The explanatory note, attached to the budget for July to December, 1918, thus depicts our future budget: “When the Socialist reconstruction of Russia has been completed, when all the factories, mills and other establishments have passed into the hands of the government, and the products of these will go to the government freely and directly, when the agricultural and farming products will also freely flow into the government stores either in exchange for manufactured articles or as duty in kind ... then the state budget will reflect not the condition of the monetary transactions of the State Treasury ... but the condition of the operations involving material values, belonging to the State, and the operations will be transacted without the aid of money, at any rate without money in its present form.” It is clear that at present the conditions are not yet fully prepared for the transition to the above-stated new form of state budget. But, in spite of this, the Commissariat of Finance has taken a big step forward in the direction of reforming our budget. The budget of the Russian Socialist Federal Soviet Republic, adopted by the All-Russian Central Executive Committee on May 20, 1919, represents the experiment in effecting a survey not so much of the financial activity of the state, as of its economic activity, even though it is as yet in the form of money. In the work of reforming the budget, the Commissariat of Finance has come across two obstacles which are a heritage of the pre-revolutionary time: the division of revenue and expenditures into general state and local, and the hesitation on the part of some to include in the budget all the productive and distributive operations of the Supreme Council of National Economy and of the Commissariat for Food Supply. Both, the first and second obstacles have been somewhat surmounted, and the above-mentioned (third) revolutionary budget is already different from the two preceding budgets in many peculiarities which are very typical. These consist in a complete account of all production and distribution which the state has taken upon itself. This experiment is by no means complete, but the achievement should nevertheless be judged as considerable. The concrete conditions for making out the budget, as is stated in the explanatory note, have already made it possible to enter upon the road of accounting for the entire production and distribution of the nation, and that thereby the foundation has been laid down for the development of the budget in the only direction which is proper under the present conditions.