The purpose of this homework is to give information about the monetary reserve within Ecuador and how it is made.
The monetary reserve is the money that has the state and especially now under the dollarization system, is reflected in the accounts of the monetary reserve, and therefore is crucial to check periodically figures.
In Ecuador, the monetary reserve is composed of these elements: • Central government money which is called treasury account. • Savings Social Security Institute
• Money that supports printing money (fractional currency) • Deposits of private banks (through mandatory bank reserve) • Deposits / savings local governments (municipalities and prefectures) • Deposits / Savings of public enterprises
• Private sector deposits (in practice almost nonexistent) (Prado, 2009)
Ecuador's monetary reserve consists of several elements, and the most important is to understand that there is free money available from the Government, and other items that don’t belong.
The government money is recorded in the treasury account. But beware, that money is not additional to what the government has budgeted, that money is actually the mirror Financial Budget. No additional money, government is the box containing money to the daily flow of operations.
Apart from seeing the monetary reserve of Ecuador, it is also important at the same time see the International Monetary Reserve and the Treasury has to determine whether the increase in the latter responds only to a transfer or a real increase.
Prado, J. J. (13 de Marzo de 2009). IDE. Recuperado el 16 de 01 de 2013, de IDE: http://www.ideinvestiga.com/