1. Fundamentals of Government Accounting
S. SATHYAMOORTHY
Independent Consultant &
Former Deputy CAG of India

2. 2
Internal
External
Borrowings
Contingency
Fund of India 1
3 Dimensional
Consolidated
Fund of
India
Taxes
Development Exp
Social,Economic,&
General Sectors
Both as
Capital & Revenue Exp
&flows of loans
And interest
Fees,etc
Interest
Grants
Dividends 3
Public
Account
Other Public Moneys

3. Basis of Govt Accounting
Generally Cash basis and not accrual basis
No Profit motive
Based on Receipts
Period
1 year April - March
Currency
INR.

4. System of Accounting
Single Entry
Double Entry

5. Classification of Transactions
Receipts
Payments
Constitutional
Developmental
Longevity
Plan
Non Plan
Revenue
Capital
Voted
Charged

6. Classification Types Functional Classification Economic Classification
Economic & Functional Classification
To generate Government Financial Statistics in consonance with IMF requirements

7. Functional Classification
Government Accounting Rules 1990
List of Major & Minor Heads of Account for Union & States

8. Functional Classification
Should have closer reference to
the purpose of the transactions
than
the department which incurs it.
Rule 30 of the Government Accounting Rules

9. Consolidated Fund of India
Division
Section
Sector
Sub sector
Sub-Sub Sector

10. Consolidated Fund Revenue Other than Revenue Receipts Expenditure
Capital
Public Debt
Loans & Advances
Receipts
Expenditure
Appropriations to Contingency Fund

11. Public Account Public Moneys like Trust Funds
Moneys set aside out of Consolidated Fund
Cash Balances
Miscellaneous

12. Public Account ….2 Small Savings & PF Trusts & Endowments
Reserve Funds
Bearing interest
Not bearing interest
Deposits
Bearing Interest
Advances

13. Public Account …3 Suspense & Miscellaneous Remittances
Suspense Accounts
Coinage Accounts
Miscellaneous
Remittances
Inter-State Settlement
Reserve Bank Deposits
Cash Balance

14. Object Heads Class of Objects Personnel Services & Benefits
Other Expenditure 1 5
Administrative Expenses 2
Acquisition of Capital Assets 6
Contractual Services & Supplies 3 7
Accounting Adjustments
Grants, etc 4

15. OBJECT CLASS 1 PERSONNEL SERVICES AND BENEFITS
Salaries
Wages
Overtime allowance
Pensionary Charges
Rewards

16. OBJECT CLASS 2 ADMINISTRATIVE EXPENSES
Domestic travel expenses
Foreign travel expenses
Office Expenses
Rents, Rates and Taxes
Royalty
Publication
Other Administrative expenses

17. OBJECT CLASS 3 CONTRACTUAL SERVICES AND SUPPLIES
Supplies and Materials
Arms and Amunition
Cost of ration
P.O.L.
Clothing and Tentage
Advertising and Publicity
Minor Works
Professional Services
Other Contractual Services

18. OBJECT CLASS 4 GRANTS ETC
Grants-in-Aid
Contributions
Subsidies
Scholarships/Stipend

19. OBJECT CLASS 5 OTHER EXPENDITURE
Secret Service expenditure
Lump Sum Provision
Suspense
Exchange Variations
Interest
Share of taxes/duties
Other Charges

20. OBJECT CLASS 6 ACQUISITION of CAPITAL ASSETS, etc
Motor Vehicles
Machinery & Equipment
Major Works
Investments
Loans & Advances
Repayment of borrowings
Other Capital Expenditure

21. OBJECT CLASS 7 ACCOUNTING ADJUSTMENTS
Depreciation
Reserves
Inter-Account Transfer
Write off/losses
Deduct recoveries

22. GoIDepartmentalised system
State Govts System
GoIDepartmentalised system
AG, Maharashtra
C G A
Accounts
Consolidation
PrAO
Health
Education
Welfare
Pay & A/cs
Consolidation
Treasury Office
Nagpur
Payment
Health
Welfare
Education
PAO
Health
Welfare
Education
DDOs at Nagpur
DDOs at Nagpur

23. What is New? Roles : 3 Mode of Payment: 1 RBI Advice Roles : 1
PAO
AG (Accounts)
Roles : 3
Payment
Receipts
Accounting
Mode of Payment: 1
Cheque
RBI Advice
Roles : 1
Accounting
Treasuries handle Payment & Receipts
Mode of Payment: 3
Cash
Payment Order
Cheques
RBI Advice

24. Banking Arrangements Bankers to Govt : Reserve Bank of India
Central Govt. Account
Other UTs & State AGs
Proforma balances
Dptmntlsd
Ministries/UTs Account
Railway
Fund
Postal
Account
Telecom
Account
Defence
Account

25. Banking Arrangements .... Ministry/Dept Accredited Banker PAO
Special Account
Focal Point
Branch
Account
Dealing
Branch
CDDO
Assignment
Account
Dealing
Branch
NoN MONETISED accounts

26. Flow of Receipts Money Bank Scrolls Focal Point Bank Tax payer PAO
Accounts
PrAO
RBI
CGA

27. Payment Procedure
Bill
PAO
Cheque
DDO
Claim
BANK
Claimant

28. Outflow of Payments Scrolls consolidation PAO at CGA Dealing Branch
Accounts
Focal Point
Bank
PrAO
Money
Put Thru
RBI, CAS
NAGPUR
Link Cell
Nagpur

29. Accounting Entries - Receipts
Dr Cash Balance
-Dr RB Deposits
By CGA
By PrAO
based on
RBI put thru
Dr RB Deposits
-Dr Suspense A/c
PSB Suspense
By PAO
based on Credit Scrolls
Dr Suspense A/c
PSB Suspense
Cr Receipt head

30. Accounting entries - Payments
Dr. nnnn Service heads
Cr PAO Cheques
By PAO on issue
of Cheques 1
- Cr PAO Cheques
Cr Suspense A/c
PSB Suspense
By PAO based on
Debit Scrolls 2
-Cr Suspense A/c
PSB Suspense
Cr RB Deposits 3
By PrAO based on
Put Thru statements
-Cr RB Deposits
Cr Cash Balance 4
By CGA

31. Borrowings MoF decides in consultation with RBI
Scrolls sent to PAO, DEA, MOF
Head wise entry , DEA, MOF
RBI Borrows money
Dr RB Deposits
Cr Internal Debt of
Central Govt
Credited to Govt. A/c with RBI

32. Accountal of Borrowings
Original Receipt/repayment is by RBI
PAO maintains headwise accounts
RBI maintains loanwise accounts

33. Accountal of borrowings - Drawbacks
Details not available with the Government
Repayment schedule not available for monitoring
Lender profile not available with Govt

34. Proforma Accounts Normal Govt accounts on Cash Basis
Additional & Separate Accounts
On Mercantile Basis
Departmental Commercial Undertakings
Atomic Power Plants
Delhi Milk Scheme
Not by autonomous bodies/corporate bodies

35. Flow of Accounts CGA Parliament C&AG Railways Posts Telecom Defence
Ministry
of Finance
UTs/
AGs
Civil
Ministries
CGA
CCA/CAs
PAO