1. FINANCIAL STRUCTRE OF INDIAN RAILWAYS.
Sanjay upreti
PAM

2. FINANCIAL STRUCTRE OF INDIAN RAILWAYS.
ACCOUNTAL OF MONEY
EXPENDITURE ACCOUNTAL
REVENUE EXPENDITURE
WORKS EXPENDITURE
EARNINGS ACCOUNTAL

3. 1. HOW EARNINGS ARE ACCOUNTED
ACCOUNTAL OF MONEY
1. HOW EARNINGS ARE ACCOUNTED
COLLECTION AT
THE
STATIONS
SENDS THE MONEY
TO THE CASH
OFFICES
DEPOSIT AT
THE BANK
BANK ADVICES
RBI/NGP
RBI/NGP CREDITS/INCREASES
THE RLY.’S ACCOUNT

4. 2. HOW EXPENSES ARE ACCOUNTED
ACCOUNTAL OF MONEY
2. HOW EXPENSES ARE ACCOUNTED
RBI/NGP DEBITS/REDUCES
RLY.’s ACCOUNT
CHEQUE ISSUED
BY RLY.
CHEQUE DEPOSITED
IN BANK BY THE
PARTY
BANK GIVES MONEY TO
THE PARTY AND ADVICES
RBI/NGP.

5. FINANCIAL STRUCTURE OF RAILWAYS. RELATIONSHIP WITH THE GoI
&
RELATIONSHIP WITH THE GoI
EARNINGS
CFI
WORKS EXP.
REVENUE EXP./
WORKING CAPITAL
BUDGETARY ALLOCATION

6. Commercial Accounting Para 201 of A-1
Commercial Accounting is done in a manner so as to show:
How capital is utilize.
Its standing with debtors and creditors.
Whether it is gaining or losing.
The reasons for loss and gain.
Whether it is solvent or insolvent.

7. Government Accounts Para 201 of A-1
The main requirement of government accounting is to prepare a systematic record of receipt and expenditure.
Indian Railways is a DEPARTMENTAL COMMERCIAL ENTERPRISE.
Thus we maintain accounts on commercial basis as well as government basis and then link the two through link accounts.

8. Accounts prepared for the government are called “ Finance Accounts”.
Para 202 & 205 of A-1
The accounts of a Railway prepared as in a commercial unit are known as “Capital and Revenue accounts”.
Accounts prepared for the government are called “ Finance Accounts”.
To facilitate the preparation of finance accounts a detailed structure of accounts has been developed which synchronies with the government of India Accounting.

9. CLASSIFICATION / STRUCTURE OF ACCOUNTS
WHAT IS IT?
A DETAILED SCHEME OF RECORDING ACCOUNTS
NEED FOR IT?
INFO/DATA - MEANINGFUL REPRESENTATION
HELPS ANALYSIS
ENABLES - DECISIONS BASED ON
COMPARISONS
COST CONTROLS
BUDGETING
FORECASTS

10. REVENUE EXPENDITURE DEFININTION COMPONENTS
1. ORDINARY WORKING EXPENSES (Para 324 of F-1)
2. OTHER MISC. EXPENSES.
3. APPROPRIATION TION TO FUNDS
FROM WHERE DO WE GET MONEY FOR REVENUE EXPENSES?
Relevant References ( Page 1 & 2 of A-2 & Para 701 of F-2)

11. DEMANDS FOR GRANTS
1. Railway Board makes policies
2. Miscellaneous expenditure common to all
3. RAILWAY ADMINITRATION maintains
4. BUILDINGS & TRACKS to run
5. LOCOMOTIVES and
6. CARRIAGE by using
7. PLANT & EQUIPMENTS to operate
8. ROLLING STOCK by
9. TRAFFIC DETARTMENT using
10.FUEL and earn money for
11. STAFF WELFARE and
12. MISCELLANEOUS EXPENSES.
13. PF, Pension & other retirement benefits.
14. Appropriation to funds. DRF,Pension
15. Dividend, Repayment of loan etc.
16. Works expenditure.
FROM
1 TO 12
OWE .
1 TO 14
TWE
1 TO 15
REVENUE
EXP
1 TO 16
TOTAL

13. EACH DEMAND IS DIVIDED INTO :
MINOR HEAD
SUBHEAD
DETAILED HEAD
PRIMARY NO.
THUS EXP. CLASSIFICATION WILL BE
DEMAND No DETAILED HEAD PRIMARY UNIT

14. CLASSIFICATION OF WORKS EXP.
PLAN HEAD--- MINOR HEADS
24 TILL 1999 AFTER WHICH 2 NEW HAVE BEEN ADDED--- ROB & RUB UNDER SAFETY WORKS.
Thus in all 26 plan heads exists.
e.g.
DRF PROCUREMENT OF ELEC. LOCO

15. WORKS EXPENDITURE DEFINITION
Rules for classification of expenditure under the various heads are given in chapter 7 of F-1
FROM WHERE DO WE GET MONEY FOR WORKS EXPENDITURE.
DRF
REVENUE DF
SURPLUS
CAPITAL FUND
MONEY FROM
EXCHEQUER
CAPITAL

16. WHILE GIVING ALLOCATION OF WORKS EXPENDITURE
WE GIVE
SOURCES OF FUND
&
THEIR APPLICATION
CAP.,CAP.FUND,DRF,
DF,
PLAN HEAD
LIKE DOUBLING,
S&T ETC.

17. DRF STARTED FROM 1.4.1924 PROVIDES FOR COST OF REPLACEMENT OF ASSETS.
AMOUNT ON THE BASIS OF RCC’s RECOMMENDATIONS.
SUBJECT TO VOTE OF PARLIAMENT
FOR Appropriation to DRF has been Budgeted at Rs.2804 Crores and withdrawal from the fund is kept at 2704 Crores..

18. DF
STARTED IN BETTERMENT FUND AND RENAMED AS DF FROM
IT IS OF 4 TYPES TYPES
DFI PASSENGER AMENITIES
DF II LABOUR WELFARE
DF III UNREMUNERATIVE WORKS FOR OPERATIONAL EFFICIENCY
DF IV SAFETY WORKS
The appropriation to and withdrawal from the fund for the year has been kept at Rs. 511 crores.

19. CAPITAL FUND CREATED IN 1992-93
ALL EXCESS AFTER APPROPRIATION TO DF IS CREDITED TO THIS.
WITH A VIEW TO CREATE INFRASTRUCTRE FROM INTERNAL RESOURCES.
NOW OF NOT MUCH USE
The appropriation to and withdrawal from the fund for the year has been kept at Rs crores.

20. RULES OF ALLOCATION EARNINGS
ABSTRACT X -
COACHING EARNINGS PASSENGER FARES, LUGGAGE CHARGES, PARCEL COLLECTIONS, LIVE STOCK BY PASSENGER TRAINS ETC.
ABSTRACT Y -
EARNINGS FROM GOODS TRAFFIC, GENERAL MERCHANDISE, COAL, FERTILIZERS, LIVESTOCK BY GOODS TRAINS, TRANSHIPMENT CHARGES ETC.

21. ABSTRACT Z -
SUNDRY OTHER EARNINGS, COLLECTION OF RETIRING ROOM CHARGES, RECEIPTS FROM CATERING DEPT., SALE PROCEEDS OF TREES AND GRASS ON LINE, RENT OF PLOTS GIVEN TO OUTSIDERS, TELEGRAPH EARNINGS ETC.