Criteria for Classification of the Principles of Financial Control

Classification Of The Principles Of Financial Control According To The Hierarchical Structure Of The Control System Of The Country

The structure and organization of the country's control system are subject to the general theory of systems. They exist and function in order to achieve certain goals and objectives. They are built on the basis of the structure of state power and represent a set of separate elements (subsystems) that function as a whole. These subsystems are: legislative, executive and judicial control. The division of the main building blocks of the country's control system is subject to one of the basic principles of state power, namely, the separation of powers.

In his work entitled On the Spirit of the Laws, in 1748, Charles de Montesquieu (Hajoljan, 2012) was the first to declare that the functions of the state should be exercised by various bodies - legislative, executive and judicial, which have to interact, but also to control each other “. In Montesquieu's view, this is the only democratic way in which the rights and freedoms of citizens can be guaranteed without compromising the sovereignty of the state itself. Today, every democracy builds its government on this basic principle. Therefore, state control, which is presented as a function of government, unites all subsystems that exercise control, resulting in creating the overall control system of the country. In order to maintain the balance in each community, one of the most important unwritten rules has been adopted, namely, that no controlled system should exceed its scope of action, ie. not to be dominant. This is achieved through the relationship between the exercise of a power and the control that other bodies exercise over it.

Each individual control subsystem is made up of separate elements (also called subsystems). With the help of Figure 2 the hierarchical structure of the control system of the country can be presented as follows:

Figure 2.

Hierarchical structure of the control system of the Republic of Bulgaria

• 1.

  The concept of “control system” is more general and comprehensive than the concepts of “legislative control system”, “executive control system” and “judicial control system”. This is determined by the fact that they (the legislative, executive and judicial control systems) are subsystems (elements) of the overall control system of the Republic of Bulgaria.

• 2.

  The control subsystems that make up the overall control system of the country are very diverse in appearance. This determines the complexity of development and the impossibility to cover all control subsystems and to study all control principles that build not only the systems themselves, but also their subsystems.

• 3.

  The control system helps to provide information to stakeholders by the state authorities. Information technologies, together with the control actions of the controllers, drive the mechanisms for the preservation of the state property and the society as a whole, without infringing on their autonomy and their statutory rights.

• 4.

  Control is an open system that can continuously include in its scope a variety of subsystems. The main objective of all subsystems is to ensure complete, effective and comprehensive control over the identified controlled objects. The purpose of the financial control system is: to understand the main financial processes; to establish key financial policies and objectives; to determine which processes are a prerequisite for maintaining the appropriate level of risk in the control environment; to apply best practices and continuously improve the philosophy for building effective control actions.