CHAPTER 1 1.

1 General considerations regarding taxes

To tax (from the Latin taxo; "I estimate") is to impose a financial charge or other levy upon a taxpayer (an individual or legal entity) by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities. Taxes consist of direct tax or indirect tax, and may be paid in money or as its labour equivalent (often but not always unpaid labour). A tax may be defined as a "pecuniary burden laid upon individuals or property owners to support the government a payment exacted by legislative authority." A tax "is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority" and is "any contribution imposed by government whether under the name of toll, tribute, tallage, gabel, impost, duty, custom, excise, subsidy, aid, supply, or other name." The legal definition and the economic definition of taxes differ in that economists do not consider many transfers to governments to be taxes. For example, some transfers to the public sector are comparable to prices. Examples include tuition at public universities and fees for utilities provided by local governments. Governments also obtain resources by creating money (e.g., printing bills and minting coins), through voluntary gifts (e.g., contributions to public universities and museums), by imposing penalties (e.g., traffic fines), by borrowing, and by confiscating wealth. From the view of economists, a tax is a non-penal, yet compulsory transfer of resources from the private to the public sector levied on a basis of predetermined criteria and without reference to specific benefit received. In modern taxation systems, taxes are levied in money; but, in-kind and corve taxation are characteristic of traditional or pre-capitalist states and their functional equivalents. The method of taxation and the government expenditure of taxes raised is often highly debated in politics and economics. Tax collection is performed by a government agency such as Canada Revenue Agency, the Internal Revenue Service (IRS) in the United States, or Her Majesty's Revenue and Customs (HMRC) in the UK. When taxes are not fully paid, civil penalties (such as fines or forfeiture) or criminal penalties (such as incarceration) may be imposed on the non-paying entity or individual. Money provided by taxation has been used by states and their functional equivalents throughout history to carry out many functions. Some of these include expenditures on war, the enforcement of law and public order, protection of property, economic infrastructure (roads, legal tender, enforcement of contracts, etc.), public works, social engineering, and the operation of government itself. Governments also use taxes to fund welfare and public services. These services can include education systems, health care systems, pensions for the elderly, unemployment benefits, and public transportation. Energy, water and waste management systems are also common public utilities. Colonial and modernizing states have also used cash taxes to draw or force reluctant subsistence producers into cash economies. Governments use different kinds of taxes and vary the tax rates. This is done to distribute the tax burden among individuals or classes of the population involved in taxable activities, such as business, or to redistribute resources between individuals or classes in the population. Historically, the nobility were supported by taxes on the poor; modern social security systems

are intended to support the poor, the disabled, or the retired by taxes on those who are still working. In addition, taxes are applied to fund foreign aid and military ventures, to influence the macroeconomic performance of the economy (the government's strategy for doing this is called its fiscal policy), or to modify patterns of consumption or employment within an economy, by making some classes of transaction more or less attractive. A nation's tax system is often a reflection of its communal values or/and the values of those in power. To create a system of taxation, a nation must make choices regarding the distribution of the tax burdenwho will pay taxes and how much they will payand how the taxes collected will be spent. In democratic nations where the public elects those in charge of establishing the tax system, these choices reflect the type of community that the public and/or government wishes to create. In countries where the public does not have a significant amount of influence over the system of taxation, that system may be more of a reflection on the values of those in power. All large businesses incur administrative costs in the process of delivering revenue collected from customers to the suppliers of the goods or services being purchased. Taxation is no different, the resource collected from the public through taxation is always greater than the amount which can be used by the government. The difference is called compliance cost, and includes for example the labour cost and other expenses incurred in complying with tax laws and rules. The collection of a tax in order to spend it on a specified purpose, for example collecting a tax on alcohol to pay directly for alcoholism rehabilitation centres, is called hypothecation. This practice is often disliked by finance ministers, since it reduces their freedom of action. Some economic theorists consider the concept to be intellectually dishonest since, in reality, money is fungible. Furthermore, it often happens that taxes or excises initially levied to fund some specific government programs are then later diverted to the government general fund. In some cases, such taxes are collected in fundamentally inefficient ways, for example highway tolls, this is also true of privately funded roads. Some economists, especially neo-classical economists, argue that all taxation creates market distortion and results in economic inefficiency. They have therefore sought to identify the kind of tax system that would minimize this distortion. Also, one of every government's most fundamental duties is to administer possession and use of land in the geographic area over which it is sovereign, and it is considered economically efficient for government to recover for public purposes the additional value it creates by providing this unique service. Since governments also resolve commercial disputes, especially in countries with common law, similar arguments are sometimes used to justify a sales tax or value added tax. Others (e.g. libertarians) argue that most or all forms of taxes are immoral due to their involuntary (and therefore eventually coercive/violent) nature. The most extreme anti-tax view is anarcho-capitalism, in which the provision of all social services should be voluntarily bought by the person(s) using them.

1.2 Direct taxes (comparison with other countries from E.U.) In the general sense, a direct tax is one paid directly to the government by the persons (juristic or natural) on whom it is imposed (often accompanied by a tax return filed by the taxpayer). Examples include some income taxes, some corporate taxes, and transfer taxes such as estate (inheritance) tax and gift tax. In this sense, a direct tax is contrasted with an indirect tax or "collected" tax (such as sales tax or value added tax (VAT)); a "collected" tax is one which is collected by intermediaries who turn over the proceeds to the government and file the related tax return. Some commentators have argued that a direct tax is one that cannot be shifted by the taxpayer to someone else, whereas an indirect tax can be. Direct taxes in Romania - evolution and effects It is well known that Romania has never had a coherent tax system, able to comply with the requirements of the transition phase to market economy and it has developed a gradual reform that unfortunately has not always generated beneficial effects on the economic environment, mainly due to unfavourable conditions for economic reforms and for the discordance between legislative provisions and practical realities. Replacing the disbursements from benefits with economic units profit tax, established in differentiated quotas in related to profitability rate was a measure adopted in 1990 which focused on state enterprises. The reform included the other economic units as well and made a differentiation between the fiscal regime and the ownership form. At the same time tax facilities were established in order to stimulate investments. Further alterations occurred very quickly with the establishment of the profit tax, computed through the application of 67 quotas over 67 tranches.... Recorded difficulties resulted in their replacement with two trances and two quotas (30% and 45%), justification residing in the stimulation of small and middle enterprises. The effects were not what they had been expected in this case either, because from a previous tax of 5% we reached a tax of 30%, the aid being actually given to large enterprises (a tax of 45% from 77%). Then there were the quotas of 38%, 25% and, since 2005 the unique quota of 16% has been used, many times adopting conjuncture measures that have had long-term negative effects. Incomes taxation system has faced repeated alterations, replacing the total retribution remuneration fund tax with a progressive quotas tax, between 6% and 45%, as further amended. Therefore, in 2004 a progressive system with differential quotas was applied for natural persons incomes, that is from 18% to 40%, and since 2005 the 16% proportional taxation has been used. In 1991 dividends tax was established, with a restricted applicability range, being applied only to the profit distributed to the foreign shareholders of a partially or fully foreign capital company. There were further legislative alterations, regulating the notion of dividend, the maximum establishing limit of employees contribution fund to the profit from the net profit, of the fund for the managers contribution quota to the net profit and of the fund for establishing its own financing resources. There were also alterations at the level of taxation quotas, from 5% for natural persons and 10% for legal entities up to 16% at present. Passing to the unique taxation quota has not generated the foreseen effects. Therefore, the performances of year 2005, related to GDP level, to industrial production, to industrial labour productivity, to the current account deficit etc., were below the performances related to year 2004 (difficult problems for our country, like floods, aviary flu cannot completely explain these results). Irrespective of the repeated alterations at the level of the tax system, the main effects reflected at the level of received incomes. As a matter of fact, the

main role of taxes can be seen at financial level, resulted incomes holding the largest weight within the whole budgetary incomes.

Evolution of total incomes, fiscal incomes and direct taxes during 1995 - 2009 period

Analysis of direct taxes evolution in member states of the E.U At the level of EU member countries, we can see a differentiation process of tax policies in the field of direct taxes (the harmonization process applies especially in the field of indirect taxes because they affect services free circulation and free supply). EU tax policy in the field of direct taxes refers mainly to the prevention of tax evasion and to the cancelation of double taxation. The structure and evolution of direct taxes in EU member states reveals major discordances between various states. To this end in view, in 1995-2002 period, the weight of direct taxes within the total fiscal liabilities varied between 31,5% and 33,5% for EU25 and EU15 and between 22,2% and 29,1% in the case of the new member states. In 2007, Denmark was first from the point of view of direct taxes weight in GDP (29,8%), Slovakia being the last with a level of 6,1%. In our country, in the same year, the percentage was 9,8%, that is 1% over the previous year and 1,3% more compared to the introduction of the unique taxation quota. In comparison to 1995, the most significant growth was in Cyprus, where the gap was 5 %, on the opposite side being Estonia and Poland where the gap was 3,1%. In the new member states, in 2007, the weight of direct taxes in fiscal incomes was low in comparison to the other member states (EU average was 32,3%, while in Slovakia was 20,8%, Bulgaria 20,9%, Romania 23%, Cyprus 33,6% ). Values over the average were in the United Kingdom (46,3%), Sweden (39,4%) .

An analysis of the evolution of direct taxes weight within fiscal incomes during 19952007, reveals significant alterations that is its growth in Leetonia (percentage growth being of 8,7%), Malta (8,2%), France (7,8%), Slovenia (7,2%) and its decrease in Poland (6,7%), Estonia (6,3%), Slovakia (6%), Luxemburg (4,5%).

1.3 Indirect taxes

The term indirect tax has more than one meaning. In the colloquial sense, an indirect tax (such as sales tax, a specific tax [a tax per unit], value added tax (VAT), or goods and services tax (GST)) is a tax collected by an intermediary (such as a retail store) from the person who bears the ultimate economic burden of the tax (such as the consumer). The intermediary later files a tax return and forwards the tax proceeds to government with the return. In this sense, the term indirect tax is contrasted with a direct tax which is collected directly by government from the persons (legal or natural) on which it is imposed. Some commentators have argued that "a direct tax is one that cannot be shifted by the taxpayer to someone else, whereas an indirect tax can be. An indirect tax may increase the price of a good so that consumers are actually paying the tax by paying more for the products. Examples would be fuel, liquor, and cigarette taxes. An excise duty on motor cars is paid in the first instance by the manufacturer of the cars; ultimately the manufacturer transfers the burden of this duty to the buyer of the car in form of a higher price. Thus, an indirect tax is such which can be shifted or passed on. The degree to which the burden of a tax is shifted determines whether a tax is primarily direct or primarily indirect. This is a function of the relative elasticity of the supply and demand of the goods or services being taxed. Under this definition, even income taxes may be indirect.

References
 Dobrot , G., Taxation. Concepts, methods and tax techniques, Romanian Writing Publishing House, Craiova, 2009  Nandra, E.R. Tax Competition: Hell and tax haven, Sphere LLC, ClujNapoca, 2008;  [Link]  [Link]

CHAPTER 2 2.1 History [Link] Emergency County Hospital, founded in 1972, having the legal form of public institution, operates under legal regulations and in accordance with the provisions of the state. The hospital is public institution financed from own revenues and from allocations from the state [Link] largest unit of its kind in the county, [Link] Hospital begins as a municipal hospital (with a capacity of 700 beds), then turning into County Hospital and since 2006 becomes [Link] Emergency Hospital Focasni. At 37 years after opening, the hospital is authorized with a total of 823 beds, located in 3 buildings: the central pavilion, where there are placed approximately 740 beds and another 2 outer sections located in Focsani, on Comisia Centrala Street and Maior Sava Street. The hospital provides high quality medical care for more than 100.000 patients annually and for approx. 60.000 other clinicians from Vrancea County and another counties. It is the merit of a welding team of professionals, consisting of 142 doctors and 550 nurses and a patient-oriented and efficient management of medical care. The institution operates at the center from Cuza-Voda Street, no. 50-52, in Focsani, having the fiscal code 50505 and state capital. The main activity is the provision, at a very high level of competence, to care for patients with chronic and acute diseases. 2.2 Organizational structure In terms of organizational structure, the institution has the following composition:                   Board of directors; Steering Committee; Manager; RUONS service; Statistical and medical information service; Litigation office; Public relations department; Internal audit department; Medical director; The emergency unit; Room with beds; Phatalogy services; Pharmacies; Hemodialysis center; Forensic service; Laboratory Care manager: coordinates care activities throughout the entire hospital; Chief financial officer; Procurement and administrative services: public transport office, administrative office, security;

  

Administrative office, safety and civil protection, maintenance workshop; Financial services accounting; Financial office

Board of directors

RUNOS services Steering Committee

Nosocomial department

Statistical and medical information serivce

Manager

Public relations department

Litigation office

Internal audit department

Medical director

Care manager

Chierf financial officer

Procurment and and administrative services Public trasport Office [Link], security Meitenance workshop

Financial servicies - accounting

Hemodialysis center

Phatalogy services

Rooms with beds

Emergency Uunit

Speciality amb.

Forensic service

Financial office

Pharmacies

Laboratory

Coordinates care activities thorughout the entire hospital

2.3 Trading partners The hospital has the following trading partners:    Suppliers = S.C. CHEQUE DEJEUNER the producer of meal tickets; S.C. EUROPHARM the producer of all kinds of medicines; Partners = SMURD Vrancea; Another medical centers; Clients = People who need medical care and hospitalization;

2.4 Field of activity The hospital signs medical supplies contracts with Casa Judeteana de Asigurari de Sanatate. Under the contract regarding the conditions for granting health assistance, in the health insurance system, the following contracts are concluded:      One-day hospitalization; Continuous hospitalization; Ambulatory; Clinical services; Health programs.

Under monthly settlements with medical benefits, consumer service bills are prepared and collected by Casa Judeteana de Asigurari de Sanatate as incomes. The unit is funded by the state budget for:     Health programs funded by the Ministry of Health; Investments; Wage expenses for U.P.U., forensic and laboratory; Hospital`s incomes which comes from taxes and medical services that are provided on request.

The management unit prepares annually the budget of revenues expenses of the estimated revenues, collected during a budget year and the costs are estimated based on the needs of departments and the budget classification structure.

CHAPTER 3 3.1 Main accounting operations

[Link]

Date Explicatii

Sum Debit Credit

3.01.2010 1 121 Closing 121 account through income statement = 117 2500 2500

9 05.01.2010 3029 2 Purchasing medicines from S.C. Europharm = 401 5388 5388

05.01.2010 3029 3 Purchasing medicines for TBC program = 401 1331 1331

05.01.2010 3029 4 Purchasing drugs = 401 8169 8169

05.01.2010 3029 5 Purchasing vaccines = 401 5886 5886

06.01.2010 3029 6 Sponsorship for medicines = 779 2863 2863

06.01.2010 3029 7 Meal tickets = 542 1185 1185

06.01.2010 409 8 Supplying open account = 5601 2000 2000

06.01.2010 423 9 Acordare avansuri trezorerie = 542 100 100

07.01.2010 626 10 Postage consumption = 409 181 181

07.01.2010 11 626 = 5321 36 36

Stamps consumption

07.01.2010 5324 12 Buying vouchers = 401 7499 7499

07.01.2010 3022 13 Vouchers consumption = 5324 7499 7499

07.01.2010 5326 14 Purchasing meal tickets from S.C. Cheque Dejuner = 401 167580 167580

07.01.2010 642 15 Meal ticktets consumption = 5326 167580 167580

07.01.2010 3031 16 Purchasing inventory items = 401 19594 19594

07.01.2010 3032 17 Putting inventory items into use = 3031 813 813

07.01.2010 6028 18 Combustible material consumption = 3028 53 53

07.01.2010 6029 19 Medicines consumption = 3029 3127 3127

07.01.2010 482 20 Blood consumption = 3029 1015 1015

07.01.2010 6028 21 Prints consumption = 3028 547 547

07.01.2010 22 Spare parts consumption 6024 = 3024 2351 2351

07.01.2010 6022 23 Fluel consumption = 3022 17888 17888

07.01.2010 6027 24 Food consumption = 3027 27137 27137

12.01.2010 641 25 Registering Wages = 421 800000 800000

26

12.01.2010

84000 84000

421 CAS registering employee (10,5 % )

4312

12.01.2010 421 27 Health registering employee (5,5 %) = 4314 44000 44000

12.01.2010 421 28 Employee unemployment ( 0,5 % ) = 4372 4000 4000

12.01.2010 421 29 Wage income tax ( 16% ) = 444 107000 107000

12.01.2010 645 30 CAS company (20,8 %) = 4311 166000 166000

12.01.2010 645 31 Fund work accidents ( 0,25 % ) = 4315 2000 2000

12.01.2010 645 32 Health company ( 5,2 % ) = 4313 42000 42000

12.01.2010 645 33 FNUASS (0,85% ) = 4317 7000 7000

12.01.2010 645 34 Unemployment company = 4371 4000 4000

15.01.2010 4312 35 Steering CAS employee = 560 84000 84000

15.01.2010 4314 36 Health steering = 560 44000 44000

15.01.2010 37 4372 = 560 4000 4000

Unumployment steering

15.01.2010 444 38 Income tax steering = 560 107000 107000

15.01.2010 4311 39 Conributuions streeing at CAS = 560 166000 166000

15.01.2010 4315 40 Social fund work = 560 2000 2000

15.01.2010 4371 41 Unemployment transfer = 560 4000 4000

15.01.2010 4313 42 Health transfer = 560 42000 42000

15.01.2010 4317 43 FNUASS transfer = 560 7000 7000

15.01.2010 421 44 Wages payment = 560 561000 561000

24.01.2010 213 45 Monitors transfer = 481 48180 48180

24.01.2010 626 46 Telephone bill registration = 401 862 862

24.01.2010 610 47 Electricity bill registration = 401 503 503

24.01.2010 48 Purchasing rogvinieta 624 = 401 118 118

25.01.2010 612 49 Rent registration = 401 483 483

25.01.2010 628 50 Medical test registration (made at U.P.U.) = 401 11700 11700

25.01.2010 624 51 Transportation expense of patients registration = 401 2500 2500

52

25.01.2010

117000 117000

560 Supplying account from CASS

411

26.01.2010 411 53 Providing services bill registration = 704 575000 575000

26.01.2010 561 54 Supplying account from budgetary allocations = 772 87000 87000

26.01.2010 5311 55 Own revenues registration = 708 68000 68000

26.01.2010 581 56 Supplying account from own revenues = 5311 68000 68000

26.01.2010 561 57 Supplying account from own revenues = 581 68000 68000

27.01.2010 401 58 Payment of calls = 561 862 862

27.01.2010 6811 59 Monthly depreciation registration office equipment = 2814 6317 6317

27.01.2010 6811 60 Monthly depreciation registration transportation = 2813 1262 1262

28.01.2010 4281 61 Withdrawal guarantee = materiale 550 903 903

28.01.2010 550 62 Interest registration = 4281 179 179

28.01.2010 63 560 = 401 200 200

Soft asistance payment

materiale

28.01.2010 5311 64 Collecting taxes from medical tests = 704 350 350

28.01.2010 411 65 Billing medical tests = 704 1200 1200

28.01.2010 581 66 Payment sheet registration = 5311 350 350

28.01.2010 561 67 Payment sheet registration = 581 350 350

28.01.2010 401 68 Medicines suppliers payment = materiale 560 5388 5388

28.01.2010 401 69 Vaccines payment = 560 5886 5886

30.01.2010 % 70 628 542 Cash advance justification = 423 90 10 100

30.01.2010 561 71 Collecting bills from medical tests = 411 1200 1200

31.01.2010 % 779 704 72 772 708 Closing the revenue accounts = 121 2863 576550 87000 68000 734413

31.01.2010 121 73 = % 1263735 6022 6024 6027 17888 2351 27137

6028 6029 610 612 624 626 628 642 645 641 6811 Closing the revenue accounts

600 3127 503 483 2618 1079 11790 167580 221000 800000 7579