Simplified Accounting Structure for PRIs HIPA-SIRD, Shimla on 2 nd December 2009 Local Bodies Division Office of Comptroller & Auditor General of India

What is New? Simple, robust, and easy for functionaries at PRI level Generation of Financial Reports through computers Enables networking of data 2-Part Accounts: – Part-I: Receipts & Expenditure – Part-II: PFs, Loans, Deposits, Advances, etc. 11/22/2015% CAG of India2

3-tier classification Major Head: 4 digit Relates to ‘Functions’ given in 11 th Schedule 1 st tier Minor Head: 3 digit Activity/programs within ‘Functions’ May also cover some similar nature ‘Functions’similar nature 2 nd tier Object Head: 2 digit Receipts & Expenditure 3 rd tier % CAG of India11/22/20153

Some major GoI schemes would additionally need 2-digit sub- heads e.g.: Exceptions % CAG of India11/22/20154 ReceiptsPayments Grants in aid2210-Health and Sanitation 101-Grants from GOI101-Primary Health Centre 15- NRHM 15-NHRM 02- Wages (object head)02-wages(object head)

Added Features Major GoI Schemes: distinct 2-digit subheads State Schemes: 2-digit alfa-numeric subhead Common expenditure: Standardized object heads New object heads: can be opened by Panchayats 23 Major Heads to cover 29 functions 12 functions clubbed under 6 Major Heads ‘2206 –Market and Fairs’ : to PRI market and fairs 11/22/2015% CAG of India5

Additional Heads for use at Panchayat level 800Other Receipts 800Other Expenditure 901Share of net proceeds assigned to Panchayats 7610Loans to Panchayat Employees 8011Insurance and Pension Fund 8550Civil Advances 8009Provident Fund 8443Civil Deposit 2049Interest payments 2071 Pension and Other Retirement Benefits 2515Panchayati Raj Programmes 11/22/2015% CAG of India6

Other Heads 8658 Suspense Accounts Major Head ‘4000- Capital Receipts Capital Heads relate to Revenue Heads 11/22/2015% CAG of India7

Preparation of Accounts Budget in prescribed (new) classification. Accounts: on cash basis Refunds of revenues, re-imbursement of expenditure – to be accounted as reduction of receipts/expenditure of the current year 11/22/2015% CAG of India8

Data through IT Applications Pro gressive figures of respective Major Heads Total receipts Total revenue and capital expenditure Progressive figures under each part of accounts 11/22/2015% CAG of India9

Addl Formats to facilitate Switch Over to Accrual System 1.Monthly/Annual Receipts & Payment Accounts 2.Consolidated abstract register 3.Reconciliation Statement with Bank and Treasury 4.Statement of Receivable and Payable 5.Register of Immovable of Property 6.Register of Movable property 7.Inventory Register 8.Register of Demand, Collection and balance 11/22/2015% CAG of India10

THANK YOU % CAG of India11/22/201511

Major Head NomenclatureFunctions 2403 Animal Husbandry, Dairying Poultry and Fuel and Fodder  Animal Husbandry, Dairy & Poultry  Fuel & Fodder 2851 Village & Small Scale Industries  Small Scale Industries including Food Processing Industries  Khadi, Village and Cottage Industries 2202Education  Education including Primary & Secondary schools  Adult & Non-Formal Education 2205 Art, Culture and Libraries  Libraries  Cultural Activities 2210 Health and Family Welfare  Family Welfare  Health including Hospitals, Primary Health Centres and Dispensaries 2406Forestry  Social Forestry, Farm Forestry  Minor Forest Produce Similar Nature Functions % CAG of India11/22/201512