ASSESSMENT OF THE RISKS SYSTEM IN THE FINANCIAL PROVISION OF MUNICIPAL EDUCATION AND MECHANISMS FOR THEIR NEUTRALIZATION

Abstract

Introduction. The article addresses the problem of risk management in the financial provision of municipal education in the context of economic instability, inflation, and fiscal decentralization. These factors significantly complicate the planning, allocation, and efficient use of local budget funds. Both external risks (macroeconomic, political, social) and internal risks (managerial shortcomings, low financial literacy of educational institution leaders) create a complex and risk-prone environment that hinders the sustainable functioning of the municipal education system. Purpose. The purpose of the study is to conduct a comprehensive analysis of the risks associated with the financial provision of municipal education and to develop effective mechanisms for their mitigation. The aim is to strengthen the stability, transparency, and resilience of local budget processes in the educational sector, with a focus on adapting international practices to Ukrainian realities. Methods. The study applies systemic, process, and risk-oriented approaches to risk assessment. Analytical methods such as SWOT and PEST analysis, expert evaluations, and scenario modeling are used to identify and assess threats and opportunities in both internal and external environments that influence financial management in municipal education. Results. The study identifies key internal and external risks affecting the financial stability of municipal education. Proposed tools for their neutralization include program-targeted budgeting, internal financial control and audit, reserve fund formation, digitalization of financial monitoring, financial literacy improvement for managers, institutionalization of risk management, and partnerships with non-state donors. The integration of these tools enhances transparency, accountability, and resilience in the use of educational budget funds. Conclusion. A systematic approach to risk management is essential for ensuring the stability, adaptability, and transparency of municipal education financing. The implementation of risk-based strategies, combined with strategic planning and collaboration with public and international stakeholders, supports the creation of a sustainable and development-oriented education system at the local level. This contributes to the socio-economic development of territorial communities and the improvement of educational service quality.