BUDGETING AS A TOOL OF FINANCIAL MANAGEMENT OF HIGHER EDUCATION INSTITUTION

In the process of managing a higher education institution (hereinafter — HEI), especially its financial and economic activities, there is a growing need to use the capabilities of the budgeting system. The article analyzes the approaches to the interpretation of the concepts «budgeting» and «budget» and reflects their differences. It is noted that budgeting is a process of forming and implementing budget indicators and, in fact, managing this process. It is emphasized that the use of budgeting as a management tool will allow forming a high level of financial potential in order to achieve current and strategic goals. Consistent financial planning, thorough analysis and control by governing authority and relevant departments are important components of the budgeting process and successful financial management. The research identifies the factors that affect the effectiveness of the processes of formation and use of the financial potential of the higher education institutions, including legal and regulatory framework, financial management, financial planning and others. A step-by-step budgeting process is proposed (organization of preparation for budget formation; development and formation; consideration and approval; implementation; analysis and adjustment), in which the budget is a tool. It is important to note that in the review of the conceptual apparatus, the budget is singled out as a financial document or financial plan, according to which the subject (HEI) conducts its activities. The scientific and practical significance of this research is the proposed budgeting process, the effective implementation of which will allow the governing authority to make reasonable decisions on educational, scientific-innovative, financial and economic and other activities of the HEI, increase its financial potential, achieve goals and ensure competitiveness among others, occupy high positions in domestic and international rankings.