ESSENCE AND CLASSIFICATION OF SOCIAL COSTS OF THE BUSINESS ENTITY FOR ACCOUNTING PURPOSES

Abstract

The article examines the essence of social costs of a business entity as a component of sustainable development. Attention is also emphasized to the fact that the study of such expenses aims to reveal the mechanisms of their formation and effective use for the support of employees and the development of communities. In this regard, the purpose of the article was to study the essence of social costs of business entities in the direction of organizing their effective accounting and control. It is proven that the process of managing social costs involves the performance of all functions that are characteristic of the management of any accounting object, namely, it determines the development and implementation of management decisions with the simultaneous establishment of implementation control. The functions of managing social costs, in turn, should be carried out according to the stages of the management cycle, such as forecasting and planning, organization, coordination and regulation, stimulation of implementation, as well as accounting and analysis. It is emphasized that the need to define social costs as a separate accounting category is due to a number of factors, namely, social costs differ from other types of enterprise costs, which, accordingly, requires specific management methods and appropriate approaches to their accounting. Most of these costs are voluntary, while only a certain part is considered mandatory under the law. The study of models of functioning of institutions of social responsibility made it possible to single out the main functions of the enterprise's social costs, namely: socio-economic, motivational, protective and social-partnership functions. A refined classification of the enterprise's social costs is proposed for practical implementation in order to detail the accounting, the use of which will make it possible to improve data analytics in the process of making effective management decisions of a current and strategic nature. Thus, it can be concluded that the accounting of social costs is aimed at determining and implementing the social policy of the enterprise on the basis of complete, reliable and objective information about the implementation and compliance with the legality of such costs.