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83MANAGEMENT CONTROL IN NON-PROFIT ORGANIZATIONS
Kopotiienko T.
PhD in Economics, Associate Professor at theDepartment of financial analysis and audit
Kyiv National University of Trade and Economics,
Tolmachova A.
Assistantat theDepartment of financial analysis and audit Kyiv National University of Trade and Economics
Danylova N.
Student
Kyiv National University of Trade and Economics
Abstract
The article highlights aspects of management control in non-profit organizations. Particular attention waspaid to internal, external factors influencing non-profit organizations and the characteristics of non-profit organizations that affect the process of management control. The study identified the main problems faced by the management control system in non-profit organizations.
Keywords: non-profit, non-profitorganizations, management, management control, aspects of management.
Introduction. Non-profit organizations rightly called third sector organizations, because they play an important role in the implementation of the state's social program. The set of non-profit organizations can be called a united social movement, movement consisting of separate, mutually not subordinate, but interacting public organizations that direct the energy of citizens to creative and other activities, thereby reducing social tension in the community. This fact must be understood, to be able to properly use and, most importantly, to control. The work of non-profit organizations has significant value, both in the short and long terms, because society functions constantly and an important factor is financial independence. Without the goal of making a profit, they redistribute available resources and create additional financial, material, intellectual and other benefits aimed at satisfying private and public interests. Therefore, management control in non-profit organizations has its own specifics and plays an important role.
The research objective. The purpose of the article is to define the theoretical aspects of management control in non-profit organizations. It is necessary to determine peculiarities of the functioning of non-profit organizations, to determine the impact of these features of non-profit organizations on management control in them, to suggest ways to solve problems arising in the functioning of management control systems in nonprofit organizations.
Materials and methods. World experience shows that a society cannot exist without a developed network of non-profit associations of citizens, which ensures the participation of the general public in the development process. Such associations function as mediator between the government and various social groups, protecting their rights and interests. They prevent the state from monopolizing the political, economic and other spheres of society, ensuring public control over the activities of the state and its structures.
Non-profit organizations have already demonstrated in practice that they can have an impact on eco-
nomic reform. The development of management control in non-profit organizations within countries with economies in transition is usually at an early stage due to the fact that theory lags behind practice, there is inconsistency of decisions and their unbalance. [1]
The problem is that managers are not always aware about management, or they may change their minds under the influence of their subordinates, who do not have practical skills in managing organizations, or simply do not know what financial and operational goals the organization currently pursuing. Traditionally, professional education in the CIS countries does not include a management component. Most educators believe that training in professional skills is much more important than training in the skills needed to manage the organizations in which they work. Banal ignorance often led professionals to underestimate the importance of the management function. The culture of many nonprofit organizations has intensified the tendency to despicable managers, who have a negative impact on management control in the organization, because official negligence will not lead to the prosperity of companies [2].
The influence of external factors on the implementation of decisions in non-profit organizations directly depends on the management system. In comparison with other enterprises, non-profit organizations, as a rule, are subject not only to the provisions of many regulations, but also to other rules. The influence of these norms or the so-called quasi-legal requirements is mainly felt in two directions: external - laws, regulations, instructions, as well as internal - through statutory requirements, agreementsand contracts. The impact of these regulations or the so-called quasi-legal requirements mainly felt in two directions: external -laws, regulations, guidelines, and internal - through statutory requirements, agreementsand contracts. These quasi-legal requirements in some way limit the scope of such organizations, in order to maintain their nonprofit status, and at the same time they are the main principles of non-profit activities. Only by following them, non-profit organizations can achieve the main
board fasteners which it was created its founders, to ensure the interests of the public and certain social groups. It should be noted that professional associations of individuals and legal entities also occupy a significant share in non-profit organizations that are created to provide a variety of professional services to each other. These professional associations may be related to the operation in one or more interrelated areas. For such guilds, certain regulations, such as those relating to professional ethics, are of great importance, according to which they are obliged to provide services within the established professional rules. Therefore, compliance with rules and regulations is extremely important for the proper functioning of non-profit organizations. [3]
As nonprofit organizations, financial incentives are generally less important to people who do work other than management, and this is because professionals usually consider their current compensation adequate they derive their main satisfaction from their work. And, as a rule, such people give inadequate weight to financial consequences of their decisions. For example, many doctors believe that restrictions should not be placed on the amount spent on saving lives. Unfortunately, in a world of limited resources, this attitude is simply unrealistic. Management should focus on the ability to achieve organizational goals in the allocation of resources and to ensure that the interests of specific groups of service users are met with the available number of available assets. Reducing costs will help ensure the preservation of the organization's assets in the absence of additional capital and increase the ability to continue the activities of a non-profit organization. [4]
The formation of effective management control is necessary at all levels of management of a non-profit organization, because it is a guarantee of successful organization. Because of this, in educational institutions of developed countries, management control in nonprofit organizations is studied in general as a separate subject, but, nevertheless, its concepts and methods are not widely used, or are not used properly.
Many non-profit organizations continue to believe that their noble mission providingthem permanent involvement rising number of public and private support to their activities. Unfortunately, many organizations then find that the outside support diminishes, although before they used / abused it. Eventually, managers of non-profit organizations begin to realize that the problem is in the system of management control, because neglect to reduce their autonomy can lead to complete dependence [5]. Whatever the purpose of a nonprofit organization, it is important to remember that doing business from a management point of view should be tough and aimed at independent survival, and not rely on outside help, otherwise the state of the organization will simply get out of control.
Characteristics of non-profit organizations that affect on the process of management control: no measure of profit tax and legal aspects; tendency to be service organizations, greater constraints on goals and strategies, less dependence on clients for financial support, dominance of non-managerial employees, differences in management, importance of political influence, tradition of inadequate management control. Of these, the
lack of a measure of profit is the most important characteristic, as it affects all non-profit organizations, it will be a good reason for discussion for many years to come. Most nonprofit organizations are service organizations and do not have the same advantages in management control, as companies that produce and sell physical goods. Here are some important differences between the two types of organizations [2]:
- services cannot be stored, while goods can be in stock, waiting for the customer. If the tools and staff available today to provide services are not used, the potential income from their possible occupation willbe lost forever.
-service organizations are usually time consuming. Although they require relatively little capital per unit of output to control their production, they need to manage people who provide services. Typically, it is more difficult than management operation in which the work is done by mechanisms;
- it is not always easy to measure the number of services. Tracking of material goods, both during the production process and during the sale are easily controlled. But in services it is much harder to do. For example, a medical team may measure the number of patients treated by a physician per day, or even classify patient visits by type, but this in no way measures the number of services the physician provides to each of these patients;
-the quality of the service cannot be checked in advance. The quality of tangible goods can be checked before delivery of goods to consumers. And the quality of the service at best variant can be checked only during the time when it is being provided to the client. Judgments about the quality of most services are subjective due to the lack of standards.
The line of responsibility is often not clear in many non-profit organizations. There are no shareholders, etc., and managers are rarely paid for their services, and many are chosen for political or financial reasons rather than their ability to run the organization [7]. The downside is that the governing body of a non-profit organization is often insufficiently informed about the main problems faced by the non-profit organization, and therefore solutions may not always be optimal. Thus, management control is less influential in non-profit organizations than in commercial ones, where the board is responsible for all its actions when the organization is experiencing problems. Since there is no measure of profit in a non-profit organization, management control should be better developed than in a commercial one. Often there is not even a general recognition of the responsibility of managers.
Because non-profit organizations lack the semiautomatic controls provided by the profit mechanism, they need good control and evaluation systems of management even more than businesses. However, many such organizations, especially government ones, lag behind.
Results of research and discussions.
Characteristics of non-profit organizations can be grouped into two categories - technical and behavioral. Both are very important in management control. Specifications related to the difficulty of measuring results
and evaluating connection between them, there are difficulties in controlling profits and expenses. This complexity is usually unique to non-profit organizations.
However, measurement is important and possible, and managers must make significant efforts to carry them out. Here it is necessary, yet subjective, but effective development of standards that will help managers control processes within the organization, systematizing them by indicators specific to a particular activity. The development of indicative controls may be useful. Nonetheless, from the outset it should be recognized that the resulting system will never be a solid basis for planning or performance measurement, as does the rate of profit in commercial organizations.
The values of behavioral characteristics are twofold. First, most behavioral factors which impede necessary management control can be overcome through improved understanding and education. Second, if these problems are not overcome, then any improvement in technical characteristics will most likely not have a real impact on management control.
Conclusions. Non-profit organizations play a very important role in formation of public relations, and therefore the shoulders of managers have a huge responsibility and from their control activities within such organizations can depend on the fate of people and even their lives. Management control in non-profit organizations has many aspects in comparison with commercial companies, so its system is more complex and not always based on objective data. The anthropogenic factor plays an important role in the system of management control of non-profit organizations, so it makes sense for managers to think and make decisions about
its optimization or stabilization for the benefit of the organization.
REFERENCES:
1. Kutyeva D.A. Similarities and differences between non-profit organizations and commercial organizations / D.A. Kutieva, V.A. Makarova // Problems and prospects of development of economics and management: materials of the Intern. correspondence scientific-practical conference (Novosibirsk, May 22, 2013). - Novosibirsk: Publishing house "SibAK", 2013. - pp. 123-129
2. David W Young Management Control in Nonprofit Organizations, Cambridge, Massachusetts, 2012
3. Savchenko RO, Savchenko NM Management control of non-attributable organizations. Economy that power. 2019. No. 2. P. 53-57
4. For additional discussion, see Robert L. Burns, Elisabeth H. Bradley, and Bryan J. Weiner, Shortell and Kaluzny's Health Care Management: Organization, Design, and Behavior, 6th edition, Clifton Park, NY, Delmar Cengage Learning, 2012
5. KunleAkingbola, Sean Edmund Rogers, Alina Baluch Change Management in Nonprofit Organizations: Theory and Practice / Springer, 2019
6. Martha Golensky, Mark Hager Strategic Leadership and Management in Nonprofit Organizations: Theory and Practice / Oxford University Press, 2020
7. Tolmachova A. Features of the organization of internal audit of non-profit organizations / A.M. Tolmachova // Problems of theory and methodology of accounting, control and analysis: an international collection of scientific papers. Output 2 (40). - Zhytomyr: ZPTU, 2018. P. 59
SOCIO-ECONOMIC ASPECTS OF REPRODUCTION HUMAN CAPITAL IN RURAL AREAS
Utechenko D.
postgraduate student of Bila Tserkva National Agrarian University
(Ukraine)
Abstract
The article deals with the socio-economic conditions of human capital reproduction in rural areas. It is substantiated that the functioning of rural areas in economic turbulence is reflected in their condition, which requires an analysis of the main socio-economic indicators of the environment of human capital reproduction.
The socio-economic conditions have been systematized and their impact on the human capital reproduction in rural areas has been outlined. It has been pointed out that the human capital reproduction in rural areas is influenced by the demographic crisis, which is caused primarily by economic factors. Factors in the manifestations of the demographic crisis have been identified, which is accompanied by a natural and migration decline in the working population and the development of social infrastructure, particularly health care and education. The main components of social assistance to the rural population have been highlighted and the directions of their modernization have been outlined.
Keywords: human capital, reproduction, social factors, economic factors, rural areas.
Introduction. Human capital in relation to rural areas is a factor in the reproductive development of the economy and a necessary condition for the development of socio-economic environment. In addition, it is a structural component of this area, mostly forming its qualitative characteristics. Under current circumstances, we have identified human
capital as a resource of a strategic action plan to bring the territory out of a depressed state. In turn, qualitative and parametric quantitative characteristics of rural areas are determined by a set of problems of rural development, actualized in other related areas of their functioning. In this regard, dialectical unity as a sign of systemic interaction of two elements, human capital
