Weekly Finance Tips

Local financial management in terms of allocation of capital expenditure is associated with long-term financial planning, particularly financing for the maintenance of fixed assets resulting from capital expenditure. According to the concept of multi-term expenditure framework (MTEF), that the capital expenditure policy should pay attention to expediency (usefulness) and the financial capacity of local government (budget capability) in the management of these assets in the long run (Allen and Tommasi, 2001). Capital expenditures intended to get a local government fixed assets, such as equipment, buildings, infrastructure and other fixed assets. Theoretically there are three ways to acquire fixed assets, namely: (1) build your own, (2) exchange with other fixed assets, and (3) purchase. Most of the cases in the government, usually the way it does is build it yourself or buy.

The issue now is the limited financial resources to build  remain, on the other fixed assets is needed. Therefore, the Government will certainly look for other sources, such as investors, loans to third parties, and are much easier today with the publication of the Regional Bond (OD).

This short paper will explain the above issues, and how their prospects for Regional Development.

Possibility Related Posts:

• Local financial management
• Definition of Current Assets
• Regulation of Finance
• Debt Management
• Decisions Relating and Working Capital