What is Role of Ministry of Finance Finance Essay

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Answer: The Role of ministry of finance is to prepare the yearly government budget, in coordination with the other ministries and public enterprises. Thus the main motive is to collect money in form of tax from the people and then spend it again back on people. This is a kind of process where money is collected from rich and spent on the general public. While the tax money is collected in the government treasury they are mostly spent on public welfare projects, defense, paying income to the government officials. Thus the role of Ministry of Finance is to back the government and its local bodies with finance related requirements meant to fulfill the public services and welfare projects. Therefore the main purpose is to implement such policies and implement such regulations as to fulfill the monetary related requirements of the government. Not only that the Ministry also takes care of its International deals and debts which are made for the security and development of the country. How does the Ministry interact with other governmental entities? Answer : The ministry interacts with other government entities in written documents consisting of orders, request and appointments that are bound to be taken. An operation coordination unit is also kept in the Ministry so as to channelize the easy flow of information within the ministry to the concerned departments.There is a hierarchy like situation where in the concerned secretaries of the Ministry takes orders and respond from their respective departments. This hierarchy is classified as follows. Level I. Ministry of finance Level II. This level includes the Secretaries of different departments. These includes Public revenue, financial affairs, economic affairs, resource and info, Audit and follow up director, Legal affair s office, Quality management secretary, and Operations coordination unit Level III. The Secretaries have their respective departments consisting of corporate tax directorate, value added Tax directorate, budget directorate, treasury directorate, financial system directorate, project directorate etc. Which departments are dealing with government entities? There a number of departments that are dealing with the government entities. These include the followings departments. The Budget Directorate Economics study and research directorate Financial system development directorate The Project directorate Treasury directorate External Economic relations directorate Human and Financial resource directorate Privatization and Outsourcing directorate The role of each department dealing with government entity? Answer: The role of each department dealing with the government entity is a follows. The Budget Directorate who deals with the fixing budget amount that is required to be collected from the people in form of taxes to finance the government projects meant for public welfare and growth. Economics study and research director works evaluation of the economic conditions of the country in comparison with the other countries. This way this department suggests the government to take appropriate actions in certain fields in the form of investment to keep the pace of growth. Financial system development director helps in directing the methods of taxing and fixing the percentage of taxes that should be levied. The Project directorate is entitled with the job of fixing the amount required for financing a project. Therefore he has to work as facilitator to finance and control the project cost until it is completed. Treasury directorate takes full care and record of the money being collected from the taxes. The movement of money occurs with proper instructions from the government head office. External Economic relations director helps in directing the government regarding the finance required to continue the projects with participation of other country. Human and Financial resource director helps the Ministry to decide on how much to spend on the Human Resource of the country and what are the requirements of the Human resource so as to make it competitive and capable enough to meet the International requirements. Privatization and Outsourcing director suggests the government to take appropriate actions which could help in the movement towards privatization through which the state is going to take out its finance and allow the private companies to take the public companies ahead. Also outsourcing helps the Ministry to complete its project by hiring people from other countries where the labor is cheaper. Foreign Economic Relations Directorate (FERD) is entitled with responsibilities related to various matters. Moreover the all competent authorizes matter including the matters related to the followings. Exchange of information (EOI), Certificate of residence (COR) and Mutual agreement procedures (MAP). What is the accounting system used by government entities? Answer: The government entities use the Organization for Economic Cooperation and Development or the OECD manual for the implementation of Exchange of Information provisions of tax purposes. Thus it’s an FERD’s approved format where in all the departments of the government has to follows the same principles and report their financial statements. Thus the OECD manual helps in the implementation of the exchange of information provisions for tax purpose. What is the standard finance manual? Answer: The Standard finance manual sets the financial and accounting policies and procedures which are related to the finance. Thus these manual helps in controlling and recording of various assets, liabilities and other fund properties. Along with that the manual helps in fulfilling the commitments of the government of the Kingdom of Bahrain. The manual is often revised and features are added as per the demand of time. Thus amendments are often seen in this manuals. Why is it published? Answer: The Standard finance manual are published with a view to meet the following requirements. To pen down the properties, funds and other assets in the Kingdom of Bahrain so as to save it from any fraud, negligence or becoming part of any dispute. To record all such transactions in the government records so that tax collection later on can be facilitated. To bring all the transactions at a certain level where they become generally acceptable and meet the International requirements regarding its reporting and method of recording. To keep the records clear and easily understandable. To bring a high level of consistency of accounting treatment through the available records helping in the decision making process of the government and its related departments. To keep a record of earnings and expenditures of the public fund collected through taxes. To figure out the requirements and obligations that are being a matter of concern. To make a financial policy which deal with the requirements of finance in the next financial year. Who’s responsible to publish standard finance manual? Answer: The Ministry of Finance is responsible for publishing the finance manual. Actually through this publications only the financial needs and requirements, the financial transactions of different departments and all other matter related to financial reporting is controlled by the Ministry of Finance. Thus Standard finance manual acts as not only administrator but also controller of following the accounting process of recording, analyzing and reporting the financial statements as per the International methods. Conclusion. In the end, we can say that the Ministry of Finance is entitled with the responsibility of taking care of all the things related to finance. Later on it issues standard finance manual so as to prefix a certain method of reporting the financial statement by different departments so that its easier to understand by everyone and follows the generally acceptable rules being administered by the International community related to reporting of financial statements. Reflection and impression of the subject. The reflection and impression of the subject from the above we can evaluate the various benefits of reporting the financial transactions by government institution and in this case Ministry of finance and its various departments. These are as follows. A common framework to enable review, analysis and interpretation of financial information across entities, countries and regions Transparent, timely, reliable financial information to the general public creating confidence in the government. Access to efficiently priced capital is key to economic growth

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