Utility enterprise: forms of ownership, device, functions and tasks

2024 Author: Henry Conors | [email protected]. Last modified: 2024-02-12 02:41

A public utility is an economic concept that implies an organization that provides the population with electricity, gas, water and other essential services. Such organizations have a monopoly, and their functioning is regulated by the activities of the government. A related term is also used to refer to a utility business entity: public utility.

How public housing companies operate

Communal property funds are one of the main components of the local finance system. The enterprises of the communal sector of the economy include only those business entities that operate only on the basis of communal property, or those in whose finances the share of communal property is above 50%. They also include those industries, activitieswhich is under the control of local governments.

Utilities operate on the basis of local budget funds.

Stages of creating public utilities

1. The decision to establish a utility company is taken by the local council. At the same time, funds are allocated, registration is made, the seal is approved, a bank account is opened, the statutory fund is determined and a candidate for the position of director of this organization is selected. Also, the local council decides on the minimum amount of the authorized capital.

reasons why the operation of the enterprise may be terminated.

2. The name of the legal entity is selected. It should include information about the legal and organizational form, as well as the name. At the same time, it is not allowed to use in this name the names (both full and abbreviated) of any state bodies. government or local government.

Main types of utilities

Communal services are divided into corporate and unitary. Let's take a closer look at them.

A unitary utility company is created by one bodylocal self-government, which becomes its founder and is included in the sphere of its management. This body approves the charter, allocates the funds required for its functioning, creates an authorized fund that is not divided into shares (shares), distributes income (both directly and through the head), manages the enterprise, and also hires employees to form a work team, oversees issues related to the possible transformation or removal of the enterprise.

Most utilities in Russia are unitary.

Unlike a unitary enterprise, a corporate enterprise is created with the participation of two (or more) founders on the basis of their mutual agreement. They carry out joint management of affairs, and their property is combined into a single whole. They can create bodies through which to manage public utilities.

Sometimes corporate entities operate as joint stock companies or even limited liability companies. The latter can be created by one person, at least in Ukraine.

Communal Joint Stock Company

In a communal joint-stock company, there is a division of the statutory fund into a certain number of shares with an equal value, the rights to which are secured by shares. Only the corporate property of the given joint-stock company acts as a source of compensation for damages. In a joint stock companycommunal type local governments own half of the shares and the right to decisive influence.

Utility LLC

In a communal limited liability company, the fund of funds is divided into certain shares (that is, shares), and their volume is determined by special documents. This fund is fully or partially administered by local self-government bodies. At the same time, they also play a decisive role in the functioning of a communal limited liability company. The liability of members of the company for the obligations of their activities concerns only the funds of this fund.

Interaction between members of public utilities and local self-government bodies is based on the principle of subordination, accountability, provided that the higher authority is the self-government bodies that control the work of communal services. In particular, their tasks include monitoring the rational use of funds by public utilities, using the profits they receive for their intended purpose, receiving reports in oral or written form.

Funds of unitary enterprises are state property and are used as economic expenses.

Utility and housing enterprises have property, which consists of such components as goods, current and fixed assets, as well as other material and financial assets.

What is the source of funds for the utility?

Sources of material andthe financial property of the utility can be:

• funds provided by the city, district or regional council;
• profit from securities;
• income arising from the implementation of economic and financial activities, in particular, the sale of services;
• funds received under an agreement from the district, regional or city budget;
• bank and other loans;
• cap. investments, budgetary and other financing;
• donations, charity (from citizens or organizations);
• transactions to acquire someone else's property;
• other legitimate sources.

Rights of a commercial and non-profit organization

A public utility non-profit enterprise (that is, a state utility company) does not have the right to freely use the funds assigned to it without the consent of the authority in whose subordination this enterprise is located. It carries out its activities in accordance with the instructions of the higher authority and submits to it.

Commercial-type utility enterprise refers to business entities, has the right to free economic autonomy, but at the same time bears responsibility, under which all its property is placed.