, as we orient to an objective or subjective theory of value.

The functions of money are:

1. Facilitate the exchange of goods. Being a fairly conventional generally accepted and guaranteed by the state.

2. Acting as unit of account. That is, expressed in certain units that already have values things. In this case, known as numerary basis.

3. Monetary standard. Regulating the amount of money in circulation in an economy through a fixed parity with the other central element behind it, which can be a precious metal or hard currency widely accepted internationally for all types of commercial transactions.

4. Book value. In a hypothetical barter economy, people change for other goods. Moving to a cash economy, these transactions are broken down into two parts: first, individuals carry out transactions of sale (exchange goods and services for money), on the other hand, carry out transactions of purchase (money for goods). This change implies a breakdown not only material but also temporary. That is, the person obtaining money, has a purchasing power that may materialize in the time they see fit.

5. Means of transferring purchasing power. When a person gives a credit to another, you are transferring purchasing power for a fixed period. For the lender, the transaction provides a store of value for the amount agreed upon, and for the borrower represents a transfer of purchasing power.

6. Means of payment of monetary obligations. The obligation to give a certain sum of money, they cancel giving that amount of money.

7. Instrument of economic policy. The monetary authorities can influence the economy by regulating the amount of currency, bank loans, etc., In this way, it influences the production structure, investment in the purchasing power of the population.