Budgetary classification

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Budgetary classification
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The budgetary classification, in accordance with the provisions of the Act on public finances, is a system of signs that are used to describe the income, expenditures and revenues and expenses, occurring in the various units of the sector of public finances.

Income/resources that come from the European Union are classified by:

  • section,
  • chapter,
  • paragraph.


It is a kind of income due to the origin or nature of any expenditure, its legal nature and purpose.

Section and chapter

Specifies the type of activity from the specific income or expenditure is derived.

The budgetary classification thanks to subdivisions and their connections, is a convenient instrument describing the funding, and is necessary for planning, and financial reporting. Also facilitates the surveys of revenue or expenditure on the public finance sector.


In the planning of public finance sector units. Thanks to the budgetary classification administration can plan income and expenditure limits on individual areas of activity, i.e. on the sections and appropriate chapters.

By paragraphs, sources of income are projected or possible limits of expenditure are set. Any amount of money described in budgetary classification becomes official norm for given period of planning. These norms, by virtue of their transfer to the annual financial plan, provides competence for the executing of planned activities and investments of local and state administration.

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