Use of financial analysis in comparing projects and policies for investments in local governance

AuthorYlldeze Sokoli
PositionUniversity 'Ismail Qemali' Vlorë
Pages127-135
European Journal of Economics, Law and Social Sciences
IIPCCL Publishing, Graz-Austria
Vol. 2 No. 2
June, 2018
ISSN 2519-1284
Acces online at www.iipccl.org
127
Use of nancial analysis in comparing projects and policies
for investments in local governance
Ylldeze Sokoli
University “Ismail Qemali” Vlorë
Abstract
The use of nancial analysis to assess the inputs and outputs of government projects, makes it
possible to take be er decisions regarding e cient allocation of limited resources, in front of
which is faced the local governance. The choice of investments that will be selected, must be
carried out in such a way as to ensure the most e cient use of economic resources and a higher
extent of bene ts for citizens. It is important that the investor, Municipality, achieve a surplus
as high as possible, because it would lead to the fact that can be o ered more investment
for the community with a higher performance. The main role of local government consist
in the e cient management of this budget, management which would guarantee maximum
utilization of taxpayer money and spending of budget funds only for projects that improve
the quality of life of citizens and contribute to rasing the level of income. The main aim of the
government remains minimizing risk and maximizing investment income.
The methodology used in the paper is rst related to: the study of foreign literature on
theoretical and practical treatment related to the use of nancial analysis comparing the
projects and policies to be invested in local governance, secondly, will describe the steps
through which passes the selection of investments to be carried out by the municipality, and if
this is a way to ensure e ciency and e ectiveness in the use of funds?
Results of the study can help central and local government to focus more a ention on using
the most e cient methods related to selection and be er management of funds for public
investment.
This paper aims to conclude that performing a detailed analysis of the projects and policies to
solve them, which provide a more e cient allocation of resources, thereby bringing bene t to
the entire community.
Keywords: Public investment, local governance, economic development, projects, nancial
analysis.
Introduction
This work includes issues of relations between central and local government
regarding the nancing of investment projects, distribution of public resources
process according to investment needs to compete each other, and improve service
quality and local activities. In conditions of limited resources and the needs of the most
diverse municipality is required to choose between them according to importance.
For a be er use of funds from municipalities, project requirements for carrying out
the investment should be based on measurable and viable criteria which establish
priority among needs.
Central government has an indispensable role in the primary economic activity, but
its fundamental task is the creation and maintenance of functioning of the legal and

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