Growth of capital requires some kind of money capable
of intermittently serving flow of current assets. It is recommended to use
transferable right of ownership to money (assets) in the bank instead of non-transferable
financial obligation (liability) of the bank. Form of accounting reflects the essence
of relations which are established between the parties. It is necessary to
eliminate forceful credit relations for a producer in his relations with the
bank by its debt paper to determine who and how much has loaned the paper`s issuer.
Thus industrial relations represent an exchange of means of production to money
that reflects the assets of the issuer of money means.
The source of monetary capital in production is
connected with distribution of national income and consumption level. For accounting
it is suggested to use the asset created by a producer of goods. This will
stimulate development of production relations on the basis of cooperation of
manufacturers to obtain this kind of money asset. Production relations create
money capital as a right to request payment for final production goods.
We will further show how the banking assets reflect
money rights of producers. The right of ownership to a certain amount of money
at the issuer`s bank is reflected by the bank`s executive book-entry
(certificate). The issuing bank of this certificate is a payer in a contract of
delivery of final goods to its client and the owner of money received from
selling goods to consumers, thus the bank account is credited. Emission of the certificate
is executed with the aim to pay producers for the final goods and is
corresponded with the bank account of the purchaser of the final goods by
writing off the amount of their cost. Emission of the certificate reflects
money rights of the sellers of final goods. The bank`s certificate reflects a combination
of two assets: one is the bank`s reserve and the other – right to money created
by producers.
Essentially the issuing bank takes upon itself the
central bank’ functions for the participants – producers of final goods because
accounting is done by money means issued by the bank. However the issuing
bank`s relations with the certificate owner are not credit relations, the
bank`s role is to hold the assets of the owner of this certificate. In order to
serve the turnover of the certificate the issuing bank should keep the “Banking
Certificate” register for the depositaries of the executing banks that act as
nominal holders of this certificate.
The certificate serves the turnover of final goods’
means of production and produces income from the turnover for the bank. At the
end of the turnover when the final goods are being sold and paid for, the
certificate is exchanged for the financial obligation of the issuing bank in
the amount of the current (one-month period) expenses on the added value and on
the taxes of the owner of the certificate. These expenses have a regular
character and serve the consumer market.
Accounting by certificate in production sector
distributes the cost of final goods among consumers. Payment received by the
bank for the final goods is being directed by the bank to the payers for these
final goods after the cost has been distributed among the consumers. The
issuing bank acts both as a payer and payee for the final goods. As a result
final accountings are being made only between banks – issuers of the certificate
as they are obliged to pay themselves.
The right to claim payment for delivery of final goods
is created by a consolidated labor of producers. This is the motivation for
cooperation among the producers. The added value of each participant of
production represents a share of right of monetary claim (income from selling
final goods).
The issuing bank may be any bank that acts as a payer
by certificate for final goods. The name of this issuing bank is impersonalized
for the owner of certificate because the depositary registers the certificates
of different issuing banks on one depositary account. This allows the owner of
the depositary account to pay by certificate for any means of production of
final goods, and not only for those for which the certificate has been
received.
Accounting by impersonal and divisible certificate
allows the issuing bank not to spend money to cover production relations. If money
(in the form of Central Bank banknote) won`t be spent in consumer market the executive
bank may use a banking card to pay for the value-added expenses of the
certificate holder, excluding taxes. If the payment for the final goods is made
by a card that is by executive bank’s debt, it is possible to make a set-off
between the executive and the issuing banks.
The accounting system allows to square money quantity
and amount of trade relations which positively results on macroeconomic figures
of employment and prices. The turnover becomes the bank`s capital which gains
income thus stimulating the bank to increase it. Banks’ financial stability is
based on further merging the banks with real economic sector and limits finances`
emission to serve exclusively consumer market. The exchange of financial
obligation on the bank`s depositary obligation results in reduction of the
bank`s monetary debts in the amount of production turnover. The bank reserve
(assets) is left in the bank – issuer of the certificate. Change of structure
of the banking liabilities accompanied by keeping the bank’s primary reserve
(assets) eliminates the banking crisis.
The operational system of accounting has been prepared
as a regulatory Statement which describes the parties` relations, documents
that are being used, and the book-keeping.
