Roll Out of Accrual Accounting over Indian Railways ...irastimes.org/Article_pdf/CSER-IR_V11 28062017.pdf · Indian Railways - Comprehensive Scope Evaluation Report 2017 1 | ICAI

Indian Railways

1 | ICAI Accounting Research Foundation

Roll Out

Accounting

Railways

Scope Evaluation

Indian Railways - Comprehensive Scope Evaluation Report

2017

ICAI Accounting Research Foundation

Out of Accrual

Accounting over Indian

Railways - Comprehensive

Evaluation Report

(CSER)

Comprehensive Scope Evaluation Report

Accrual

Indian

Comprehensive

Report

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2017

ICAI Accounting Research Foundation (ICAI ARF)

TABLE OF CONTANTS .................................................................................................... 2

1 Introduction ....................................................................................................................... 1

1.1 Project Background .....................................................................................................................1

1.2 Understanding of Accrual Accounting System ..............................................................................1

1.3 Introduction to Comprehensive Scope Evaluation Report (CSER) .................................................3

1.4 Structure of the CSER ...................................................................................................................4

2 Approach and Methodology ............................................................................................... 6

2.1 Team for the Assignment .............................................................................................................8

2.2 Approach & Methodology............................................................................................................9

2.3 Tasks to be performed by Unit Teams of ICAI ARF: ..................................................................... 10

2.4 Tasks to be performed by Nodal Team of ICAI ARF: .................................................................... 10

2.5 Tasks to be performed by AR Team of Indian Railways: .............................................................. 11

3 Indian Railways–An Overview .......................................................................................... 12

3.1 Organization Structure............................................................................................................... 12

4 Understanding of Zonal Railway ....................................................................................... 13

4.1 Division ...................................................................................................................................... 13

4.1.1 Functions of Various Departments in a Division ....................................................................................... 15

4.1.2 Accounting System at Division Level ........................................................................................................ 19

4.1.3 Various Sections of Accounts Department in a Division: .......................................................................... 19

4.1.4 Management Information System (MIS) .................................................................................................. 21

4.1.5 General Understanding of Accounts Department .................................................................................... 22

4.1.6 General Process of Recording of Intra-Unit Transactions ........................................................................ 23

4.1.7 Use of Suspense heads ............................................................................................................................. 24

4.1.8 Auditing System ........................................................................................................................................ 27

4.1.9 Budgeting System ..................................................................................................................................... 28

4.1.10 Mapping of Current Process at Divisional Office.................................................................................. 29

4.2 Workshop .................................................................................................................................. 55

4.2.1 Introduction .............................................................................................................................................. 55

4.2.2 Organizational Structure of Workshop ..................................................................................................... 55

4.2.3 General Organizational Structure of Accounts Department in a Workshop ............................................ 55

4.2.4 Type of Works Performed in a Workshop ................................................................................................ 56

4.2.5 Departments in a Workshop .................................................................................................................... 56

4.2.6 Workshop Manufacturing Suspense (WMS) Account or Workshop Account Current ............................. 57

4.2.7 Workshop General Register (WGR) .......................................................................................................... 58

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4.2.8 Outturn Statement ................................................................................................................................... 58

4.2.9 Fixed Assets .............................................................................................................................................. 58

4.2.10 Store Department ................................................................................................................................ 59

4.2.11 Methods of Procurement of Material .................................................................................................. 61

4.2.12 Illustrations on Stores Accounting ....................................................................................................... 61

4.3 Traffic Accounts Office ............................................................................................................... 62

4.3.1 Station Balance Sheet ............................................................................................................................... 63

4.3.2 Mapping of Accounting Processes at Traffic Accounts Office (TAO) ........................................................ 65

4.3.3 Compilation of Traffic Book ...................................................................................................................... 74

4.4 Other Accounting at Zonal Railway Headquarter ........................................................................ 77

4.4.1 Study of Fuel at HQ Level.......................................................................................................................... 77

4.4.2 Transfer Transactions – Intra and Inter Unit Transactions ....................................................................... 85

4.4.3 Transfer without Financial Adjustments – TWFA ..................................................................................... 90

4.4.4 TWFA transactions to transfer the balances other than source of fund: ................................................. 93

4.5 Other Departments at the Zonal Railway Headquarters ............................................................. 93

4.5.1 Construction Department ......................................................................................................................... 93

4.5.2 Stores Department ................................................................................................................................... 94

4.5.3 Establishment Section .............................................................................................................................. 98

4.5.4 Cash and Pay Section HQ .......................................................................................................................... 98

4.5.5 Settlement/ Pension Section .................................................................................................................... 99

4.5.6 Statement of Service of Non-Gazetted Staff ............................................................................................ 99

4.5.7 Statement of Service of Gazetted Staff .................................................................................................... 99

4.5.8 Expenditure Section................................................................................................................................ 101

4.5.9 Books and Budget Section ...................................................................................................................... 102

5 Understanding of Production Unit (PU) .......................................................................... 106

5.1 Organization structure of PU ................................................................................................... 106

5.1.1 Structure of Accounts and Finance Department .................................................................................... 107

5.1.2 The Production Process .......................................................................................................................... 107

5.1.3 Functions of various Departments of PU ................................................................................................ 110

5.1.4 Management Information System (MIS) ................................................................................................ 115

5.1.5 Understanding of Existing Software Systems ......................................................................................... 115

5.2 Review of Existing Accounting System ..................................................................................... 118

5.2.1 Sections in the Accounts Department .................................................................................................... 118

5.2.2 Mapping of Current Process at PU ......................................................................................................... 122

5.3 Understanding of Workshop Manufacturing Department ........................................................ 126

5.3.1 Materials and its Accounting Treatment ................................................................................................ 126

5.3.2 Preparation of Stores Sub ledger ............................................................................................................ 127

5.3.3 Reconciliation of Gate Attendance with Labour Booking ....................................................................... 127

5.3.4 Compilation of Overheads ...................................................................................................................... 128

5.3.5 Workshop Manufacturing Suspense Account (WMS Account) .............................................................. 128

5.3.6 Monthly and Annual Workshop General Register (WGR) ...................................................................... 130

5.3.7 Vetting of Price Formats ......................................................................................................................... 131

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5.3.8 Transfer of Goods from Workshop to Other Railways ........................................................................... 132

5.3.9 Raising of Debits on Railway Board for Coaches Manufactured during the Month ............................... 132

5.3.10 Production for Non-Railway Customers (NRC) ................................................................................... 132

5.4 Fixed Assets Register at PU ...................................................................................................... 132

5.5 Stores Department .................................................................................................................. 133

6 Central Organisation for Modernization of Workshop-COFMOW .................................... 135

6.1 Introduction ............................................................................................................................ 135

6.2 Organization chart of COFMOW............................................................................................... 137

6.3 Procedure for procurement of M&P items ............................................................................... 139

6.3.1 Accounting aspects of procurement of Machinery and Plant: ............................................................... 140

7 Electrification in Indian Railways .................................................................................... 144

7.1 History ..................................................................................................................................... 144

7.2 Central Organization for Railway Electrification (CORE) ............................................................ 144

7.3 Accounting at CORE Head Office .............................................................................................. 145

7.4 CORE Project Office ................................................................................................................. 147

7.5 Compilation of Fixed Assets Register (FAR) – Electrification ..................................................... 148

7.6 Observations ........................................................................................................................... 155

8 Understanding of Research Designs & Standards Organisation (RDSO) ........................... 157

8.1 History ..................................................................................................................................... 157

8.2 Organisation Structure............................................................................................................. 157

8.3 Accounting at RDSO ................................................................................................................. 159

9 Understanding of Sub-Urban Operations ........................................................................ 160

9.1 Introduction ............................................................................................................................ 160

9.2 Understanding of Sub Urban Train System ............................................................................... 160

9.3 Financial Overview of Sub Urban Segment of Indian Railways .................................................. 160

9.4 Important features of Mumbai Suburban System: ................................................................... 161

9.5 Accounting for Sub urban ........................................................................................................ 161

9.6 Observations ........................................................................................................................... 162

9.7 Costing of Sub Urban Operations ............................................................................................. 162

9.8 Fixed Assets Register-Sub Urban .............................................................................................. 164

10 Kolkata Metro ................................................................................................................ 165

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10.1 History ..................................................................................................................................... 165

10.2 Organizational structure: ......................................................................................................... 165

10.3 Accounting at Kolkata Metro ................................................................................................... 166

11 Understanding of Chennai Metropolitan Transport Project ............................................. 169

11.1 Accounting system of Chennai MTP ......................................................................................... 169

11.2 Observations ........................................................................................................................... 169

12 Understanding of Existing Software ................................................................................ 170

12.1 Introduction: Computerisation of Accounting Activity over Indian Railways ............................. 170

12.2 Functional Module of IPAS ....................................................................................................... 171

12.3 Integrated Material Management System (i-MMIS) ................................................................. 172

12.4 Indian Railway E Procurements System (IREPS)- ....................................................................... 172

12.5 Advanced Railway Pension Access Network (ARPAN) ............................................................... 173

12.6 E-Reconciliation Portal ............................................................................................................ 173

12.7 VPN – ONLINE Budgeting System ............................................................................................. 173

12.8 New Applications ..................................................................................................................... 174

13 Chapter - Way Forward for implementation of Accrual Accounting ................................. 176

13.1 Comprehensive Study of Existing Accounting Systems ............................................................. 176

13.2 Compilation of Fixed Assets Register (FAR) .............................................................................. 176

13.3 Categorization of Fixed Assets ................................................................................................. 177

13.4 Preparation of Opening Balance Sheet (OBS) ........................................................................... 178

13.5 Valuation Norms of Assets and Liabilities ................................................................................. 179

13.6 Finalizing Significant Account Policies ...................................................................................... 180

13.7 Capturing Accounting Transactions on day-to-day Basis ........................................................... 182

13.8 Compilation of Financial Statements ........................................................................................ 182

13.9 Capacity Building, Hand Holding & Training ............................................................................. 182

14 Annexures -Forms and Formats ...................................................................................... 183

14.1 Annexure 1: FAR Format .......................................................................................................... 183

14.2 Annexure 2 - Formats of Financial Statements ......................................................................... 208

14.3 Annexure 3 - Accrual Impact Sheet (Current Assets and Liabilities) .......................................... 232

14.4 Annexure 4 – Notes to Accounts .............................................................................................. 262

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1 Introduction

1.1 Project Background

The Government accounting system in India, in all three tiers of Governance, i.e., the Union,

States and Local bodies including Autonomous or Statutory Bodies, is pre-dominantly cash

based accounting system linked with the budgeting process within the framework of

legislative financial control. The basic principles derive its form and substance from cash

based procedures that were laid during the British period. The basic principles of the

government accounts are enunciated in General Financial Rules and other related legislations,

manuals, etc. as prescribed in the ‘Operational Guidelines for Accrual Based Financial Reporting’ as

issued by GASAB secretariat. In recent times, there has been a paradigm shift in the priorities of

public finance management from identifying resources for public scheme funding to fiscal

prudence, efficiency & transparency in public spending. These shifts in priorities have been

reflected in initiatives like the Fiscal Responsibility & Budget Management Act and Outcome

Budget. It is reflected that there is a need for Financial Reporting that is to be in sync with the

shift in priorities of Public Finance. To achieve this, accounting systems the world over, are

being revisited with an emphasis on transition from rule to standards based accounting and

migration from cash to accrual based system of accounting.

On these lines the Ministry of Railways (MoR) decided to prepare an additional set of

Financial Statements on accrual based system of accounting in addition to the cash based

Financial Statements, as it would help in bringing more transparency, timely availability of

information, improved financial performance, advanced decision-making, etc.

As a part of the Accounting reforms project a pilot study on introduction of accrual

accounting was undertaken at North Western Railway, Jaipur and Rail Coach Factory,

Kapurthala. The pilot study saw the preparation of accrual based financial statements of

these units in addition to the present cash based financial statements. On successful

completion of pilot project, it was decided to roll out this exercise across the Indian Railways

on the basis of same methodology and strategy as followed in the pilot study.

1.2 Understanding of Accrual Accounting System

Accrual based accounting is a method of recording transactions by which revenues, costs,

assets and liabilities are reflected in the accounts of the period in which they accrue and arise,

irrespective of actual receipt/ payment thereof..

Objectives and Benefits of Accrual Based System

This section gives the objectives and the merits of transitioning to accrual based accounting

system. The primary objectives of accrual based accounting are:

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2 ICAI Accounting Research Foundation

i. Improve decision-making to enhance efficiency and effectiveness of public spending

through the creation of more accurate and accessible financial information.

ii. Improve resource allocation due to a better insight into costs of policy and transparency

of results.

Benefits

Accrual accounting provides meaningful information both for accountability and decision-

making. Financial information prepared on an accrual basis allows users to:

i. Make better/balanced comparisons between alternative disposition(s) of resources;

ii. Better assessment of performance, financial position and cash flows of the entity;

iii. Better evaluation of the entity’s ongoing ability to finance its activities and to meet its

liabilities and commitments;

iv. Gain clearer insight into how the organization finances its activities;

v. Better evaluation of the organization’s performance in terms of its service costs, efficiency

and accomplishments; and

vi. Gain more understanding into how the organization is managing its resources.

In context of Indian Railways, Accrual Based Accounting System would help in achieving the

following objectives:

i. The accounting system will be in line with commercial accounting system;

ii. Under the accrual system, revenue is recognised as and when the claim of the entity in

respect of such revenue is recognised has become reasonably enforceable. Thus, an item

of income would constitute revenue even if cash is not received against it. Currently, IR

follows a hybrid system of accrual and cash accounting system. To elaborate, the traffic

earnings are accounted for on booking basis and certain other items of earnings viz. rent

and siding charges and interest and maintenance charges from sidings are accounted for

on billing basis. The realisation thereof is monitored through Suspense heads Traffic

Accounts and Demands Recoverable, respectively. However, in other cases the revenues

are recorded only when these are collected. Further, the revenues are recorded on

booking/ billing basis without regard to the accounting period. For example, the revenue

of passengers tickets booked for period beyond accounting year (viz. passenger ticket

issued in March for journeys in the next financial year) and rent etc. received in advance

are recorded as revenue in the year of booking/ billing. The financial status of the

Division/Workshop or as a whole Indian Railways will be better reflected if the total

revenue including any amount receivable is shown appropriately. If done, it will help in

understanding the revenue generation possibility, collection efficiency, etc. It is pertinent

to note that, for this purpose, accounting policy for revenue recognition is to be laid down

first;

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iii. Under the accrual system, expenditure is recognised as and when the liability for

payment arises even if the payment is not made at that time. Under present accounting

system , the value of services already consumed during the financial year is not

recognised by IR as an expense of the period in which the service is received unless and

until the payment is made for it except in case of salaries/ wages. For salaries, a suspense

account, namely, Demands Payable and Labour is maintained. The salaries of the

accounting period are debited to the Expenditure head by credit to these suspense heads

and the latter is cleared on actual payment in subsequent accounting period. Thus, in

present accounting system, expenditure incurred on a repair and maintenance contract,

which has been executed and completed during a financial year, shall not be recognised

as an expense of the said financial year unless the payment is made in that financial year

for the bills received in respect of the services received. This would have an effect of

showing a higher financial surplus or a lower financial deficit and thus a better (and

unintended incorrect) picture of the entity.

However, in accrual basis of accounting, expenditure incurred on repairs and

maintenance shall be recognised as expense of the financial year in which it is incurred

even if not paid during that year so that the Income and Expenditure Statement correctly

reflects the position in respect of the expenditure. The amount not paid shall be treated as

a liability (payable) and be disclosed as such in the Balance Sheet. This will enable the

entity to be aware of its obligations towards its creditors;

iv. The accrual basis of accounting matches the expenditures for a year with the income

earned in that year. It thus provides for a better understanding of the operating

performance of the entity;

v. Accrual based accounting system clearly distinguishes between items of revenue and

capital nature. This helps in correct presentation of financial statements, viz., the Income

and Expenditure Account and the Balance Sheet. Thus, an asset, which is likely to yield

benefit of an enduring nature, is shown as such and not expensed. This facilitates an

understanding of the asset base of the entity with reference to which services are provided

and which revenues are earned;

vi. Financial Statements prepared on accrual basis of accounting have a much greater degree

of acceptability amongst various stakeholders;

vii. One of the distinct advantages of accrual accounting system is ease in financial appraisals

by financial institutions/ other stake holders. It also facilitates credit ratings through

approved credit rating agencies, which is a pre-requisite for mobilising funds in the

financial markets.

1.3 Introduction to Comprehensive Scope Evaluation Report (CSER)

As a part of the MOU between ICAI ARF and Indian Railways (IR), an action plan for

conceptualizing and implementing the accounting reforms in the Indian Railway has been

agreed wherein an additional set of Financial Statements on accrual based system of

accounting is being prepared in addition to the cash based Financial Statements. Under this,

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one of the key deliverables is Comprehensive Scope Evaluation Report (CSER). The CSER is

intended to put together all the components of the existing system, the intended accounting

system, identify the gaps and conceptualize the data requirement and other necessary details

required to fill up the gap to produce the Financial Statements based on accrual based

accounting system in a time bound manner. In particular, the CSER is envisaged to address

the task of bringing together in a detailed manner all the components of the existing system

and the extent of prudence and propriety of the existing system by presenting:

i. detailed description of the present accounting system for the purpose of recording and

processing of revenue receipts, capital receipts, revenue expenditure and capital

expenditure;

ii. detailed internal organization chart of finance and accounts division; and

iii. flow of data/information in respect of every kind of assets and liabilities and also the

validity thereof.

iv. the methodology for converting cash based financial statements into accrual based

financial statements and roadmap to achieve the same.

ICAI ARF has already prepared Comprehensive Scope Evaluation Report (CSER) based on

their pilot study on North Western Railway and Rail Coach Factory, Kapurthala. However,

for rolling out the accrual accounting across the Indian Railway, CSER for Indian Railways

as a whole is required to be prepared. Therefore, it was considered necessary to study the

working/ activities/ accounting of several segments (areas/offices) of Indian Railways which

were not covered in North Western Railway in compilation of CSER for the entire Indian

Railways. The offices covered for preparation of CSER are as under:

1. Central Organisation for Modernisation of Workshops (COFMOW), New Delhi;

2. Central Organisation for Railway Electrification (CORE), Allahabad;

3. Project Office, CORE, Lucknow

4. Sub Urban Operations, Mumbai

5. Kolkata Metro, Kolkata

6. Metropolitan Transport Project (MTP), Chennai

7. Research &Development Standards Organisation (RDSO)

8. Traction Sub Station (TSS), Sahibabad

9. Electric Loco Shed, Ghaziabad

10. AMU Car Shed, Mumbai

11. Traffic Accounts Office, Western Railway, Ajmer (for SPV)

1.4 Structure of the CSER

Based on study carried out at selected offices (selected in consultation with the concerned

officials of the office of CPM/AR of Indian Railways) across the Indian Railways, the CSER

comprise of the following chapters:

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a. Approach and Methodology

b. Indian Railways Overview

c. Understanding of a Zonal Railway

d. Understanding of a Production Unit

e. Electrification in Indian Railways

f. Understanding of Suburban operations

g. Kolkata Metro

h. Research Design and Standard Organization

i. Understanding of Chennai Metropolitan Transport Project (MTP)

j. Understanding of Existing Software

k. Way Forward for Implementation of accrual accounting

l. Annexures

It may be mentioned here that in case any segment/area/office of Indian Railways

comes to the knowledge of ICAI ARF which is not covered in CSER, the same will be

covered in the Accrual Accounting Implementation Manual which is one of the

deliverables of the project in the later stage.

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2 Approach and Methodology

For any project/assignment, a good approach and methodology is the most essential key for its

timely completion and also, for the fulfilment of client requirements. The ICAI ARF team has

also adopted time tested methodology to complete this project. The team deployed has

experience of Railway Accounting and financial management. In addition it has the support of

professional counterpart team of the Chief Project Manager/ Accounting Reforms. Therefore, it

is placed in a strong position to meet the objectives of the project with a minimal learning curve.

Further, based on the collective information available to the project team in designing and

undertaking similar kind of assignments carried out for various Government

departments/offices, the lesson learnt from such assignments and insights, knowledge and skills

gained by the team members in these assignments, the project approach and methodology have

been developed. This chapter provides ICAI-ARF Team’s approach and methodology for the

assignment.

A consultative and participative approach will be emphasized to ensure maximum stakeholder

participation. This will encourage local ownership of the Project, and will be beneficial for the

Indian Railways while sustaining the process. Systems will be developed using user friendly

formats to improve in-house participation.

Our experience suggests that a hands-on, grass-root level approach with policy support from

the top has the maximum beneficial impact. A similar approach is proposed to be adopted

for this assignment also.

The consulting team of ICAI ARF has already completed pilot study in North Western Railway

(NWR) and Rail Coach Factory, Kapurthala (RCF) on accrual accounting. Same methodology

will be followed for implementation of accrual accounting across Indian Railways which

involved recasting the financial statements of NWR on accrual basis, deriving data and

information from the existing accounts based on the cash based Account Current, with

additional information on accrual elements culled out of existing records. Significant accounting

policies approved jointly by ICAI ARF and Accounting Reforms (AR) Directorate of Indian

Railways were applied in the formulation of these statements. A similar methodology will be

adopted for roll out of accrual accounting in other Zonal Railways and Production Units.

Various activities involved in the proposed methodology are as under:

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# Name of Deliverable Activities to be Undertaken/ Methodology

1 Updation of

Comprehensive Scope

Evaluation Report(CSER)

ICAI ARF team had drafted a CSER during the NWR

and RCF pilot studies. Further to it, the Nodal Team of

ICAI ARF has now covered the following

offices/activities to produce this updated CSER of Indian

Railways as a whole:

1. Central Organisation for Modernisation of Workshops

(COFMOW), New Delhi;

2. Central Organisation for Railway Electrification

(CORE), Allahabad;

3. Project Office, CORE, Lucknow

4. Sub Urban Operations, Mumbai

5. Kolkata Metro, Kolkata

6. Metropolitan Transport Project (MTP), Chennai

7. Research &Development Standards Organisation

(RDSO)

8. Traction Sub Station (TSS), Sahibabad

9. Electric Loco Shed, Ghaziabad

10. AMU Car Shed, Mumbai

11. Traffic Accounts Office, Western Railway, Ajmer (for

SPV)

2 Preparation of Opening

Balance Sheet as on 31st

March 2015, Financial

Statements for the

Financial Year 2015-16

and 2016-17

Determination of Current Assets and Current

Liabilities;

Determination of Capital Work in Progress (CWIP)

Determination of Long Term Liabilities

Validation of data captured on the above

Collection of data having accrual impact not captured

in the existing cash based financial statements

Finalization of Significant Accounting Policies on

areas which were not covered during the NWR and

RCF, Kapurthala Pilot Studies

Preparation of Profit & Loss a/c

Preparation of Statement of Financial Position, i.e.,

Balance Sheet

Preparation of Cash Flow Statement

Notes to Accounts

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# Name of Deliverable Activities to be Undertaken/ Methodology

3 Mapping of Existing

Chart of Account (F2) for

the purpose of

implementation of

accrual accounting at

transaction level.

Review of existing chart of accounts;

Assessment of existing codification structure for

income, expenditure, assets and liabilities;

Grouping and sub grouping of assets, liabilities,

income and expenditure as per Generally Accepted

Accounting Principles (GAAP) in due consultation

with Indian Railways (IR) officials; and

Testing/Validation of new chart of accounts.

4 Updation of Accrual

Accounting

Implementation Manual

(AAIM)

Finalization and incorporation of accounting policies

in new areas;

Finalization of period end procedures/ reconciliation

procedures; and

Finalization of forms/formats for books of accounts/

register to be maintained for accrual based system of

accounting.

Covering those aspects of Indian Railways, if any

which comes to the knowledge of ICAI ARF at later

stages of the project and so not covered in CSER.

2.1 Team for the Assignment

The Nodal team comprises of CA Atul Gupta, Project Mentor, Rollout Project and Director,

ICAI ARF, who shall monitor the assignment He shall be assisted by the Nodal Team stationed

at Delhi.

CA Atul Gupta

CA Namrata Khandelwal CA Ajesh Tuli Shri Anil D Lal

CA Vikas Maheshwari CA Monika Sharma CA Devesh Medetwal

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This team will be assisted by Unit teams of consultants stationed at all Zonal Railways and

Production Units. Both these teams shall work under overall guidance of Chief Project

Manager/ Accounting Reforms.

2.2 Approach & Methodology

Indian Railway uses a centralized accounting software i.e. Integrated Payroll & Accounting

System (IPAS) across all Zonal Railways in India. However, Production Units presently use

different accounting packages for compilation of accounts. As informed, IR plans to implement

IPAS in these Units also.

ICAI ARF team has already completed pilot study in one Zonal Railway (NWR) and one

Production Unit (RCF) and prepared financial statements on accrual basis in addition to the

existing financial stements as being prepared by IR which are predominantly on cash basis

(with some elements of accrual eg. Traffic Accounts, Demands receivable, Demands payable,

etc.) .

Preparation of Financial Statements on accrual basis as an additional set is now being rolled out

across Indian Railways. To complete this task in a professional manner, the project team is

divided into:

a. Nodal Team: Nodal Team is the central team which is responsible for overall execution

and completion of the project. The Nodal Team shall oversee the implementation process across Zonal Railways and Production units by way of handholding, trouble shooting and capacity building.

b. Unit Teams: These teams will be stationed at each of the Zonal Railway/Production Unit/

other accounting units. Around 25 unit teams will be in place at the ground level. The team

strength at the Zonal Headquarters would depend upon the number of Divisions and

Workshops in each of the Zonal HQs, preferably one resource for two Divisions/ Workshops.

The teams would be travelling to the Divisions/ other offices, as and when required for

handholding. In case of Production Units, the team strength would be 3 resources per

Production Unit.

Further, an IT utlitity is also being developed for preparation of financial statements. The

following stakeholders will access the IT utility:

1. Unit Teams;

2. Nodal Team; and

3. AR team of Indian Railways

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2.3 Tasks to be performed by Unit Teams of ICAI ARF:

1. The entire information/data will be captured in prescribed excel formats as circulated by

the Nodal Team. This information will be fed in the utility by the Unit teams of ICAI ARF.

2. Unit Teams will be the main users of the utility and will update the information in

proposed utility as per stipulated schedule in discussion with the Nodal Team.

3. Once the information/data is approved by the Nodal Team, only then it will be updated in

the database of the utility.

4. Apart from the information received from Zonal Railways/Production Units, unit teams

will also / feed information from appropriation account (where applicable) in the system.

Thereafter the IT utility will generate the Profit & Loss Account, Balance Sheet and Cash

Flow Statement, etc., in the prescribed format.

5. Unit teams would be responsible for training of IR staff in their respective zones, divisions,

workshops. Assistance from Nodal Team would be provided as required.

2.4 Tasks to be performed by Nodal Team of ICAI ARF:

1. Nodal Team will be responsible for overall monitoring and execution of the project.

2. Rules for calculation of depreciation will be defined by Nodal team. The Nodal team will

define these rules through their login account and these rules will be applicable on

information entered by Unit teams in the database.

3. All desired MIS reports will be generated by Nodal Team through their login accounts.

4. The reports builder tool will be part of IT utility and reports will be generated after

selection of various parameters.

5. Approval of any modification in the information as fed by the unit team.

6. Nodal team will be responsible for valuation of Tracks, Rolling Stock, preparation of

training manual and training of Unit Teams and IR staff.

7. Nodal team would be responsible for interaction with the O/o CPM/AR and AR Directorate

at Railway Board.

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8. Nodal team shall also study the Accounting treatments and consolidation done at the

Railway Board level to prepare a consolidated Balance Sheet and Profit and Loss account

for IR as a whole.

2.5 Tasks to be performed by AR Team of Indian Railways:

1. To arrange provision of all the necessary data of Fixed Assets, Accrual Impact Sheet, etc., in

prescribed format within stipulated time period from all the accounting units;

2. To arrange provision of data of Rolling Stock and Track to Nodal Team;

3. To provide suggestions and comments on the deliverable as submitted from time to time

within stipulated time to facilitate the timely finalization of deliverables;

4. To liaison with and motivate Zonal Railways, Production Units and other organization of

Indian Railways to extend their full co-operation and support to the Unit teams stationed

there;

5. To finalize accounting policy related issues from time to time with due approval of Railway

Board.

In the end, we can say that AR Team will be functioning as the spindle around which the Nodal

Team will be providing its expertise and guiding the Unit Team to complete the project in a

time bound professional manner.

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3 Indian Railways–An Overview

INDIAN RAILWAYS, the premier transport organization of the country is one of the largest

rail networks in Asia. The first railway on Indian sub-continent ran over a stretch of 21 miles

from Bombay to Thane. Since then, it has covered many more miles.

Indian Railways is a multi-gauge system consisting of Broad Gauge, Meter Gauge and Narrow

Gauge; multi-traction system consisting of electrified and non-electrified routes. Apart from

above, IR is using several types of locomotives, coaching vehicles and freight wagons. Also, IR

owns almost 7000 stations spread across the country, hundreds of yards, thousands of good

sheds and repair shops and a workforce of more than 1.5 million.

3.1 Organization Structure1

1 Source : Ministry of Railways (Railway Board) CMS Team Last Reviewed on : 14-02-2017

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4 Understanding of Zonal Railway2

Indian Railways is divided into various Zonal Railways and Production Units for the purpose

of administration and control. Zonal Railways are further sub-divided into Divisions/

Workshops/ Traffic Accounts Offices etc. Each of the Zonal Railway/ Production Unit is headed

by a General Manager (GM), Division is headed by a Divisional Railway Manager (DRM) while

Workshop is headed by Chief Workshop Manager (CWM).

There are various departments in a Division and Workshop viz. Engineering, Mechanical,

Electrical, Signal and Telecommunication, Accounts, Personnel, Operating etc. ICAI ARF Team

undertook field visit to Ajmer Division, Traffic Account Office and Ajmer Group of Workshops

for gaining an insight into their working and accounting aspects.

4.1 Division3

Division is, primarily, an expenditure unit and is responsible for recording of expenditures. The

project team held detailed discussions with various officials of Division to understand the

existing organization hierarchy, nature and process of accounting transactions, data capturing

mechanism, type of records developed, level of adequacy, and preparation and presentation of

financial statements, etc.

The general organisational structure of a Division is as under:

2Based on pilot study undertaken in North Western Railway 3Based on Pilot study carried out in Ajmer Division

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Sr. Div.

Engineer (W)

Div. Engineer

(East)

Divisional Railway

Manager

Additional Divisional Railway

Manager & Mukhya Rajbhasha

Adhikari

Sr. Div.

Engineer (Co.)

Sr. Div. Signal &

Tele. Engineer Sr. Div. Finance

Manager

Chief Medical

Superintendent

Sr. Div. Operating

Manager

Sr. Div Commercial

Manager

Sr. Div.

Personnel

Officer

Sr. Div. Mechanical

Engineer-Power

Sr. Div. Security

Commissioner Div. Safety

Officer

Sr. Div. Mechanical

Engineer-SL/ABR

Div. Engineer

(South)

Divisional

Materials

Manager

Rajbhasha

Adhikari

Sr. Div.

Electrical

Engineer

Sr. Div.

Mechanical

Engineer

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4.1.1 Functions of Various Departments in a Division

i. Commercial Department

Commercial department is the interface between the Railways and its customers. It ensures

comfortable and safe journey to all passengers by taking care of passenger amenities at the

stations and maintaining friendly relations with the passengers and traders. It also looks

after marketing and transportation of goods. Fixing of rates, fares and other charges and

correct collection and remittance of traffic receipts are also amongst its functions.

ii. Personnel Department

Personnel Department looks after the staff matters, welfare, industrial relations and

personnel policies, rules & regulations, recruitment, training, promotions, transfers,

selections, creation of posts , retirement benefits, disbursement of pay and allowances,

productivity linked bonus and maintenance of service and leave records of non-gazetted

staff except RPF and Accounts departments

It engages with the recognized unions and arranges meeting of the Permanent Negotiating

Machinery for settlement of staff grievances. The Personnel department also ensures

compliance of the provisions of various laws and acts promulgated by the Government of

India from time to time viz. Industrial Disputes Act, Factory’s Act, Workmen’s

Compensation Act, Wages Act, Disciplinary & Appeal Rules and Railway Servant Service

Conduct Rules, etc.

Personnel department is the custodian of all establishment rules and regulations and their

interpretation in service matters. Many welfare activities like running of staff canteens,

holiday homes, consumer cooperative societies, railway schools and institutes etc., are also

undertaken by this Department.

iii. Engineering Department

Civil Engineering Department is responsible for the construction and maintenance of all

civil engineering assets, viz. all buildings including station buildings, residential quarters,

hospital, sheds, workshop structures, goods sheds, etc., water supply and sanitary

installations, railway tracks, sidings, all allied structures, bridges including road over

bridges and road under bridges.

The Engineering Department of Indian Railways has two distinct organizations namely

Open Line and Construction. While the Open Line Organization is responsible for

maintenance of all fixed assets of Indian Railways, i.e., Tracks, Bridges, Buildings, Roads,

Water Supply, etc., the Construction Organization is responsible for construction of new

assets such as new lines, gauge conversion, doubling and other expansion and

developmental works in Railways.

iv. Medical Department

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The Medical department primarily performs the following functions:

(a) Curative Services: Medical Department provides curative service to the all railway

employees, Railway Employees Liberalised Health Scheme (RELHS) card holders and their

dependants;

(b) Preventive/Promotive Health Services:

1. Cleanliness and disposal of garbage at nominated place of municipal corporation in

Railway colonies;

2. Collection of water samples for bacteriological and chemical examination and

testing of chlorination on regular basis;

3. Hygiene and Sanitation at railway stations and Railway colonies;

4. Wellness programs are conducted at workplaces in addition to regular health

check-up camps at remote places where employees and their dependents are

screened for chronic preventable diseases; and

5. Vaccination and anti-natal check-up is performed on stipulated days every week.

(c) Disaster Management;

(d) Medical examination of candidates and employees; and

(e) Reimbursement.

v. Mechanical Department

Mechanical Department assists the operating control in smooth and safe operation of trains.

Technicians, Helpers and Carriage and Wagon Supervisors are responsible for maintenance

of rolling stock and maintenance and operation of break down equipments. The key

functions of Mechanical Department are:

(a) Maintenance of coaching & freight rolling stock; and

(b) Maintenance and operation of break down equipments, restoration, relief and rescue

work in case of railway accidents.

Functions of Mechanical Department include repairs & maintenance of Diesel Locomotives,

Coaches and Wagons. It carries out periodical overhauling (POH) of locomotives, coaches &

wagons and other rolling stock in workshops. It is also responsible for fuel management for

diesel locomotives and crews; monitors punctuality of passenger trains; undertakes

maintenance and operation of break down equipments, restoration; relief and rescue work

in case of railway accidents; planning & execution of works, machine & plant and rolling

stock programme.

vi. Electrical Department

Functions of the Electrical Department include operation and maintenance of electrical

power supply for lighting, ventilation, air-conditioning in station areas, residential areas,

passenger reservation system (PRSs), offices, hospitals, running rooms, rest house and in AC

and Non-AC coaches; water coolers at stations, offices, running rooms, hospitals, etc. It also

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undertakes operation and maintenance of power supply to stations; water supply pumps for

stations and railway residential colonies.

vii. Signal Department

Signal Department is responsible for installation and maintenance of signalling system for

safe and speedy movement of trains. It undertakes operation and maintenance of panel

interlocking/route relay interlocking/electronic interlocking and train warning & protection

systems.

viii. Telecom Department

Functions of Telecom Department include control over Train Traffic Control System.

Telecom Department is responsible for maintenance of all telecom equipments of train

control circuits and responsible for maintenance of telephone exchanges, associated

equipments and underground cable of telephone exchanges at stations. It is responsible for

providing telecommunication infrastructure for Passenger Reservation System (PRS),

Unreserved Ticketing System (UTS), Freight Operation Information System (FOIS), Crew

Management System (CMS), Coaching Operating Information System (COIS). It manages

the Railway Information Network (Rail net).

Common functions for Signal & Telecom Department: It provides various passengers

amenities for the benefit of travelling public.

Public Address System is provided at various stations to announce the arrival & departure

of trains and other information required by travelling passengers.

Train Indication Boards are provided for indicating the train timing and platform numbers.

Coach Indication Board is provided for indicating the coach position of the train on the

platform.

ix. Accounts Department

Accounts department on IR has twin responsibility of rendering financial advice and book

keeping. Functions of Accounts Department mainly consist of keeping the accounts of the

railway in accordance with the prescribed rules; internal check of transactions affecting the

receipts and expenditures of railway; prompt settlement of proper claims against railway;

rendering advice to the administration on matters involving financial implications ;

compilation of budget; monitoring the budgetary control procedures from time to time;

discharging other management accounting functions such as providing financial data for

management reporting, inventory management, purchase/contracting decisions and surveys

for major schemes; assessing the financial irregularity (if any) in the transactions of the

railways. In addition, Accounts department also handles personnel functions of its staff.

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Cash and Pay Office also comes under the purview of the Accounts Department and

functions as its treasury branch. They are responsible for receiving the remittances received

in cash from stations/ other entities and are entrusted with the task of remitting the cash in

banks. The Cash and Pay office also disburses payments authorised by Accounts Officers

and submit accounts thereof to the Accounts Department.

Statistical branch brings out periodical statistics of operations, workshop repairs,

commercial results, stores transactions etc.

Traffic Costing branch works out cost of traffic operations gauge-wise, service wise and

traction wise. EDP Centres also function under Accounts department and are responsible for

development/ maintenance/ processing of various computerised applications of Accounts/

Stores/ Traffic departments etc. to produce required MIS besides being nodal office for

technical appraisal of procurement of computers etc.

x. Audit Department

Audit department works under the O/o C&AG of India and carries out Statutory audit in all

Government Departments. Functions of Audit Department mainly consist of auditing

sanctions involving finance; auditing rules and general orders involving finance; auditing

tender documents involving finance; auditing accounts maintained by Accounts

Department; auditing estimates prepared for projects; checking internal audit mechanism

ensuring the accounting system; test check of vouchers; inspections of offices; check of all

orders/sanctions issued by GM & other officers. Statutory Audit has three fold purposes:

(i) Accountancy Audit i.e. to check accuracy of arithmetical calculations and to see that all

payments are supported by receipted vouchers. It assesses the adequacy of the accounting

system and system of internal check in the organisation.

(ii) Appropriation audit i.e. to check the classification of expenditure to ensure that the

expenditure and receipts have been charged to proper heads of account and further that the

voted appropriations under these heads have not been exceeded. It is applied as a measure

of Parliamentary Control.

(iii) Administrative Audit i.e. audit of sanctions to check that expenditure has been incurred

according to prescribed rules and regulations or under sanctions of a competent authority.

xi. Security (RPF) Department

Functions of Security Department are to protect and safeguard passengers and railway

property, escorting passenger trains ; providing access control, regulation and general

security on the platforms, passenger areas and circulating areas;, passenger luggage to

ensure passenger facilitation; removal of obstructions in the movement of railway property

or passenger area. RPF aims at hassle-free train operations. RPF also takes steps for

prevention of any cognizable offences against the passengers. The RPF is legally empowered

Indian Railways


to apprehend any person who

against without ticket travellers.

xii. Operating Department

The operating department is

The department arranges multi

Corporation of India. This includes

Operating Department has to

for infrastructural development

4.1.2 Accounting System

The organizational structure of

4.1.3 Various Sections

The Accounts Department comprises

each section. Each section is

(SSO/SO). Following are the sections

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Indian Railways - Comprehensive Scope Evaluation Repor

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who is involved in such offences. RPF assists ticket

travellers.

responsible for running of both passengers

multi modal traffic in regular coordination

includes both traffic for export and traffic for

to examine the requirements of traffic, which

development.

System at Division Level

of Accounts Department is as under:

Sections of Accounts Department in a Division:

comprises various sections and a separate code

is headed by one/ more Senior Section Officer

sections in the Accounts Department at the Division

Senior Divisional Financial Manager

Divisional Financial Manager

Assistant Divisional Financial Manager

Senior Section Officer

Accounts Assistant

Junior Accounts Assistant

Accounts Clerk


ticket-checking staff

passengers and goods trains.

coordination with Container

domestic use. The

traffic, which involves planning

Division:

code is assigned to

Officer/Section Officer

Division level:

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i. Administration and Co-ordination Section: This section deals with general

administration work of Accounts Staff, e.g. departmental examination, records of

attendance, preparation of salary bills, allotment of residential quarters, etc.

ii. Inspection and Audit: Inspection section deals with inspection of various offices for

monitoring deficiencies/irregularities in regard establishment, stores and construction.

This section is also responsible for periodic verification of stock items, which are

maintained in the stock registers. Further, if any objection is raised by auditors, then

this section makes necessary arrangement to respond to the Audit objections.

iii. Finance Section: Finance section is responsible for vetting of all financial proposals

and estimates.

iv. New Pension Scheme: This section deals with matters relating to the new pension

scheme. For example, to monitor the employee contribution/Employer contribution,

keeping necessary records as applicable, to ensure timely payment of NPS to

regulatory bodies, etc.

v. Provident Fund Section: This section is responsible for recording all transactions for

provident fund. For example, maintenance of PF ledgers, passing entries for PF

received from employees, withdrawal from PF, Loan against PF balances, etc.

vi. Pension Section: This section maintains all records relating to payment of pension. For

example, preparation of PPO, review of pension paid, etc.

vii. Establishment Section: This section maintains the service sheet of employees and

deals with all service matters and passing of salary bills.

viii. Miscellaneous Section: This section is in charge for Estate Management. For example,

supplying of office stationery to every section as per requirement, repair &

maintenance of office equipment, computers, printers, etc.

ix. Expenditure Section: This section records all types of contractors/suppliers bills,

utilities bills, imprest bill, etc. Also have the records of all securities deposit, EMD

received from contractors/suppliers.

x. Budget Section: Budget section deals with preparation of budget and review.

xi. Works Accounts Section: This section reviews the bills of all contractors in respect of

works contract with the measurement book before making any payment.

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xii. Books Section: Books section is the compiling section. Preparation of cheque for

payment is done by this section. Books section also prepares monthly account current

for revenue expenditure and capital expenditure.

The financial statements (Profit & Loss A/c and the Balance Sheet), are prepared at Zonal

level and not at Divisions, Workshop & Traffic Account Office level. However, the Division

prepares following statements as stipulated under the Codes and Manuals of Indian

Railways:

i. Account Current: Account current is a monthly statement of receipts and disbursements

of an account circle, duly classified under the prescribed head of accounts. The main

principle on which the Account Current are prepared is that all entries should be shown

“NET” basis, i.e., after deducting the write back adjustment against each head of account

i.e. entries of (-Debits) and (-Credits). The figures are shown for the month as well as for

the financial year. The monthly Account Current is prepared at workshop/division level

and thereafter, is sent to Head Quarters Office where it is consolidated for the entire

Zonal Railway.

The monthly Account Current is supported by various schedules giving the details of the

expenses/receipts. Presently, under Accounting Information Management System,

preparation of monthly account current and the connected schedules is computerised.

ii. Block Account: As per Indian Railways Finance Code 1, with effect from 1st April, 1950,

two separate accounts are maintained to represent the value of all the physical assets of

the railway zone- a Loan Account and a Block Account. The Loan Account represents the

loan (share) capital and the physical assets created therefrom. The Block Account

represents all the physical assets of the Zone whether financed from loan capital or the

Railways’ own generation of funds. Block account includes plant, property and

equipment (Fixed Assets) as the major item on the asset side with a detailed schedule

indicating the plan head of assets, source of fund, etc., Block account is maintained in

separately for commercial and strategic lines.

4.1.4 Management Information System (MIS)

The Divisions prepare various reports based on their need and the requirements of higher

authorities. Some of the finance and accounts related MIS reports include:

i. CO6 report for 10 days;

ii. Report on balances under suspense heads;

It is pertinent to note here that though accounting is done at Division/Workshop/Traffic

Accounts Office level, consolidation of accounts is done at Zonal level. The Traffic Accounts

Office is responsible for accounting of all earnings.

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4.1.5 General Understanding of Accounts Department

i. General Payment Process: Payments made by the Divisions include salaries, temporary

wages, payments related to works, general administration, etc. All payments are made

through the Accounts Branch. The general payment process is as under:

ii. CO6 Registration: This is the first step, to make payment of any bill, required to be paid

through bank by RTGS/NEFT. After registration, a 12 digit unique registration number

is generated and this number is called CO6 number. Basically, the CO6 is a

memorandum entry. It is to be noted that the CO6 registration of a bill does not result

into recognition of liability. After registration of CO6, bills are checked in all respect by

the concerned dealing clerk and corresponding SSO. Thereafter, it is required to be

Checking

of bills

Sanction by

Competent

Authority

Preparation of

CO7 and

Allocation to

concern head

Check by

competent

Authority

Send to Book

Section for

Cheque Abstract

Journal

Voucher

CO6 of

Each Bill

Generation of Cash

Book

Account Current

Revenue & Capital

Back to

personnel

Journal

Book

Cheque Abstract Prepared

Bills received by various

sections involving cash

payments.

Start

End

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sanctioned by the competent authority. CO6 number is structured in 4 tier in the

following manner:

CO6 Number : Total 12 Digit

Accounting

Unit Code

Section Code Financial

Year Code

CO6 No.

2-Digit

Code

2-Digit Code 2-Digit

Code

6-Digit Code

Static Code Static Code Change

with each

year

New series starts for

each year

0 3 0 1 1 5 0 0 0 0 0 1

It is to be noted that for each year, CO6 number is started afresh.

iii. CO7 or Bill Passing: After completing CO6 registration and checking the bills in all

respect, accounting entry is to be passed in books of accounts to record the transaction.

The entry is to be recorded after classification under proper head of account. This

process is termed as CO7 or bill passing. After generation of CO7, it becomes a liability

of the railways and payment is required to be made to settle this liability. Like CO6, it

also consists of 12 digits. However, CO7 has the following architecture of five tier:

CO7 Number : Total 12 Digit

Accounting

Unit Code

Section

Code

Financial

Year Code Static Code

for CO7

CO7 No.

2-Digit Code 2-Digit Code 2-Digit Code 1-Digit 5-Digit Code

Static Code Static Code Change with

each year

Static Code New series starts for each

year

0 3 0 1 1 5 7 0 0 0 0 1

4.1.6 General Process of Recording of Intra-Unit Transactions

Use of (–) Debit and (-) Credit–At present, Indian Railways uses (-) Debit and (-) Credit for

recording various transactions including intra unit transactions to maintain budgetary

propriety. Though from the commercial accounting point of view, these are not standard

terms. We can understand the use of the same with the help of following examples:

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4.1.7 Use of Suspense heads

In Indian Railways various transactions are recorded with the help of suspense heads. A

suspense account is an account in which transactions are posted on a temporary basis until

their final head is determined. Suspense accounts sometimes are also used as clearing

accounts.

As per the ‘Suspense Accounts Manual’ issued by Controller General of Accounts (CGA), certain

intermediary/adjusting heads of accounts known as ‘Suspense Heads’ are operated in

Government Accounts to reflect transactions of receipt and payments which cannot be

booked to a final head of account due to lack of proper information as to their nature, or for

other reasons. So, not only Indian Railways but also various other Government

department/ministries use suspense heads.

Presently, certain suspense heads are operated in the accounts of the railways to facilitate

proper accounting of the various types of transactions which cannot be booked immediately

under the final heads for want of allocation or due to any other reason. Suspense heads

therefore play a very important role in compilation and maintenance of accounts of the

railways. Following is an illustrative list of some transactions for which suspense heads are

operated:

i. Advance to Employees; and

ii. Inter unit transactions/intra unit transactions, etc.

Example 1 If an employee of a Division is transferred from one Division to other Division and

there is a credit balance of Rs. 50,000 in the employee’s PF account. Transferor Division

will record this transaction by passing following entry:

Suspense head for PF - (Credit) 50,000

Suspense head for Transferee Division Credit 50,000

On the other hand Transferee Division will pass following entry to record this

transaction:

Suspense head for PF Credit 50,000

Suspense Head for Transferor Division -Credit 50,000

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Operation of CIVIL head

Ministry of Railway also operating some accounting head in its accounts on the behalf of

Ministry of Finance, these heads are known as Civil heads. For instance, Income Tax, Service

Tax, Advance to employees, etc.

Other Accounting Facts

i. Treatment of TDS: Currently, the Divisions deduct TDS as per the provisions of the

Income Tax Act, 1961. However, same is not deposited directly to the income tax

department. A monthly summary is sent to the Zonal Head Quarter. Payment of TDS is

made at Railway Board level through ‘Inter Government Adjustment’. Also, the Divisions

files quarterly TDS returns with the help of professionals. Further, in the books of the

Divisions, TDS amount is accumulated till 31st March in relevant suspense head

corresponding to TDS. This account is nullified by transferring its balance to

‘Miscellaneous Government Account’ at the end of the financial year.

As per Indian Railway Code for Accounts Department Part I, “Misc. Government Account is

a major head no. 880, under L- suspense and miscellaneous (e) miscellaneous, and is

operated along with the following minor heads:

a. Ledger balance adjustment account; and

b. Write off from heads of accounts closing to balance.

This account will be used for closing of all heads of accounts, which do not record

Railway revenue or expenditure. The balances, if any, under the debt and remittance

heads, with the exception of ‘Transfer Railway’, however, are closed to ‘Balance’. The

transaction under the head ‘Transfer Railways’ will be closed to minor head of

‘Miscellaneous Government Account’, in the books of individual railways and to

‘Balance’ if there is any balance in the books of the Railway Board. The transactions

under the head ‘Deposits with Reserve Bank (Railways)’ will be closed to minor head of

‘Miscellaneous Government Account’.”

Sales Tax, which is deducted from the bills of the Contractors and technically known as

Works Contract Tax (WCT), is deposited to Government Account on a monthly basis

through a challan. At the time of deduction, the sales tax is recorded under relevant

suspense head pertaining to sales tax and at the time of payment the same head is

debited.

ii. Existing Classification and Codification Structure: Under the cash based government

accounting system followed by IR at present, income and expenditure are classified

based on the classification of expenditure rules prescribed in the ‘Indian Railways Finance

Code Volume – II (also known as F-2)’. In F-2, all the expenditures heads have been

segregated on the basis of various demands and as per the nature of expenditure. The

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revenue and capital expenditure is classified into 16 demands. It is to be noted that

budget is also prepared on the basis of this classification.

The essence of these demands can be understood as follows:

i. Demand 1 and 2 is for policy formulation which covers the expenditure of Railway

Board and Miscellaneous Expenditure (General);

ii. All working expenses are covered into Demand 3 to Demand 13;

iii. Appropriation to DRF and PF(Demand 14)

iv. Payment of Dividend etc. to General Revenues(Demand 15); and

v. All capital and other works Expenditure (Demand 16).

At present, all revenue working expenses are denoted by an 8 digit numerical code. The first

3 digits stand for demand no., next 3 digits for detailed head corresponding to demand and

last 2 digits denote the primary unit. For instance, salary of General Manager will be as

follows:

On the other hand, capital and other works expenditure are classified under Demand no. 16

for asset acquisition, construction and replacement. The accounting classification of the same

is in the form of 8digit/ 4 tier numerical code which is as follows:

i. The first tier of two digit numerical code indicates the source of fund viz. capital, DRF,

etc., as the case may be;

ii. The second tier of two digit numerical code represents the standard plan head. For

example, code 11 stands for New Lines (Construction);

iii. The third tier which is also numerical represents the two digit corresponds to the sub-

head and detailed head of classification giving the details of assets acquired,

constructed or replaced. For example, 41 stands for rails and fastenings; and

iv. The last tier of two digit depict the primary unit, i.e., object of the expenditure. For

Example, PU code 01 stands for pay and allowances of Departmental Establishment.

0 3 0 1 1 1 0 1

Stand for

Demand No. 3

Detailed head of demand

no. 3 represents officers

Establishment

Primary code

represents Salary

and wages.

Indian Railways


4.1.8 Auditing System

i. The Comptroller & Auditor

of Indian Railways and

& Auditor General (DAI).

headquarters level. The

below:

ii. As per instructions contained

(Administrative Vol.1)

and audit of financial sanctions

control accorded by MoR

authorities; sanctions pertaining

ensure that these are prepared

annual review of balances

of expenditure between

iii. Any irregularity which

report should also be sent

Rs.50,000/- as required

regard to adequacy of action

iv. Directors/Deputy Directors

important audit sections

v. PDA is further assisted

with special investigation/performance

level. SAO/AO work under

examination and audit of

of Railways at Divisions

vi. At the beginning of every

a test audit of transactions

Principal Director of Audit, Zonal Railways (Headquarters level)

Deputy Directors

Senior Audit Officers/Audit Officers (Division level)

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Indian Railways - Comprehensive Scope Evaluation Repor

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System

Auditor General of India is the final authority to

and this responsibility is discharged through Deputy

(DAI). DAI is assisted by Principal Director of Audit

The detailed organization chart of Railways Audit

contained in Para 132 to 138 of Manual

Principal Director of Audit (PDA) is responsible

sanctions pertaining to Railways and offices

MoR or the General Manager; estimates sanctioned

pertaining to local traffic; detailed accounts

prepared correctly and in proper form; internal

balances and appropriation accounts of Railways;

between two or more sections of railway, etc.

comes to the notice of an officer should be reported

sent of losses and embezzlements of cash or

under Para 1102- F (1). PDA also submits

action taken by investigating departments.

Directors who work under PDA are entrusted

sections and inspections.

assisted by Senior Audit Officers/Audit Officers,

investigation/performance audit cum efficiency audit,

under the personal direction of PDA. AO conducts

of accounts. He is also expected to carry out

Divisions Level and report thereon to PDA.

every financial year Audit officers prepare an Audit

transactions occurring monthly is carried out by the Audit

C & AG of India

Dy. C & AG of India

Principal Director of Audit, Zonal Railways (Headquarters level)

Deputy Directors

Senior Audit Officers/Audit Officers (Division level)

Assistant Directors

Directors/Principal Directors

Senior Administrative Officers/Administrative

Officers


to conduct the audit

Deputy Comptroller

Audit (Railways) at

Audit Branch is given

Manual of Standards

responsible for scrutiny

offices under their audit

sanctioned by same

of the railways to

internal check system;

Railways; proper allocation

reported to DAI. A

or stores exceeding

a report to DAI in

entrusted with charge of

who are entrusted

audit, etc., at Divisions

conducts periodical

independent audit

Audit Plan. Usually,

Audit Officer.

Directors/Principal Directors

Senior Administrative Officers/Administrative

Officers

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vii. Audit of Debt head Reports and all Appropriation accounts is conducted on annual

basis. Audit of Suspense balances including store suspense and all arrear reports is

conducted on half-yearly basis.

viii. Audit department also carries out an audit of all proposals/tenders before sanction.

AO conducts scrutiny of all relevant documents, briefing notes, contract agreements,

etc., in regard to tenders.

ix. AO reports to PDA any material irregularity which is observed by him at any time

during audit of Railway Accounts. Reports made by AO are circulated with

supporting documents regarding any irregularity (if any).

x. Government of India can also order a Special Audit of Railway Accounts.

xi. For keeping a proper control over the subordinate units, PDA visits their subordinate

formations as well as important units of the Railway Administration like major

stations, Workshops and the sites of important works for review from time to time.

Important points noticed during these visits/ tours/ inspections are reported to

Headquarters office for information of DAI.

xii. The office of Comptroller and Auditor General emphasise on systematic training of

newly recruited Audit staff. The course covers all main principles of audit of all the

branches of Railway transactions such as Establishment, Engineering Works,

Workshops, Stores, etc., and the Code rules regulating them.

4.1.9 Budgeting System

Preparation of budget is one of the most important management tools for any Government

organisation. In Indian Railways, budget plays an important role. There is a laid down

system for the preparation and approval of budget in the Indian Railways. The process of

preparation of budget is as follows:

i. Every year, budget estimation is made by the each Senior Section Officer (SSO)/Senior

Section Engineer (SSE) of the department concerned for the requirement of funds

relating to their section. For example, SSE prepares the budget of engineering

department.

ii. Thereafter, it is sent for approval to the competent authority of the department

concerned.

iii. After approval of the Competent Authority, the budget is forwarded to the finance

department for vetting. The finance department evaluates the Budget Estimate on the

basis of various financial parameters.

iv. Once the Budget Estimate is vetted by the finance department, a sanction letter is

issued by the finance department in multiple copies, which is forwarded to the various

departments concerned which in turn send the sanction letter to DRM if it is related to

mini law book matters, to Headquarters for matters related to Law book and to

Railway Board if it is related to Pink Book for further approval.

v. There is a system of review of the estimates on the basis of an actual expenditure of

three months in the month of August, in the month of November based on the actual

expenditure of first the Six months and final budget in the month of December.

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4.1.10 Mapping of Current Process at Divisional Office

The mapping of accounting processes refers to the activities involved in defining exactly

how an accounting process is carried out in an entity and what records are maintained to

capture the transactions. The ICAI ARF team has carried out the mapping of current

accounting processes in Indian Railways separately for a Division, Traffic Accounts Office

and Workshop in order to understand the components of the existing accounting system;

the extent of prudence and propriety of the system in place and to find out the gaps in the

present system from the viewpoint of implementation of accrual based accounting system.

Following table depicts the accounting process of various transactions at a Division:

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# Transactions Process Accounting and

Records

Maintained

Accounting of Revenue Receipts

1 Railway

Recruitment Board

(RRB) Receipts

All recruitment in Indian Railways is made through RRB/RRC/UPSC.

Periodically, RRB publishes advertisements for recruitment.

The recruitment process is centralized, i.e., RRB can advertise for

recruitment in any Zonal Railways.

Candidates apply to the post according to their qualification/age/location

within the prescribed time frame along with applicable fees (either in

IPO or DD) and necessary documents.

The application is sent to the RRB concerned.

RRB office collects all the applications as per their selection criteria.

DDs/IPOs are segregated separately.

IPOs/DDs are sent to the designated Cash Office with all the relevant

details as applicable.

Cash Office deposits all the DDs to the respective Indian Railways Bank

accounts in the designated bank through Treasury Remittance (TR) Note.

IPO is deposited into designated post office. Post office issues cheque for

the amount of IPOs deposited after deducting charges (if any). This

cheque is also deposited into bank through TR Note.

Cash Office sends details of all cheques/DDs to the books section

concerned along with TR note for the purpose of recording and

compilation.

Book section passes the following entry to record the transaction :

Suspense Head-Remittance into bank DR xxx

Accounting

Accounting entry is passed in

Books Section.

Books & Register Maintained

1. Reconciliation into Bank

(RIB) Cash Book.

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To Major head 1001- Misc. Rec

Earning Head for RRB receipts

CR xxx

Finally, amount of this receipt is depicted in 'Revenue Account

Current' under the head ‘Misc. Receipts’.

2 Land Licence

Fees/ Building

Rent

Indian Railways earns revenue by giving its Land & Buildings on rent.

Revenue generated from land given on rent is termed as Land Licence

fees.

Land & Buildings are given on rent only after approval of competent

authority. Licence fees for the lands are determined by executive section

based on extant rules.

At present, accretion in license fees for land is to be done at the

prescribed rates.

Building rent is revised every 5 years on the basis of DLC rate applicable

for the land on which the building is constructed.

Periodically, expenditure section prepares bill in a prescribed format in

three copies for recovery of Land licence fee/Building Rent and forwards

one copy to the party concerned for payment, one copy to executive

section and one copy for their records.

If there is any anomaly in the bill then same is returned by parties to

Expenditure section for correction.

Expenditure section makes necessary correction and forwards the same

to the party for payment.

Parties make the payment by cheque/DDs to the Expenditure section.

Accounting

Accounting entry passed in

Books Section.

Books & Registers

Maintained

i. Demands Recoverable

Register.

ii. RIB Cash Book.

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Expenditure section forwards these cheques/DDs to designated Cash

Office with CR Note.

Cash Office deposits all the cheques and DDs to the IR Account through

TR note.

Subsequently the Cash Office sends details to Books Section for

recording.

Books section transfers the earning to Traffic Accounts Office by passing

the following journal voucher in their books of account:

Suspense Head -Remittance into bank DR Xxx

To Suspense Head-

Transfer Divisional TAO

CR Xxx

Finally, this amount is shown under the head ‘’Transfer Divisional” in

Revenue Account Current.

Subsequently TAO books the earning under the relevant accounting

head.

3 Way Leave

Charges

Way leave is the facility given by Indian Railways to other Government

Departments/Private companies by providing them the right of way

over/under the railway track. For example, giving facility to BSNL for

laying cables under the tracks.

At present, way leave charges are recovered from the party concerned in

advance of 10 years.

Engineering section is responsible for monitoring the recovery of way leave

Accounting

Accounting entry is passed in

Books Section.

Books & Registers

Maintained

i. Bills Recoverable

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charges.

Periodically, engineering section raises demand note for the recovery of way

leave charges and forwards this note to Expenditure section.

Expenditure section checks the demand note and sends it to the party

concerned for payment.

If parties find any anomaly in the demand note than it is returned to

Engineering section via Expenditure section.

Parties make the payment as per the terms and conditions in the prescribed

mode, i.e., cheques/DDs.

After receipt of payment from parties, Expenditure section forwards these

cheques/DDs to designated cash office through CR Note.

Cash Office deposits all the cheques and DDs in the IR Account through TR

note.

Cash Office sends all the details along with TR Note to Books Section for

recording.

Books section of the Divisions transfers the earning to Traffic Accounts

Office by passing the following journal voucher in their the books of account:

Suspense Head Remittance into bank DR Xxx

To Suspense Head


CR Xxx

Finally, this amount is shown under the head ‘’Transfer Divisional” in

Register.

ii. RIB Cash Book.

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Subsequently, TAO records the entry under the relevant accounting head.

4 Siding Charges/

Foreign Service

Contribution (FSC)

Charges

Siding is the facility provided by Indian Railways to third parties in the

structure of laying track from any station to their business premises to

facilitate loading and unloading of goods.

As per Code : An Assisted/Private Siding is a siding constructed to serve a

Government Department, a factory, mill, industry, mine or other private

party. The user of the siding has to pay to the Railway a Siding charge to

be fixed by the Railway Administration from time to time for every wagon

whether loaded or empty hauled over the siding in each direction.

If a Siding has been provided with complete facilities for direct reception

and despatch of trains and such trams do not require to be dealt with at

the station from which the Siding takes off/serving station but run

through to or from the Siding with railway locomotive or originate from

or terminate in the exchange/peripheral yard provided by the siding

holder, the Railway Administration shall have the powers of levying

freight charges on through distance basis up to the buffer end of the

Siding or the farthest point of the Exchange Yard, instead of levying

freight charges up to the serving station and Siding charges for haulage of

wagon over the Sidings.

The cost of siding is either borne by the party or by Indian Railways.

However if IR bears the cost then the same is recovered from parties in the

mode of siding charges.

Accounting


Books Section.

Books & Registers

Maintained

1.

ills Recoverable Register.

2.

IB Cash Book.

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In addition to this, if Indian Railways provides any personnel for

maintenance of tracks, etc., then the salary of such staff is also recovered

from parties in the form of Foreign Service Contribution (FSC) charges.

FSC charges are revised as per the revision of salary of personnel engaged

on the siding.

Divisional Personal Officer (DPO) and Divisional Finance Manager (DFM)

are responsible for the recovery of FSC charges while Engineering section

is responsible for the recovery of siding charges.

Both offices prepare the demand note for the recovery of FSC

charges/siding charges and forward it to the Expenditure section.

Expenditure section checks the demand note in every aspect and sends it

to the party concerned for payment.

If parties find any anomaly in the demand note, then it is returned to the

section concerned via expenditure section.

Parties make the payment as per the terms and conditions of the

agreement, in the form of Cheque/DD.

Expenditure section forwards these cheques/DDs to designated Cash

Office through CR Note.

Cash Office deposits all the cheques and DDs in the respective Railways

Account in the designated bank through TR Note.

Cash Office sends details along with TR Note to Books section for

recording.

Books section transfers the earning to Traffic Accounts Office by passing

the following journal voucher in their the books of account:

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Suspense Head Remittance into bank DR Xxx

To Suspense Head


CR Xxx

Finally, this amount is depicted under the head ‘’Transfer Divisional” in


Subsequently, TAO records the entries under the relevant accounting

head.

Accounting for Employee Benefits

1 House Building

Advance/ Pay &

TA Advances/

Computer

Advances/ Scooter

advance

There are two types of advances granted by Indian Railways to its

employees, one is interest bearing and the other is non-interest bearing.

At present, only Pay & TA advance is non-interest bearing.

Following are the interest bearing advances:

i. Car Advance;

ii. Scooter advance/motor advance;

iii. House Building Advance; and

iv. Computer Advance.

The advances are given to employees as per extant rules.

An employee, who is willing to take an advance, makes an application in

the prescribed format to the competent authority.

Advance is sanctioned by head of the department concerned subject to

availability of funds. For example, if an employee of Accounts department

wants to avail HBA then it will be sanctioned by the head of the Accounts

Accounting


Books Section.

Books & Registers

Maintained

1. Suspense register of civil

advance

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department, i.e. FA&CAO. Accounts department estimates the total

amount required for each type of advance.

This estimation is sent to the Zonal Head Quarter while sending Revised

Estimates of Budget.

Zonal Head quarter allots the amount for the disbursement of advances.

This grant is called Civil Grant. A separate grant is released for each type

of advance. For instance, grant received for HBA cannot be used for

payment of car advance or vice versa.

If the amount is adequate for the disbursement towards all applications

made then the same is disbursed to all applicants. However, if amount is

not adequate then the advance is disbursed on the basis of application

first made.

A Pay order is made in the name of the employee for the payment of

advance.

Normal payment process is followed for making of payment. Following

entry is passed while making payment:

Suspense Head corresponding to Advance DR Xxx

To Suspense Head Cheques & Bills CR Xxx

Recovery is initiated from the salary of the employee from the following

month. In case of an interest bearing advance, recovery of interest is

initiated after recovery of principle which is restricted to maximum 60

instalments.

At the time of recovery of principle from the salary of the employee,

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following entry is passed to record the transaction in the Books of

account.

Salary head for Relevant Demand DR Xxx

To Suspense Head corresponding to

advance (Recovery of Advance)

CR Xxx

To Suspense Head Cheques

& Bills (Payment of Salary)

CR Xxx

While at the time of recovery of interest following entry is passed to record the

transaction in the Books of accounts:

Salary head for relevant Demand DR Xxx

To Suspense Head corresponding to

Interest (Recovery of Interest)

CR Xxx

To Suspense Head Cheques & Bills

(Payment of Salary)

CR Xxx

In case of transfer of employee, balance amount is transferred to

concerned accounting unit through E-RECON/ now IPAS and necessary

journal voucher is passed in both accounting units.

2 Payment of Salary

For the purpose of payment of salary, the Division is divided into Bill

units. The Executive/ Personnel section for each Bill unit is responsible for

Accounting


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Maintained

preparing the salary of the employees of that bill unit.

The personnel are appointed in each Bill unit as per applicable cadre

norms/rules. Number of employees in each cadre cannot exceed the

sanctioned strength limit.

The Bill unit prepares salary bills for the payment of salary and forwards

it to Executive/Personnel section every month.

Designated personnel of executive section feed all salary bills in IPAS.

CO6 of each salary bill is made.

The Establishment section of the Accounts Department checks the salary

bills in terms of amount of salary, deductions to be made from salaries,

etc.

If any anomaly is found in a salary bill, then the same is returned to the

concerned Bill unit for correction.

If bill is found correct in all respect, CO7 of salary bill is made, i.e., salary

bill is passed as per allocation head.

After the CO7 is prepared, the bill is again checked by Senior Section

Officer concerned in terms of allocation, etc. if any correction is required,

bill is returned to Establishment section otherwise it is sent to Books

section for preparation of cheque abstract.

After preparation of cheque abstract, this entry is reflected in the Revenue

Account Current and as well as Cash Book.

Generally, payment of salary is made through RTGS/NEFT. However in

some cases individual cheque is also issued.

If payment is made by RTGS/NEFT, a consolidated cheque is prepared

and sent to Bank along with Bank account details of all employees to

Books Section.

Books & Registers

Maintained

1. Salary and allowance

register (R.No.69)

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whom salary is to be paid.

If individual cheque is issued then same is sent to Cash Office from where

the cheque is dispatched by appropriate mode.

Following entry is passed at the time of making payment of salary to

record the transaction:

Expenditure head-Salary head for corresponding

to Demand

DR XXX

To suspense head Cheques & Bills (net

Payment Amount)

CR XXX

To Statutory recovery (TDS) CR XXX

To HBA/Car/Scooter Advance Recovery CR XXX

To PF Recovery CR XXX

To other recovery (if any) CR XXX

3 State Railway

Provident Fund

As per State Railway Provident Fund Rules, all employees, other than

those covered under New Pension System, after a continuous service of

one year are eligible to subscribe the SRP Fund.

This fund is non-contributory, i.e., employer does not make any

contribution to this fund.

Minimum contribution to this fund is 8.33% of basic salary. However,

employee may also make a voluntary contribution of any amount to this

fund in addition to the minimum contribution subject to the maximum

Accounting


Books Section.

Books & Registers

Maintained

1. Records of individual

employees are maintained

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limit that the amount should not be more than the amount remaining after

recoveries.

While processing salary for each month, employee contribution for SRPF

is deducted. Following accounting entry is passed while deducting the PF

amount from salary:

Salary head for corresponding to Demand DR XXX

To suspense head Cheques & Bills

(net Payment Amount)

CR XXX

To Suspense Head SRPF CR XXX

To other recovery (if any) CR XXX

SRPF payment

SRPF payment may be divided into two parts:

a) Advances and withdrawal

b) Final Payment

Advances & Withdrawals

Any permanent withdrawals can be made from the fund as per stipulated

Rule. Otherwise, only temporary withdrawal is allowed.

For making any withdrawal, whether temporary/permanent against

SRPF, employee makes an application in prescribed format to the head of

the department (HOD).

in individual files and also

in IPAS software.

2. Records are maintained in

PF Ledger.

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HOD forwards this application to Divisional Personnel Officer (DPO) for

necessary action. PF applications of accounts staff are processed by

Accounts Department itself.

Eligibility for withdrawal is determined after verification of the

application vis-à-vis the extant rules and sanction given by DPO. The

same is then sent to the PF section for arranging payment.

CO6 is registered for payment and normal payment process is followed.

Following entry is passed while making the payment to record the

transaction:

Suspense Head SRPF DR XXX



CR XXX

Recovery from salary is to be made if the withdrawal is temporary.

Following entry is passed at the time of recovery of SRPF advance/loan:




CR XXX


To other recovery (if Any) CR XXX

Interest at stipulated, rates presently @ 8.70%, is paid to employees on

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their monthly PF balances. Following entry is passed while crediting the

interest on SRPF account:

Suspense Head Transfer Divisional Head

Quarter

DR XXX


4 Group Insurance

Scheme

Employee ‘Group Insurance Scheme is governed by ‘Central Government

Employee Group Insurance Scheme’.

The benefit of this scheme is available only to regular Railway employees,

i.e., benefit is not available to contractual employees/workers.

While processing the salary for each month, a nominal amount as

applicable towards premium is deducted from the salary of employees

every month. Following accounting entry is passed to record the

transaction:


To Suspense head Cheques & Bills


CR XXX

To GIS premium- MH 0022 CR XXX

The amount so collected towards GIS premium is transferred to GOI

through ‘Inter Government Adjustment’

At the time of death of employees, death benefit is paid as per entitlement

Accounting


Books Section.

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Records

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under the rules.

At the time of retirement, employee gets accumulated amount as per the

calculation table applicable for this purpose as issued by Central

Government.

At the time of making payment either on death or retirement, following

entry is passed:

Major Head for GIS- 0022 DR XXX

To Cheques & Bills CR XXX

At the end of the financial year, this head is closed by transferring its

balance to ‘Misc. Government Account’ as per Codal provision.

5 New Pension

Scheme

New Pension Scheme (NPS) is applicable with effect from 01.01.2004. It is

defined as contributory pension scheme where both employees as well

employer contribute to the pension fund.

Employee makes contribution @ 10% of basic pay and DA which is to be

recovered from their salary as per prescribed rules. The Government

matches this with an identical contribution into the pension fund.

A unique permanent retirement account number (PRAN) is allotted to

each employee.

While processing the salary every month, employee’s contribution

towards NPS is deducted from salary. Following entry is passed to record

Accounting


Books Section.

Books & Registers

Maintained

1. Employees wise NPS data

files

2. Statement of transactions

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Records

Maintained

this transaction:

Exp Head Salary head corresponding to Demand DR XXX

To suspense head of Cheques & Bills (net

Payment Amount)

CR XXX

To suspense head for employee

Contribution to NPS- Major head -0071

CR XXX

For employer’s contribution to NPS, following entry is passed:

Corresponding Head of Demand 13 DR XXX

To suspense head of employer ‘s

Contribution to NPS- Major head- 0071

CR XXX

Thereafter, payment of employer’s contribution as well as employee’s

contribution is made to the Trustee Bank at designated place. Following

entry is passed at the time of making payment

Suspense Head – Employee cont. NPS MH- 0071 DR XXX

Suspense Head – Employer cont. NPS MH-0071 DR XXX

To suspense head Cheques & Bills CR XXX

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Records

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6 Pension Benefit There is a centralized pension department in Divisions for pension benefit

to employees.

There are two types of retirement, one is Normal and the other is Other

than Normal. In normal retirement, employee retires after completion of

service at the maximum age specified for retirement. However, in other

than normal retirement, employee may take retirement as per his

convenience.

In case of other than normal retirement, employees would be eligible for

pension only when he retires after completing 20 years of qualifying

service.

In case of normal retirement, all the relevant documents relating to

pension are submitted by employees before 3 months of retirement.

Pension is calculated on basis of Last basic pay plus grade pay.

For payment of pension, a Pension Payment Order (PPO) is generated at

the Divisional accounting unit which is counter signed by competent

authority.

Commutation of pension is also allowed at the request of employee

according to the prescribed rules.

PPO along with all relevant documents is sent to the designated bank for

payment.

Following accounting entry is passed to record the transaction in the Books of

accounts:

Accounting


Books Section.

Books & Registers

Maintained

1. Employees wise pension

file

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Records

Maintained

Concerned head of Demand No 13 for Pension DR XXX


7 Staff Benefit Fund There is a staff benefit fund in Indian Railways. This fund is used for

Railway employees for the following purposes:

i. Higher education of children

ii. Provide assistance to differently abled children

iii. Sports activities, etc.

The fund is provided to and is managed by Staff Benefit Committees

nominated by competent authorities.

Employees give applications in prescribed format to competent authority

for granting assistance from staff benefit fund.

Competent authority determines assistance available to each employee on

the basis of number of applications received, availability of fund and

applicable norms/rules.

Payment is arranged as per the discretion of the Staff Benefit Committee.

Accounting


Books Section.

Books & Registers

maintained

1. SBF Register by Staff

Benefit Committees

Accounting for Liabilities

1 Indian Railways

Deposits

Indian Railways deposit is a liability head. There are several deposit

heads which constitute Railways Deposit, some of them are:

i. Deposit Misc. – Establishment: Salary which is not claimed by employee

or otherwise is recorded in Deposit Misc. E. and following entry is passed

to record this transaction:

Remittance into bank DR XXX

Accounting


Books Section.

Books & Registers

Maintained

1. Deposit E- Register

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Records

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To suspense head Dep Misc. E-

unclaimed salary

CR XXX

At the time of claim, after necessary approval and verification, pay order

in the name of employee is generated and following entry is passed:

Suspense head Dep Misc. E- unclaimed salary DR XXX


If the amount is not claimed within 3 years it is transferred to SBF

Account.

ii. Deposit Misc. Works: Indian Railways undertakes various types of

deposit works on behalf of other Government institutions/private parties.

Before starting any work, cost estimation is prepared by section

concerned. This cost estimation also includes departmental charges at a

specified rate of the estimated cost.

This cost estimation is given to the Institution/Department/Party

concerned for payment.

Thereafter, the Institution/Department/Party pays the amount as per

the terms & conditions of the contract. Following entry is passed to

record this transaction:

2. Deposit W- Register

3. Deposit X- Register

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To suspense head Deposit Misc. W CR XXX

The amount so received is accounted for in the Deposit Works Register.

Separate ledgers are opened in the Register for each deposit work.

Any amount which is incurred on particular deposit work is adjusted

against Deposit Misc. W. Following entry is passed while making a

payment against a particular deposit work:

Suspense head Deposit Misc. W DR XXX


iii. Deposit Misc. Expenditure: Deposit expenditure includes Earnest money

deposit/security deposit received from contractors/suppliers. At the time of

tendering, contractors/suppliers apply along with appropriate EMD/SD as per

terms & condition mentioned in the advertisement. Following entry is passed

at the time of receiving EMD/SD:


To suspense head Deposit Misc.-Exp.

- EMD/SD

CR XXX

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After completion of work, SD is returned to concerned contractor/supplier

upon request. Following entry is passed at the time of making payment of

SD/EMD:

Suspense head deposit Misc.-Exp. - EMD/SD DR XXX


If contractors/supplier does not claim security deposit for more than 3

years then the same is transferred to earnings.

2 Sales Tax/ Works

contract tax

Division deducts WCT/sales tax on the works contract according to the

statutory requirement.

While deducting sales tax, the following entry is passed:

Relevant demand corresponding to expenditure DR XXX

To suspense head Deposit Misc.-

WCT/Sales tax

CR XXX

Sales Tax/WCT so deducted is deposited with the designated Government

department within prescribed time. Following entry is passed to record

the transaction:

Suspense head Dep. Misc. WCT/Sales tax DR XXX

To suspense head Cheques & Bill CR XXX

Accounting


Books Section.

Books & Registers

Maintained

1. Sales tax/Works contract

tax file

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Records

Maintained

Miscellaneous Accounting Transactions

1 Transfers

Divisional

Transfers divisional depict the transaction within various accounting

units in a Zonal Railway.

All transfer transactions take place through a Transfer Certificate (TC); all

the transfer transactions with in the railways are raised through E-

RECON/ IPAS software. All the TCs are raised and accepted

electronically.

To record the transactions in the Books of accounts both accounting units

pass Journal Vouchers.

All transactions for a particular period are shown under ‘Transfers

Divisional’ in ‘Account Current’.

Any inter Zonal transaction between accounting units takes place through

Head Quarters.

Books & Registers

Maintained

1. TC/ATC Register

2 Transfers Railway

Capital

If any revenue expenditure has been booked initially under capital head

or vice versa, then this expenditure needs to be transferred to the relevant

head of account. Such transfers come under the head Transfer Railway

Capital. For Instance, purchase of fuel is revenue expenditure but at the

time of purchase it is booked under capital head.

At present, Fuel is purchased at Head Quarter level, thereafter it is

transferred to divisions/workshop and debit is given to unit concerned.

The following entry is passed in Head Quarter’s books at the time of

purchasing fuel:

Accounting


Books Section.

Books & Registers

Maintained

1. Journal Voucher file

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Records

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Store Suspense Head DR XXX


Head Quarter raises a debit on Divisions through a TC for fuel used by

Divisions. After acceptance of the TC by Divisions, the following entry is

passed in Head Quarter’s books:

Suspense head Transfer Divisional Divisions -CR XXX

To Store suspense head CR XXX

On the other hand, division passes the following entry in their books of

accounts to record the transaction:

Store suspense head DR XXX

To suspense head Transfer Divisional

head quarter

CR XXX

As purchase of fuel is revenue expenditure and initially booked under store

suspense, which is a capital suspense head; a journal entry/voucher is required

to be passed for transfer from capital to revenue. Following journal entry is

passed in capital account:

Transfer revenue (00878292) DR XXX

Store suspense head CR XXX

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Following journal voucher will be passed in revenue account:

Relevant demand DR XXX

Transfer capital (00878291) CR XXX

3 Imprest Imprest is given by Indian Railways to its officers to meet out petty

expenditure as per the prescribed rules.

The officer entitled to an imprest makes an application to the competent

authority.

After financial vetting and sanction by competent authority, a pay order is

issued in the name of employee/officer.

A bank account is opened for every imprest holder and an ATM card is

provided to the imprest holder.

At the time of disbursing imprest amount following entry is passed:

Suspense Head for Imprest (00867201) DR XXX

To Cheques & Bills (00867002) CR XXX

Periodically, upon submission of bill imprest amount is recouped to the

extent of bills submitted. Following entry is passed upon submission of

bill and recoupment of imprest amount:

Relevant head of concerned demand DR XXX


Accounting


Books Section.

Books & Register maintained

1. Imprest Ledger

2. Expenditure Register

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Records

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4 Demands Payable This is a suspense head that records the revenue liabilities incurred and

the actual discharge of such liabilities, when payment is made. Balance

under this head will always be a credit figure, representing outstanding

revenue liabilities.

A separate account is kept for the purpose. However, at present this head

is mostly operated for salary payable that too only for the salary for the

month of March which is paid in April. This head is operated in the month

of March in order to bring the liabilities towards salary in the same

financial year. (Some Railways operate this account every month, some

only in yearend.)

Following accounting entry is passed at March end:

Relevant Demand Head DR XXX

To Demands Payable CR XXX

Following entry is passed upon submission of bill and actual payment of bill

in April:

Demands Payable DR XXX


Accounting


Books Section.

Books & Register maintained

1. Demand Payable register

Indian Railways


4.2 Workshop

4.2.1 Introduction

Workshops are independent

engaged in overhauling, repairs

certain manufacturing activities

4.2.2 Organizational

4.2.3 General Organizational

In small workshops, the Accounts Offices are headed by Sr. AFA/W&S or AFA/W&S.

Personnel

Dy. CPO

APO (Carriage)

APO (ADL &W)

Electrical

Dy. CEE (W&S)

DEE (MOD)

AEE (PR)

Deputy Financial Advisor and Chief Accounts Officer (works

Senior Section Officer

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independent accounting units of Indian Railways, which

repairs and maintenance of rolling stocks. They

activities sometimes.

Structure of Workshop

Organizational Structure of Accounts Department


Chief Workshop Manager

AEE (PR)

Mechanical

Dy. CME (L)

WM (DSL) / PE (L)

AWM (DSL) / APE

(L)

Dy. CME(C)

AMM

PE (C)

Accounts

Dy. FA & CAO (W &

S)

Sr. AFA/W&S

AFA/W&S

Deputy Financial Advisor and Chief Accounts Officer (works

and Stores)

Senior AFA (W & S )

AFA ( W&S )

Senior Section Officer for each section

Accounts Assistant


Accounts Clerk

Scope Evaluation Report

which are primarily

They also carry out

Department in a Workshop


Stores

Dy. CMM

DMM AII

SMM

AMM

Signal

WM

AM

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4.2.4 Type of Works Performed in a Workshop

i. Rolling Stock Programme: The Rolling Stock Programme approved by Railway Board

lays down works for improvement or modernisation of Locomotives, Carriages and Wagons

(hereinafter referred as the rolling stock).These works are carried out by the Workshops. For

example, if there is a work of changing iron sheet of wagons into steel sheets, then the same

would be done within this programme.

ii. Periodical Overhauling Work (POH): The Locomotives, Carriages and Wagons have a

prescribed schedule of overhauling which is known as POH. A Workshop is primarily

dedicated to POH related works and manufacturing in a few cases. When any

Locomotive/Coach/Wagon is overhauled, the next due date for POH is also specifically

mentioned on each rolling stock. The Rolling Stock is sent to the nearest workshop for POH

whenever it falls due. Separate cost is identified for each overhauling.

iii. Non Periodic Overhauling Work: Overhauling, other than routine is known as NPOH.

iv. Special Repair (SR): Under this type of programme, repairs or maintenance of rolling

stock is done under special circumstances, which is due to some damage or happening of a

sudden event, which leads to breakdown of rolling stock. For example, overhauling of a

Coach/ Wagon/ Loco damaged in an accident.

v. Deposit work: These are works that are done by the Workshops for private parties and

various other Government organizations. For example, laying of cables for BSNL.

Generally, this work is done at cost (departmental charges) but no profit is charged in such

type of deposit works by the workshop.

4.2.5 Departments in a Workshop

Normally, there are seven departments in a workshop. Each department has its own sphere

of responsibility. Working of each department as follows:

i. Mechanical: The Mechanical department monitors all types of repair, maintenance and

manufacturing work that is carried out on the rolling stock.

ii. Electrical: This department carries out every type of electrical work whether related to

electrification of coach, wagon, diesel locomotive or administration.

iii. Personnel: This department deals with the service matters of employees like

recruitment of new employees, transfer and promotion of existing employees, etc. This

department also deals in making policies relating to establishment office and staff

matters.

iv. Printing Press: This department is dedicated for any work relating to printing of

stationery for the Zonal Railway. Earlier, Railway tickets were also printed but now this

is discontinued.

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v. Stores: Stores department is engaged in purchase and issue of various items as per

requirement. There are two types of purchase, which are made by stores:

a. Purchase of Stock items: Stock items include all materials which are required on

regular basis. For example, machinery parts required on routine basis, etc.

b. Purchase of Non Stock items: Items other than stock items are known as Non Stock

item, i.e., item which is not required on a regular basis. For example, computer,

furniture, etc.

Other than purchase and issue of various stock items, stores department also

undertakes sale of scrap/discarded/condemned assets.

vi. Signal: Activities of this department are related to various manufacturing, repair and

maintenance of signalling and safety equipment. Work of this unit is related with

signalling and safety. Apart from this, manufacturing is also done on a small scale.

vii. Accounts: This department is responsible for works relating to accounting and

compilation for the purpose of generating necessary financial information. For example,

recording of all vouchers relating to Income and Expenditure to find out the cost or any

other relevant information for decision making.

4.2.6 Workshop Manufacturing Suspense (WMS) Account or Workshop Account

Current

It is a monthly statement showing total expenditure made on overhauling/maintenance of

Rolling Stock or any Capital Repairs like MLR, Re-cabling, etc. for a particular period. It is

prepared by every unit of a workshop, i.e. locomotive, carriage, electrical, signal. After

compilation of these monthly statements, a financial review report is prepared. This

statement has following two sides, i.e., Debit Side and Credit Side.

i. Debit Side: Debit side of the statement contains the following items:

a. Labour payments - from labour schedule;

b. Store material - from daily issue notes; and

c. On cost charges of labour and store both.

ii. Credit Side: Credit side of statement has following items:

a. Transfer of manufacturing items from one workshop to another;

b. Items returned to store;

c. Amount of work done for other Zonal Railways; and

d. Amount of work done for other Workshops.

Labour and Store amount is entered from Workshop General Register and all the credits are

obtained from the Outturn statement. All credits to other Workshops/Divisions is done

through Journal Voucher entries. Closing Balance of WMS is transferred to capital account

current.

For example, a workshop conducted a POH for the rolling stock of a division. Following

entry will be passed in workshop to record this transaction:

Transfer Division DR Xxx

Indian Railways


4.2.7 Workshop Genera

This register is prepared every

and credit is given for return

railways or other workshops.

4.2.8 Outturn Statement

This is the statement which

relating to the credit side of Workshop

the Outturn statement WMS

Workshop General Register

month. These JV relate to various

4.2.9 Fixed Assets

Proper recording of fixed assets

for recording of Fixed Assets

and Rolling Stock. Every addition

Step 1

•Work order wisework order.

•Summarised notesS-2702.

Step 2

•Data of Time sheet

•Data of summarised

Step 3•Total of Labour

Step 4

•Credit is given for Stores returned and other manufacturing sale to other Workshops through DS 8 and P 10 form

Step 5

•Finally the total of labour schedule, bonus, on cost charges, stores returned and manufacturing sale is enetered in WGR

To Workshop Manufacturing Suspense Account

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General Register (WGR)

every month under which all labour and store

returned stores and sale of minor manufacturing

Following steps are taken while preparation

Statement

which records all types of Journal Voucher (JV’s)

Workshop Manufacturing Suspense account.

account is prepared. In this statement total

is also entered on the basis of total JV’s

various POH done for various divisions, workshops,

assets is important for every organization. There

Assets in a Workshop. A register is maintained for

addition or deletion in rolling stock or Plant

wise time sheet is prepared for all the direct labour

notes of store is prepared for store related expenses

sheet is entered in labour sub ledger.

summarised notes of stores is entered in stores sub- ledger

sub ledger and stores sub ledger is transferred

Credit is given for Stores returned and other manufacturing sale to other Workshops through DS 8 and P 10 form

Finally the total of labour schedule, bonus, on cost charges, stores returned and manufacturing sale is enetered in WGR

To Workshop Manufacturing Suspense Account CR


charges are added

manufacturing items to foreign

preparation of WGR:

(JV’s) entries passed

account. With the help of

total of credit side of

passed during the

workshops, etc.

here is no fixed format

for Plant, Machinery

Plant & machinery is

labour engaged in each

expenses under the form

ledger.

transferred to labour schedule.

Credit is given for Stores returned and other manufacturing sale to other

Finally the total of labour schedule, bonus, on cost charges, stores returned and

Xxx

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recorded in this Register. Monthly capital account current is prepared for all the additions

and deletions on assets and from that Block account is prepared in which opening value,

addition and deletion value of assets is written.

At present, no depreciation is charged directly on any assets. However, each year Indian

Railways contributes a certain amount to the Depreciation Reserve Fund (DRF) in relation to

the expenditure on renewal and replacement of assets. This contribution is determined by

the “Railway Convention Committee”. Further, Workshop does not create any provision for

impairment of assets.

4.2.10 Store Department

It is one of the most important Departments in a Workshop. All stores accounting relating to

a workshop is done here. There are various stores depots under a Stores department. For

instance:

i. General Stores Depot,

ii. Carriage Stores Depot;

iii. Wagon Stores Depot;

iv. Signal Stores Depot;

v. Diesel Stores Depot;

vi. Railway Printing Press;

vii. Diesel Stores Depot;

viii. Divisional Stores Depot; and

ix. Electrical Production, etc.

Further, a centralized store also exists at HQ level. Following activities are undertaken by

the Stores Department:

i. Purchase of Stock;

ii. Manufacturing;

iii. Transfer to Shop or consignee;

iv. Depot to Depot transfer;

v. Stores Returned; and

vi. Sale of scrap, etc.

The following process is followed in the Store Department:

Indian Railways


A material request is sent by

material is available in the depot

available in the Stores Depot,

i. Purchase;

ii. Depot transfer;

iii. Returned stores; and

iv. Manufacturing (if possible).

Once the material is available

shop/department. Issue note is

to the consignee, third copy is

Accounts Department. The Accounts

after making necessary accounting

Issue Note.

TC (Transfer Certificate) is

against the consignee with a credit

is also issued by the consignee

JV is passed and the same is

the end of the month then the

If there is any difference in the

reflected in Stock Adjustment

generated by depot and periodically,

consigner, date of purchase, type

Note.

Requistion by the shop

or concerned deptt for

material to the depot

Issue from

Depot

Issue of

Issue note by

depot

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by the shop or department concerned to the S

depot then the same is issued to the department.

then the material is procured through the following

possible).

available in the Stores Depot then the same

is generated for every issue in five copies. Two

is retained at the depot, fourth and fifth copies

Accounts Department returns the fifth copy

accounting entries. All the details of the request

generated by the Accounts Department and

credit to the Stores Department. Advice Transfer

consignee at the time of receipt of material. Based upon

reflected in the Account Current. If the material

the same is reflected in the Stores Suspense.

the Receipt Note and Issue Note of material

Adjustment Account. Whenever material is issued,

periodically, it is sent to Accounts Department.

type of material, value of material, etc., are written

Issue

Issue

depot

Receipt by the

concerned Deptt

Entry of

receipt in

Issue note

Issue of TC and ATC by accounts

deptt

Making of JV for

the issue and

receipt at depot


Stores Depot. If the

department. If it is not

following methods:

is issued to the

Two copies are sent

copies are sent to the

copy to the consignee

request are entered in the

and debit is raised

Transfer Credit (ATC)

upon TC and ATC, a

material is in transit at

material then the same is

issued, an issue note is

Department. All the details of

written on the Issue

Making of monthly summary register

depot wise

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4.2.11 Methods of Procurement of Material

i. Indigenous Purchase: All the indigenous purchase is made at Zonal Headquarters. All

the demands are vetted by Finance Department at the Zonal Headquarters. For the

indigenous purchases tenders are issued by Zonal Headquarters. Thereafter, a purchase

order is issued to the successful bidder. The purchase order contains all the details of

procurement and terms and conditions of payment. After that material is received by the

depot/consignee directly and Receipt Note is issued after verifying the purchase order and

actual quantity received at the depot. If any discrepancy is found between Receipt Note and

purchase order then, the payment is made as per the Receipt Note. However, these

discrepancies may be resolved later when the supplier approaches the Stores Department.

ii. Import: All the imports are made at Railway Board level. Railway Board issues the

purchase order for the import as and when Zonal Headquarters sends a request.

iii. Local Purchase: Local purchases contain any purchase which is made by the workshop

locally like general items of day to day consumption, etc. Further, payment is made at local

level.

Indigenous procurement and imports are generally made for stock items. Further, some

purchases are also made from Directorate General of Supplies & Disposals (DGS&D) but

these purchases are restricted to stock items only.

When there is shortage of any stock item, firstly, the stock item is checked in all other Stores

Depots of other Zonal Railways. If sufficient quantity is found in any one of these stores

then shortage can be made good from that store.

There is also a concept of Slow Moving and dead stock in Stores. An item is treated as slow

moving when it is not issued for two years. This is done automatically through the MMIS

application. Further, an item is classified as dead stock when it is not issued for three years.

Either dead stock is sold as scrap or transferred to other Store Depot after getting the

approval of the Competent Authority.

4.2.12 Illustrations on Stores Accounting

Illustration-1: If Depot (General Store) receives any material from supplier then following

entry is passed, 20716105 is a centralized allocation for stores and in narration depot number

is entered:

20716105 (Store Allocation) Stores in Stock DR Xxx

Cheques and bills CR Xxx

Illustration-2: If the store department issues any stock to any other depot then following

entry will be passed:

Indian Railways


(+) Debit to Suspense

(-) Debiting the

(+) Debit to receiving

(-) Debiting Suspense

Illustration-3: If the store department

entry will be passed:

Consignee (Division

20716105 ( Store

Ilustration-4: If after utilisation

consignee to the depot then the

4.3 Traffic Accounts Office

Accounting for revenue is done

Generally, there is only one TAO

Book and Revenue Accounts

classification of earnings. The

under:

Sundry Earnings

20716105 (Store Allocation) Depot

To the consignee

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Suspense Account DR xxx

the issuing depot CR

receiving depot DR xxx

Suspense account CR

department issues any stock to any consignee

(Division ) DR xxx

Store Allocation) CR

utilisation of stock there remains any item which

the following entry will be passed:

Office

done at the Traffic Account Office (TAO) of each

TAO in each zone. TAO records earnings and

Accounts of the Railway. IR follows Finance Code

The major heads for recording of earnings can

Earnings of Traffic

Accounts

Earnings from Coaching -Passengers

Earnings from Coaching -Other than Passengers

Earnings from Goods

Sundry Earnings

20716105 (Store Allocation) Depot DR xxx

To the consignee CR


Xxx

Xxx

then the following

Xxx

is returned by the

each Zonal Railway.

earnings and compiles Traffic

Volume-II for the

can be understood as

Earnings from

Other than

Xxx

Indian Railways


Every Railway station prepares

of 10 days and sends it to the

followings dates:

i. For collection made during

ii. For collection made during

iii. For collection made during

The organization structure of

4.3.1 Station Balance

The earnings collected at the stations

the station which is prepared

Station Balance Sheet contains

balance sheet is of two types:

i. Coaching Balance sheet

passenger traffic. This is

illustrative items on the debit

a. Amount received from sale

b. Amount received from Passenger

c. Amount received as Service

Financial Advisor and Chief Account Officer/ Traffic Accounts

Deputy Financial Advisor & Chief Account Officer/ T.A

Senior Assistant Financial Advisor

Senior Section officer

Accounts Assistant


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prepares a separate statement for its originating earnings

the Statistical Branch of the TAO of the Zonal

during 1st to 10th day of the month 13th day of

during 11th to -20th days of the month 23th day of

during 21st day to month-end 3rd day of

the TAO may be understood from the following

Sheet

stations of a Zonal Railway are depicted in the

prepared by the Station Master and submitted to the

contains the receipts and payments of a particular station.

: Coaching balance sheet is compilation of

divided into debit and credit sides. Following

debit side of a Coaching Balance Sheet:

sale of Unreserved Ticketing;

Passenger Reservation System (PRS);

Service Tax on PRS ;

Financial Advisor and Chief Account Officer/ Traffic Accounts

Deputy Financial Advisor & Chief Account Officer/ T.A

Senior Assistant Financial Advisor Assistant Financial Advisor

Senior Section officer

Accounts Assistant


Accounts Clerk

Senior Travelling Inspector of Accounts


earnings for a period

Zonal Railways on the

of the month

of the month

the next month

following figure:

the Balance Sheet of

the TAO concerned.

station. The station

the earnings from

Following are some of the

Senior Travelling Inspector of Accounts

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d. Amount received from Halt Stations; and

e. Amount received from parcel, luggage, LT luggage and TTE/EFT.

On the credit side the following items (illustrative) are presented:

a. Voucher received against sale of tickets. For example Military warrant, AG voucher,

CRPF voucher, etc.;

b. Refund made on cancellation of tickets;

c. Withdrawals from station earnings for petty expenses such as funeral of beggar, etc.;

d. Date wise detail of Cash Remittance to Cash Office; and

e. Any special credit allowed by competent authority.

ii. Goods Balance sheet: Goods Balance Sheet depicts the income from goods traffic. It has

two sides, i.e., debit and credit. Debit side of Balance Sheet includes the following

(illustrative):

a. Receipts from goods traffic originating with in Zonal Railway;

b. Receipts from wharfage charges from Public as well as Railways;

c. Receipts from demurrage charges; and

d. Receipts from goods traffic other than Zonal Railway on account of under charges

collected.

On the credit side of Goods Balance sheet the following are included (illustrative not

exhaustive):

a. Waiver of demurrage charges;

b. Cash remitted to Cash Office; and

c. Amount withdrawn for petty expenses.

Basically, the debit side represents the earning of a Station and the credit side represents the

remittances.

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4.3.2 Mapping of Accounting Processes at Traffic Accounts Office (TAO)4

ICAI ARF Team conducted a detailed study on how revenue is booked in accounts. The mapping of recording of revenue processes refers to

the activities involved in defining exactly the process followed by Indian Railways to record revenue. ICAI ARF team carried out the

mapping of current accounting process at Traffic Accounts Office to understand the components of the existing accounting system in a TAO:

S. No. Transactions Process Accounting and Records

Maintained

1 Station

Earning

From

Coaching -

Passengers

Generally, earnings from Coaching- Passenger are that portion of earning which is

earned from carrying passengers. From the recording perspective, earning from

passengers is categorized as under:

i. Sale of Unreserved Tickets;

ii. Printed Season Tickets;

iii. Passenger Reservation System (PRS) Tickets;

iv. Special Tickets, etc.

Reserved tickets as well as unreserved tickets are sold from stations for cash or in lieu

of cash/vouchers/warrants. Here, voucher/warrants mean facility of free travelling or

travelling at concessional fare given by various Government departments to their

employees. For example, travelling warrant issued by Ministry of Defence to the

Military.

Passenger tickets are issued either by Unreserved Ticketing System (UTS) or Passenger

Reservation System (PRS) or booking window (Printed Card Tickets).

There is a Chief Reservation Supervisor (CRS) at each railway station who is

accountable for monitoring of revenue from the reserved passenger tickets.

There is also a Chief Booking Supervisor (CBS) at every station who is responsible for

monitoring of all type of receipt collected at station under his/her jurisdiction, whether

it belongs to tickets, parcel or miscellaneous.

Books & Registers

Maintained

1. Coaching Balance sheet

4 Based on our study carried out at Traffic Account Office, Ajmer

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Maintained

All collections made on a particular day are deposited into designated bank on the next

working day under the supervision of CBS vide a Treasury Remittance (TR) Note.

Thereafter, the acknowledged TR notes are sent to Cash Office concerned. The Cash

Office prepares the daily Cash Check sheet and sends the same along with the TR notes

to TAO for accountal.

TAO records all TR notes, date wise, into Remittance into Bank Register and reconciles

it with monthly statements received from banks through RIB reconciliation application.

However, in case of some stations, cash is not directly deposited by them into Bank.

They send cash periodically to Cash Office of Division concerned in a sealed cash box

through scheduled trains under supervision.

Thereafter, cash is counted in presence of Cash witnesses. Cash office is responsible for

depositing this cash into the Bank account of Indian Railways. After depositing the

cash, Cash Office sends a Treasury Remittance note (TR Note) to TAO.

Station Superintendent of each railway station is responsible for preparing and sending

its monthly Coaching Balance Sheet to TAO.

Every month, the Balance Sheet Section in TAO receives Coaching Balance Sheets of all

stations.

All the balance sheets so received are checked in all respects by the Balance Sheet

section.

In some cases, if Balance Sheet of any station is not received within the prescribed time,

then on the basis of statement/returns submitted by that station, an approximate

balance sheet is prepared. However necessary adjustment is made on receiving the

actual Balance Sheet.

Thereafter all the Balance Sheets are posted for consolidation and recording purpose.

Following journal entry is passed to record the earning from passenger traffic by

section concerned:

Traffic Accounts DR XXX

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Maintained

To Abstract ‘X’ Earning from Coaching –

Passenger

CR XXX

2 Station

Earning

from

coaching –

other than

passenger

Earning, which is earned from activities other than passenger traffic is classified as

earning from coaching – other than passenger. For example, earning from carrying of

parcels, luggage, Fine/penalty charged by TTE from passenger, etc.

Booking of parcels/luggage is made only on cash payment.

There is a Chief Parcel supervisor (CPS) at the station, who is responsible for booking

of other coaching earnings.

Details of earning from coaching – other than passenger are also sent in the Coaching

balance sheet.

The subsequent process is similar to the process followed for passenger coaching. And

following accounting entry is passed by concerned section to record the earning:


To Abstract ‘X’ Earning from

Coaching – other than Passengers

CR XXX

Books & Register

Maintained

1. Coaching balance

sheet

3 Earning

from goods

traffic

Earning from goods traffic includes that part of earning which is to be received from carriage

of goods. The process of recording of revenue from carriage of goods is different from that of

carriage of passenger. We may understand this as given below:

Revenue from carriage of goods is not generated at every station; it is generated only

on some stations notified for handling of goods traffic/siding, etc.

Presently, earning from goods is recorded by generating invoice through TMS

(Terminal Management System) which is developed by CRIS. This software is linked to

the party’s Bank account and Bank Guarantee.

Whenever any invoice is raised on a party, the software informs about the bank

balance available in the party’s account. If balance available in party’s account is

equivalent to invoice amount, then the same is debited to party’s bank accounts and

receipt is generated.

Books & Register

Maintained

1. Goods balance

sheet

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Maintained

If sufficient balance equivalent to invoice amount, is not available in the party’s Bank

account then invoice is generated with ‘To pay’ direction and the same is recovered

from party at the destination station before making delivery of goods and a To Pay

surcharge is charged from the customer.

Station Superintendents are responsible to send their monthly Station Balance Sheet to

section concerned in TAO.

All the Balance sheets so received are checked in all respects by the Balance Sheet

section.

In some cases, if Balance sheet of any station is not received within the time prescribed,

then, on the basis of statement/returns submitted by that station, an approximate

balance sheet is prepared. However, necessary adjustment is made on receiving the

actual Balance Sheet.

Thereafter, all the balance sheets are posted in relevant software for consolidation and

recording purpose.

Demurrage & wharfage charges are also levied on the party if the goods lying at the

station and are not cleared within the time allowed for clearance.

Demurrage/wharfage charges so levied are also reflected in the monthly Station

Balance Sheet.

Following journal entry is passed to record the earning from passenger traffic by the

concern section:


To Abstract ‘Y’ Earning from Goods Traffic CR XXX

4 Sundry other

earnings

Earning other than goods carriage and passenger carriage are grouped into sundry

earnings. For example, rent and toll, sale proceeds from damaged goods, sale proceeds

from scrapped items, advertisement fees, etc.

The process to record the sundry earning in accounts is the same as mentioned above

for recording earnings from passenger carriage. Following entry is passed to record

Books & Registers

maintained

1. Abstract Z

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Maintained

the transaction in the books of accounts:


To Abstract ‘Z’ Sundry Other Earnings CR XXX

Traffic Accounts also receives transfer credit (TC) from Workshops/Divisions in respect

of certain revenue/earnings which were initially recorded in Workshop/Division’s

books of accounts. For example; Electricity charges recovered, tender fees, licence fee,

etc. At the end of a particular period, Workshops/Divisions transfer these earnings to

TAO. Following entry is passed in the concerned section of TAO to record this

transaction:

Concerned Workshop/Division -CR XXX

To Abstract ‘Z’ Sundry other Earning CR XXX

Misc. Transactions process

1 Receipt from

military

warrants

A special facility is given by Ministry of Defence to its employees to travel either free of

cost or at concessional fare. For this purpose, Ministry of Defence issues military

warrants to its employees.

Indian Railways issues ticket to military personnel against such warrants.

Subsequently, Indian Railways raises bills and recovers amount from the respective

Controller of Defence Accounts (CDA).

The Military warrants received by stations are sent to Divisional Cash Office and then

they are forwarded to the Traffic Accounts Office.

Thereafter warrants are sorted CDA wise a list is prepared in the prescribed form.

On the basis of this list, Transfer Advice (TRA) is raised on concerned department.

Following entry is passed by concerned section in TAO:

Concerned CDA Adjustment account DR XXX

Accounting

The Accounting entries are

passed by Books-I section

of Traffic Accounts Office.

Records Maintained for

Accounting

1. Military Warrant

Register

2. Concession Voucher

Register

3. Daily Figure Register

4. Journal Slip and

Transfer Advice (TRA)

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Maintained

To Respective Head of Earning CR XXX

After receiving the amount from concerned CDA, HQ sends information to Traffic

Account Office. Following entry is passed at that time:

Transfer Divisional (HQs) -CR XXX

To concerned CDA adjustment Account CR XXX

File

2 Receipts

from

voucher/war

rants – other

than

military

Some other Government department/ministries also provide facility of

free/concessional travel. For example, CRPF, police departments of various states, BSF,

CISF, etc. For this purpose, these departments issue travel voucher/warrants.

Indian Railways issues tickets against these vouchers/warrants.

These vouchers come to TAO for sorting department wise.

Thereafter a bill is raised on the department concerned in prescribed formats and

following entry is passed:

PAO Concerned Department/ Ministry DR XXX

To respective head of earning CR XXX

On receipt of payment from all departments/ministries following entry is passed.

Remittance into Banks DR XXX

To Concerned Department/Ministry CR XXX

Accounting


passed by Books-I section

of Traffic Accounts Office.

Books & Register

Maintained

1. Account General

Register

2. Pay & account office

register

3 Indian

Railways

Deposit

(Deposit

Traffic

Book)

In TAO, Indian Railways Deposit includes the following :(only illustrative list)

i. Wagon Registration Fees: Advance received from the parties against the booking of

wagon is called Wagon Registration Fees. Initially it is recorded in the respective

income head. Following entry is passed to transfer this amount, from earning to

deposit book:

Accounting


passed by Books section of

Traffic Accounts Office.

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Maintained

Abstract ‘Y’ Earning from goods DR XXX

To Deposit Misc. - Traffic Book CR XXX

If the party does not use the wagon as booked on a particular date then this amount

received as advance is forfeited and transferred to earning by passing following entry:

Deposit Misc. - Traffic Book DR XXX

To Abstract ‘Y’ Earning from goods CR XXX

If the party uses the wagon as booked then money so received as advance is adjusted

against the amount receivable from party. Following entry is passed:



However, in some cases advance is not adjusted against the amount receivable from

party but it is refunded separately on the refund claim lodged by the party. Following

entry is passed:


To suspense head Cheques &Bills CR XXX

If the party does not claim the amount of advance for more than 3 years then same is

transferred to earnings and following entry is passed:



Books & Register

Maintained

1. Deposit

Book/Register

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Maintained

ii. Carriage Deposit: Advance received from the parties against the booking of special

Train/Coach is called Carriage Deposit. Initially, it is recorded in the respective income

head. Following entry is passed to transfer this amount, from earning to deposit book:

Abstract ‘X’ Earning from passenger DR XXX

To Deposit Misc. - Traffic Book CR XXX

If the party uses the special Train/Coach, then money so received as advance is not

adjusted with the fare amount. However, this advance can be adjusted against any

additional amount to be charged. For example, detention of train beyond the normal

hours allowed. Following entry is passed:


To Abstract ‘X’ Earning from passenger CR XXX

The amount received as carriage deposit is refunded to the party upon the claim

lodged and following entry is passed:



If the party does not claim the amount of advance for more than 3 years then the same

is transferred to earnings and following entry is passed:


To Abstract ‘X’ Earning from passenger CR XXX

4 Traffic

Suspense

Traffic Accounts is debited with all earnings and is credited with realised earnings.

Traffic suspense shows all outstanding amounts which are to be received. The effect of

Books & Register

Maintained

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Maintained

traffic suspense is taken in preparation of Account Current. It includes cash in transit,

station outstanding, demand recoverable, etc.

1. Traffic Suspense

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4.3.3 Compilation of Traffic Book

Traffic book is compiled to bring into account all earnings of the Zonal Railway. Traffic book

consists of following parts:

Part A: Part A is prepared on the basis of balance sheet sent by station superintendent and

shows all traffic earnings consisting of Goods, Coaching and Sundry Earning for the Zonal

Railway.

Part B: This part of traffic book consists of net result of revenue apportionment. All the

earning which is to be recorded in part A (as mentioned above), also has some portion

which is required to be apportioned to foreign railways (Other than Home Railway).Earning

which belongs to other Zonal Railway is apportioned.. At present, this apportionment takes

place through RITES according to the formulas and methodology adopted for this purpose.

At the end of each month, RITES sends revenue apportionment detail to each Zonal Railway

separately for both goods and passengers.

Part C: This part is the “Statement of Earning Compilation for the Month” in which the

following adjustments are taken into consideration:

Adjustment of the Diversion of goods;

Adjustment of over charge and under charge of Accounts office balance sheet;

Adjustment of foreign railways or deposit private companies;

Adjustment of the inward and outward transfer certificate, etc.

Part D: This is the “Statement showing the apportioned earnings” and it is prepared after

making the adjustment of the Part C in the following format:

Commercial Lines Strategic Lines Combined Lines

Passenger Earnings xxx xxx xxx

Other than Coaching Earnings xxx xxx xxx

Goods Earnings xxx xxx xxx

Sundry other Earnings xxx xxx xxx

Gross Earnings xxx xxx xxx

Adjustment of Suspense xxx xxx xxx

Gross Total Receipts xxx xxx xxx

The Traffic Books section of Headquarter is also responsible to prepare the Actual and

Approximate “Statement of Apportioned Earning position at a glance for and to end of the

month” and submit the same to Books section of Head Quarter, for compilation of Accounts

for submission to Railway Board and for the preparation of the Financial Review for

managerial review by 5th of the following month. The Financial Review is that statement

which contains the details of earnings and expenditures for the month. Every month the

Budget section of Head Quarter, prepares this statement on the basis of details of earnings

provided by Books section of Head Quarter, and the details of expenditure is taken from the

Consolidated Account Current of the Zone. The Financial Review is prepared on two bases,

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i.e., demand wise and primary unit wise. At last the Financial Review is uploaded on E-

Lekha portal.

Also, the Traffic Books section of Head Quarter compiles the Abstract-Z for sundry earnings

on the basis of details received from TAO and further it is submitted to the Railway Board.

Earning from Special Tourist Trains5

The Indian Railways has a contract with Rajasthan Tourism Development Corporation

(RTDC) to run the train named as “Palace on Wheel” and Rajasthan Royal on Wheel”.

a. Palace on Wheel (POW) – As per the Memorandum of Understanding between Indian

Railways and Rajasthan Tourism Development Corporation the earnings received from

“Palace on wheel” will be shared in the ratio of 56:44 respectively. As per the terms the

RTDC is required to pay the prescribed amount as an advance at the beginning of the each

quarter and at the end of the quarter a statement of earnings is submitted to Indian

Railways. If the RTDC fails to pay the amount on time then the interest will be charged at

the prescribed rate.

b. Rajasthan Royal on Wheels (RROW) – As per the Memorandum of Understanding

between Indian Railways and Rajasthan Tourism Development Corporation, the RTDC is

required to pay only Haulage charges to Indian Railways per Km. per trip in case of

Rajasthan Royal on Wheels. The Prescribed amount is to be paid by RTDC to Indian

Railways in advance before starting any trip/tour.

The Traffic Miscellaneous and Service tax Section (TMSS) deals with the earnings received

for the tourist trains like Rajasthan Royal on Wheels (RROW), Palace on Wheel (POW), etc.,

and service tax.

On the receipt of the cheque of advance amount from the RTDC the TMS Section advices

this amount through letter to the TAO, Ajmer. And the TAO, Ajmer passes the following

entry:

Relevant Suspense Head for NWR HQ (00878201) DR XXX

To Abstract ‘X’ Earning from Coaching –

Passenger

CR XXX

Quarterly statements of earnings are also received by this section from RTDC, on the basis of

this the outstanding amount from the RTDC is identified and advices to the TAO, Ajmer.

The TAO, Ajmer records the outstanding of RTDC in the Traffic Suspense under the head

“Account office balance sheet-tourist”. This outstanding amount does not include the

amount of interest. And also for this purpose no accounting entry is passed at TAO, Ajmer

as well as at head quarter, Jaipur.

5 Only for North Western Railway

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The Monthly details of Service tax are received by TMS section from all the units of NWR

zone in the prescribed format. This format contains all the services for which the NWR zone

is registered with Service tax department. TMS section verifies the information of service tax

with the data available at Books section, HQ and prepares the excel file to compile all the

data of service tax. This compiled data is handed over to the Professionals to file the Service

tax returns within the prescribed time.

Diversion of Coal

Whenever coal of any thermal power is not delivered by the Indian Railways due to some

abnormal reasons like natural calamity, agitation etc., at the destination point as per the

original Railway receipt is known as “Diversion of Coal”.

For instance, as per the Railway Receipt, the coal of a thermal power was to be delivered at

zone A whereas it is delivered at zone B. Now zone A will raise the Transfer Certificate to

the zone B and pass the following entry on the acceptance of TC:

Transfer Railway-Zone A(008797) DR XXX

To suspense head of Cheques and bills

(00867002)

CR XXX

On the other hand, when the Transfer certificate of zone A is accepted by the zone B, the

zone B will pass the following entry:

Relevant suspense head of concerned demand

(12111199)

DR XXX

To Transfer Railway-zone A(008797) CR XXX

Compensations and Claims

The Finance Compensation Claims (FCC) section of TAO is responsible to pay the

compensation for the claims lodged. There are two types of cases for which claims may be

lodged:

1) Accidental Cases – These cases are filed with the Railway Claims Tribunal.

2) Other than accidental cases such as refund of freight, damages/loss in transit, etc. – These

cases may be filed with the appropriate authority of the commercial department of the

Indian Railways as well as with the Railway Claim Tribunal.

Presently, on the final judgement the commercial department hands over the file of claim

along with the pay order to the finance compensation claims section of TAO. This section

studies the claims file in all respect and checks the accuracy of compensation with the final

judgement to pass/approve the pay order. If there is no anomaly in the claim as well as pay

order then the FCC section proceeds for the procedure of CO6, CO7 and Cheque Abstract.

At the time of payment following entry is passed:

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Corresponding Head of Demand 12 ( 12025299) DR XXX

To suspense head of Cheques and bills (00867002) CR XXX

To suspense head of TDS (000021029) CR XXX

Sometimes the Railway Claim Tribunal (RCT) /High court pass interim orders and advise to

deposit the amount with the court before passing the final judgement. In this case following

entry is passed:

Corresponding Suspense Head of Demand 12 (12111199) DR XXX

To suspense head of Cheques and bills (00867002) CR XXX

To suspense head of TDS (000021029) CR XXX

4.4 Other Accounting at Zonal Railway Headquarter

4.4.1 Study of Fuel at HQ Level

Expenditure on fuel procurement forms one of the largest components of expenditure in

Indian Railways. Data pertaining to procurement of fuel is maintained in Store Accounts

Branch. Management of Fuel Account is the key function of Stores Account Branch at the

Zonal as well as Divisional level. Basically three main sub sections are operated by store

accounts branch with regard to recording and settlement of fuel transactions namely:

1. Fuel Bill Passing section: In this section, fuel bills are received and pre -scrutinized on

the basis of purchase order. After exercising the above check, pay order is prepared and

approved by the Stores Accounts Officer and sent for payment to cash & pay section.

2. Fuel Suspense section: The job of this section is to maintain procurement and issuance

of Fuel and accounting of the same through the Stores Suspense account. This section

accounts for HSD oil (Traction) received by RDI’s and raises debit to concerned division for

its prime cost. It is a capital suspense head which get cleared as and when the bills received,

are passed by the Fuel Bill Passing section.

3. Gross Tonne Kilometre (GTKM)/ HSD Section: This section performs two main

functions i.e. Accountal of GTKM earned by foreign locos on home railways and Accountal

of HSD taken by home locos from foreign Railways through transfer certificate (TC) which is

approved by home Railways at Zonal level. GTKM is the derivative unit of services. It is

used to calculate the value of services provided by locos of home Railway to foreign Railway

or vice versa. The net GTKM (receivable or payable) is adjusted in the fuel head booked

Fuel Bill Passing Section

Fuel Suspense Section

Gross Tonne Kilometre

(GTKM)/ HSD Section

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under Demand No. 10 including debits of home Railway locos involving HSD oil receipt

from foreign Railway.

4.4.1.1 Railways Diesel Installations (RDI)

Railway Diesel Installation (RDI) stores HSD in high capacity storage tanks for further

supply to locos. Locos take HSD at fuelling station at the platform which is connected to a

storage tank installed in RDI through a pipe line. There are two types of fuelling stations in

Indian Railways based on purpose of consumption of fuel. These are as under:

1. Traction: Fuelling station meant for consumption only for Locomotives are categorized

as Traction RDI’s.

2. Non Traction: Fuelling station meant for consumption for purposes other than

Locomotives. (For example: Consumption of fuel in workshops or loco sheds)

4.4.1.2 Procedure for Procurement of Fuel:

Procurement of fuel is done through a rate contract (RC) which is made between Railway

Board and Oil companies through tenders which are invited and executed by Railway

Board.

Rate contract (RC) – The Rate contract is a rate agreement with a certain stock obligation on

the supplier. During the period of its currency, the supplier engages to supply on demand at

a monthly price list (MPL), irrespective of quantity at a price within a given period of the

receipt of such demand. There are four major companies which are empanelled by Railway

Board for procurement of fuel:

1. Indian Oil Corporation Limited (IOCL)

2. Bharat Petroleum Corporation Limited (BPCL)

3. Hindustan Petroleum Corporation Limited (HPCL)

4. Reliance Petroleum Limited (RPL)

Procurement of fuel is done on the basis of an RC executed by Railway Board. On the basis

of the RC, the Controller of Stores (COS) of a Zonal Railway issues the purchase order (PO)

RDI-wise and payment of the same is made on the basis of Monthly Price List (MPL) which

is issued by oil companies. Freight expenses are included in MPL, which are paid by the

Zonal Railways as per the nearest point. However, minimum round trip distance (RTD) of

39 kilometre freight has to be paid to the oil company.

4.4.1.3 Procurement of Fuel by RDI’s

HSD oil is being received at the RDI’s by tank wagon and / or road tanks / pipe lines.

Considering the location of RDI’s and the location the feeding depot of the supplying oil

company, Zonal Railways may formulate the mode of transportation and the detailed

procedure of receipts as per current valid R.C. If both Rail and Road alternatives are

available, preference has to be given to obtaining supply of HSD oil by Road.

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Decanting of HSD oil from tank wagon / Road tank trucks is undertaken during day time,

decanting is not permitted after the sunset, unless extreme urgency warrants so, the urgency

of decanting oil after sunset is to be certified by the Sr. DME.

Sample test from the each road tank truck and / or tank wagon with water soluble paste

must be carried out before decanting and dip reading of the tank wagon (s) and road tank

truck(s) are to be meticulously taken and recorded before decanting.

Decanting of HSD oil is done to the storage tanks. Decanting of oil into empty barrels

(except for drawl of samples) or to locomotives directly is not permitted.

Wherever the supply of HSD oil to RDI is exclusively done by road, a level platform is made

for placement of road tank truck. Good approach road is also made available to RDIs by the

Railways. Decanting of such road tank truck is personally inspected by a gazetted officer at

least once in two months to ascertain that the instructions and Accountal procedure are

being properly followed. Before decanting, 10-15 minutes setting time is permitted.

As soon as a tank wagon is placed in the siding of decanting line, the supplier’s seals at the

top and bottom are checked. If they appear tampered with or missing, an immediate joint

inspection by representatives of mechanical, traffic and security department is conducted,

the actual quantity assessed in their presence by dip measurement and appropriate record is

made. Oil Company is also to be intimated.

In some RDI’s, receipt of HSD oil is made directly through a pipe line from the oil

company’s depot. In such case, the measurement of quantity is done as per the latest

replacement agreement. The received quantity is recorded in the presence of representatives

of the RDI and Oil Company.

RDI in charge is authorized to maintain the fuel accounts in RDI. Fuel stock register is

maintained for the said purpose on daily basis and accordingly the requirement/demand is

placed keeping in view the schedule of locos going forward.

The Oil Company sends fuel to the RDI as per their requirement. Generally 5 to 7 day’s

minimum stock is kept in RDI’s. After receiving the fuel, the Senior Section Engineer (SSE)

concerned checks the quality of fuel vis-à-vis the specification and receives 10 copies of the

bill from the Company and verifies and stamps all the copies. 2 copies are retained by RDI, 3

copies sent to the Zonal office (one copy for finance, one copy for Fuel suspense and one

copy retained as office copy by bill passing section), and remaining copies are sent back to

the oil Company concerned.

4.4.1.4 Fuel Issued to Loco:

Fuel is issued by RDI’s to Home locos as well as Foreign Locos as per requirement and

urgency. In case of foreign loco, confirmation of Registration no. and Zone details of Foreign

Loco have to be received by SSE concerned of RDI.

Indian Railways


Issue of HSD oil is to invariably

flow meter an associate pipe

railway cost.

Issue of HSD oil to the locomotives

flow meter is calibrated and is

per the flow meter reading. The

for maintaining book balance

Zone is authorized with the

locomotives. A CCR (DSL) is

loco should be filled by RDI at

noted by loco pilot in engine

Further, a fuel trip card is also

of HSD and the balance fuel available

Procurement of fuel by RDI’s,

unit of the same explained in

Rates of issue of stock to locos

Fuel is issued to locos as per

adjustment account at the year

Home Loco procure from

Home RDI

Accounting at Divisional level

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invariably undertaken through a calibrated flow meter.

pipeline etc., if metered, will be provided by Oil

locomotives is accounted by the flow meter reading.

is in working condition all Accountal records

The flow meter total recording is to be noted

and cross checking with the ground balance

the instruction of minimum & maximum quantit

is also posted in control room of each division.

at all fuelling points as per fixed schedule. The

engine log book, which is maintained since the

also maintained by the pilot. This document provides

available in the loco at the time of fuelling.

RDI’s, issue of fuel to various Locos and the responsible

the following diagram:

locos

per weighted average rate and the same is settled

year end.

Procurement of Fuel by RDI

Issue of Fuel by RDI- Following

cases

Home Loco procure from

Home RDI

Accounting at Divisional level

Foreign Loco Procure from

Home RDI

Accounting done at Divisional level through outward

TC

Home Loco Procure from Foreign RDI

Accounting done at Zonal level

through inward TC


meter. Any standby

Oil Company at the

reading. Wherever the

records on issue side is as

noted out on every shift

balance measured by dip.

quantity of HSD in

division. The tank of the

The quantity is also

loco is put to use.

provides the fuelling

responsible accounting

settled though Fuel

Home Loco Procure from Foreign RDI

Accounting done at Zonal level

through inward TC

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4.4.1.5 Accountal of Fuel

Cost of fuel is divided into two components:

1. Prime cost

2. Other than Prime cost

Prime Cost: This involves only prime cost of diesel. The payment is made by Zonal

Headquarters office after checking Monthly price list (MPL) and prime cost is charged

against capital plan head 71 in head of allocation 20713509 of suspense head. Dividend is

paid to Government of India against stock available as on 31stMarch of every year on the

capital held. In case of Prime cost Transfer certificate is issued for debit by Head office to

Divisions concerned on 7thof the consequent month.

Other Than Prime Cost: This involves all Taxes, delivery charges and freight, etc. Other

than prime cost is charged directly to revenue expenditure in the account of Division

concerned through a cash transfer certificate on the 7th of the consequent month.

Accountal of Fuel is done at four stages:

1. Procurement of fuel by Traction RDIs

2. Issue of Fuel by Traction RDI’s to Locos

3. Procurement and Issue of Fuel by Non Traction RDIs to Workshops/Divisions/ Sheds

4. Accountal of loss of fuel

1. Accounting of Procurement of fuel by Traction RDI’s:

1.1 In the Zonal Headquarters’ Books

RDI submits details of receipt of fuel every month on the 7th day of the next following month

and in case of March details are sent on the last day of the same month, i.e., 31st March.

The following entry is passed at the time of receipt of fuel at RDI:

Particulars DR. CR.

Concerned Division A/c (Prime Cost) XXX

To Fuel Suspense A/c (20713509) XXX

(Being fuel receipt at RDI)

At the time of payment of fuel procured in RDI’s

Particulars DR. CR.

Fuel suspense A/c (Prime Cost) XXX

Concerned Division A/c (Other than prime cost) XXX

To Cheques and Bills A/c XXX

(Being payment made for the fuel)

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1.2 In the books of concerned Division

At the time of receipt of Fuel

Particulars DR. CR.

Fuel suspense A/c(7160) – Capital A/c (Prime Cost) XXX

Demand no. 10 - Revenue A/c (Other than prime cost) XXX

To Zonal Railway A/c XXX

(Being Transfer certificate raised by zone)

2. Accounting of issue of fuel by Traction RDI’s to Locos

Issue of Fuel can be explained in following three scenarios:

2.1 Case 1: Home locos takes fuel from home RDIs

Journal entry in Concerned Division Books

Particulars DR. CR.

Demand no 10 – Fuel Head XXX

To Fuel Suspense A/c (7160) (Prime Cost) XXX

(Being fuel cost expensed off with suspense account)

2.2 Case2: Home locos take fuel from foreign RDIs

In this case, home railway will be issued debit T.C by foreign railways.

Journal entry in Zonal Books

Particulars DR. CR.

Fuel Suspense A/c (00844506) (Total Cost) XXX

To Concerned Foreign Railway XXX

(Being fuel taken by home loco at Foreign RDI)

Particulars DR. CR.

Demand no. 10 – Fuel head (Total Cost) XXX

To Fuel Suspense A/c (00844506) XXX

(Being fuel cost expensed off)

Note: prime and other than prime cost posted in separate sub head mentioned in Demand 10

2.3 Case 3: Foreign Locos takes fuel from Home RDIs

In this case home railways will issue debit T.C to foreign railways

Journal entry in Concerned Division Books

Particulars DR. CR.

Concerned Foreign Railway A/c XXX

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To Fuel Suspense A/c (Prime Cost) XXX

To Demand no 10 (Other than Prime Cost) XXX

(Being Transfer Certificate raised)

3. Procurement and issue of fuel by Non Traction RDIs to Workshop/ Divisions:

The fuel of non traction RDIs is utilized for other than traction purpose. It is known as

charged store. The bill received from oil companies duly acknowledged by concerned RDIs,

is passed by fuel bill passing section and is directly debited to division concerned transfer

head through Transfer certificate (TC). Following accounting entries are passed in this

regard:

3.1 At the time of procurement of fuel: In Zonal Books

Particulars DR. CR.

Concerned Division A/c XXX

To Fuel Suspense A/c XXX

(Being procurement of fuel done by RDI)

3.2 At the time of payment of fuel: In Zonal Books

Particulars DR. CR.

Fuel Suspense A/c XXX

To Cheques and Bills A/c XXX

(Being disbursement of fuel cost)

3.3 At the time of procurement of fuel: In Division Books

Particulars DR. CR.

Fuel Suspense A/c (7160) XXX

To Zone A/c XXX

(Being procurement of fuel cost other than for loco’s )

3.4 At the time of issue of fuel: In Division Books

Particulars DR. CR.

Respective Demand heads (Other than D 10) XXX

To Fuel Suspense A/c (7160) (Prime Cost) XXX

(Being fuel cost other than for loco’s expensed off)

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4. Accountal of loss in fuel:

The Permissible limit as approved is 0.1% under the terms of 6.2 of (journal Procedure

Order) JPO of Railway Board dated 09.03.2010, of the Fuel stock in RDI, waiver of which is

duly authorized by the Mechanical Department. In case, loss of fuel is higher than the

permissible limit, waiver of the fuel loss will be done by the General Manager of the Zonal

Railway.

4.1 Journal Entry for Waiver of Abnormal loss on fuel in Divisional Books:

Particulars DR. CR.

Demand no 10 (Loss Head 10118099) XXX

To Fuel Suspense A/c (Prime Cost) XXX

To Demand no. 10 (Non- Prime cost) XXX

(Being loss on fuel waived off)

4.4.1.6 Recording of GTKM/HSD oil:

GTKM is the derivative unit of services. It is used to calculate the value of services provided

by locos of local railway to foreign railway or vice versa. The net GTKM (receivable or

payable) is adjusted in the fuel head booked under Demand no. 10 including debits of home

Railway’s locos involving HSD oil receipt from foreign railway.

Further, the division is involved in following activities:

Inward TC: Accepting Inward Transfer Certificates of HSD oil for and GTKM raised from

various foreign railways for those Home Railway Locos taking HSD oil in the location of

Foreign Railways and those foreign railways Locos earning GTKM on Home Railway.

Outward TC: Raising of outward TC’s of GTKM to various foreign railways for home

railway locos earning GTKM on foreign railways. As regards, raising of debit TCs of HSD

oil received by foreign railway locos from home railway done by the concerned NWR

divisions directly.

Following table shows the booking levels of GTKM/HSD oil:

Particulars Inward Outward

HSD Oil Zonal Level Divisional Level

GTKM Zonal Level Zonal Level

Calculation of GTKM:

Gross GTKM = Gross tonne * Kilometre

# Gross tonne = Net tonne + Tare tonne

# Tare tonne = Weight of spare wagon

# Net tonne = Weight of Stock in Wagon

GTKM booked in two ways in case of Intra HQ transactions:

Indian Railways


Observation 1: At the time of

suspense with the Prime cost

Suggestion by ICAI ARF: The

as a current liability at the end

Observation 2: As per the current

and passed for approval to the

approved the same is forwarded

pending invoices as on 31st March

Suggestion by ICAI ARF: Accrual

not accounted with CO6 for which

Observation 3: Substantial quantity

storage point to fuelling point)

on 31st March.

Suggestion by ICAI ARF: A

pipeline should be recorded in

4.4.2 Transfer Transactions

The Indian Railways is a very

divided into 17 Zonal Railways

there are 8 Production Units

Inward GTKM

NWR LOCOs earn GTKM on Foreign

Railway

Recorded at Zonal Level through

inward TC

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of Procurement of Fuel by RDI, the same is charged

of the fuel and knocked off at the time of payment.

he credit balance of the purchase suspense should

end of financial year.

current process, when a Tax invoice is received,

the concerned department by competent authority.

forwarded to cash and pay section in CO7 format.

March outstanding for payment process.

Accrual entry should be passed at the end of the

which the amount needs to be quantified.

quantity of fuel stock remains in the connecting

point) at RDI which should be taken into closing

A procedure for recording of outstanding fuel

in a register.

Transactions – Intra and Inter Unit Transactions

very large organization. The whole network of

Railways from the administrative and geographical

Units (PUs), which are engaged in production

GTKM

Inward GTKM

NWR LOCOs earn GTKM on Foreign

Railway

Recorded at Zonal Level through

inward TC

Outward GTKM

Foreign Railway earn GTKM on NWR

Recorded at Zonal Level through outward TC


charged to purchase

payment.

should be recognised

received, CO6 is prepared

authority. Further, once

format. Treatment of

the year for the bills

connecting pipeline (from

balance of stock as

fuel quantity in the

Transactions

Indian Railways is

geographical perspective. Also,

production of Coaches,

Indian Railways


Locomotives, and Wagons etc.

Railways network.

Transfer transactions include

i.e., Divisions, Workshops,

Railways, such transaction takes

These transfer transactions are

made or received for them.

Transaction between any two

means of Transfer Certificate

raised and accepted electronically

Books of accounts both accounting

As per Para 401 of Chapter IV

classified as follows:

4.4.2.1 Transfer Transactions

The transactions between the

Intra Railway transactions. These

Capital, Transfer Revenue and

Transfer Capital and Transfer

As separate accounts records

Railway, it often becomes necessary

revenue books to capital account

remittance heads are operated

involving revenue account in

transfers to capital account in

If a capital transaction is brought

transfer to Capital Account Books

Transfer Capital and Transfer Revenue

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etc. These Production Units are an integral

include transactions which are made between two

etc., of a Zonal Railway and between Zonal

takes place through Transfer Certificates which

are settled through book adjustment, i.e., no

two accounting units of same railway is effected

ertificate (TC). All Transfer Certificates of transfer

electronically through E-RECON software. To record

accounting units pass the Journal Vouchers.

IV of “Accounts Code Volume – I” Transfer

Transactions – Intra Railway Transactions:

two accounting units of the same Zonal Railway

These transfer transactions comprise transaction

and Transfer Divisional.

Transfer Revenue

records are kept for "Capital" and "Revenue" transactions

necessary to transfer capital items brought to

account and vice versa. For this purpose, the

operated in accounts :- (a) Transfers, Railway Revenue

the Capital Accounts Books, (b) Transfers, Railway

the Revenue Account Books.

brought to account through the Revenue Account

Books is effected as in the journal entries below:

Transfer Transactions

Intra Railways Transaction

Transfer Capital and Transfer Revenue

Transfer Divisional

Inter Railways Transactions


integral part of Indian

two accounting units,

Zonal Railways. In

which is known as TC.

no cash payment is

effected in the books by

transfer transactions are

record the transactions in

Transfer Transactions are

Railway are known as

transaction of Transfer

transactions of a Zonal

to account through

the following two

Revenue-For transfers

Railway Capital-For

Account Books, its

below:-

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(i) Revenue Books –

Appropriate Revenue Head* DR Xxx

To Transfers Railway Capital CR xxx

OR

Transfers Railway Capital DR Xxx

To Appropriate Revenue Head* CR xxx

(ii) Capital Books –

Appropriate Revenue Head* DR Xxx

To Transfers Railway Revenue CR xxx

OR

Transfers Railway Revenue DR Xxx

To Appropriate Revenue Head* CR xxx

*Appropriate Head under major head 5002 / 5003-Capital outlay on Indian Railways

Commercial lines/strategic lines.

The result is that the per contra debit or credit to transactions recorded under the head

"Transfers, Railway Capital" in the revenue books will appear under "Transfers, Railway

Revenue" in the capital books and vice versa

It is pertinent to note that no TC is raised for these transactions since these transactions take place

within the same accounting unit.

For Example: Purchase/Receipt of fuel; which is a revenue expense for railway but

initially booked under capital head.

1. Journal entry at the time of receiving fuel Dr. Cr.

Store suspense head 100000

To Transfer head for Head Quarter 100000

Store suspense head is a capital head.

2. Journal entry to book this expense under revenue Dr. Cr.

Transfer Revenue 100000

To Store suspense head 100000

3. Journal entry to transfer from capital head Dr. Cr.

Relevant Demand (Demand No. 10) 100000

To Transfer Capital 100000

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Transfer Divisional

In Zonal Railway, the Accounts Department is decentralised. The transactions arising in the

accounts of one accounting unit which are adjustable in the accounts of the other unit are

adjusted to the latter by operating the head Transfer Divisional. Separate sub-heads are

allotted to each Accounting Unit. The Division or Branch originating the transaction Debits/

Credits the Head Transfer Divisional which is accepted by the responding office by minus

Debit or minus Credit against this head or by Debit/Credit. We can understand the use of

the same with the help of following examples

4.4.2.2 Transfer Transactions – Inter Railway Transactions

Transfer Railway:

Transactions between Zonal Railways are known as Inter Railway Transactions. Transfer

Certificates relating to these transactions are dealt with in the Books sections of Head

Quarters offices of respective Zonal Railways. For issuing the TC, the accounting unit of a

Zonal Railway sends relevant vouchers or bills to the Books section of its Head Quarter

along with a memo showing the allocation against which the amount is to be adjusted.

Thereafter, the Head Quarters Books section forwards the TC to its corresponding Zonal

Railway. The receiving Zonal Railway passes on this TC to its accounting unit concerned

with a memo for acceptance or adjustment.

For instance, a unit of Zone A paid an amount of expenditure on behalf of the unit of Zone

B then the unit of Zone A will pass the following accounting entry:

Transfer Railways - B(008797--) DR Xxx

To Head for Cheques and Bills (00867002) CR xxx

And for this transaction the unit of zone A will raise the TC through E-RECON/ IPAS within

the prescribed time. In case the accounting unit of zone A fails to generate TC in E-RECON/

IPAS within prescribed time then the following write-back entry is passed at the time of

Example 1

If an employee of Division A is transferred to Division B and, there is a credit balance of

Rs. 50,000 in the employee’s PF account, Division A will record this transaction by

passing following entry:

Head for PF - (Credit) 50,000

Transfer head for Division B Credit 50,000

On the other hand Division B will pass following entry to record this transaction:

Head for PF Credit 50,000

Transfer Head for Division A -Credit 50,000

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finalization of monthly accounts to remove the effect of such debit for the purpose of

reconciliation of accounts between Zonal Railways;:

Corresponding Suspense head DR Xxx

To Transfer Railways - B(008797--) -DR xxx

In next month at the time of preparation/generation of TC, JV is prepared in E-RECON/

IPAS and following journal entry is passed after acceptance of TC by responding unit:

Transfer Railways - B(008797) DR Xxx

To Corresponding Suspense head -DR xxx

4.4.2.3 Returned/Disputed Transfer Certificates

Responding unit accepts the TC received in the same month in which it is raised by

originating unit. However in some cases TC is not accepted by the responding unit due to

some deficiencies like transactions does not clearly pertain to it; all relevant vouchers are not

attached, etc., in these cases the TC is returned by responding unit with objection remarks.

Sometimes, if responding unit neither returns nor accepts the TC upto prescribed date then

system automatically accepts the TC and prepares JV.

For instance, if a unit of zone A receives a TC showing debit from a unit of zone B but unit of

Zone A neither returns nor accepts the TC upto prescribed date then TC is accepted

automatically in system and JV is prepared. At the end of month, when all the inward and

outward TCs are uploaded/ported on IPAS from E-RECON or on IPAS directly, then the

following entry is affected in IPAS.

Transfer Railways - A(008797 ) DR Xxx

To Transfer Railways - B(008797 ) CR xxx

Further, to rectify the above entry in IPAS two situations arise:

i. If concern head of relevant demand is known then the following entry is passed:

Concern Head of Relevant Demand DR Xxx

To Transfer Railways –A(008797 ) -DR xxx

ii. If concern head relevant demand is not known or it is required to return the TC then the

following entry is passed:

Corresponding Suspense head DR Xxx

To Transfer Railways – A(008797 ) -DR xxx

Indian Railways


4.4.2.4 Transfer of Advances

When an employee is transferred

the balance of his Advances

Advance, etc., are also transferred.

means of transfers certificate

accounting units pass Journal

For instance, an employee of Zonal

a Debit balance of Rs. 50,000

Zone A, it will record this transaction

Head for House Building Advance

To Transfer Railways

Zonal Railway B will record this

To Transfer Railways – B

Head for House Building

4.4.3 Transfer without

In the context of Indian Railways

through financial accounts of

opening balance of the concerned

transferred from one zone to

Coaches, Wagons, Railway

cumulative total cost of transferred

from its block account and the

its block account in the year of

types of transactions are dealt

types:

1. Transfer of Rolling Stock

transferred from one Zonal Railway

amount of depreciation from

renewed, both are transferred

Transfer of Rolling Stock

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Advances – Inter Railway

transferred from one Zonal Railway to another Z

Advances like House Building Advance, Computer

transferred. These transactions of transfer are effected

certificate (TC). To record the transactions in Books

pass Journal Vouchers.

Zonal Railway A is transferred to Zonal Railway

50,000 in the House Building Advance account of

transaction by passing following entry:

Advance -CR Xxx

Railways – A -DR

this transaction by passing following entry:

DR Xxx

Building Advance CR

without Financial Adjustments – TWFA

Railways, TWFA are those transactions which

of the year. These adjustments are carried

concerned account head. For instance, when

to another zone viz. inter Zonal railway

lines, Land, etc., the transferring railway

transferred assets from opening balance of the relevant

the transferee Railway will add the same in opening

of transfer without financial transfer i.e. with

dealt with in the Head Quarters Books section

Stock - When rolling stock like Wagon, Coach,

Railway to another Zonal Railway then the original

from the date of purchase or from the date

transferred from the Selling Railway (Transferor)

TWFA

Transfer of Rolling StockTransfer of Assets other than Rolling

Stock


Zonal Railway then

Computer Advance, Scooter

effected in the books by

Books of accounts both

Railway B and there is

of that employee in

xxx

xxx

which are not passed

out by modifying

when the assets are

transfer of Locos,

railway will reduce the

relevant plan head

opening balance of

without any TC. Such

section. TWFA is of two

Coach, Loco etc. is

original cost and the

of last renewal if

to the Purchasing

Transfer of Assets other than Rolling Stock

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Railway (Transferee) without any financial adjustment. If any renewal has taken place then

the cost of part renewals actually charged to the Depreciation Reserve Fund is deducted

before transfer.

Further, for this transfer the value of depreciation is calculated on the basis of "normal

life/useful life’’ as per the paragraph 219 of Finance Code-I except in case of "carriage" and

"wagon" where the life is to be taken as 30 and 40 years respectively.

Computation of amount of Depreciation –

When locomotives and other rolling stock are transferred from an Indian Railway to a

railway other than Indian Railways the Depreciation Reserve Fund of the selling railway is

debited with the original cost of the stock by credit to Capital and the Depreciation Reserve

Fund credited with the depreciated value of the stock, by debit to the railway to which the

stock is transferred.

The depreciated value being arrived at according to the following formula where-

(a) is the sum of the years the stock has run, six months or less to be ignored and more than

six months to count as one year;

(b) is the sum of the years of its normal life;

(c) is the original cost of the stock or present day replacement cost, whichever is greater;

Then

� −

⎝

⎜⎛

�−�

� 75 �/100

⎠

⎟⎞

=Depreciated value of Stock

Eg. If a Workshop of Western Railway transfers its Carriage costing Rs. 60, 00,000 with a

useful life of 30years to Workshop of North Western Railway after using it for 15years then:

Adjustments in the Block Account Current of Workshop of Western Railway

The original cost of Rs. 60, 00,000 Carriage will be deducted from the Source of fund (in

terms of Railways “Minus Debit” will be given to the source of fund); and

The amount of depreciation of Rs. 11, 61,290* will be added to the Depreciation Reserve

Fund (in terms of Railways “Minus Credit” will be given to the source of fund).

*Calculation of Depreciation

120 75*60, 00,000 11, 61,290/-

465 100

X =

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Adjustments in the Block Account Current of Workshop of North Western Railway

The original cost of Rs. 60, 00,000 Carriage will be debited to the source of fund ; and

The amount of depreciation of Rs. 11, 61,290* will be credited to the source of fund.

2. Transfer of Assets other than Rolling Stock - When assets other than rolling stock like

land, building, railway line, etc., are transferred from one Zonal Railway to another Zonal

Railway, adjustments, where necessary, will be made between the selling railways

(Transferor) and the purchasing railways (Transferee) in accordance with paragraphs 703 to

715 of Finance code – I. The transfer/sale value for this transaction is actual cost, if the actual

cost is available, otherwise the sale value is mutually decided by both the Zonal Railways,

and it may be market value as decided in case of disposal or sale of assets.

Eg. If a Division of Western Railway transfers its Railway line at the mutually agreed price

of Rs. 25,00,000 to a Division of North Western Railway.

Adjustments in the Block Account Current of Division of Western Railway

The realizable value of Rs. 25,00,000 Railway line will be deducted from the source of

fund (in terms of Railways “Minus Debit” will be given to the source of fund).

Adjustments in the Block Account Current of Division of North Western Railway

The realizable value of Rs. 25,00,000 Railway Line will be debited to the source of fund.

The information of transactions of the TWFA is provided by the concerning unit to the Head

Quarter in the following format:

STATEMENT OF TWFA TO END OF 2XX1-X2

S.

No.

Particulars

of Assets

Railway to

which

Transferred

Railway

from which

transferred

Amount

in Rs.

Head of

Account

Amount

in Rs.

Reference

Letter

Total Original Cost of

transferred assets

Total Uses Amount of transferred

assets

Contribution to Source of

Fund

Amount of Rs. XXX Amount of Rs. XXX Amount of Rs. XXX

On receipt of information of transaction of TWFA in the aforesaid format from all the units

of the Zone, the Headquarters Books section compiles details of all TWFA transactions for

the purpose of calculation of dividend on capital and interest on Depreciation Reserve Fund.

Rate of Dividend is prescribed by the Railway Board and the same rate of dividend is used

to calculate the interest on railway funds.

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This information of TWFA transactions is sent to Railway Board to verify the balance of

Capital and total TWFA transactions carried out during the year.

4.4.4 TWFA transactions to transfer the balances other than source of fund:

Usually, TWFA transactions are made to transfer only assets from one zone to another zone

but in some other cases these adjustments are also carried out to transfer the balances of

Deposits, Advances, other fund balances etc., and adjusted through the transfer heads. The

transfer head of transferor will be debited or credited and the transfer head of the transferee

will be credited or debited.

For instance, when North Western Railway was carved out of Western Railway, all assets

which were financed from Capital were transferred through TWFA and block account of

both WR and NWR were affected as explained above.

Further, to transfer the other balances like balance of Miscellaneous Advance Revenue,

Miscellaneous Capital etc. the head of respective balance were affected through TWFA in

the following way:

Adjustments in the Head of Miscellaneous Advance Revenue of Western Railway

The outstanding balance of Miscellaneous Advance Revenue was credited, by debiting

to NWR.

Adjustments in the Head of Miscellaneous Advance Revenue of North Western Railway

The outstanding balance of Miscellaneous Advance Revenue was debited, by crediting WR.

4.5 Other Departments at the Zonal Railway Headquarters

4.5.1 Construction Department

The Construction Department is headed by Chief Administrative Officer/Construction

(CAO/C)

Main work of Construction Department is to construct, replace and acquire the fixed assets

for the railways viz. new line, gauge conversion, doubling, traffic facilities and yard

remodelling, ROB, RUBs, signalling and telecommunications, electrical traction and non-

traction works, workshop modernization and other specified works.

Process followed in the Construction Department:

For the new project first of all operating department of Zonal Railway works out the

requirement of new project. On the basis of which open line prepares abstract estimate for

inclusion in the preliminary works program which is generated on IRPSM monitored by RB.

If the new work is chargeable to capital than necessary rate of return is worked out. The

proposals are forwarded to RB after concurrence of associate as well as HQ finance duly

ensuring that the investment will be financially justified and the rate of return anticipated is

actually materialized. Once the works proposed have been approved by the Railway Board

the competent authority conducts a reconnaissance survey (if applicable) to ascertain

Indian Railways


whether the project is feasible

through CAO/C and GM of Zonal

Surveys are to be carried out

detailed estimate of the work

report should be accompanied

report should be in sufficient

decision regarding the standard

submitted to finance for concurrence

authority (as per the SOP). Detailed

the work subject to availability

The project report contains the

4.5.2 Stores Department

Stores Department is responsible

quality of materials to the user

Therefore Indian Railways

Workshops. The Stores department

out the following functions: Procur

Efficient maintenance of stock

Efficient financial scrutiny

Verification of physical b

Disposal of waste/ scrap

Project Engineering including Cost Estimate and

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feasible or not. The survey team sends its report

Zonal Railway.

out for new projects as per the provisions of engineering

work is thereafter prepared by the department

accompanied by cost estimate. The estimate based on

sufficient detail and accurate to enable a competent

standard of construction of the new project. This detailed

concurrence and thereafter, the same is sanctioned

Detailed sanctioned estimate constitutes authority

availability of funds.

the following details:

Department

esponsible for ensuring timely procurement and availability

user departments.

have a separate Stores department at HQ,

department along with the associated finance and

Procurement of materials and spares at the most

stock

crutiny and accountal

balance

Introduction

Characteristics of the Project Area

Standard of Construction

Route Selection

Project Engineering including Cost Estimate and Construction Schedule

Conclusion and Recommendations


report to Railway Board

engineering code. A

department concerned. The

on the preliminary

authority to take a

detailed estimate is

sanctioned by competent

authority to commence

availability of right

HQ, Divisions and

and accounts carries

most economic costs

Project Engineering including Cost Estimate and

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Description of Different Types of Stores:

i. Stock Items: Items which are frequently and regularly required and whose unit cost

justifies incurring inventory carrying cost are known as 'Stock' items. These items are

kept in the custody of Stores Depots Stock items comprise the following types:

a. Ordinary Stores: Ordinary Stores are generally such items of Stores for which there

is a regular turnover caused by a constant demand and which are stocked by the

Stores Depots.

b. Emergency Stores: Items of stores which do not ordinarily wear out or require

renewal, which have, however, to be kept in stock to meet emergencies, such as

those due to breakage or unanticipated deterioration, and which are not readily

obtainable. The stock cards relating to such stores are marked with the letter 'E'.

ii. Non Stock Items: All items other than 'stock' items are called "Non-stock items”. These

items may, however, be described in the Standard Nomenclature List. No purchase of

such items is made for stock purposes.

iii. Special Stores: These are stores required for works and other special purposes i.e. other

than for 'operation' or 'ordinary maintenance and repairs' and which are ordinarily

dispatched directly to the requisitions without being stocked in a Stores depot.

iv. Surplus Stores: are those items of stores not consumed for a period of 24 months owing

to the following:

a. Obsolescence i.e. due to change in design or specification

b. Unanticipated fall in consumption

c. Return in large quantity of stores by consuming department

Surplus stores are further classified into following two categories:

Movable Surplus: Items not issued for a period of 24 months but which are

anticipated to be utilised in near future.

Dead Surplus: Items not issued for a period of 24 months and also not likely to be

utilised on the Railways within the next 2 years.

Classification of Stores on ABC analysis basis: Procurement of stores is done on the basis of

ABC analysis which is as under:

1. Category ‘A’: This category includes items whose annual consumption value is the

highest; the top 70% of the annual consumption value accounts for only 10-20% of total items

of Stores. These items can be purchased six months in advance.

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2. Category ‘B’: This category includes items with annual consumption value of around

20% accounting s for 30% of total items of Stores. Stock of these items can be purchased

twelve months in advance.

3. Category ‘C’: Remaining items are taken in this category. Stock of these items can be

purchased two years in advance.

Procurement process followed in Stores Department:

Procurement, in IR, is broadly made in the following manner:

i. Purchases through Director General of Supplies & Disposals (DGS&D) – For Stock

Items: Based on the demand made by the Stores Depot which is vetted by the Associated

Finance, the Controller of Stores (COS) makes an estimate of the requirement for the

next 12 months for each of the item held in stock.

Subsequently the items required are listed in the indent form and after certification of

the fund availability by the Associate Finance the indents are forwarded to Director

General of Supplies & Disposals (DGS&D) for compliance.

A Rate Contract is entered upon by DGS&D with approved firms. A consolidated list of

requirement of all the Stores depots is made at the Headquarters Stores Department and

a Purchase Order (PO) is placed by the HQ through the DGS&D Rate Contract. A copy

of the Purchase Order is sent to the Firm, two copies are sent to the Accounts office out

of which one copy is sent to the Bills Section for making payment.

On the basis of such PO supply of stock is made by the supplier to the depot concerned.

The Stores Depot checks the material received and thereafter issues a Receipt Note (RO).

ii. Purchase by the Railway Board: For the Purchase of Superior Kerosene Oil (SKO),

Furnish Oil (FO) and Lubricants, a Rate contract is made by the Railway Board with the

approved suppliers. Subsequently, procurement is made by the Zonal Headquarter

directly through the Railway Board Rate Contract.

iii. Direct Purchase by COS: Two types of stores are procured by the COS directly:

a. Stock Items: The Controller of stores (COS) has to estimate in advance the total

purchases which have to be made during the next 12 months for each item of stock

held. Before the COS can estimate the quantities he should purchase during the next

period of 12 months, he has to obtain detailed information/ demand raised by the

concerned Divisions under the zone. This demand for the quantities of Stock Items

is vetted/ authorized by the associated finance.

b. Non Stock Items: Demand for the Non-Stock Items is received from concerned

Division/Consignee and approved by the competent authority (as per schedule of

powers). Budget is made available for the Non-Stock demand, after this proposal of

Non-stock items is vetted by the Associate Finance and sent to the COS for the

procurement.

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Recording of transactions by the Accounts and Finance Office

A. In case of direct purchase through tendering:

On receiving the material the Stores Depot issues a Receipt Note i.e. RO statement no. 3 in

the Material Management Information Systems and the following entry is made:

Stock in Depot DR xxx

To Purchase Suspense CR Xxx

On payment to the supplier the Accounts Store Bills office passes the following entry in the

books of accounts by preparing a CO7:

In certain cases 90/95/98% advance payment against proof of dispatch i.e. Railway receipt,

Material receipted challan of consignee and inspection certificate is also arranged as per

terms and condition of PO. In such cases remaining 10/5/2% payment can be claimed by

vendor after obtaining RO.

Also 100% payment can be claimed by the Vendor on the basis of Receipt Note and

inspection certificate.

B. In case of purchase through DGS&D

The Department of Commerce supply chain debits the Purchase Suspense (20713709) and the

same book as under:

Purchase Suspense (20713709) DR Xxx

To Department of Commerce supply chain

Mumbai (00866081)

Calcutta (00866082)

Delhi (00866083)

Chennai (00866084)

CR Xxx

On accepting the debit, the Zonal Railway passes the same in the Books as under:

Stores in Stock DR xxx

To Purchase Suspense CR Xxx

C. In case of purchase through Railway Board (RB)

On receiving the material the Stores Depot credits Purchase Suspense (20712309) by making

the following entry:

Purchase Suspense DR xxx

To Cheques and Bills CR Xxx

Stores in Stock DR xxx

To Purchase Suspense (20712309) CR Xxx

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On payment, Accounts and Finance office passes the following entry in the books of accounts

by preparing a CO7 wherein payment is to be made to approved firm:

Information in respect of payables are to be captured in prescribed formats (Refer Annexure

3 – Accrual Impact sheet) for the purposes of preparation of financial statement on accrual

basis These details are available with the Books and Budget Section and Stores Department

4.5.3 Establishment Section

The HQ Establishment Section of deals with the internal checks exercised in accounts office

on personal claims of railway employees.

During the internal check of Pay and Allowances it is seen that the charges are incurred

against the sanctioned post either revenue or work-charged. The check against the budget

provision should, in the case of construction projects or work-charged post operated in Open

Line, is conducted with reference to the detailed estimates sanctioned by the competent

authority as well as extension of currency of such posts. This section maintains the service

sheet of employees and deals with all service matters.

Work Done under Establishment:

Establishment section conducts internal checks on the following:

1. Pay Bills

2. Leave Encashment

3. Arrears

4. Central Government Employee Group Insurance Scheme (CGEGIS)

5. Maintenance of Suspense Registers of advances granted to employees viz, HBA, Motor

Car, computer, scooter/motor cycle, cycle, fan and natural calamities etc.

6. Service Record and leave account of Gazetted Officers.

7. Certification of pay fixation, cases of proforma promotion, cases of stepping up, TA,

Tuition Fees, Last Pay Certificate (LPC).

8. Maintenance of scale checks register and cadre register.

9. Recovery of Foreign Service Contribution (FSC) Charges.

10. Compensation arising from Workmen Compensation Act or other act and ex-gratia

payments in case of death on duties.

4.5.4 Cash and Pay Section HQ

There are Cash Offices on Divisions and HQ of the Railway under charge of Dy. FA&CAO/

Cash & Pay to deal with the earnings and Miscellaneous Receipts of the Railway.

Further Pay Offices at Head Quarter, Divisions also handle the payments and work under

the charge and control of the Dy. FA&CAO (Cash & Pay) & Chief Cashier.

Purchase Suspense DR xxx


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4.5.5 Settlement/ Pension Section

The Settlement/ Pension Section of HQ Railway deals with the internal checks exercised in

accounts office on the retirement claims of railway employees.

This section maintains Data pertaining to retired employees and performs internal checks

on the following:

1. Pension benefits

2. Revision of Pension Payment Orders (PPOs) due to Pay Commission or Court case, etc.

3. Check of pension debits received from Treasury, Banks and Department of Post

Pension benefits granted to Railway employees generally fall under the following

categories.-

1. Superannuation Pension

2. Retiring Pension

3. Compensation Pension

4. Commuted Pension

5. Death-cum-retirement Gratuity

6. Service Gratuity

7. Other (extra-ordinary) Gratuity

8. Compassionate allowances/grants

9. Family Pension

10. Terminal Gratuity

11. Death Gratuity

12. Pension under New Pension System

The detailed rules regulating the grant of pensionary benefits are contained in the Indian

Railway Establishment Code Vol. II, in the Manual of Railway Pension Rules, 1993 and

extant orders issued from time to time.

The internal check of pension lies in verifying that the qualifying conditions governing the

grant of a pension are fulfilled, the calculation of amount of pension is correct and the

incidence and allocation is correct.

4.5.6 Statement of Service of Non-Gazetted Staff

On receipt of the application for pension in the prescribed form the head of the

Office/Department prepares a statement of the applicant's service in accordance with the

instructions contained in form No. 30A RII to enable the Accounts Officer to verify the

service.

4.5.7 Statement of Service of Gazetted Staff

As the Service Records and leave accounts of Gazetted Officers are maintained by the

Accounts Officer, the concerned Accounts Officer will send the service record and leave

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account of the Officer to the head of the Department to enable the head of the Department to

prepare the Statement of Service. In addition, a statement showing the pay drawn during the

last ten months of service by the officer will be sent by the Accounts Officer to the head of

the Department for preparing the Memorandum of average emoluments.

The Statement of Service shows all the important events; the temporary and officiated service

or those affecting the emoluments, of the Railway employee. It should be clearly seen that:-

Verification of Service by Head of the Office

The head of the Office/Department is required to verify the service of Non-Gazetted staff

recorded in the Statement of Service. The head of the Office/Department will also verify the

portion of service, if any, of a Gazetted Officer rendered in Non-Gazetted capacity. The

service of a Gazetted Officer rendered in the Gazetted capacity should be verified by the

Accounts Officer himself.

Check of Service by the heads of Offices

The heads of offices are required to verify service annually and record a certificate regarding

the service verified, in the Service Book as prescribed in Indian Railway Administration and

Finance-an Introduction. In respect of the past service (prior to 01.04.1957 i.e. the date from

which pension scheme was introduced on Railways) only one consolidated certificate is

S. No. Particulars

1. The statement shows not only the periods which count as qualifying service but

also all periods of leave, suspension, overstayed etc., which do not so count. The

latter is entered in red ink in order to clearly distinguish them, and reasons for

their rejection are given in the remarks column.

2. If the date of confirmation has been deemed date of confirmation, the fact should

be clearly mentioned in the statement, the details of the case being given in the

remarks column;

3. The statement shows date, month and year of the various appointments,

promotions and reversions. For the purpose of adding together broken periods, a

month is reckoned as thirty days.

4. Periods which count as qualifying services are clearly indicated and that full

details of the nature of posts/service and the relevant Para under which the same

qualifies is indicated in respect of each period in the remarks column;

5. If the emoluments drawn in an officiating appointment count in full for pensioner

benefits all details regarding the officiating appointment are given;

6. The total of the periods of the qualifying service shown in the statement tallies

with the total service less the non-qualifying service shown in the statement tallies

with the total service less the non-qualifying periods shown in the statement;

7. In the column "how verified" the particulars of records such as verification

certificate in the service book/pay bills, acquaintance rolls/office orders, collateral

evidence/affidavit, etc., are mentioned.

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recorded for the whole service in the Service Book. Where it may not be possible to verify the

entire past service due to non-availability of office copies of pay bills etc. From which service

is verified, the verification is done from the application of the employee supported by

collateral evidence of contemporary employees etc. These documents relied upon by the

Head of the Office in verifying the service may be accepted in Accounts Office.

Check by Accounts Inspection Party

The verification of service by the head of office should be supplemented by a test check by

the Accounts Inspection Party during their local inspection of the Executive Offices on

annual, biennial or triennial basis, as the case may be.

Verification of service in the case of non-availability of records

If paid vouchers or other documents are not available in the Accounts Office the verification

may be made from the documents made use of by the Executive Offices. If it be impossible to

verify (a portion of the) service otherwise, the facts determined should also be accepted for

the purpose of check in the Accounts Department relating to the particular period of service.

The date of birth and the date of beginning of service, as shown in the Application Form and

the service Statement may be checked with the Office Order containing the appointment of

the employee or old Gradation Lists etc. and in the absence of these, with the Service Book

Register. Whenever the Service Book/Roll sent with the pension application, contains entries

relating to important events such as alteration in date of birth, suspension, dismissal

resignation etc. these entries may be verified with copies of orders furnished to the Accounts

Office.

4.5.8 Expenditure Section

The Expenditure Section of HQ of the Railway carries out internal check of all bills received

from the Executive Officer for arranging payments.

4.5.8.1 Organization Chart of Expenditure Section

FA & CAO (Finance and Budget)

Dy. FA & CAO (Finance and Expenditure- F &X)

Sr. AFA (X)/ AFA(X)

SSO – X1

SSO – X2

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4.5.8.2 Functions of Expenditure Section:

The Expenditure section deals with the following functions:

i. Bill passing of empanelled hospital.

ii. Payment of Contractor bill

iii. Preparation& maintenance of works register.

iv. Demand -9 acceptance & raising TCs of IRFA, IRCA & IRFC

v. Submission of quarterly return Income Tax.

vi. Maintenance of Dues/Demand recoverable

vii. Payment of Lease bill.

viii. Payment of Supplier/ Procurement Bills.

ix. Maintenance of Suspense Register Deposit (X) and Miscellaneous Advance

Expenditure (MAX).

x. Posting of unpaid cases of suspense Heads and passing of unpaid pay orders.

xi. Acceptance of TC/ATC

xii. Preparation of Journal Voucher of Railway.

xiii. Posting & Reconciliation of paper security register.

xiv. Passing of telephone bill.

xv. Advertisement bill.

xvi. Postal, fuel and cash imprest.

xvii. Bill passing of hiring of vehicles.

xviii. Payment of Advocate bills.

xix. Payment of GRP bills.

xx. Reimbursement of Laptop/Repair bills.

xxi. Preparation of Block Account.

xxii. Payment of Miscellaneous bills (Purchase/Quotation/Works etc.)

xxiii. Payment of Non Stock bills and Local Purchase bills.

xxiv. Compilation of report for uneconomic branch lines.

xxv. Compilation of report/ return received from units:

a. Bills Recoverable

b. Bills Payable

c. Way leave cases

xxvi. Preparation and maintenance of Objectionable item register

xxvii. Payment of unsanctioned expenditure.

4.5.9 Books and Budget Section

Books section is the compiling section. Preparation of cheque for payment is done

by Books section. Books section also prepares monthly account current. Budget

section deals with preparation of budget and review.

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4.5.9.1 Organization Chart of Books and Budget section

4.5.9.2 Functions of Books and Budget Section:

The Books section deals with the following functions:

1. Cheques Section-This section deals with the work of arranging payments for all types of

bills passed by the various sections of FA&CAO office issuing cheques.

2. Approximate Account Current Section-This section deals with the following works:

a. Preparation of approximate account current of Head Quarter office.

b. This section compiles the approximate Account Current of Railway and submits it

to Railway Board (RB) on 5th of the next following month.

c. Approximate Account Current consists of both Revenue and Capital at one place.

3. Actual Account Current Section-This section compiles head wise actual figures of

Account Current and submits it on 4th of next of the next following month. Actual

Account Current is prepared in two parts-Revenue and Capital, and further sub divided

in two schedules viz. Commercial and Strategic. Account current is supported with

various schedules namely, Working Expenses, P Loans & Advances, Earning, Plan Head

schedules etc.

4. Remittance into Bank (RIB) Section-This section deals with the receipt side. Amount

received at Railway Stations and/or at Cash Offices is remitted to designated bank

through remittance challan. A copy of challan is received in Accounts Office from

designated bank and credit is posted in RIB reconciliation register and Debit is posted

from the statements received from Traffic Accounts Office and other accounting units in

respect of receipts. Thereafter this reconciliation register is reconciled and differences

are sorted out by chasing with bank and or accounting units. On receipt of challan from

cash office, RIB suspense head is debited by crediting to various heads of earnings,

Sr. SOs for Cheques,

Account Current, RIB,

Cheques, TC etc.

Sr. SO’s

Sr. AFA (Books)

FA & CAO

(Finance and

Dy. FA & CAO

(Books and Budget)

Sr. AFA (Budget)

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service heads or deposits as the case may be. Reserve Bank of India (RBI) confirms the

receipt and issues clearance memo. In these regards the following entries are made:

i. On receipt of challan:

RIB Suspense DR Xxx

To respective heads of earnings service

heads or deposits

CR Xxx

ii. On receiving clearance memo from RBI:

Deposit with RBI DR Xxx

To RIB Suspense -DR Xxx

iii. If the instrument is dishonoured:

Respective heads of earnings, service heads or deposits DR xxx

To RIB Suspense (-)DR Xxx

5. Cheques & Bills Section - This section deals with the issue of cheques for making

payments by preparing cheque abstract. While preparation of cheque abstract, software

(IPAS) automatically transcribes the data available in CO7 to cash book, revenue/capital

allocation register. On confirmation of cheque clearance from RBI, the following entries are

made:

i. On issue of cheque for payment:

Respective Expenditure head DR xxx


ii. On receiving clearance memo from RBI:

Cheques and Bills (-)CR xxx

To Deposit with RBI CR Xxx

6. Transfer Certificate Section – This section deals with the monitoring of

Inward/Outward Transfer Certificate (TC) whether it is Inter Railway or Intra Railway. The

whole process is dealt on E-RECON/ IPAS software which is centralised server and web

enabled application. After acceptance of debits/credits received inward on E-Recon/ IPAS,

software generates Journal slip. Earlier E-Recon was not integrated with the IPAS software

where financial accounting of Railway was maintained, therefore, Journal Slip so prepared

on the E-Recon were either ported on IPAS or data entry in Journal Voucher was made by

the section accepting the Debit/Credit. However now IPAS application has been

implemented on all Zonal Railways and transfer transactions are also being carried out

through IPAS.

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The Budget section deals with the following functions:

i. Capital and Revenue Demands

ii. Distribution of Original Budget Grant (OBG), Revised Grant(RG) and Final Grant (FG)

iii. Compilation & Submission of August Review (AR), Revised Estimate (RE), Budgeted

Estimate (BE), Final Estimate (FE) & Modification.

iv. Review of Actual Expenditure vis-à-vis Budget Grant.

v. Appropriation Account of Grant against the respective demands.

vi. Monthly FR to Railway Board (RB).

vii. Preparation of Statement of important misclassification

viii. Preparation of Statement of Defect in Budgeting

ix. Preparation of statement of Losses & Theft.

x. Preparation of Statement of Ex-Gratia Payment

xi. Preparation Monthly Statement : Financial Review (Demand Wise – Actual&

Approximate)

xii. Financial Parameter.

xiii. Financial Performance.

xiv. Working Expenses – Gross- Credit- Net.

xv. Preparation of Statement of Appropriation Account Depreciation Reserve Fund.

xvi. Statement of Appropriation Account Pension Fund.

xvii. Statement of Appropriation Account Stock Adjustment & Store Account.

xviii. Statement of Appropriation Account Suspense Balances.

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5 Understanding of Production Unit (PU)6

A detailed study of the accounting practices of a Railway Production Unit was made by

ICAI ARF during the pilot study at Rail Coach Factory (RCF) at Kapurthala. RCF is a

coach manufacturing unit of Indian Railways established in the year 1986.

5.1 Organization structure of PU

GM General Manager

CME Chief Mechanical Engineer

CDE Chief Design Engineer

CEE Chief Electrical Engineer

CMM Chief Material Manager

Fur Furnishing

CPLE Chief Plant Engineer

CWE Chief Works Engineer

CPE Chief Planning Engineer

CMO Chief Medical Officer

CPM Chief Project Manager

CESE Chief Electrical Service Engineer

FA & CAO Financial Advisor & Chief Accounts Officer

FA & CAO/P Financial Advisor & Chief Accounts Officer/Production

CE Chief Engineer

COS Controller of Stores

6 Based on pilot study carried in Rail Coach Factory (RCF), Kapurthala

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5.1.1 Structure of Accounts and Finance Department

Financial Advisor and Chief Accounts Officer

Financial Advisor and Chief Accounts Officer/P

Dy. Financial Advisor and Chief Accounts Officer

Sr. Assistant Financial Advisor

Assistant Financial Advisor

Sr. Section Officer Sr. Inspector Stores Accounts

Accounts Assistant Sr. Stock Verifier

Junior Accounts Assistant Stock Verifier

Accounts Clerk

5.1.2 The Production Process

An overview of coach production process is given below:

The production process starts from Receipt/Storage of store items as per work order for

manufacturing of coaches as per production plan. Material store items are issued to

shop floor through Shell Sub Store and Furnishing Sub Store. The production process

consists of following six major activities:

1. Sheet Metal Shop

2. Shell Assembly

3. Paint Shop

4. Bogie Shop

5. Furnishing Shop

6. Quality and Checking Shop

Besides the above major production centres, there are service centres which assist in the

production process. A Chart showing the production process in detail is given below: -

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Overall Diagram of Manufacturing Process

Activities of Shell Assembly

Shell Assembly

Paint Shop

Bogie Shop Machine Shop

Furnishing Shop

Finishing Shop Quality Check

Under Frame Shop

Side Wall Shop

Roof Shop

End Wall Shop

Shell Assembly

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Activities of Paint Shop

Activities of Bogie Shop

Masking of Windows

Internal cleaning

Primer Application of sides

First coat filler application

Second coat filler application

Wet filler rub down

Necessary filler application

Surfacer application

Dry rub down of surfacer

Top coat application and lacquer coat

Multicolor Scheme (Masking demasking and

bend painting)

Exterior painting, lettering and

pasting etc.

Straightening of Steel Plates

Profile Cutting

Shot BlastingWelding of Bogie

Frame

Bending

Milling/Beveling 100% X-Ray Testing

Shot Blasting of Bogie Frame

Painting of Bogie Frame

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Activities of Furnishing Shop

5.1.3 Functions of various Departments of PU

Functioning of some of the major departments in a PU is detailed hereunder:

i. Mechanical Department

The Mechanical Department plays an important role in manufacturing of coaches

as per production plan. The major sections of the Mechanical department are as

under:

(a) Mechanical Design: This section is responsible for developing the design of

various variants, products etc. Product structure list is also prepared by this

section by using the Integrated Design Monitoring System. It assists in

approving the vendor registration and also approves the prototype samples

for production orders.

(b) Material Planning Section prepares material schedules based upon the

Product Structure List (PSL) provided by the Design Office. It also prepares

the procurement memo wherein system picks up the rates from Financial

Accounting System. Wherever rates are not available, estimated rates are fed

by the material planning section; it also prepares the indents for coach spares

for other railways wherein the said PU is the nodal procurement agency. This

department also monitors non-stock indents for coach items. Proposals related

to off-loading of items to trade, which are being manufactured in house are

also made by this section. Besides Protective Clothing Management System

(PCMS) is used for monitoring safety requirements. Procurement of Stock

Requirements Memo (SRM) items is also done through planning.

Flooring

PVC Laying

Panelling

Window Ceilling

Moulding

Lavatory

Plumbing

Seat and Berths

lowering

Furnishing Interior

Furnishing Detail Paint

Furnishing Miscellaneous

Paint

Alarm chain assembly &

fitting

Carpentary

FRP

Air brake

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(c) Planning/Industrial Engineering Section works out the incentive labour rate

and labour hours for different jobs. It also works out manpower planning

under different groups as well as keeps the track of additional work done,

work off loaded to trade, and also works out the conversion factor for new

variants to be produced. Employee Incentive System is used to work out

Employee Incentive. Besides this Production Control Organisation and

supervisory allowances are also monitored by this section.

ii. Mechanical Production: This section is responsible for production of coaches as

per production plan. Major shops which perform their specified role in each stage

of coach production are as under:

S. No. NAME OF THE SHOP

1. Sheet Metal Shop

2. Roof Section

3. Under Frame

4. Fabrication shop

5. Shell Assembly

6. Machine shop

7. Bogie shop

8. Paint Shop

9. Furnishing Gang Number 13

10. Furnishing Mechanical

11. Train Lighting Shop

12. FRP Shop

13. Carpentry and Trimming

14. Finishing Shop

15. LHB Section

16. Wheel shop

17. Furnishing Gang Number 10, 11, 12

The following are the supporting shops to the abovementioned shops:

S. No. Tool Room

1. Millwright (Mechanical)

2. Millwright (Electrical)

3. Millwright (Electronics)

4. Transport shop

5. Progress

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6. Workshop maintenance L/T

Technicians, Supervisors and Helpers are responsible for production, maintenance

and operation of break down equipment. They are also responsible for preparation

of Rolling Stock Programme and correspondence with Railway Board for allotment

of Coach numbers and Zonal Railways. For carrying out the above activities

following softwares are being operated: -

(a) Jigs &Fixtures Quality Control (JFQC)

(b) Production Management Systems (PMS)

(c) Coach Manufacturing Monitoring System (CMMS)

iii. Stores Department:

Stores department of PU have different purchase offices located at various stations.

The department is headed by the Controller of Stores (COS). The main objectives of

this department are:

(a) To ensure timely availability of quality material at competitive price from

right place and source through e-procurement system of Indian Railways

(IREPS);

(b) Transparency in procurement;

(c) Inventory management;

(d) Material handling;

(e) Vendor development; and

(f) Scrap disposal

To fulfil its basic objectives, the activities carried out by the Stores Department are:

(a) Assessment of demand for placement of Purchase Orders;

(b) Contract management;

(c) Regular follow-up with suppliers to ensure timely supply of material;

(d) Receipt, inspection and accounting of incoming consignments;

(e) Stocking, storage, preservation and custody of stores;

(f) Issue & distribution of material;

(g) Registration and approval of vendors;

(h) Continuous review of requirement to avoid situations of over or under

stocking.

(i) Coordination with various departments of RCF (Planning, Design, Quality,

Finance) and with other units of Railways and Inspection agencies of RCF

(Railway Board, ICF/RWF/RSK, workshops of Zonal Railways,

RITES/RDSO/DGS&D)

(j) Sale of scrap through Public Auction.

iv. Procurement

Purchasing is done in consonance with the policies prescribed by Railway Board,

through competitive bidding. Local purchase is resorted to meet urgent

requirement and for purchase of low value items. High value tenders are examined

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and evaluated by Tender Committees (consisting of 3 Officers-Stores, Finance &

Technical).There are mainly 3 categories of items purchased in a PU:

(a) Material Schedule items: Coach components/assemblies – Demands

(Procurement memo) for these items are generated by Planning Department

based on Quantity per Coach (QPC) and Coach Production Plan.

(b) Stock Recoupment Memo (SRM) items: Demands for consumables and other

items (other than coach components/assemblies) required by shops are also

generated by Stores Depot. This is done on the basis of vetted Estimated

Annual Requirement (EAR) and trend of consumption.

(c) Non-stock items: Non-regular & ad-hoc requirement, such as M&P/Spares/

Furniture/ Computers etc. for which requisitions are prepared by indenters of

consuming department based on their need.

v. Engineering Department

The Engineering department is responsible for construction and maintenance of

all civil engineering works viz. all buildings including residential quarters,

hospital, sheds, workshop structures, goods sheds, water supply, sanitary

installations, railway tracks and all allied structures.

vi. Quality Control Department

Quality Control Department ensures the quality in production as well as

purchased items. The department is also entrusted with the task of

implementation of modern management techniques viz. Integrated Management

System IMS. Customer service, vendor approval as well as eco-friendly steps

initiated by this department.

vii. Accounts Department

The Accounts Department primarily maintains the accounts of PU in accordance

with the prescribed rules. It also conducts internal check of transactions affecting

the receipts and expenditures, prompt settlement of claims, rendering advice to

administration regarding matters of tendering, compilation of budgets,

monitoring the budgetary control procedures from time to time, discharging other

management accounting functions such as providing financial data for

management reporting, inventory management, purchase/contracting decisions,

assessing the financial irregularity (if any) in the transactions of PU.

viii. IT Department:

Information Technology department is responsible for smooth functioning of IT

activities of PU. All applications related to Workshop, Stores, Accounts, Planning,

Design, Personnel, Civil, Hospital and applications of other departments are

managed by a team of IT professionals. IT department is also responsible for

procurement and maintenance of computers, printers, cartridges, CAD &

networking equipment of PU.

ix. Personnel Department

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The Personnel Department is responsible for establishment matters, welfare

activities, industrial relations, policy, rules& regulations of personnel related

matters of other departments. The personnel department carries out recruitment,

training, promotions, transfers, selections, creation of posts, granting retirement

benefits, disbursement of pay and allowances, productivity linked bonus and

maintenance of service and leave records of non-gazetted staff except Railway

Protection Force (RPF). It deals with the recognized unions and arranges meetings

and participation of Railway Employees in Management (PREM) meetings for

settlement of staff grievances. The personnel department is the custodian of all

establishment rules and regulations and their interpretation in service matters.

Many welfare activities like running of staff canteens, election of consumer

cooperative societies, coordinating the running of schools, cultural societies &

scouting activities etc. are also undertaken by the personnel department. The

department also deals with the provisions of various laws and acts promulgated

by the Government of India.

x. Medical Department

Medical Department renders preventive and curative medical services to employees and

retired employees and their families and is headed by the Chief Medical Officer.

Monitoring of activities of medical department is done by Hospital Information

Management System (HIMS). The medical department also interacts with the local

hospital to strengthen the medical facilities.

xi. Electrical Department

Functions of Electrical Department include operation and maintenance of electrical

power supply for lighting, ventilation, air-conditioning in Administrative Block,

residential areas, passenger reservation system (PRS), offices, hospitals, rest house

and water coolers at offices, hospitals, etc. It also undertakes operation and

maintenance of power supply to stations, water supply pumps for workshop and

railway residential colonies. It also takes steps for energy saving such as

distribution of LED lights and use of solar energy.

xii. Signal& Telecom Department

Functions of Signal &Telecom Department include control over Optical Fibre,

Railtel and BSNL leased line. Telecom Department at PU is responsible for

maintenance of all telecom equipment telephone exchanges, associated equipment

and underground cable of telephone exchange. It is responsible for providing

telecommunication infrastructure for Passenger Reservation System (PRS) for

Railways employees. It manages the Railway Information Network (Railnet) and

Public Address System for various meeting and functions.

xiii. Audit Department

Functions of Audit Department mainly consist of auditing sanctions involving

finance, rules, general orders, tender documents, accounts, estimates prepared for

projects, checking of internal audit mechanism, inspections of offices and checking

of all orders/sanctions issued by GM & other officers.

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xiv. Security (RPF) Department

Railway Protection Force (RPF) is an armed force and is responsible for protection

and safety of Railway property. At PU, RPF generally has a setup of executive

branch, fire service branch, dog squad and crime & special intelligence branch. All

these units work under the control and command of Commandant cum Security

Commissioner/RPF. The administrative control of the security department lies

with Inspector General-cum-CSC/RPF of the concerned Railway and general

supervision is under General Manager of the PU.

xv. Vigilance Department:

The main objective of vigilance department is to create vigilance consciousness

among the officers, supervisors and staff of PU and also assist the external

vigilance for administrative function at all levels. More emphasis is placed on

preventive and educative vigilance.

5.1.4 Management Information System (MIS)

PU prepares various reports to fulfil the requirements of senior management. Some of

the finance and accounts related MIS reports include:

i. CO6 report;

ii. Report on balances under suspense heads;

iii. Workshop Manufacturing Suspense (WMS);

iv. Review of material management;

v. Stock and dues position;

vi. Tender related reports, etc.

5.1.5 Understanding of Existing Software Systems

The IT systems available in RCF Kapurthala are as under:

1. Financial Accounting System (FACT)

2. Material Management System (MMS)

3. Employee Accounting System (EASY)

4. Personnel Information System(PINS)

5. Scrap Disposal System(SDS)

6. Employee Incentive System(EICS)

7. Coach Manufacture Monitoring System(CMMS)

8. Cash Imprest

9. Time Office Attendance System(TAMES)

10. Civil Engineering Works(CEW)

All the programmes have interfaces with each other. In addition to the above other

software which are in use at RCF Kapurthala are as under:

Indian Railways


i. Protective Clothing

ii. Plant Maintenance System (PLANS)

iii. Integrated Design Monitoring

iv. System for Employees

v. Production Management

vi. Jigs and Fixture Quality

vii. Security Management

RCF’s integrated application

The above diagram depicts

Kapurthala. All the above

Kapurthala team. A brief descriptio

i. Personnel Information

viz. personal data, family,

recruitment of employee

from Time Office Maintenance

attendance and work

information is recorded

fetches information

accounting system and

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Clothing Management system (PCMS)

Plant Maintenance System (PLANS)

Monitoring System (IDIOMS)

Employees Enquiry (SEE)

Management System(PMS)

Quality Control (JFQC)

Management System (SMS)

application system is the main interface for all applications.

Integrated Data Sharing

depicts various applications which are currently

above applications have been developed in house

description of the applications is given below:

Information System: - It stores the information related

family, service leave, training, pass and other

employee in special category. This system fetches

Maintenance system which keeps the record

work time. After calculating their salary and

recorded in the financial accounting system.

from employee incentive calculation system,

and hospital information system.


applications.

currently in use at RCF

house by the RCF

below: -

related to employees

other details as well as

fetches the information

of the employees

other wages, the

This system also

system, employee

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ii. Employee Accounting System: -This system deals with payroll, income tax,

productivity linked bonus (PLB), electricity billing, employee quarter dues, pay

commission and other activities. This system also records the present and future

projections related to the employee and other activities. This system interacts with

employee incentive calculation system and personnel information system to

prepare their salary and wages at the end of the month.

iii. Financial Accounting System: -It deals with books, bills, establishment, works,

material, NPS, material accounting, cash handling and other activities. All

transactions related to material procurement are recorded in the financial

accounting system. The financial accounting system also interacts with scrap

disposal system. The expenditure done by the works department is also recorded

in the system. The cash imprest system also interacts with FACT.

iv. Integrated Design Monitoring System (IDIOMS): It deals with detailed

description of components and material pertaining to the different type of coaches.

The IDIOMS interact with Production Monitoring System. This system also deals

with Material Management as well as Drawing Management System.

v. Material Management System: It deals with Planning, Procurement and

disbursement of material for coach production (as per annual RSP and other items

which are of miscellaneous nature (Non Stock Items). The quantity related to each

type of coach is entered in the system and system does not allow booking of

material more than the specified quantity. Higher quantity can be taken only after

approval of competent authority.

vi. Receipt Inception Management System: This system works with material

management system. Only authorised department or production unit can issue

receipt for material. The system closely interacts with material management

system and security management system.

vii. Hospital Management Information System (HMS): It deals with registration of

patients, procurement of medicine, information on pathology & radiology and

daily patients queue position. The HMS also interacts with financial accounting

system to record the expenditure spent. It also interacts with personnel

information system to store the data.

viii. Works for Civil Engineering: It keeps record of generation of estimates, tenders

and execution of civil work required in RCF. All the expenses related to the civil

works and planning and construction are recorded in the Financial Accounting

system.

ix. Computer Hardware Management System (CHARMS): It deals with all hardware

equipment, their maintenance, downtime calculation and AMC bills processing

and other activities related to computer hardware.

x. Time Attendance Maintenance System: It deals with attendance of workshop

staff. This system is connected with punching machine and calculates their

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working hours. This system fetches the information from punching machine and

also works closely with Employee Incentive Calculation System and Personnel

Information System for calculation of wages and salary.

xi. Employee Incentive Calculation System: - It deals with incentives of all regular

employees based on the working hours.

xii. Production Monitoring System: It deals with generation of load charts for

machines in relation to work order. This system stores all the flow charts

pertaining to each type of coach. This system closely interacts with Integrated

Design Office Management System as well as Material Management System.

xiii. Scrap Disposal System: It deals with generation of estimates, tenders and

execution of sale of scrap. After measuring in terms of quantity, higher authorities

give approval for tender which is released by the PU. This system is responsible for

execution of the scrap sale and sale amount received is updated in the Financial

Accounting System.

xiv. Cash Imprest System: -All transactions which are related to petty cash are

recorded in this system. This system interacts with various systems like Financial

Accounting System, Employee Accounting System and Personnel Information

System.

5.2 Review of Existing Accounting System

The Accounts Department comprises of various sections and a separate code is assigned

to each section. Each section is headed by a Senior Section Officer (SSO)/Section Officer

(SO). Following are the sections in the Accounts Department of PU:

5.2.1 Sections in the Accounts Department

i. Administration –This section deals with general administration work, e.g.

departmental examination, records of attendance, allotment of residential quarters,

etc. This section is also in charge of Estate Management. For example, supplying of

office stationery to every section as per requirement, repair & maintenance of office

equipment.

ii. Inspection and Audit–Inspection section deals with inspection of various offices

for monitoring deficiencies/irregularities with regard to establishment matters,

stores and construction. Further, if any objection is raised by the external auditors,

then this section makes necessary arrangement to respond to the Audit objections.

iii. Store Finance Section – Store finance section is responsible for vetting of all

financial proposals and estimates related to the Stores Department.

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iv. Stock Verification Section- This section is responsible for periodic verification of

all stock, non-stock and Tools and Plants Items (T&P), which are maintained in the

stock registers by different departments and also witness sale of scrap.

v. New Pension Scheme – This section deals with matters pertaining to the new

pension scheme e.g. to monitor the employee contribution/Employer contribution,

keeping necessary records as applicable, to ensure timely payment of NPS to

regulatory bodies, etc.

Regularity in uploading Subscribers Contribution File SCF:

At PU, the SCF is uploaded on the National Securities Depository limited (NSDL)

site immediately after passing of the salary bills and the funds are transferred to

Trustee Bank after uploading of SCF. At present RCF has 03 wage periods. Hence

data is uploaded and funds are transferred thrice a month.

vi. Provident Fund (PF) Section – This section is responsible for recording all

transactions pertaining to provident fund. Maintenance of PF ledgers, passing

entries for PF received from employees, withdrawal from PF, Loan against PF

balances, etc.

vii. Pension Section–This section maintains all records relating to payment of pension.

For example, preparation of Pension Payment Order (PPO), revision in PPO and

Review of pension paid, etc.

Every month provision is made for Pension Fund through JV as per Railway Board

allotment and the following entry is passed:

WMS (00123092) DR Xxx

To Appropriation to Pension Fund (12319500) CR Xxx

Entry for interest on Balance fund:

Deposit with Reserve Bank (1690600) DR Xxx

Interest on Pension Fund (12320100) CR Xxx

As per Railway Board’s guidelines, PPOs are issued through ARPAN (Advanced

Railway Pension Access Network) w.e.f. from 31.08.2014.

Spot verification of Pensioner’s Bank Account: -

A team of Accounts officials has been formed for verification of Pension Bank Accounts

of beneficiaries at the spot in respective Banks. The accounts have been spot checked and

excess payment made by Banks has been deducted and recovered from pensioners.

viii. Establishment Section – This section maintains the service sheet of employees and

deals with all service matters. Payment of salary, advance under civil grant, Group

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incentive, Productivity Linked Bonus (PLB) and Medical reimbursement. This

section also deals with service record of Gazetted Officers of PU.

ix. Expenditure Bills Section - This section records all type of contractors/suppliers

bills, utility bills, imprest bills, etc. and reviews the bills of all contractors in respect

of works contract with the measurement book before making any payment. This

section also maintains records of all Security deposits, Earnest Money Deposits

(EMD) received from contractors/suppliers.

x. Expenditure Finance Section–This section accords concurrence and vetting to of

proposals, contracts (Annual Maintenance Contracts, repair and maintenance,

Preliminary Works Programme (PWP), Machinery & Plant (M&P) programme)

other than stores.

xi. Budget Section – Budget section deals with preparation of budget and monitoring

of the same through regular review in the form of August review, Revised Estimate

(RE), Final Modifications (FM) I and FM II. It allocates the funds allotted by the

Railways Board to executive departments. It prepares appropriation accounts after

the closing of the financial year and submits to Railway Boards through Audit.

xii. Books Section – Books section is the compiling section. Preparation of cheque for

payment is done by this section. Books section also prepares monthly account

current. This section also deals with the following:

REMITTANCE TRANSACTIONS

i. Reserve Bank Suspense (RBS):

(a) It is a suspense head operated for settling INWARD transactions from

other Accounts Officers (Except for Cheques & Bills and Remittance

into Bank).

(b) As and when, the ADVICES are received from RBI; the RBS A/c is

debited (in case of receipts) or credited (in case of expenditure).

(c) On receiving "CLEARANCE MEMO" from RBI-Reserve Bank of India,

the a/c RBS is cleared by contra Debit or credit to Reserve Bank

Deposit (RBD).

(d) All balances under RBS should be NIL at the end of financial year i.e.,

31st March. If any balance is left over, the same is transferred to

Miscellaneous Advance Receipt (MAR) (if debit balance) or to Deposit

Misc. (if credit balance) as the case may be.

The following entries are passed while recording the transactions relating to RBS:

1. When Advice is received:

Service Head DR Xxx

To Reserve Bank Suspense CR Xxx

2. When clearance is received from Reserve Bank of India

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Reserve Bank Suspense DR Xxx

To Reserve Bank Deposits Railway CR Xxx

ii. Cheques and Bills: The following entries are being made: -

1. When Cheques are issued:

Service Head DR Xxx


2. When Cheques are encashed:

Cheques and Bills - CR Xxx

To Public Sector Bank Suspense CR Xxx

3. When clearance is received from Reserve Bank of India

Public Sector Bank Suspense - CR Xxx

To Reserve Bank Deposits Railway CR Xxx

iii. Remittance into Bank:

1. When cash is deposited into bank by the chief cashier or anyone on behalf of

Railway:

Remittance into Bank DR Xxx

To Service Head CR Xxx

2. Scroll from Focal bank:

Remittance into Bank - DR Xxx


Reserve Bank Deposits - Railway - DR Xxx


Note: -The suspense head Public Sector Bank Suspense is operated only in respect of

Remittances/ withdrawals from Public Sector Banks. This head is not operated when the

transactions are made to/ from RBI branches directly.

Balance under the Head Reserve Bank Deposit Railways is transferred to the Head

Govt.

xv. Workshop, Costing &Taxation Section: This section prepares the workshop

manufacturing suspense account at the end of every month, raising of debits

against Railway Board production plan for Rolling Stock Program (RSP) coaches on

monthly basis and vetting the pricing format in respect of each coach. This section

also works out the average rate of labour, overheads and on cost budget for

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working out the cost of the product manufactured in house. It also prepares the

budget for the production activity and conducts the regular budgetary reviews.

Besides this the record of staff benefit fund also being maintained in the section. At

the end of every year Batch Cost Report is prepared in respect of coaches

manufactured during the year and the same is submitted to the Railway Board.

This section also raises the Transfer Certificate (TCs) to other Railways against the

transfer of material. Allocations have been created for proper booking of Excise

Duty, Counter veiling Duty (CVD) and Service Tax payments.

xvi. Stores Ledger Section: This section deals with inventory control, Stock

Adjustment Account, pricing of stock, clearance of store suspense account, store

Imprest, inter railway transactions, sale of scrap, returns related to VAT, etc. It also

submits the annual reports to Railway Board related to stores.

xvii. Stores Bill Section: This section deals with checking and making payment of

supplier bills, LC, etc. It also keeps a proper record of payments released and

ensures the recovery from suppliers. This section also maintains the records of all

security deposits, EMDs received from suppliers.

5.2.2 Mapping of Current Process at PU

The mapping of current accounting processes of PU has been carried out to understand

all the components of the existing accounting system; the extent of prudence and

propriety of the system in practice and to find out the gaps in the present system from

the viewpoint of implementation of accrual based accounting system. Apart from the

mapping process as mentioned in chapter 4 of this document, following are the

additional areas in PU:

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Maintained

Accounting for Employee Benefits

1 Staff Benefit

Fund

There is a staff benefit fund in Indian Railways. This fund is used for Railway employees in

the following fields:

i. Higher education of children especially for promoting education to Girl Child.

ii. Provide assistance to differently abled children.

iii. Sports activities.

iv. For promoting alternative system of medicine i.e. Homeopathy.

v. For promotion of scouts and guides & cultural activities.

vi. Provide assistance to economically weaker employees on account of medical

ground.

vii. Provide funeral expenses and immediate assistance to families of deceased Railway

servants.

viii. Provide assistance to various clubs.

Every year, Railway Board allocates specific amount on the basis of working non-

gazetted employees. Meeting is held with all SBF members to allocate SBF amount to

various activities.

Following entry is passed at the time of creation of Fund under SBF:

App. to SBF (00123109 WMS) DR XXX

To Staff Benefit Fund (13103900) CR XXX

At the time of making payment from SBF for the specific purpose, the following

entry is passed.

Accounting

Accounting entry passed

in Books Section.

Books & Registers

maintained

SBF Register

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Maintained

Staff Benefit Fund (13103900) DR XXX

To suspense head Cheques &Bills CR XXX

Employees give applications in prescribed format to competent authority for

granting assistance from staff benefit fund.

Competent authority determines assistance available to each employee on the

basis of number of applications received, availability of fund and applicable

norms/rules.

After determination of amount, Pay order is issued by the competent authority

which comes to SBF section for recording.

Fund position is monitored in accounts department and at the end of the financial

year, balance amount under SBF along with simple interest @2% is carried

forward to the next financial year.

The following entry is passed when interest on SBF is carried out:

Deposit with Reserve Bank (16900600) DR XXX

To Staff Benefit Fund (13103900) CR XXX

Accounting for Liabilities

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Maintained

1 Labour Cess RCF deducts 1% labour cess from all civil, electrical and mechanical contractors from

their bills and credited to deposit Misc. Account.

While deducting the labour cess, following entry is passed :

Service Head DR XXX

To Deposit Misc. (14110000) CR XXX

The labour cess so deducted is deposited with the Assistant Labour

Commissioner through DD every month. Following entry is passed to record

the transaction:

Deposit Misc. (14110000) - CR XXX

To Suspense head Cheques & Bills CR XXX

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5.3 Understanding of Workshop Manufacturing Department

5.3.1 Materials and its Accounting Treatment

The Stores Department in a Production Unit deals with procurement/Purchase, receipt,

custody and issue of materials, Machinery & Plant (M&P), Tools and consumable stores

required for production and service Department, inventory management and disposal of

scrap material.

i. Receipt of Materials: On receipt of materials in the receipt branch these are checked

with relevant Purchase Orders and after inspection and their acceptance by the

Inspecting Officer, a Receipt Note is prepared which shows the allocation as final head

or stores suspense and the material is passed on to the ward keeper or the department

concerned. Imported stores are also verified with reference to the advice of despatch.

The vouchers are posted in the numerical and priced ledgers as receipts and accounted

for by debit to 'stores suspense' or final head as the case may be, by credit to purchases.

If in any month Receipt Note is received before actual receipt of materials, the debit is

held temporarily under 'stores-in-transit' account till materials are received.

In case of imported stores, the value of materials as ascertained from Invoice

Distribution statement together with sea-freight, port, custom charges, etc. is debited to

stores suspense (or final head of a/c) and credit to purchases imported to the extent of

prime cost and different standing work orders for sea freight, port charges, custom duty

etc.

Materials manufactured in shops are accounted for through material tags and priced at

price list rates. The value of the material is debited to stores suspense by credit to

workshop manufacture suspense account.

Materials no longer required by shops and offices are returned to stores depot on

'Advice Note of Returned Stores' and the value thereof is accounted for as debit to

'stores suspense' and credit to shops or departments concerned against specified work

orders or final heads of accounts.

Transfer of materials from one Priced Ledger (PL) No. to another within the same

Depot is made through Book transfer forms. Adjustments necessitated by stock

verification are made through Departmental or Accounts stock verification sheets

surpluses being shown as debit and deficiencies as credit to stores suspense by credit or

debit to stock adjustment account as the case may be.

Materials are sometimes supplied to outside firms or other Railway units for

fabrication, reconditioning, etc. In these cases, issue notes are prepared and the value is

debited to 'miscellaneous Advances', and when the materials are received back duly

fabricated or reconditioned they are received on Receipt Notes, which are valued at the

original cost of materials plus fabrication charges and accounted for a debit to 'stores

suspense' and credit to 'Miscellaneous Advances'. The extra credit balance lying under

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'Miscellaneous Advances' represents fabrication charges and is cleared on payment or

adjustment as the case may be.

ii. Issue of Materials: The process of accounting of material issue is as under:

(a) Material Requisition: Raw material required for manufacture in the shops are

drawn through material Requisition released by the sub store and after necessary

posting in the ledgers, is accounted for by debit to various work orders concerned

and credit to stores suspense.

(b) Issue Notes for consumable stores etc.: Consumable stores for repairs and

maintenance etc. are drawn on Requisition-cum-issue Notes (Form S. 1523) which

after posting in ledgers, are accounted for as debit to various work orders

concerned and credit to stores suspense.

(c) Issue Notes for Sales: Materials sold to outsiders, railways or employees are

transacted through issue Notes (S-1314) and accounted for by debit to sales and

credit to 'stores suspense'/ W.M.S.

5.3.2 Preparation of Stores Sub ledger

Store Sub Ledger: - Materials for coach production and in the workshops are obtained from

the following sources: -

(a) Through main stores

(b) Through direct supply orders

(c) From other Railways/workshops.

The materials from the main stores are drawn by the production department on requisition-

cum-issue notes. Shop-wise and Work-Order-wise summary of materials drawn from the

main stores by the production department through requisition cum issue notes is prepared in

the stores sub-ledger. From this shop-wise and work-order wise summary is also drawn to

show the cost of direct material in WMS account. Store Sub Ledger is prepared in terms of

Para W-627 of Mechanical Code. Work-order wise and shop wise summary is also posted in

Work shop general register (WGR)

5.3.3 Reconciliation of Gate Attendance with Labour Booking

i. Gate Attendance: As per Para 220 of Indian Railway Mechanical Code each workman

has to punch his Gate Attendance Card two times in the first half and two times in the

second half of the day.

ii. Labour Booking : The assignment of production work to the artisan Staff is done by the

Shop in charge. The Time Book is written up daily and made available to Time-booth

Clerk for necessary posting in the Time Sheets7*

7 Time sheet is the record that shows the time for which wages are earned by each workman during a

wage period as distributed over the different work orders on which he had been engaged during that

period.

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At the end of each month an abstract of gate attendance and actual labour booking by

the concerned supervisors is generated and reconciled through computer. Differences, if

any, are investigated and advised to concerned works managers for necessary

adjustments. This reconciliation is necessary to ensure that the payment made to the

workers is properly charged to the relevant work order.

iii. Preparation of labour Sub ledger : The summary of total labour amount booked in

different shops against each work order is called Labour Sub-Ledger (Para 522 of

Indian Railway Mechanical Code). Shop-wise and category-wise labour amount on a

particular work-order is allocated/calculated by multiplying the Labour Rate of that

particular artisan' s category with the hours booked in that shop on the work-order.

The detailed calculation of labour average rate and incentive are given in costing

section.

5.3.4 Compilation of Overheads

Overheads: Besides direct expenditure on labour and materials incurred on a job, there is

certain expenditure which cannot be directly charged to jobs but included in the cost of

production on certain equitable basis. This indirect expenditure is termed as overheads.

The expenditure incurred by the cost centres are collected under a system of work-orders (In

terms of Para W-804). Work orders are of two types: -

i. Non-Production Work Orders: - These are used for collection of indirect expenses i.e.

overheads. The allocations/work orders starting with 0011, 0012, 0013 and 0014 are

non-production work orders.

ii. Production Work Orders: - These are used for collection of direct costs of manufacture

of coaches. These work-orders start with 0050 to 0099. The apportionment of overheads

to direct cost is detailed in costing section

5.3.5 Workshop Manufacturing Suspense Account (WMS Account)

It is a Suspense Head of Account under Capital (7200) under Demand number 16. It is

operated upon to accommodate expenses incurred on labour, material and on-cost charges

expended on various jobs. The labour pay sheets when passed for payment are allocated to

the head 'Labour' under WMS Account which is cleared to various jobs with reference to the

Time/Tally Sheets. Debits on account of materials issued to various jobs are allocated to

various work orders under the WMS Account. Overheads charges i.e. shop-on-cost and

general on-cost incurred are charged to on-cost work orders under WMS Account and spread

to various jobs on the basis of pre - determined rates, labour, material and on cost charges so

booked are accumulated in Workshop General Register which is a detailed subsidiary

register of WMS Account. Charges appearing in Workshop General Register against various

Work Orders are summarized in out-turn statements WMS Account Current is compiled and

journal entries prepared for incorporation of the transactions affecting Workshop

Manufacturing Suspense Account in the Finance Accounts. It is a monthly statement showing

total expenditure made on production of coaches. This statement has following sides.

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i. Debit Side: Debit side of the statement contains the following items: -

(a) Labour payments - from labour schedule (Labour L7)

(b) Store material - from daily issue notes (Store L7); and

(c) On cost charges of labour and store both (Cash L7, Store L7 and Adj L7)

ii. Credit Side: Credit side of statement has following items:

(a) Transfer of manufactured coaches to Railway Board

(b) Items returned to store (Minus Debit)

(c) Amount of work done for other railways/ departments/NRC ((Minus Debit)

(d) Works in Progress (WIP)

Labour and Store amount is entered from Workshop General Register and all the credits are

obtained from outturn statement. Credits belonging to other workshop/railways are done

through Journal Voucher entries.

Element-wise details of WMS Debit and Credit Account

Debits Credits

Shop Labour :-

The cost of wages incurred in a workshop as

a 'Direct Cost' to operations i.e. Artisans of

various shops is booked to WMS Account

against appropriate work order and indirect

cost of labour is booked under factory

overhead.

Returned Stores: -

All the materials no more required

by the consuming departments

should be returned to the nominated

stores. Such materials are returned

along with an Advice note for

returned stores (form No. S-1539)

prepared in 6 copies.

Depot Stores: -

Actual consumption of stores done through

form S-1313 by the Executive is passed

through JV and is checked to see that the

debits booked to WMS are correct by

ensuring correctness of rates and quantities

(Abnormal shop drawls’) by reconciling

store L7 summary on monthly/ annually

basis.

Amount of work done for other

Railways/Departments: -

Based upon the requirement of other

railways, certain in house, such type

of work is carried out and the value

realised is shown as minus debits in

the book of account to ensure proper

booking prior concurrence of such

activity is taken from finance so that

monitoring of booking of such

transactions can be done.

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Preparation of Cash and Adjustments of L7

Cash L-7 / Adjustment L-7: - Allocation-wise data for cash payments made by different

sections (relating to Workshop) and adjustments made through journal vouchers (relating to

workshop) is compiled in Cash L-7 and Adjustment L-7 respectively. It is prepared every

month before preparation of WMS Account.

5.3.6 Monthly and Annual Workshop General Register (WGR)

This register is prepared every month under which all labour booked, overheads levied and

store charges are added and credit is given for returned stores. Following steps are required

to be taken while preparation of WGR:

Direct Purchases:-

Purchases made through Non-Stock Indents

are accounted under this element of item.

Indents are checked to see that the Funds are

available under WMS and the repeated

purchases made through Non stock Indents

are proposed for stocking to attain the

advantages of Bulk Purchases.

Works in Progress

The Accounting treatment for Works

in Progress (WIP) describes under

head of 7200 against various batch

orders. It includes the elements of

labour, material, and overhead cost.

Any balance in the form of

suspended jobs, wrong accounts, etc.

is set aside and effort is made that it

should reflect the correct position for

the actual work in operations.

Annual review is carried out at

FA&CAO level. It is observed that

WIP is remains 4-5 %. Of the total

credits.

Miscellaneous Adjustments:-

Appropriation to DRF, pension, staff benefit

fund and electricity charges, and stock

adjustment if any is shown under this head

of debits.

Indian Railways


5.3.7 Vetting of Price Formats

The estimated transfer price of

Pricing Formats (In terms of Para

Direct Labour, Overheads and

i. RSP No. and Work Order

ii. No. of Coaches to be manufactured

These are prepared by the Chief

Accounts Office for vetting. While

cost taken in the Pricing Formats

Material Planning for the financial

should match with the Pink

should be same as per the Railway

transfer price of coaches is fixed.

Step 1

•Work order wise time is booked by the Production Shops and value of direct labour is worked out by the computer based based upon wages drawn by direct labour.

Step 2

•Summarised notes of material drawn by the shops against different work orders is prepared for store related expenses.

Step 3

•Data of Time sheet is generated by system and tally sheet is prepared dully reconciled with hours booked with gate attendance and variation if any is set right and labour L7 is prepared

Step 4

•Data of summarised notes of stores is prepared in stores subsystem.Besides this the coach material procured directly by the shop floor is also entered in it.

Step 5•Credit is given for Store return.

Step 6

•Journal vouchers are prepared for the material drawn from depot, appropriation to DRF, pension, SBF and for inter Railway Transfer vouchers.

Step7

•Finally the total of all transaction in work order wise display in the Workshop General Register. There is no manual intervention in the generation of the WGR.

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Formats

of the coaches to be manufactured is prepared

Para W-1402) indicating the estimated cost

and other relevant Information like: -

No.

manufactured under the work-order

Chief Mechanical Engineer’s (CME) Office

While vetting the pricing formats it is ensured

Formats should be as per Material Schedules

financial year, the RSP No. mentioned in the

Book and the number of coaches proposed

Railway board’s production Program. Based

fixed.

Work order wise time is booked by the Production Shops and value of direct labour is worked out by the computer based based upon wages drawn by direct

Summarised notes of material drawn by the shops against different work orders is prepared for store related expenses.

Data of Time sheet is generated by system and tally sheet is prepared dully reconciled with hours booked with gate attendance and variation if any is set right and labour L7 is prepared.

Data of summarised notes of stores is prepared in stores sub- ledger L7 through system.Besides this the coach material procured directly by the shop floor is also

Credit is given for Store return.

Journal vouchers are prepared for the material drawn from depot, appropriation to DRF, pension, SBF and for inter Railway Transfer vouchers.

Finally the total of all transaction in work order wise display in the Workshop General Register. There is no manual intervention in the generation of the WGR.

prepared in the form of

of Direct Material,

Office and received in

ensured that the material

Schedules prepared by the

the pricing formats

proposed to manufacture

ased upon this, the

Work order wise time is booked by the Production Shops and value of direct labour is worked out by the computer based based upon wages drawn by direct

Summarised notes of material drawn by the shops against different work orders is

Data of Time sheet is generated by system and tally sheet is prepared dully reconciled with hours booked with gate attendance and variation if any is set right

ledger L7 through system.Besides this the coach material procured directly by the shop floor is also

Journal vouchers are prepared for the material drawn from depot, appropriation to

Finally the total of all transaction in work order wise display in the Workshop General Register. There is no manual intervention in the generation of the WGR.

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5.3.8 Transfer of Goods from Workshop to Other Railways

PU also produces and transfers semi-finished material to other railway customers. PU issues

the transfer certificate to the other railways on the completion and delivery of the materials to

be supplied.

Generation of transfer certificate- process in brief: -

i. Preparation of cost sheet of the material to be supplied by the material planning

department.

ii. Sanction for sale: - After the vetting of cost sheet by the finance department, the sale

order is prepared by the finance department which ensures that material and labour is

booked as per the cost sheet.

iii. Gate pass is generated on dispatch of shop made material to the concerned railway

indicating description, no. of packages, voucher no and date to whom sent and

purpose, whether railway or private party.

iv. Issue Note: - This is issued to the concerned railways indicating the material handed

over to the consignee.

5.3.9 Raising of Debits on Railway Board for Coaches Manufactured during

the Month

On manufacturing of coaches during the month, statement/ transfer certificate is issued by

the PU to Railway Board for the credit realisations on the production and transfer of coaches

to the respective consignee.

Transfer Certificate is issued to the Railways Board only after the allotment of coach number

to the respective railway. If coach number is awaited but respective railway consignee is

disclosed, then also transfer certificate can be issued to the Railway Board.

PU issues to the Railway Board such transfer certificate in the following ways:

Actual debits of Rolling Stock Programme (RSP) of manufactured coaches.

Differential Debits of RSP Coaches for the financial year, if any.

5.3.10 Production for Non-Railway Customers (NRC)

These are works that are done by Indian Railways for the private parties and various other

Government organizations. For example, manufacturing of coaches for Bangladesh Railway

through RITES, DRDO, Defence, NTPC, etc. And difference between actual sale price and

cost of production is to be shown in developmental suspense.

5.4 Fixed Assets Register at PU

Proper recording of fixed assets is important for every organization. A register is maintained

for Plant, Machinery by CPE office. Monthly capital account current is prepared for all the

additions and deletions on assets and from that Block account is prepared in which opening

value, addition and deletion value of assets is written.

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The departments have submitted information of fixed assets as per the formats advised by

ICAI-ARF. Each department also maintains a Tools and Plant Register (T&P) containing only

the quantitative details of assets recorded. However, cost is mentioned only for those

items/assets, which are added during the current financial year. This Tools & Plant register is

updated/physically verified after every two years. Life of these assets is also determined as

per codal provision. In PU, as there is no revenue account current in operation. The values of

all tools and plants are booked under WMS Account and the same is being realised through

Coach Cost. At present, no depreciation is charged directly on any assets. However, each

year Indian Railways contributes a certain amount to the Depreciation Reserve Fund (DRF)

in relation to the expenditure on renewal and replacement of assets with respect to Indian

Railway as whole. The creation of fund is not need based for PU and which ultimately result

in increase in cost of the coach.

5.5 Stores Department

It is one of the most important Departments in PU. Stores accounting relating to PU is carried

out at Depots such as:

i. Shell Depot

ii. Furnishing Depot

Further, there are various wards in above depots. Following activities are undertaken by the

Stores Department:

i. Purchase of Stock;

ii. Receipt and Issue of Material for Fabrication

iii. Issue of material for manufacturing;

iv. Transfer to Shop or consignee;

v. Depot to Depot transfer;

vi. Stores Return;

vii. Sale of scrap,

viii. Departmental Stock verification

Here, first of all, material request is sent by the shop or concerned department to the store

depot. If the material is available in the depot, then the same is issued to the

shop/department. Issue note is generated for every issue in five copies. Two copies are sent to

the consignee, third copy is retained at the depot, fourth and fifth copies are sent to the

Accounts Department. The Accounts Department returns the fifth copy to the consignee after

making necessary accounting entries. All the details of the request are entered in the Issue

Note.

If there is any difference in the Receipt Note and Issue Note of material, then the same is

reflected in Stock Adjustment Account. Whenever material is issued, an issue note is

generated by depot periodically and is sent to Accounts Department. All the details of

consignee, date of purchase, type of material, value of material, etc. are written on the Issue

Note.

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6 Central Organisation for Modernization of Workshop-

COFMOW 6.1 Introduction8

The Central Organisation for Modernization of Workshops (COFMOW) was established in

1979 under the Ministry of Railways by the Government of India with headquarters at New

Delhi. COFMOW is a centralised agency of Indian Railways and is responsible for

modernisation of Railway Workshops/Production Units and for carrying out procurement of

specialised machinery and plant and induction of modern workshop technologies. Since its

establishment in 1979 COFMOW has assisted in modernizing Indian Railways Production

Units and maintenance workshops.

COFMOW is in a position to offer its services to those needing modernization or up

gradation of their manufacturing/maintenance activities. COFMOW provides professional

advice and a single window service in planning and procurement of machine tools and allied

equipment. The activities performed by the COFMOW are as follows:

Guide railway customers in selection of manufacturing technologies and Machinery &

Plant (M&P).

Prepare detailed technical specifications for procurement of M&P.

Procurement of M&P and commissioning at site.

Coordinate turnkey works associated with M&P.

Training of workshop personnel in operation and maintenance of machines.

Coordinate warranty services with vendors.

Undertake industrial engineering and layout studies.

Conversion /reconditioning of machines and manufacturing lines.

Designing standard processes, layouts and facilities for overhaul/ maintenance of critical

subassemblies.

Promoting indigenization of M&P items.

Support rolling stock tot projects like LHB coach, GM diesel loco and ABB loco by

purchasing special purpose M & P.

COFMOW is uniquely placed for providing consultancy in designing and execution of

projects for manufacturing repair and maintenance facilities, specifically it provides:

Professional advice for all aspects related to manufacturing, maintenance and repair

facilities.

Techno economic and feasibility studies.

Contract planning and administration.

Project management.

8 Source: www.cofmow.gov.in

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Manpower planning and training in maintenance and operation of equipment.

Post project appraisal.

Procurement of all type of sophisticated plant and machinery, machine tools and allied

equipment to suit special requirement and also for general purposes.

Thus, it seem to be a single window service organisation engaged in procurement of

machinery and plant on behalf of the Zonal Railways/Production Units/Workshops

according to the terms and conditions mentioned in the Machinery and Plant (M&P)

program as issued by the Railway Board for each of them. The organisation structure of

COFMOW is as follows:

Indian Railways


6.2 Organization chart of COFMOW

Chief Mechanical Engineer

Chief Mechanical Engineer (PCM)

Chief Mechanical Engineer (P)

Chief Project Manager

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COFMOW

Chief Administrative Officer

Chief Mechanical Engineer

Dy. Chief Mechanical Engineer -I

Dy. Chief Mechanical Engineer -II

Dy. Chief Mechanical Engineer -III

Dy. Chief Mechanical Engineer -IV

Dy. Chief Project Manager

Dy. Chief Electrical Engineer

Controller of Stores

Controller of Stores-II

Dy. Chief Material Manager-I

Dy. Chief Material Manager-II

FA&CAO

FA&CAO-II

Dy. FA&CAO

Chief Electrical Engineer

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Every year, Railway Board analyses the running work and the work to be done for the

betterment, enhancement, efficacy, etc. of the Indian Railways. For this purpose all the

information related to the works viz. Name of the work, Sanctioned cost of the work with

source of fund, Expenditure incurred at the end of the financial years, revised outlay,

proposed outlay, etc. are provided in Pink Book.

Railway Board prepares Machinery and Plant (M&P) programme for each Zonal

Railway/Workshop/Production Unit which is issued to these units. M&P programme

contains the funds provisioning limits for each of them. As per their requirement of plant

and machinery and fund availability, each unit, sends its indent to the Mechanical

Department of COFMOW for procurement.

However, it may be noted that M&P item costing up to Rs. 30 lakhs is procured by the Zonal

Railways/Production Units concerned, without seeking dispensation from COFMOW subject

to exception list issued by COFMOW and items covered under COFMOW’s rate

contract/price agreements. For all other items i.e., M&P items costing more than Rs. 30 lakhs

and exception list, Railways/Production units are not authorised to procure machines

without prior clear dispensation from COFMOW.

For procurement of M&P items a monthly cash authorisation is provided by Railway Board

and 5% variation is allowed on the same. However, COFMOW is not required to prepare

separate budget for procurement of M&P items since cash authorisation is provided under

Non plan budget i.e. expenditure incurred on behalf of other Zonal

Railways/Workshops/Production Units.

6.3 Procedure for procurement of M&P items

COFMOW follows the prescribed tender process for procurement of plant and machinery or

any other item as requested by Zonal Railway/Production Unit. Firstly, COFMOW reviews

all requisitions received from Zonal Railways/Production Units. After finalization of

requisitions, these are forwarded to the Stores department. On the basis of the requisition,

Stores department invites tenders.

There are two types of Tender:

i. Indigenous Tender: This type of Tender is required to procure the machinery and plant

from India and only Indian suppliers are eligible to participate for this tender in Indian

currency.

ii. Global Tender: If any item is required to be procured from outside India, Global tender

is invited for the same. However, global tendering can be made after obtaining approval

from the finance department.

Further, tendering can be categorized into single packet system and two packet system and

these systems are followed as per limit of cost of Machinery set by Railway Board:

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a) Single packet system: In this system tender is simultaneously evaluated financially

and techno-commercially and lowest price (L1) from all the bids is accepted if L1 is not

suitable then they go the L2.

b) Two packet system: In this system technical evaluation of tender is done first and after

it financial evaluation is done.

For every tender a Tender Document is prepared and uploaded on the website. This

document consists following:

Bid Document Part –I have the standard conditions of the tender;

Bid Document part – II have the machine specific conditions;

Special condition of tender

Notice for inviting tender

Corrigendum

The evaluation of tenders is done in following three stages.

Firstly, Tender is commercially evaluated by Stores department;

Thereafter, the technical evaluation is conducted by convener of mechanical department;

and

Finally tender committee (it includes three members from accounts, mechanical and

stores department) makes the recommendation to the accepting authority (Accepting

authority is always one grade higher than the tender committee) and it issues letter of

acceptance (LOA) to concerned unit and supplier.

When LOA is issued a contract is prepared by the stores department and this contract is

vetted by the finance section of accounts department. On the vetting of contract it is

processed for further proceeding to stores department again.

6.3.1 Accounting aspects of procurement of Machinery and Plant:

Presently, COFMOW uses the Accounting Information and Management System (AIMS)

software for recording the accounting transactions and book keeping. However, the Account

Current is prepared in EXCEL.

COFMOW charges direction and general charge at the rates prescribed by the Railway Board

as a commission from the consignee. However, these days COFMOW is charging D&G

charges on actual basis by preparing budget estimate of expenses.

On receipt of LOA the supplier is required to deposit Security Deposit either in the form of

Bank Guarantee, Fixed Deposit or Demand Draft.

The accounting procedure to record the transactions of procurement of M&P items are as

follows:

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1. Recording of Earnest Money Deposit: Earnest Money Deposit (EMD) is required to be

deposited as prescribed in the tender advertisement by the contractor/supplier.

Following accounting entry is passed by the accounts department to record the amount

of EMD received:

2. Recording of refund of EMD:

(i) When the tender is awarded, EMD of the unsuccessful bidder(s) as well as the successful

bidder is refunded and the following accounting entry is passed:

(ii) In case of Works Contracts: As per standard GCC July -2014, the following procedure is

followed: “The Earnest Money deposited by the Contractor with his tender will be

retained by the Railways as part of security for the due and faithful fulfilment of the

contract by the contractor. The balance amount, to make up the Security Deposit, may

be deposited by the Contractor in cash or may be recovered by percentage deduction

from the Contractor’s “on account” bills. Provided also that in case of defaulting

contractor, the Railway may retain any amount due for payment to the Contractor on the

pending “on account bills” so that the amounts so retained may not exceed 10% of the

total value of the contract.

3. Recording of Security Deposit in case of Supply Contracts: Security Deposit at 10% of

the cost of the machinery is also taken from the contractor/supplier to whom the tender

is awarded. If security deposit is in the form of Bank Guarantee or Fixed deposit then it

is kept with the custodian i.e. Bank Guarantee section of the accounts department. Bank

Guarantee section maintains all details of Bank Guarantees viz. year, extension, release,

encashment, etc.

Suspense head Remittance into Bank DR XXX

To Suspense head for EMD CR XXX

Deposit with RBI DR XXX

To Suspense head Remittance into Bank -DR XXX

Suspense head for EMD DR XXX

To suspense head Cheques and Bills CR XXX

Draft


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However, if security deposit is received in the form of Demand Draft then the same

accounting entry is passed as in the case of EMD. Sometimes, when SD is not deposited

by the supplier then it is deducted from the running bills of the supplier.

4. Recording of payment made to contractor/suppliers: When the contractor/supplier

deposits the security deposit, then an inspection of M&P items is carried jointly by

RITES and supplier at the suppliers’ site. After the joint inspection, supplier is required

to deliver the machinery at consignee’s site within the time limit prescribed in Bid

Document Part-I.

Whenever the machinery is delivered at the consignee’s site then consignee sends a

certificate of good condition i.e. joint inspection certificate of consignee and supplier, of

machinery to COFMOW. On receipt of the certificate of good condition, COFMOW

processes 80% payment of cost of machinery to the supplier and issues a transfer

certificate to the unit concerned. At this juncture, the following accounting entry is

passed:

Subsequently, the balance 20% payment of cost of machinery is processed within the

time limit prescribed in the Bid Document Part 1 for supervision and certification of

machinery to receive a proven test certificate (PTC) from the concerned unit and at the

same time COFMOW releases the security deposit to the contractor/supplier.

Whenever the supplier delays or deviates from the condition/time limit prescribed in the

Bid Document Part 1 then the supplier is responsible to pay a penalty minimum @ 2%

per month or part of the month and subject to maximum 10% of the cost of machinery.

This penalty is known as liquidated damages and deducted from the bill of the supplier.

5. Recording of Inspection Charges: COFMOW pays inspection charges @ 0.90% of the

cost of Machinery to Rail India Technical and Economics Services (RITES). In case the

supplier fails to deliver the machinery within the prescribed time limit then revalidation

inspection of machinery is done and the inspection charges to RITES is adjusted from the

supplier’s bill. The following accounting entry is passed for paying inspection charges:

However in case of global tender, inspection is done by Railway Advisor (RA), Berlin

and no inspection charges are paid to RA.

Railway Concerned DR XXX




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6. Recording of Warranty Bank Guarantee (WBG): When the total payment of the

machinery is paid to the supplier then supplier is required to give the WBG equal to the

10% of the cost of machinery in the paper form for 24 months and it is also kept by the

custodian. The period of WBG may be extended if there is any breakdown in machinery.

This guarantee is released to supplier after the completion of the warranty period.

In some cases, if the performance of the supplier is not upto the mark then the Bank

Guarantee provided by the supplier is revoked and the amount is transferred to the

consignee concerned.

7. Recording of Direction and General (D&G) charges: As already discussed, COFMOW

charges a specific percentage of the cost of the machinery on actual basis and debit

transfer certificate for the same is given to the unit concerned.

Reserve Bank Suspense DR XXX

To Cheques and Bills CR XXX


To Reserve Bank Suspense -DR XXX

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7 Electrification in Indian Railways

7.1 History9

Electric traction was introduced on Indian Railways in year 1925 With a view to reduce

dependence on petroleum based energy in Railway transport, IR have been progressively

switching over to electric traction. This also enables haulage of heavier loads at higher

speeds, thus increasing throughput.

7.2 Central Organization for Railway Electrification (CORE)

Central Organization for Railway Electrification (CORE) was set up in 1979 under the

Ministry of Railways, at Allahabad. The responsibility entrusted to CORE was to carryout

railway electrification over the entire network of Indian Railways. There are project offices at

various other sites where electrification projects are under execution. However, project

offices are closed after project completion.

ICAI ARF Nodal Team visited the following offices to get a preliminary understanding of

electrification:

a. Traction Sub Station, Sahibabad;

b. Electric Loco Shed, Ghaziabad;

c. CORE, Allahabad; and

d. CORE Project office, Lucknow.

ICAI ARF Team also visited the OHE department of Delhi Division to discuss various

aspects of electrification in detail. As far as accounting aspects are concerned, ICAI ARF

Team also looked into accounting system currently being followed for electrification projects.

Presently, there are following project units of CORE:

1) Ambala

2) Lucknow

3) Jaipur

4) Secunderabad

5) Chennai

6) Bhubaneshwar

7) Ahmedabad

8) New Jalpaigudi

9) Jabalpur

10) Kolkata

11) Danapur

9 Source: elcos.railnet.gov.in

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Each of these Railway Electrification (RE) Project offices is headed by a Chief Project Director

(CPD). These units are in the process of electrifying important Railway routes for harnessing

maximum benefits from their traffic potential. As of now about 65.4% of freight and 51.2% of

passenger traffic is hauled by electric traction on Indian Railways.

During the first three years of 12th Five Year Plan (2012-17), 5,772 Route Kilometer (RKM) of

Railway Track has been electrified against a total target of 6500 RKM. As on 31.03.2016, total

electrified RKM stood at 27,999. During the financial year 2015-16, 1,190 RKM was electrified

by CORE.

Presently, 84 works are being handled by the Project Offices of CORE. The budget for

electrification is approved by Railway Board. The assets on commissioning are transferred to

respective Railway(s) through TWFA. The budget is bifurcated to various works in progress

by CORE. The payments of material are made by the Head Quarters office. CORE does not

have its own depots at the project sites. There is no accounting of material at site. The

reconciliation of materials with the contractor is carried out at the closure of the project.

7.3 Accounting at CORE Head Office

The CORE head office is a separate accounting unit which prepares a separate account

current. All expenditure done by CORE is classified as capital expenditure, i.e., demand 16

and shown under ‘Plan head 3500 – Electrification’. Following source of funds are used to

create the electrification assets:

a. Capital (Loan Capital);

b. Development Fund (DF); and

c. Depreciation Reserve Fund (DRF).

Apart from Railway resources mentioned above, these projects are also being financed from

‘Extra Budgetary Resource (EBR)’ categorized into following two parts:

i. EBR (IF); and

ii. EBR (PPP).

Procurement relating to non-stock items for electrification like Copper, (catenary wire,

contact wire), transformers, etc. is done by CORE, Head Office. However, supply of material

is directly made by supplier at the Project office. Payment is also processed from the Project

office. However, in some cases payment is done by CORE and debit is raised on project

offices concerned.

Accounting Entries

Following accounting entries are passed in CORE, Head Office;

i. Receipt of Tender Fees: Primarily, receipt at CORE includes only tender fees and EMDs.

Tender is invited for procurement of material, service contracts, etc. Any tender fee

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received is treated on Capital Account and shown in Block Account. Following

accounting entry is passed to record the transaction in books:

Note: As per instruction prescribed in F-2 for Demand 16 - Miscellaneous receipts, such as

the sale proceeds of tenders on the construction organisations, whether attached to open

lines or not, forfeited earnest money, security deposits, and penalties recovered from

contractors should be credited to this head.

ii. Receipt of EMD: EMDs are received from contractors and suppliers at the time of

inviting tenders. Following accounting entry is passed to record the transaction in books

of account:

iii. Refund of EMD: EMD of unsuccessful bidders is refunded and EMD of successful

bidders is converted into security deposit. Following accounting entry is passed to


It may be mentioned that no accounting entry is passed upon conversion of EMD into

Security Deposit.

iv. Procurement of Stores: Purchase of major items is done by CORE itself. Following

accounting entry is passed to record the transaction:

It may be noted that accounting head relevant to stores, i.e., 7100 is not operated by

CORE. Any material purchased is directly debited to respective project office. A capital

suspense should be maintained to record material booked to project till its actual

consumption and any material upon receipt is directly charged to respective plan

head by Project Office.

Remittance into Bank DR XXX

To Misc. Receipt on Capital Account CR XXX


To Accounting head for EMD (Deposit Misc) CR XXX

To Accounting head for EMD (Deposit Misc) DR XXX


Project Office Concerned DR XXX


Draft


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v. Upon encashment of Remittance into Bank (RIB): Every month, cheque clearance

report is received from RBI and following accounting entry is passed:

7.4 CORE Project Office

ICAI ARF Nodal Team undertook a field visit to one of the project offices (Lucknow) to

understand the accounting practices currently being followed. The main features of a CORE

Project Office are as under:

Project office is basically an administration office.

It is opened where any electrification work is being executed.

Project office is considered as an accounting unit and separate account current is

prepared at each project office. Block account is also prepared at Project office.

Salary of administration department is not charged to all projects. It is allocated on the

basis of guidelines as received from Railway Board from time to time.

There are various electrification projects under a project office and project wise work

register is maintained.

Each electrification project is denoted by 3 digit numeric group code for identification

purpose. For example, UTR-MGS (Utretia to Mughal Sarai – Up line)) is denoted by

Group code 136 and Mugal Sarai to Ulretia (Down Line) will be denoted by group code

137.

Following accounting entries are passed in CORE, Project Office;

i. Receipt of Tender Fees: Primarily, receipt at Project Office includes only tender fees and

EMDs. Tender is invited for work contracts for execution of electrification work. Any

tender fee received is accounted as receipt on Capital Account. Following accounting

entry is passed to record the transaction in books:

ii. Receipt of EMD: EMDs are received from contractors and suppliers at the time of

inviting tenders. Following accounting entry is passed to record the transaction in books

of account:

Remittance into Bank -DR XXX

To Deposit with Reserve Bank DR XXX


To Misc. Receipt on Capital Account CR XXX


To Accounting head for EMD (Deposit Misc) CR XXX

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iii. Refund of EMD: EMD of unsuccessful bidders is refunded and EMD of successful

bidders is converted into security deposit. Following accounting entry is passed to


It may be mentioned that no accounting entry is passed upon conversion of EMD into

Security Deposit.

iv. Procurement of Stores: Purchase of major items is done by CORE itself. CORE raises

debit to the concerned project office. Following accounting entry is passed in the books

of project office to record the transaction:

It may be noted that accounting head relevant to stores, i.e., 7100 is not operated at

Project office. All material is directly charged to respective plan head. A capital

suspense should be maintained to record material booked to project till its actual

consumption.

v. Upon clearance of Remittance into Bank (RIB): Every month RIB balance is cleared in

the books of project office by passing following accounting entry:

vi. Upon clearance of Cheques and Bills Balance: Every month Cheques and Bills balance

is cleared in the books of project office by passing following accounting entry:

7.5 Compilation of Fixed Assets Register (FAR) – Electrification

The Fixed Assets of an electrified section/route are Overhead Equipment (OHE) in Railway

parlance. These fixed assets can be classified into following broad heads:

a) Mast/Portal

b) Catenary & Contact Wire

c) Transformers

d) Supervisory Control and Data Acquisition system(SCADA)

To Accounting head for EMD (Deposit Misc) DR XXX


CORE Allahabad -DR XXX

To Accounting head for Electrification DR XXX

Remittance into Bank -DR XXX

To CORE Allahabad DR XXX

Cheques and Bills -CR XXX

To CORE Allahabad CR XXX

Indian Railways


e) Others

Further, the major elements

following parts:

During the pilot study on

(NWR), ICAI ARF prepared

Railway the formats of assets

this exercise was carried

Allahabad. Based on the interaction

into 4 parts for the purpose

depreciation thereon.

Based upon categorization

formats to capture the data

the same. Following formats

40%

20%

Conductors/wire

Draft

n Railways - Comprehensive Scope Evaluation Report

2017


elements of cost of electrification can be categorized

on introduction of accrual accounting at North

prepared the Fixed Asset Register. However, NWR

assets pertaining to an electrified Railway were

out by the ICAI ARF Nodal Team during

interaction with CORE officials, electrification

purpose of capturing information for compiling

categorization as described above, ICAI ARF Nodal Team

data of electrification assets and compilation of fixed

formats have been developed:

40%

Electrification Cost

Copper Wire and Transformers

Execution Cost

Other Cost

Electrification

Tranformers Mast and Portals


categorized into

North Western Railway

being a non-electrified

not prepared. As such

during its visit to CORE,

fication assets are classified

compiling FAR and computing

eam developed the FAR

fixed assets register for

Copper Wire and Transformers

Execution Cost

Other Equipment's

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a. FA-18A (Conductors/Wires)

b. FA-18B ( Transformers)

c. FA-18C (Mast and Portals)

d. FA-18D (Other Equipment’s)

It may be noted that these formats are under discussion with IR and may undergo a change.

a. Details of Conductors/Wires (FA-18A) -Conductors/wire constitute a major cost

component in electrification. Details of all wires will be collected in this format. It

includes contact wire, catenary wire or any other wire used in the process of

electrification.

b. Details of Transformers (FA-18B) -Cost of transformer is also a major cost in

electrification. Transformer may be categorized into several types based upon their

capacity and loads. For instance, 5 MW, 10 MW, etc.

c. Structure of Mast and Portals (FA-18C) - Details of all structures like mast and portals

will be covered here.

d. Other Equipment’s (FA-18D) - Details of all other electrification assets like Circuit

breaker, control panel equipment, etc., will be captured in this format.

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Indian Railways

Details of Conductors (Wire)

Form:- FA-18A

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f C

on

du

cto

rs

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Chainage (in

KMs)

Len

gth

of

Cab

le

Dat

e o

f a

cqu

isit

ion

/

inst

alla

tio

n

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er

cod

al p

rov

isio

ns

No

of

yea

r as

sets

is

in u

se

Rat

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f d

epre

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ion

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um

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ted

dep

reci

atio

n t

ill

31.0

3.20

15

Net

bo

ok

val

ue

as o

n

31.0

3.20

15 (

Rs.

)

Rem

ark

s

Fro

m

To

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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Indian Railways

Details of Transformer

Form:- FA-18B

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f T

ran

sfo

rmer

Cap

acit

y o

f T

ran

sfo

rmer

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

No

. of

un

its

Co

st p

er U

nit

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al p

rov

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ns

No

of

yea

r as

sets

is

in u

se

Rat

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epre

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ion

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um

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ted

dep

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n t

ill

31.0

3.20

15

Net

bo

ok

val

ue

as

on

31.

03.2

015

(R

s.)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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Indian Railways

Details of Mast/Portal Structure

Form:- FA-18C

S.N

o.

Sto

ck H

old

er

De

scri

pti

on

of

Mas

t/P

ort

al S

tru

ctu

re

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Da

te o

f C

on

stru

ctio

n/i

nst

alla

tio

n

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al

pro

vis

ion

s

No

of

yea

r a

sset

s is

in

use

Rat

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f d

epre

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ion

Acc

um

ula

ted

dep

reci

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n t

ill

31.0

3.20

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Net

bo

ok

val

ue

as o

n 3

1.03

.201

5 (R

s.)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 5 6 7 10 11 12 13 14 15 16 17 18 19 20

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Indian Railways

Details of Other Equipment’s (OHE)

Form:- FA-18D

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f O

ther

Eq

uip

men

ts

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Dat

e o

f A

cqu

isit

ion

/in

stal

lati

on

No

. of

un

its

Co

st p

er U

nit

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al

pro

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ion

s

No

of

yea

r as

sets

is

in u

se

Rat

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f d

epre

ciat

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dep

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atio

n t

ill

31.0

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t b

oo

k v

alu

e as

on

31.

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(Rs.

)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

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7.6 Observations

a. TWFA of Assets: Major electrification work is done by CORE. Upon completion of

the project, the assets should be transferred to respective Zonal Railways through

TWFA. However, it is observed that TWFA of many completed projects is not done

by CORE to respective Railways and these assets are still lying in the Block

account of CORE.

It is recommended that transfer of assets should be done by CORE upon

completion of assets. If assets are not shown in the FAR of Zonal Railway

concerned, its financial statement won’t reflect true position of assets held by

them.

b. Work Done by RVNL: Some of the works relating to electrification is done by

RVNL. Railway Board makes payment to RVNL directly for this work and sends

debit to CORE and CORE books this amount under respective plan head at the time

of receiving debit. It is observed that there is no linkage between the debit received

and actual work done by RVNL.

However, upon completion of assets it should be transferred to plan head

concerned. Further, completed work should be transferred to Zonal Railways

concerned.

c. Assets Created from EBR: Presently, some of the electrification projects are funded

through EBR (Extra Budgetary Resource). It is observed that all amount as received

through EBR is kept in Deposit and upon utilization of fund, same account head is

debited so the amount spent on electrification work from EBR is not reflected in

Block Account.

It is recommended to show assets created from EBR, on the asset side of the

Balance Sheet of teh respective Zonal Railway and accordingly, corresponding

liability is also required to be created on the liability side.

d. No Stores Depots: It is observed that material procured is directly delivered to the

project site. There is no store depot either in CORE or CORE project office. There is

no linkage between supply of material and timely utilisation of material. For

instance, procurement of material is done by CORE but execution contracts are

finalized by project office. In some cases material is procured much before

finalization of works contract for execution of work.

There should be co-ordination between procurement of material and execution of

work. A capital suspense should be maintained to record material booked to

project till its actual consumption.

e. Debit for Electricity: OHE and Electricity of one Zonal Railway is used by another

Zonal Railway and no accounting transaction takes place in this regard, i.e., no

debit/credit is raised for such usage.

As operating ratio is calculated at Zonal Railway unless all the expenses/incomes

are accounted for, true profitability of a Zonal Railway cannot be determined.

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f. Fixed Assets Register: ICAI-ARF undertook a field visit to one of the Traction Sub

Stations (TSS). It is observed that no Fixed Assets Register is maintained for OHE.

However, quantitative details of equipment exist at TSS but the same is not updated

for last many years. Further, no record is maintained at TSS for the equipment

which was present in the Control Panel room. All assets in control panel are

maintained by remote wing section of the Division.

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8 Understanding of Research Designs & Standards

Organisation (RDSO)

8.1 History

Indian Railway Conference Association (IRCA) was set up in 1903 to enforce

standardization and co-ordination amongst various railway systems, followed by the

Central Standards Office (CSO) in 1930, for preparation of designs, standards and

specifications. However, till independence, most of the designs and manufacture of

railway equipment was entrusted to foreign consultants. With Independence and the

resultant phenomenal increase in country's industrial and economic activity the demand

for rail transportation increased. Therefore a new organization called Railway Testing

and Research Centre (RTRC) was setup in 1952 at Lucknow, for testing and conducting

applied research for development of railway rolling stock, permanent way etc.

Central Standards Office (CSO) and the Railway Testing and Research Centre (RTRC)

were integrated into a single unit named Research Designs and Standards Organisation

(RDSO) in 1957, under Ministry of Railways at Lucknow.

8.2 Organisation Structure

RDSO is headed by a Director General. The Director General is assisted by Additional

Director General, Sr. Executive Directors and Executive Directors, heading various

directorates.

The Organisation Structure of Finance and Accounts Directorate of RDSO is given

below:

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Executive Director

Finance

Dy. Director

Director Finance

Accounts Officer -

I

Accounts Officer -

II

SSO/INSP

SSO/EFFY

SSO/EGA

SSO/Pension

SSO/WR

SSO/ENG

SSO/BOOKS

SSO/Stores

SSO/EXPEND

SSO/PF

SSO/ADMN

SSO/CATS

Joint Director Finance

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8.3 Accounting at RDSO

ICAI ARF Nodal Team undertook a field visit to understand the accounting system

currently being followed at RDSO. RDSO is a separate accounting unit and prepares its

Account Current and Block Account which is then merged with the accounts of

Northern Railway. IPAS is implemented in RDSO.

i. Expenditure: Expenditure of RDSO consisting of both expenditures, i.e., revenue as

well as capital. All the revenue expenditure of RDSO booked to Demand 2 while

capital expenditure is booked to Demand 16.

Further, RDSO operates Demand payable in the Month of March for the recording

of Salary only. This should include all unpaid liabilities.

ii. Income: RDSO also provides consultancy services like testing charges, inspection

charges, drawing charges, etc., and earns revenue. All income of RDSO is booked in

Abstract Z.

iii. Fixed Assets: RDSO is involved in research and design activities. It is observed that

no fixed assets register is maintained by RDSO for its assets.

Indian Railways


9 Understanding

9.1 Introduction10

The suburban section of

city's business centre to Virar

per day by the Indian Railways,

Suburban section alone. We

'Train Management System'

information of train movement

9.2 Understanding of

Suburban rail plays a major

cities. Suburban rail is defined

suburbs, a conurbation or

basis. In other words, suburban

Centres to the urban conglomerates

9.3 Financial Overview

There is no budgetary segregation

Grant-wise and sub-head

Services is not being separately

expenditure incurred is

exhibit depicts the financial

07 to 2011-12:

10Source: www.wr.indianrailways.gov.in11Source: Report of Standing Committee on Railways

2006-07 2007-08 2008

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Understanding of Sub-Urban

Western Railway in Mumbai extends from

Virar to Dahanu Road .Today, of the 14 million

Railways, more than 6 million people travel per

Western Railway is a pioneer in implementing

System' (TMS) over its suburban section

movement to commuters.

of Sub Urban Train System11

major role in the public transport system of many

defined as a rail service between a central business

or other locations that draw large numbers of

suburban train services are the vital link which connects

conglomerates”.

Overview of Sub Urban Segment of Indian Railways

segregation for suburban services separately. Budget

head-wise only. Expenditure incurred for running

separately maintained in the books of account

joint cost shared with all types of train services.

financial performance of Western Railways sub urban

Source: www.wr.indianrailways.gov.in

eport of Standing Committee on Railways

-200

-100

0

100

200

300

400

500

600

700

800

2008-09 2009-10 2010-11 2011-12


Urban Operations

from Churchgate, the

million people travelling

per day on Mumbai

implementing the state of art

giving real time

many of India’s major

business district and its

of people on a daily

connects Suburban

Railways

Budget is allocated

running Suburban

account since most of the

services. Following

urban from FY 2006-

Expenses (in Cr.)

Earning

Loss/Profit

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9.4 Important features of Mumbai Suburban System:

The system recognizes the following classes of travel: First class and Second class.

Quarterly and Monthly season tickets can be booked through Internet.

The trains on Mumbai Suburban run round the clock except from 1:00 a.m. to 4:00

a.m.

Users are allowed, in certain specific cases, to book tickets from different source

stations to different destination stations. A maximum of three different source

stations and three different destination stations can be opted at a time as notified by

Railways.

There are special coaches for women in both first and second classes.

Tickets booked on internet are delivered to the customer at his desired address

through courier. This delivery of Season Tickets through courier is limited to postal

addresses covered by the specified pin codes.

As per Ministry of Railways, 0.5% discount in base fare of season tickets shall be

granted in case of digital payment w.e.f. 01-Jan-2017.

Mumbai Suburban trains recover around 36% of its cost from passengers.

9.5 Accounting for Sub urban

ICAI ARF Team visited Western Railway Headquarters at Mumbai for understanding

the accounting system of Sub-Urban. It was explained that there is no separate

accountal of sub urban train operations. All the revenue from Sub Urban traffic is

accounted for at TAO of Western Railway. As far as expenditure is concerned, it is

accounted for in Mumbai Division of Western Railway. Following are two source of

funding for creating Sub Urban assets:

i. State Government (50%); and

ii. Ministry of Railways (50%).

Further, overhauling of rolling stock or coaches of sub urban is done by Mahalaxmi Car

Shed. Generally, an EMU carriage requires periodical overhauling (POH) after 18

months and as per guidelines issued by Railway Board POH should be completed

within 18 days from the date of receiving of carriage for POH. Procurement of material

is done in following two parts:

a. Stock Items: Stock items are directly purchased by Mahalaxmi Car Shed.

b. Non-stock: Request for non-stock item is sent to main Stores Depot.

Stock items issued by car shed are deemed to be consumed because no record of actual

consumption is kept.

It is suggested that proper record should be maintained for inward and outward stores

to assess the true financial performance.

Stock items are directly procured by workshop and for non-stock items indent is sent to

COS (Controller of Stores) or HQ. Items of Total value of Rs. 5000 can be directly

purchased by consignee itself.

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It may be noted that creation of sub urban infrastructure comes under the Metropolitan

Transport Project (MTP) and ownership of all the assets vest with Indian Railways

only. Further, a surcharge is levied on the sub urban fare which is remitted to Ministry

of Finance and State Government in equal ratio.

9.6 Observations

a. TWFA of Sub Urban Assets: Presently, sub urban infrastructure is developed by

Central Railway with the help of Mumbai Rail Vikas Corporation (MRVC). As per

the budget provision made, Ministry of Railways sanctions funds to Central

Railway for sub urban infrastructure development. This also includes amount

sanctioned for Western Railway as well. It is observed that all the sub urban assets

as created by Central Railway for the Western Railway are still being reflected in

the Block account of Central Railway. Therefore, Block accounts of both Western

Railway as well as Central Railway are not reflecting true and fair view of assets

held by them.

Assets relating to WR should be transferred to WR through TWFA at the earliest

for true and fair financial statements

b. Apportionment of Expenditure: In Mumbai, sub urban traffic is carried by Western

Railway and Central Railway. Apportionment of revenue between both railways is

done by RITES based on distance master. However, it is observed that WR is using

sub urban infrastructure of CR and vice versa but no apportionment of expenditure

is done for this usage. Further, it is also observed that non sub urban trains also use

sub urban infrastructure and vice-versa and this is also not accounted for.

9.7 Costing of Sub Urban Operations

As stated earlier that there is no separate accounting of sub urban operations. However,

each year, WR is computing cost of sub urban operation for managerial information. It

is also pertinent to note that there is no relation between this cost computation and

fixation of sub urban fair tariff. Presently, cost of Sub Urban operations is calculated by

following two costing methods:

a. Conventional Method: In the conventional method, computation of cost for sub

urban operations is done as per the guidelines and formulae prescribed in Annual

Statistical Statements – II. Following table shows the cost calculation as per

conventional method:

PARTICULARS (Figures in Rupees)

%

Variation

Previous Year Current Year

I. Working Expenses 2014-15 2015-16

ABSTRACTS

A General Superintendence And

Services 351,193,147 342,807,053 -2.39

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B Repairs And Maintenance Of

Permanent Way 519,981,736 554,771,822 6.69

D Repairs And Maintenance Of

Carriages And Wagons 1,519,188,864 1,679,911,161 10.58

E Repairs And Maintenance Of Plant &

Machinery 520,448,276 506,702,596 -2.64

F Operating Expenses-Rolling Stock &

Equipment 630,997,626 688,618,151 9.13

G Operating Expenses-Traffic 1,676,607,547 1,717,114,069 2.42

H Operating Expenses-Fuel 2,162,608,372 2,275,531,706 5.22

J Staff Welfare & Amenities 535,742,173 543,980,576 1.54

K Miscellaneous Working Expenses 585,654,643 492,116,024 -15.97

L Provident Fund, Pension & Other

Retirement Benefits 67,108,568 89,912,072 33.98

M-200 Appropriation To Pension Fund 2,082,684,520 2,505,948,246 20.32

Total Working Expenses 10,652,215,472 11,397,413,476 6.99

M-100 Depreciation 399,900,550 310,393,475 -22.38

Total Working Expenses with Depreciation 11,052,116,022 11,707,806,951 5.93

Interest 277,184,353 276,080,889 -0.40

Total Expenses 11,329,300,375 11,983,887,840 5.78

II. Earnings (As per Form IV) 7,924,857,833 7,943,843,405 0.24

III. Loss/Gain (Earnings-Total Expenses) -3,404,442,542 -4,040,044,435 -18.670

IV. Percentage of expenses to earnings excl.

Interest (Operating Ratio) 139.46 147.38

b. Sivakumaran Committee method: This method is similar to the conventional

method except the calculation of depreciation. This method emphasizes that as sub

urban sections have high density traffic of comparison to non-sub urban sections,

depreciation computation for sub urban section should also be different from non-sub

urban section. This methodology adopts different useful life for computation of

depreciation on sub urban infrastructure. Following chart depicts the summary of

expenditure as calculated for the costing purpose:

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9.8 Fixed Assets Register-Sub Urban

No fixed assets register is maintained for the assets of Sub Urban sytems. As far as sub

urban infrastructure assets are concerned, detail of track is available in Track

Management system (TMS). It is to be noted that track composition of Sub Urban

sections is different from the non-sub urban sections as there are more turnouts in sub

urban sections in comparison to normal track sections. So computation of depreciation

on sub urban track is a point of discussion.

General Superintendence

And Services3%

Repairs And Maintenance Of Permanent

Way5%

Repairs And Maintenance Of

Carriages And Wagons

14% Repairs And Maintenance Of

Plant & Machinery

4%

Operating Expenses-Rolling

Stock & Equipment6%

Operating Expenses-Traffic

14%Operating

Expenses-Fuel19%

Staff Welfare & Amenities

4%

Miscellaneous Working Expenses

4%

Provident Fund, Pension &

Other Retirement

Benefits1%

Appropriation To Pension Fund

21%

Depreciation 3%

Interest2%

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10 Kolkata Metro

10.1 History

Kolkata Metro is the First Metro Rail transport system in India. It started in 1984 its

commercial services to the commuters of Kolkata. Kolkata became the 17th Zone of IR

(IR).

10.2 Organizational structure:

Indian Railways


10.3 Accounting at Kolkata

ICAI ARF team undertook a

accounting system currently

of Kolkata Metro is as under

Kolkata metro prepares

The entire infrastructure

Railway and vice versa;

required.

Kolkata Metro receives fund

All the accounting is done

(AFRES). However, w.e.f.

accounting. Various Departments

Accountal of Earnings: Earning

(i) Passenger Earnings: Earning

Token and Smart card comes

(ii) Received through Point of Sale (

(iii) Station earnings: This earning

tickets (PCT) etc.

(iv) Sundry earnings: All other

earning and reflected in

scrap, building rent, etc.

Recording of Earnings in Books

Stations earnings are collected

which includes cash amount

12 Source: www.mtp.indianrailways.gov.in

Accounts

StoresDraft


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Kolkata Metro

field study of Kolkata Metro for getting an understandi

being followed. The understanding of ICAI-

nder:

separate Block accounts for its assets;

infrastructure as developed by Kolkata Metro is not used

versa; therefore, no apportionment of earning

fund from Railway Board for creating infrastructure

done on Advance Finance Railway Earnings &

w.e.f. 1st April 2017, IPAS is in place and

Departments12 under Kolkata Metro areas under:

Earning of Kolkata Metro comprises the following

Earnings received at the counter: Earnings received

comes under this head.

Point of Sale (POS); and

earning includes amount collected from penalty,

other earnings except passenger earning is considered

in abstract ‘Z’. It includes advertisement fee,

etc.

Books

collected by Station Master. Thereafter, a Cash Receipt

amount as well as voucher amount, if any. The earnings

Source: www.mtp.indianrailways.gov.in

Electrical Engineering

Personnel Medical

Vigilance Rajbhasha


understanding of the

-ARF team in respect

used by any other Zonal

and expenditure is

infrastructure.

& Expenditure system

and same is used for

under:

following:

received from sale of

penalty, Printed card

considered as sundry

fee, Kiosk Rent, sale of

Receipt (CR) is prepared

earnings are deposited

Signal & Telecom

Traffic

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into the designated Bank for which Treasury Remittance (TR) is prepared. Thereafter, both

CR & TR Notes are sent to Cash & Pay office. The Cash & Pay office acknowledges it and

sends to TAO. TAO reconciles it and after acceptance, advice is generated by TAO and sent

to Books section, thereafter Books section pass necessary JV, which is as under:

Rolling Stock:

In Kolkata Metro, holding of Rolling Stock is with Noapara Workshop. For procurement of

Rolling Stock, requisition is sent by Electrical department to Railway Board (RB) and RB

procures Rolling Stock on behalf of Kolkata Metro and Debit is sent to it by RB. Rakes for

Metro are manufactured in Integrated Coach Factory (ICF), Chennai. Technology of BHEL

and New Government Electrical Factory (NGEF) is also used by ICF for manufacturing of

rakes. Currently, new rakes are imported from China which are assembled at ICF, Chennai.

No Rolling Stock is taken from IRFC on lease by Kolkata Metro.

Periodic Overhauling (POH) of rakes is also done by Noapara Workshop; POH of a rake is

due after running of 300000 Kms. or completion of 5 years, whichever is earlier and this POH

should be completed within 1.5 to 2 months from receipt of rake in workshop.

Track

Kolkata Metro has 24 Kms. of specified track which is not used by other Zonal Railways. The

entire track is embedded track, i.e., Ballast and Sleepers are not used for laying track.

However, concrete base is used to fix the Track. However, in yards, normal track is laid by

using Rails, Ballast and Sleepers.

Engineering department is responsible for maintenance of Track. Presently, track record is

maintained manually. However, Track Management System (TMS) is in implementation

stage.


Traffic Suspense Remittance DR XXX

To Passenger earnings CR XXX

To Sundry earnings CR XXX

To Penalty CR XXX

To Diet Charges CR XXX

To Deposit Misc. suspense CR XXX

To Service Tax CR XXX

To Swachh Bharat Cess CR XXX

To Krishi Kalyan Cess CR XXX

To Release payment of

smart card from deposit

suspense

-

CR

XXX

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Stores Accounting

Stores: Stores can be classified in two categories as follows:

(i) Stock Items -These are low value items which are used frequently. Requisition of these

items comes annually from Depot and on the basis of this, procurement is done by Controller

of Stores (COS) by following the laid down procedure.

(ii) Non-Stock Items -These are items which are not used frequently and have more value

than Stock items. Requisition of these items is received from units as and when they are

required. Procurement is done by COS based on the requisition by following the laid down

procedure.

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11 Understanding of Chennai Metropolitan Transport Project

Chennai Metropolitan Transport Project (herein after called Chennai MTP) is primarily

involved in developing infrastructure for sub urban operations. Chennai Suburban Railway

is a commuter rail system in the city of Chennai (Madras), operated by Southern Railway.

11.1 Accounting system of Chennai MTP

ICAI ARF team undertook a field visit to Chennai MTP for understanding its accounting

system. During the field visit it is observed that Chennai MTP office has developed the

infrastructure which is used by Chennai Division part of southern Railway. All the repair

and maintenance is also done by Chennai Division itself. Further, revenue is also accounted

for in Southern Railway.

Chennai MTP is a separate accounting unit. Separate account current and Block account is

prepared by Chennai MTP. All the expenditure of Chennai MTP consists of capital

expenditure only i.e., Demand 16. As far as revenue is concerned, no revenue is booked in

Chennai MTP.

11.2 Observations

a. TWFA of Sub Urban Assets: Presently, sub urban infrastructure is developed by

Chennai MTP . As per the budget provision made, Ministry of Railways sanctions funds

to Chennai MTP. It is observed that all the assets/Infrastructure created by Chennai

MTP. All such infrastructure is used by Chennai Division. Repair and maintenance is

also done by Chennai Division. However, this entire infrastructure is being reflected in

Block Account of Chennai MTP. No asset is transferred to Chennai Division through

TWFA. Therefore, Block accounts of both Southern Railway as well as MTP Chennai

do not reflect the true and fair view of assets held by them.

All completed projects relating to SR should be transferred to SR through TWFA at the

earliest for a true and fair reflection in the financial statements.

b. Assets Created from EBR: Presently, some of portion of project cost as owned by

Chennai MTP is met from EBR (Extra Budgetary Resource). It is observed that all

amount received through EBR is kept in Deposit and upon utilization of fund same

account head is debited. Amount spent on any work from EBR is not reflected in Block

Account.

It is recommended to show assets created from EBR also in the Balance Sheet and Asset

Register creating a corresponding liability.

c. Fixed Assets Register: It is observed that no Fixed Assets Register is maintained by

Chennai MTP as the assets are held by Chennai Division. Although same are being

reflected in Block account of Chennai MTP because of non-drawl of completion report.

All completed projects relating to SR should be transferred to SR through TWFA at the

earliest for true and fair reflection in the financial statements.

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12 Understanding of Existing Software13

12.1 Introduction: Computerisation of Accounting Activity over Indian Railways

ICAI ARF Nodal Team discussed and studied the level of computerisation over Indian

Railways, more specific to application related to recording of financial Transactions,

generation of Financial Statements, Statistical Statements, and other MIS compilations at

Zonal and Indian Railway Level.

Initially, applications developed internally named AFRES (Advanced Finance Revenue

Expenditure System) to cover the whole gamut of Accounts processing of Revenue,

Expenditure and Establishment (Pay Roll etc.) and PRIME (Pay Roll & Related Independent

Modules) were implemented by all Zonal Railways in standalone approach. In the process,

every Railway unit made changes in the basic application software, defeating the objective

of uniform standard application across the Zones.

Therefore, it was decided to develop and implement a web based application, namely,

Integrated Pay Roll and accounting System (IPAS) through centralised AIMS portal. This

application is designed and developed by CRIS. The application is running on a centralized

platform and ensuring that entire Indian Railways follow similar processes without any

local changes. This has given IR, capability of faster, centralised changes and management

and automation of change processes. Its pan India implementation will enable IR to have

real time access to financial transaction data and help in more accurate financial and fiscal

discipline.

The software is presently being used by all the zones of Indian Railway, and its

implementation over production units is under process. This software is mainly for

handling Pay Roll Generation and keeping the record of payments, adjustment between

Railways/ Units of Railways.

IPAS is broadly divided in two groups i.e. personnel modules and financial modules.

Personnel modules includes like payroll processing, leave, loan, TA, Income tax, electricity,

quarter, etc. Financial Modules includes IC, books, PF, pension, budget, suspense etc. In

IPAS, Personnel modules and financial modules are tightly coupled so that data generated

by module can be accessed through other modules.

13 Based on understanding as gained during pilot study carried out at Ajmer Division and Ajmer Workshop

Indian Railways


12.2 Functional Module of IPAS

Human Resources in IPAS

Objective of Human Resource modules is to maintain Employee Information

job related. It covers:

Change Data viz. allowances and recoveries, Leave, Loans and Advances, Quarters,

Electricity

Career events viz. Increments, Promotions, Transfer and Pay change),

Salary Process,

Generation of other salary related reports and

Settlement

Finance modules in IPAS

Internal Check module –

Passing, CO7 generation, abstract preparation and release ofd payment through Bank /

cheque.

Books – Generation of Account current, Schedules, Revenue Allocation Re

and other related reports

Provident Fund (PF) – to keep the record of employees’ PF deductions/ contributions,

withdrawals, interest on balances and generation of credit/ debit check sheet, monthly

and annual reconciliation and generation of

Human Resource

Leave

Settlement

Employee Profile

Service Record

Travelling Allowance

Loans & Advances

Payroll

Seniority

Cadre

Quarters & Electricity

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Functional Module of IPAS

Objective of Human Resource modules is to maintain Employee Information

Data viz. allowances and recoveries, Leave, Loans and Advances, Quarters,


Generation of other salary related reports and

– All bill passing activity viz. Registration(CO6), Auditing, Bill


Generation of Account current, Schedules, Revenue Allocation Re

and other related reports

to keep the record of employees’ PF deductions/ contributions,


and annual reconciliation and generation of reports thereof.

Human Resource

Leave

Settlement

Employee Profile

Service Record

Travelling Allowance

Loans & Advances

Payroll

Seniority

Cadre

Quarters & Electricity

Finance

Cash & Pay

Internal Check

Books

Budget

Suspense

Pension

Provident Fund

NPS

E-Suspense

Traffic

Incentive

Store Accounts


Objective of Human Resource modules is to maintain Employee Information - personal and

Data viz. allowances and recoveries, Leave, Loans and Advances, Quarters,


All bill passing activity viz. Registration(CO6), Auditing, Bill


Generation of Account current, Schedules, Revenue Allocation Register(RAR)

to keep the record of employees’ PF deductions/ contributions,


Finance

Cash & Pay

Internal Check

Books

Budget

Suspense

Pension

Provident Fund

NPS

Suspense

Traffic

Incentive

Store Accounts

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New Pension System (NPS) – to keep the record of employees/ government

contributions under NPS, transfer to NSDL, generation of MIS, co-ordination with

NSDL etc.

Pension – leading from Settlement module all PPOs are being generated / printed here.

The e-PPOs generated from IPAS are transmitted to CPPCs of various banks.

Store Accounts – Keeping the transactional record regarding Fuel Accounting, Purchase

suspense and Deposit Stores.

Incentive – To provide the incentive calculation and pushing the data to payroll

module.

12.3 Integrated Material Management System (i-MMIS)

Initially Materials Management Information System (MMIS) was developed at Central

Railway in 1998 for COS office, Stores, Accounts office and five major depots of the Central

Railway. MMIS is used for Stores Accounting, i.e., purchase, issuance of material, raising of

Purchase order (PO), generation of Electronic Requirement Mandate (ERM), Receipt Order

(RO), Issue Note, etc. There are various types of reports that can be generated in MMIS like

details of slow moving inventory, Quantities available as on date, pending PO, etc. The

system has undergone several customizations and is implemented at most of the Stores

Depots; Divisions & Stores finance branches all over Indian Railways.

Now, with the need of the hour, the present decentralized MMIS running on individual

server in Zonal Railways is being integrated at CRIS (Centre for Railway Information

Systems), New Delhi with the i-MMIS (Integrated Material Management System) web based

application on central servers. In the first phase, Local purchase module of iMMIS has been

rolled out for implementation in all depots and divisions of stores department of Zonal

Railways, both for Stock & Non-Stock items. This application is being used by all Indian

railways for finalising their tenders online. This application is catering depot transaction

(Issue/ Receipt) of all the Indian Railways. Once this application is fully implemented and

integrated with IPAS it will take care of all the payments and suspense head operated in

Stores Accounts.

12.4 Indian Railway E Procurements System (IREPS)-

IREPS is an application developed and hosted by CRIS. It takes care of all the procurements

/ Auctions electronically. This is a web based application provides one point solution from

vender Registration, e-tendering i.e. issue of tender, submission of tender, finalisation of

tender ( i.e. Tender Committee Minutes/ Acceptance of TC Minutes) , and purchase order

as it is being issued form IMMIS which is having interface with this application and

providing basic data.

This application also provides full solution for e-Auction from registration of vender to

finalisation of Auction.

http://www.cr.indianrailways.gov.in/




http://www.indianrailways.gov.in/

http://cris.org.in/

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12.5 Advanced Railway Pension Access Network (ARPAN)

ARPAN is an URL based web portal which can be accessed from any machine anywhere.

This application was developed by Western Railway in association of a third party

developer, to computerise generation of PPOs and reconciliation of Pension debits received

from different payment authorities to Railway Pensioners. This application was being used

to issue e-PPOs by all railways.

After implementation of IPAS on all zones, Railway Board has decided that all new PPOs

will be generated through IPAS, as this is the basic database of employees on the date of

retirement. However, the PPO data shall be ported to ARPAN for reconciliation and

revisions. Accordingly the legacy data of pensioners including the data of fresh pensioners

settled through IPAS is being ported to ARPAN. The revision of pension cases from 6th CPC

to 7th CPC and reconciliation of Pension debits with the bank scroll will be handled through

this application.

12.6 E-Reconciliation Portal

E-Recon is a web based portal for reconciling transfer transactions across Indian Railways.

The portal offers users of units across Indian Railways to send and receive transfer

certificates, make journal vouchers and use the transactions of e-Recon to settle their

accounts. e-Recon works on the basis of selected entries of two allocations viz., Transfer

Divisional (008782) and Transfer Railways (008797) from Cash Book generated from IPAS.

The system also offers various reports in the form of TC and JV registers. TC and JV reports,

monthly listing of TCs, Reconciliation/ Final Reconciliation reports etc. These can be used to

match the transactions and reconcile accounts. The system also offers certain monitoring

tools so that the units and users can keep pace with what has come in what has gone out.

The monitoring reports are TC-JV waiting for action report, Account reconciliation

statement and TC register. These can be used to track TCs and JVs and see where they are

lying.

e-Recon does not cater to Transfer Capital and Transfer Revenue. It is understood that there

are no financial trigger for these transactions and hence cannot be part of e-Recon.

12.7 VPN – ONLINE Budgeting System

The budgeting system over Indian Railways was computerised long back, wherein all the

budgeting figures were provided by the different accounting units of Indian Railways

manually. These figures were again keyed in manually which was error prone and time

consuming.

Later, a VPN based application was introduced by Railway Board for, letting each

Accounting unit to feed all budget related data through VPN connectivity. Being a

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centralised database application, Railway Board has real time access to the information

which is helpful in processing of the same.

12.8 New Applications

Indian Railway Accounts Department is also in the process of undertaking some more

accounting activities through computerisation. Applications like Workshop Accounting

Management System (WAMS) and Traffic Accounts Management System (TAMS) are being

developed through CRIS in consultation with nominated railways. These applications will

keep the transactional record for Workshop and Traffic Accounts of Railway on a web

based, centralised database system and will be capable for providing MIS on real time basis.

Further some locally developed applications are also being used on the railways, For

instance the following applications are in use at NWR:

1. FOXPRO (Workshop General Register)

It is a customized software used in Ajmer workshop for the preparation of WGR (Workshop

General Register). In this software, details of direct labour hours and cost of direct material

consumed is entered work order wise. This is used to calculate the cost of direct labour,

amount of all overheads allocated against each work order. Labour rates and the basis for

allocation of overheads are pre entered in software and changed periodically as per

requirement.

2. Data Entry Module

Data Entry Module Software is used in TAO. The details of Railway Receipts (RR) of goods

are entered into this software. This software contains the basic details like local/foreign card

code, load code, risk rate, commodity code, etc. If the amount of freight is exceeded by 9

digits then two entries are required to enter for the same RR. This data is submitted to IT

centre Jaipur for generating Machine prepared abstract, pair statement, paid statement and

incorrect register. With the help of these documents, the information sent by the stations is

cross checked/verified.

3. Clipper Based Program

Clipper Based Program (MS-DOS) is a program in which the details of cash remittance notes

and vouchers are entered. This program contains the basic details regarding cash remittance

notes, i.e., station code, check sheet date, collection date, month, amount relating to

goods/coaching/misc. Editing is possible if any change is required. It has re indexing feature

to save the data in case of power failure or any other reason. This program contains basic

details about the voucher, i.e., station code, check sheet date (means closing date of previous

month), earning date (voucher date). With the help of this program TAO generates the cash

register, seven report (Date wise cash collection report from the stations) and summary

report, cash in transit report and voucher register. These statements (except voucher

register) are useful to cross check the cash balance in Books section where revenue account

current is prepared. Voucher register is useful to cross check the details of vouchers in

military warrant section and bills section.

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4. Remittance into Bank (RIB)

RIB is used in TAO for reconciliation of bank remittances. In these software details of bank

transaction like Treasury Notes (TR) and receipt of E-payment is recorded. Traffic Accounts

office, Division and Workshop enter the bank transaction details. It contains the basic details

like Unit code, scroll date (date on which cash office received TR) station code, etc. Data of

this software is handed over to Zonal Head Quarter to cross check with the bank receipts.

With the help of this software each unit raises Transfer certificate (Debit) to Head Quarter

for the purpose of confirmation of bank receipts.

5. FOXPRO Program

This program is an MS-DOS based program used in TAO to generate the Traffic Book Part-A

by entering the coded balance sheet. It contains the basic details like station code, Debit/

Credit code, Traffic Book Code, Balance Sheet item code, etc. Following reports are

generated:

i. Traffic Book Summary;

ii. Traffic Book Register;

iii. Station Outstanding;

iv. Balance Sheet Report;

v. Division Wise Summary; and

vi. Service Tax summary, etc.

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13 Chapter - Way Forward for implementation of Accrual

Accounting

This Chapter covers the steps to be taken by an organization while shifting to accrual

accounting. Following diagram depicts the steps to be taken by Indian Railways for

preparation of financial statements on accrual based system of accounting:

13.1 Comprehensive Study of Existing Accounting Systems

This is the first step wherein a diagnostic review is required to be undertaken, primarily for

better understanding of the existing system and to plan the strategies and measures for

implementation of Accounting Reforms. For this, study of Manuals and other relevant

material issued by the IR as well as the Accounting Standards issued by the Institute of

Chartered Accountants of India (ICAI) is required. Further, due consideration need to be

given to the Indian Government Financial Reporting Standards (IGFRS) issued by the

GASAB. It may be noted that ICAI ARF Team carried out a detailed study of the current

flow of processes as well as accounting transactions under existing accounting system of

Indian Railways as well as requirements as per the Accounting Standards issued by ICAI

and GASAB and suggests the roadmap/steps for implementation of the new accounting

system as mentioned hereunder:

13.2 Compilation of Fixed Assets Register (FAR)

One of the most important steps in the process of implementation of accrual based

accounting system is identification and accounting of Fixed Assets. For this purpose, Fixed

Asset Register needs to be prepared which will give details of all fixed assets owned by the

Indian Railways. The FAR forms comprehensive single record of all information necessary

about each physical asset and these records will form part of general ledger accounting

1. Updation ofComprehensive scopeevaluation report

2. Compilation of FixedAssets Register andgathering the accrual data

3. Application ofvaluation norms forAssets and Liabilities asfinalized in pilot study

4. Finalization ofsignificant accountingpolicies for new areas

5. Preparation of OpeningBalance Sheet as on cutoff date

6. Compilation ofFinancial Statements forthe financial year

7. Updation of AccrualAccountingImplementation Manual

8. Capturing accountingtransaction on day to daybasis

9. CapacityBuilding, Hand holding& Trainings

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system and provides the information to manage the assets, to know the investment in assets

and help in planning for further investments in future. It also contains date of purchase of

asset which will help in determining the age of asset. FAR also gives information about

location of the asset in the organization.

Fixed Assets, being a significant portion of the total assets of any organization, the

accounting thereof requires proper classification, segregation, recording and presentation

for the purpose of reflecting the true financial status and determining the level of efficiency

of the organization in relation to the cost incurred on the assets.

It is essential to record all the assets in the books of accounts and make provision for

depreciation not only in a commercial environment, but also for entities that do not operate

for profit. Governments, particularly those operating in a parliamentary democracy, are

custodians of the money raised from the citizens and other sources. They have a duty to

ensure that assets created out of such taxpayers’ money are looked after properly, so that

they are not frittered away or used inefficiently. This duty of the Government is irrespective

of whether the assets are put to use to generate profit or otherwise. Government

Department/units in India are not following the accrual based accounting system for

preparing its financial statements. Nevertheless, after realizing the importance of preparing

financial statements under accrual-based principles, gradually these government units are

migrating to accrual-based accounting. The first step for any unit (including a Government

unit) to implement accrual system of accounting is to prepare the Opening Balance Sheet.

The preparation of the opening balance sheet requires determination of balances of fixed

assets and current assets, long-term and short-term dues and liabilities payable to outsiders.

An opening balance sheet is required to be prepared to draw the statement of affairs of the

entity as on the date of the balance sheet and carrying the balances of all assets and liabilities

to the next accounting year as the opening balances. Thus, implementation of accrual

accounting starts with preparation of the opening balance sheet.

13.3 Categorization of Fixed Assets

After detailed review of IR’s assets, ICAI ARF Nodal Team categorized the fixed assets of

Indian Railways in the following manner:

i. Land (FA-1);

ii. Buildings (FA-2);

iii. Bridge/Tunnel/Flyover/Subways (FA-3);

iv. Roads/Street (FA-4);

v. Railways Tracks;

Rails (FA-5A)

Sleepers (FA-5B)

Ballasts (FA-5C)

Other Fittings (FA-5D)

vi. Furniture & Fixtures (FA-6);

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vii. Office Equipments (FA-7);

viii. Vehicles (FA-8);

ix. Plant, Machinery &Equipments (FA-9);

x. Computer & Peripherals (FA-10);

xi. Medical Equipments (FA-11);

xii. Loco/Coach/Wagon (FA-12);

xiii. Capital work-in-progress (FA-13);

xiv. Plant, Machinery & Equipment (Signal) (FA-14);

xv. Plant, Machinery & Equipment (Telecom) (FA-15);

xvi. Electric Equipment & Fittings (FA-16);

xvii. Intangible Assets (FA-17); and

xviii. Electrified Railway Track;

Conductors (Wire) (FA-18A)

Transformers(FA-18B)

Structure of Mast/Portal (FA-18C)

Other Equipments (FA-18D)

Based upon categorization, ICAI-ARF designed the formats in consultation with the

Accounting Reforms Cell for collecting relevant information to compile Fixed Assets

Register (FAR). The formats so designed were submitted to IR officials for their

comments/suggestions. These formats are primarily designed on the basis of FAR formats

of NMAM, which is developed by C&AG and some other Government departments/

organizations (Annexure I).

ICAI ARF has already compiled Fixed Assets Register of North Western Railway (NWR)

and Rail Coach Factory (RCF) as on 31.03.2015. Now, under the Roll Out Project, FAR of

whole IR will be prepared and FAR of NWR and RCF will also be updated accordingly.

13.4 Preparation of Opening Balance Sheet (OBS)

For the purpose of preparing opening balance sheet, data capturing formats for compiling

FAR, Current Assets, Current Liabilities and OBS (Annexure III) have been designed and

circulated to Zonal Railways/Production units to be filled by the

Divisions/Workshops/Production Units, etc., and certified/ authorized by the officials

concerned. Some additional information is also required to be shown in Notes to accounts

(Annexure IV) in financial statements.

‘Valuation Norms’ for all fixed assets have also been enunciated for Opening Balance Sheet.

These norms shall act as guiding principles while preparing the OBS and be disclosed in the

‘Notes to Accounts’. Due consideration has been given to the Indian Government Financial

Reporting Standards (IGFRS) issued by the GASAB and the relevant Accounting Standards

issued by the Institute of Chartered Accountants of India (ICAI). These Accounting

Standards prescribe the accounting treatment for presentation and valuation of various

assets/liabilities so that users of financial statements can obtain information regarding an

entity’s assets and liabilities. Depreciation policy has also been finalized for providing

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depreciation on fixed assets as existing on the date of OBS. The above mentioned steps shall

lead to ascertaining:

i. balances of all the Fixed assets own by the Division/Workshop;

ii. capital work in progress;

iii. current assets such as cash, bank balances, inventories and all the receivables;

iv. current liabilities including statutory dues payable employee related liabilities, etc.; and

v. necessary provisions and contingent assets and liabilities.

Following steps are to be followed for the purpose of preparation of OBS as at 31.3.15

Figure 1: Preparation of Opening Balance Sheet

ICAI-ARF has already compiled opening Balance Sheet of North Western Railway and Rail

Coach Factory as on cut-off date 31.03.2015. Now, Opening Balance Sheet of Indian

Railways as a whole is to be prepared as on 31.03.2015.

13.5 Valuation Norms of Assets and Liabilities

After identification and verification of the assets and liabilities, the process of valuation

starts. It may be noted that valuation norms for fixed assets and liabilities have already

been finalized during the pilot studies undertaken at North Western Railway and Rail

Coach Factory. These norms may be followed during the implementation of accrual

accounting across the Indian Railways. However, if any new area emerges during

implementation, valuation norms/methodology for the same shall be addressed separately.

Determination of Cut-off date for preparation of OBS, i.e., 31.03.2015

Circulation of 'Data Capturing Formats' in respect of Assets and Liabilities

Compilation of information from 'Data Capturing Formats'. Apply Valuation

Norms for Assets and Liabilities' as finalized in Pilot Study'

Preparation of OBS by plotting information captured above.

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Assets of IR, can be broadly classified as under for the purpose of valuation:

i. Fixed Assets and

ii. Current Assets.

i. Fixed Assets: Fixed Assets may be defined as the tangible as well as intangible assets,

acquired by an organization for use in the production or supply of goods or services or

given on licence fee to others or used for administrative purposes. They are held primarily

for use, not for sale and are expected to be used during more than one accounting period.

Since fixed assets are often a major portion of the total assets of the organization they are,

therefore, significant in the presentation of its financial position.

The main issues involved in accountal of fixed assets are as follows:

a. Identification of assets;

b. Physical verification of assets; and

c. Valuation of fixed asset.

ii. Current Assets: All assets that are reasonably expected to be converted into cash within

normal operating cycle or where operating cycle is not be ascertainable within one year in

the normal course of business are categorized as Current Assets. Current assets include cash,

accounts receivable, inventory, marketable securities, prepaid expenses and other liquid

assets that can be readily converted into cash. Current assets are important to businesses

because they are the assets that are used to fund day-to-day operations and to pay ongoing

expenses. Depending on the nature of the business, current assets can range from barrels of

crude oil, to baked goods, to foreign currency. In case of IR current assets include demands

recoverable, imprest, etc.

Liabilities: Liabilities are organization's legal debts or obligations that arise during the

course of business operations. Liabilities are settled over time through the transfer of

economic benefits including money, goods or services. Liabilities include loans, accounts

payable, mortgages, deferred revenues and accrued expenses. Liabilities are a vital aspect of

an organization's operations because they are used to finance operations and pay for large

expansions. They can also make transactions between businesses more efficient. Further,

liabilities can also be following two types:

a. Current Liabilities: Liabilities which are payable within normal business operating

cycle or where operating cycle is not available/ascertainable, within one year.

b. Non – current liabilities: Liabilities other than current liabilities are treated as non-

current liabilities.

13.6 Finalizing Significant Account Policies

Accounting policies are also important to any entity to maintain consistency in all the

aspects such as carrying out activities, MIS and other transactions. Generally, based upon

the accounting policies followed by the entity, the procedures and internal control systems,

etc., are developed and followed. For example, the decision relating to capital expenditure,

processing of payment of bills, cash management and budgeting, etc., are governed by the

accounting policies. Accounting policies are usually developed and approved by the top

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management of the entity and do not get changed over a period of time. They are developed

for long-term use and reflect a firm’s values and ethics.

Accounting policies on following issues have been enunciated during the pilot studies

carried at North Western Railway and Rail Coach Factory, Kapurthala:

i. Basis of preparation of Financial Statements;

ii. Use of Estimates;

iii. Fixed Assets Accounting;

iv. Capital Work in Progress;

v. Depreciation;

vi. Provisions, Contingent Liabilities and Contingent Assets;

vii. Valuation of Inventories;

viii. Revenue Recognition;

ix. Retirements;

x. Lease Accounting; and

xi. Investments

For detailed accounting policies, kindly refer to Accrual Accounting Implementation

Manual (AAIM) as prepared in pilot study at North Western Railway. Accounting policy on

a new area not covered in pilot study, if needed will be discussed and finalized on need

basis.

Accrual Accounting Implementation Manual

Detailed guidelines on procedure to be followed to capture details in Asset Register Formats

(including valuation norms), Current Assets/ Liabilities, Balance Sheet, Cash Flow

Statement, problems that could be faced in data collection and the course of action to be

followed are given in the Accrual Accounting Implementation Manual. This document also

contains relevant accounting rules, policies, principles, guidelines and other information for

Indian Railways. It also specifies the rules and procedures for the preparation of the

Financial Statements at the end of the financial year. The Accounting Manual broadly covers

the following:

i. General Accounting Procedure including guidance for drawing opening balance

sheet and financial statements for Zonal Railways;

ii. Significant Accounting Principles;

iii. Procedural details with recommendations of books/ registers to be maintained;

iv. Forms/ formats for books of accounts, registers and other subsidiary record (if any);

v. Formats for periodical/annual financial statements (Annexure II).

The existing Accrual Accounting Implementation Manual (AAIM) has been prepared based

on pilot study at North Western Railway and the same shall be updated during

implementation of accrual accounting across the Indian Railways.

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13.7 Capturing Accounting Transactions on day-to-day Basis

The financial statements of Indian Railways for 2015-16 and 2016-17 shall be compiled on

grafting basis, i.e., based on existing financial statement with some additional information in

respect of accrual elements. However, simultaneously mapping of F-2 will be carried out for

implementation of accrual accounting on transaction basis, in addition to government

accounting.

13.8 Compilation of Financial Statements

Financial statements are intended to meet the needs of users. Users of financial statements

include stake holders like taxpayers, members of Legislature, Government entities, the

media and the public, including citizens. The objective of financial statements is primarily to

provide ‘true and fair’ view of the financial position, financial performance and cash flows

of the Government entity which is useful to a wide range of users in making and evaluating

decisions about the allocation of resources and to demonstrate the accountability of the

Government entity for the resources entrusted to it, by:

i. Providing information about the sources, allocation, and utilization of financial

resources;

ii. Providing information about how the Government entity financed its activities and met

its cash requirements;

iii. Providing information that is useful in evaluating the Government entity’s ability to

finance its activities and to meet its liabilities and commitments;

iv. Providing information about the financial condition of the Government entity and

changes in it, including its assets and liabilities; and

v. Providing aggregate information useful in evaluating the Government entity’s

performance in terms of cost of providing services and efficiency in delivery of services

besides other accomplishments.

The formats of financial statements have been finalised (Annexure II) and financial

statement of North Western Railway and Rail Coach Factory have already been prepared in

the same format.

13.9 Capacity Building, Hand Holding & Training

ICAI ARF team will strengthen, support and guide the officials of Indian Railways about

accrual based system of accounting and preparation of financial statements on accrual basis.

It will include Balance Sheet, Profit and Loss account and Cash Flow Statement along with

necessary Schedules, notes to accounts and other necessary details as required.

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14 Annexures -Forms and Formats 14.1 Annexure 1: FAR Format

Indian Railways

Details of Lands

FA-1

S.

No

.

Sto

ck H

old

er C

od

e

Par

ticu

lar/

Des

crip

tio

n o

f

Lan

d P

lots

Plo

t R

efer

ence

No

.

Blo

ck S

ecti

on

(B

etw

een

tw

o

Sta

tio

ns)

Ch

ain

age

in

Km

s)

RH

S o

r L

HS

in

in

crea

sin

g K

Ms

Sp

ecif

y i

f L

ease

ho

ld/F

reeh

old

Location

Rev

enu

e v

illa

ge

as

per

rev

enu

e

reco

rds

Dimension

of Land

yea

r o

f ac

qu

isit

ion

(if

kn

ow

n),

men

tio

n e

arli

er t

han

(if

no

t k

no

wn

)

Lan

d P

lan

No

.

Sta

tus

in R

even

ue

Rec

ord

Co

st o

f ac

qu

isit

ion

of

Lan

d

(if

Av

aila

ble

)

Co

st o

f Im

pro

vem

ent

(If

Av

aila

ble

)

(An

y e

xpen

ses

incu

rred

on

lan

d

lik

e co

nst

ruct

ion

of

bo

un

dar

y w

all/

fen

cin

g

Cu

rren

t U

se o

f L

and

An

y p

art

Sep

arab

le f

or

oth

er

use

(A

rea)

Dis

tric

t L

evel

Co

mm

itte

e (D

LC

)

Rat

e A

rea

in u

nit

in

ref

eren

ce t

o

DL

C r

ate

Yea

r o

f D

LC

Rat

e

Pre

sen

t /a

ctu

al C

ost

of

Lan

d

Rem

ark

s

Sta

te

Dis

tric

t

To

wn

/vil

lag

e

Len

gth

Are

a

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2

0 21 22 23 24 25 26

Notes:

1. Details of all Land belonging to the Ajmer Division, irrespective of the fact, whether it is vacant or any structure has been constructed on that, should be

included here.

2. Specify if land is Industrial/Agriculture/Residential.

3. Where the date/year of acquisition is ascertainable but the cost as well as the original documents is not available, valuation can be done using the

'Guidance Value' prescribed under the Stamp Duty Act for the location, type of land and date. If the 'Guidance Value' is also not available for that

particular year/date, transaction value of a similar plot in the similar area around the estimated year of transaction can be adopted as the transaction rate

for valuation purposes.

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4. If any other thing is required to be mention regarding land, then same may be shown in 'Remark Column'.

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2017


Indian Railways

Details of Buildings

FA-2

S.N

o.

Sto

ck H

old

er C

od

e

Des

crip

tio

n

Location R

even

ue

vil

lag

e as

per

rev

enu

e

reco

rds

Dimensio

n of

building

No

. of

flo

ors

Are

a o

f la

nd

on

wh

ich

Bu

ild

ing

is l

oca

ted

To

tal

bu

ild

Up

are

a

yea

r o

f ac

qu

isit

ion

/

con

stru

ctio

n(i

f k

no

wn

), E

arli

er

than

(if

no

t k

no

wn

)

cost

of

acq

uis

itio

n/c

on

stru

ctio

n Improvement

(If any)

To

tal

cost

Lif

e o

f as

set

as p

er c

od

al

pro

vis

ion

s

No

. of

yea

r as

sets

is

in u

se

Rem

ain

ing

lif

e o

f as

sets

as

on

31.0

3.20

14

Rat

e o

f D

epre

ciat

ion

Acc

um

ula

ted

Dep

reci

atio

n t

ill

31.0

3.20

14

Net

Bo

ok

Val

ue

as

on

31.0

3.20

14

Cu

rren

t U

se o

f B

uil

din

g

Giv

e re

fere

nce

of

titl

e

Do

cum

ent

Rem

ark

s

Sta

te

Dis

tric

t

To

wn

/Vil

lag

e

Len

gth

Bre

adth

Yea

r o

f

Imp

rov

emen

t

Co

st o

f

Imp

rov

emen

t

1 2 3 4 5 6 7 8 9 10 11 1

2 13 14 15 16 17 18 19 20 21 22 23

2

4 25

2

6

Notes:

1. Buildings should be categorized into Ajmer division offices, residential quarters, godowns, hospitals, workshops etc.

2. Each building should be identified separately.

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Indian Railways

Details of Bridges/Flyover/Tunnel/Subways

FA-3

S.N

o.

Sto

ck h

old

er c

od

e

Bri

dg

e ty

pe

(B

rid

ge/

RO

B/R

UB

)

Des

crip

tio

n(

Bri

dg

e n

o. O

r

RO

B/R

UB

no

.)

Blo

ck s

ecti

on

(B

etw

een

tw

o

stat

ion

s)

Ch

ain

age

(K

Ms)

Location

Ty

pe

of

bri

dg

e (A

rch

/ste

el

gir

der

/PS

C g

ird

er/R

CC

bo

x et

c.

Dimension of structure

Lo

adin

g b

rid

ge

san

ctio

n f

or

(MB

G/R

BG

/GC

) A

rea

of

lan

d o

n w

hic

h s

tru

ctu

re

is c

on

stru

cted

Dat

e o

f co

nst

ruct

ion

Co

st o

f co

nst

ruct

ion

Improv

ement

(If any)

To

tal

cost

Fu

nd

all

oca

tio

n c

od

e

Lif

e a

s p

er c

od

al p

rov

isio

ns

No

. of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

dat

e 31

.03.

2014

N

et b

oo

k v

alu

e as

on

31.

03.2

014

(Rs.

)

Ap

pro

ved

Drg

. No

.

Rem

ark

s

Sta

te

Dis

tric

t

To

wn

/Vil

lag

e

Len

gth

To

tal

no

. O

f sp

ans

No

. Of

span

-1

SP

-1

No

. Of

span

-2

SP

-2

No

. Of

span

-3

SP

-3

Yea

r o

f im

pro

vem

ent

Co

st o

f im

pro

vem

ent

1 2 3 4 5 6 7 8 9 1

0

1

1

1

2

1

3

1

4

1

5

1

6

1

7

1

8

1

9

2

0

2

1

2

2

2

3

2

4

2

5

2

6

2

7

2

8

2

9

3

0

3

1

3

2

3

3

Notes:

1. Whereas possible, prepare a separate list of bridge/tunnel/subway etc.

2. Each such structure should be identified separately.

3. If any bridge/tunnel/subways is not in used, then same also may be included here. However further details may be given in 'Remark 'column.

4. If actual date of construction is not available but the year of construction is available, then year may be given in relevant column.

5. If any other detail is required to be given in respect of Bridge/tunnel etc., then same may be mentioned in 'Remark Column'.

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Indian Railways

Details of Roads/Streets

FA-4

S.N

o.

Sto

ck H

old

er C

od

e

Ty

pe

of

road

(N

H/S

H/m

un

icip

al

road

/vil

lag

e ro

ad e

tc.

Des

crip

tio

n o

f ro

ad (

join

ing

tow

n/v

illa

ge)

Sta

tio

n

Location

Sp

ecif

y w

het

her

th

e r

oad

/str

eet

is

con

cret

e/b

itu

men

/ku

tch

a/W

BM

Su

rvey

no

. of

the

lan

d w

her

e

stru

ctu

re i

s lo

cate

d

Dimension

of roads

Are

a o

f ro

ad (

Sq

. M.)

Dat

e o

f co

nst

ruct

ion

Co

st o

f co

nst

ruct

ion

Rep

air

Fre

qu

ency

Improvement

(If any)

To

tal

cost

Fu

nd

all

oca

tio

n c

od

e

Lif

e a

s p

er c

od

al p

rov

isio

ns

No

. of

yea

r in

use

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

dat

e

31.0

3.20

14

WD

V a

s o

n 3

1.03

.201

4

Giv

e re

fere

nce

of

titl

e d

ocu

men

t

Rem

ark

s

Sta

te

Dis

tric

t

To

wn

/vil

lag

e

Len

gth

Bre

adth

Yea

r o

f im

pro

vem

ent

Co

st o

f im

pro

ve

men

t

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

Notes:

1. Here improvement means conversion of the road from one type of construction to another type of construction. E.g. Conversion of a tar road into a

concrete road. It may also include extension of road.

2. Each road should be identified separately.

3. If any road is not in used, then same also may be included here.

4. If actual date of construction is not available but the year of construction is available, then year may be given in relevant column.

5. If any other detail is required to be given in respect of road, then same may be mentioned in 'Remark Column'.

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Indian Railways

Details of Rail

FA-5A

S. N

o.

Div

isio

n/Z

on

al R

ailw

ays

Rai

l S

ecti

on

To

tal

Len

gth

(in

KM

s)

Ro

llin

g M

on

th

Ro

llin

g P

erio

d

Co

st o

f R

ails

(P

er K

M)

To

tal

Co

st

Dep

reci

able

Am

ou

nt

(To

tal

Co

st –

5%

Res

idu

al V

alu

e)

Lay

ing

Mo

nth

No

. o

f y

ears

is

in u

se

Co

dal

Lif

e

Dep

reci

atio

n R

ate

Dep

reci

atio

n

Net

Bo

ok

Val

ue

as

on

XX

.XX

.XX

XX

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Draft


2017


Indian Railways

Details of Sleeper

FA-5B

S. N

o.

DIV

/RL

Y

Sle

eper

Ty

pe

Lay

ing

Mo

nth

an

d Y

ear

Sle

eper

Den

sity

To

tal

Len

gth

(K

Ms)

To

tal

Sle

eper

s (N

os.

)

Co

st (

per

Sle

eper

)

To

tal

Co

st o

f S

leep

ers

Dep

reci

able

Am

ou

nt

(To

tal

Co

st

– 5%

Res

idu

al V

alu

e)

Co

dal

Lif

e

No

. o

f y

ear

is i

n u

se

Rat

e o

f D

epre

ciat

ion

Dep

reci

atio

n

Net

bo

ok

Val

ue

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Draft


2017


Indian Railways

Details of Ballast

FA-5C

S. N

o.

Div

isio

n/R

ailw

ay

Sec

tio

n

To

tal

Len

gth

(in

KM

s)

Scr

een

ing

Dat

e

Rat

e o

f B

alla

st

To

tal

Co

st

Dep

reci

able

Am

ou

nt

(To

tal

Co

st –

5%

Res

idu

al V

alu

e)

No

. o

f y

ears

is

in

use

Co

dal

Lif

e

Dep

reci

atio

n

Rat

e

Dep

reci

atio

n

Net

Blo

ck

1 2 3 4 5 6 7 8 9 10 11 12 13

Draft


2017


Indian Railways

Details of Track Fittings

FA-5D

S.N

o.

Div

isio

n/R

ailw

ay

Par

ticu

lars

Dat

e

Dat

e A

ssu

med

KM

.

Rat

e P

er K

M.

To

tal

Co

st

Dep

reci

able

Am

ou

nt

(To

tal

Co

st –

5%

Res

idu

al V

alu

e)

Use

ful

Lif

e

No

. o

f Y

ears

ass

et i

s in

use

Rat

e o

f D

epre

ciat

ion

Dep

reci

atio

n

Net

bo

ok

Val

ue

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Draft


2017


Indian Railways

Details of Furniture and Fixtures

FA-6

S.N

O.

Des

crip

tio

n

Lo

cati

on

Ref

eren

ce n

um

ber

(If

an

y)

Dat

e o

f

acq

uis

itio

n/c

on

stru

ctio

n

To

tal

no

of

un

its

Co

st p

er u

nit

To

tal

Co

st o

f

acq

uis

itio

n/c

on

stru

ctio

n

Lif

e o

f as

sets

as

per

co

dal

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Net

bo

ok

val

ue

as

on

31.0

3.20

14 (

Rs.

)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Notes:

1. Furniture includes tables, chairs, cupboards, almirahs, fans, coolers, air conditioner, UPS, Refrigerator, TV, invertors etc.

2. Whereas possible, prepare a separate list for each class of furniture.

3. Assets reference number denotes any numbering/coding given to each piece of asset.

4. Details of the furniture & fixtures should be collected department/section/location wise.

5. If actual date of construction/acquisition is not available but the year of acquisition/construction is available, then year may be given in relevant column.

Draft


2017


Indian Railways

Details of Office Equipments

FA-7

S.N

O.

Des

crip

tio

n

Lo

cati

on

Ass

ets

Ref

eren

ce N

um

ber

Dat

e o

f a

cqu

isit

ion

To

tal

no

of

un

its

Co

st p

er u

nit

To

tal

cost

of

acq

uis

itio

n/

inst

alla

tio

n

Lif

e o

f as

sets

as

per

co

dal

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Net

bo

ok

val

ue

as o

n 3

1.03

.201

4

(Rs.

)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Notes:

1. Office equipments include Fax Machine, Xerox Machine, Type writer, projector etc.

2. If possible, prepare a separate list for each class of office equipment.


4. If actual date of construction/installation is not available but the year of acquisition/construction is available, then year may be given in

relevant column.

Draft


2017


Indian Railways

Details of Vehicles

FA-8

S.N

O.

Des

crip

tio

n o

f v

ehic

les

Lo

cati

on

Vehicle's details

in respect of

Dat

e o

f a

cqu

isit

ion

Co

st o

f ac

qu

isit

ion

Details of

improvements

To

tal

cost

(R

s.)

Fu

nd

all

oca

tio

n c

od

e

Lif

e o

f v

ehic

le a

s p

er c

od

al

pro

vis

ion

s

No

of

yea

r v

ehic

le i

s in

use

Rat

e o

f d

epre

ciat

ion

acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Ne

t b

oo

k v

alu

e as

on

31.

03.2

014

(Rs.

)

Giv

e r

efer

ence

of

the

avai

lab

le t

itle

do

cum

ents

Rem

ark

s

Reg

istr

atio

n

nu

mb

er

En

gin

e n

um

ber

Ch

assi

s n

um

ber

Date Cost

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

Notes:

1. In Column 2, kindly specify the description of vehicles specifying whether it is car, jeeps, trucks, ambulance etc.

2. Also mention present use of vehicle in the remark column.

3. If actual date of acquisition is not available but the year of acquisition is available, then year may be given in relevant column.

4. Improvement of vehicles include extension of body or otherwise.

Draft


2017


Indian Railways

Details of Plant, Machinery &Equipments

FA-9

S.N

O.

Sto

ck H

old

er C

od

e

Un

it

Sta

tio

n

Lo

cati

on

Cat

ego

ry o

f M

ach

ine

Des

crip

tio

n o

f M

ach

ine

Cap

acit

y

CO

FM

OW

PO

no

. &

dat

e

Nam

e o

f S

up

pli

er

Co

st o

f ac

qu

isit

ion

/in

stal

lati

on

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

Dat

e o

f co

mm

ence

men

t o

f

op

erat

ion

No

of

shif

ts i

n u

se

Details of

improvements

To

tal

cost

Fu

nd

all

oca

tio

n c

od

e

Lif

e o

f m

ach

ine

as p

er c

od

al

pro

vis

ion

s

No

of

yea

rs m

ach

iner

y i

s in

use

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Net

bo

ok

val

ue

as o

n 3

1.03

.201

4

(Rs.

)

Giv

e re

fere

nce

of

the

avai

lab

le

titl

e d

ocu

men

ts

Cu

rren

t m

ark

et v

alu

e (i

f

Av

aila

ble

)

Co

nd

itio

n

Wh

eth

er S

urp

lus

Rem

ark

s

Dat

e

Co

st

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

Notes:

1. Details of any improvements to the plant and machinery, which has resulted into increasing the capacity of the plant and machinery, should be mentioned

separately.

2. Also specify the general nature of machinery in relevant column.

3. Plant, machinery & equipment used in workshop for the purpose of repair & maintenance of Loco/Coach/Wagon will also be covered here.

4. If actual date of installation/acquisition is not available but the year of acquisition/installation is available, then year may be given in relevant column.

Draft


2017


Indian Railways

Details of Computers and Peripherals

FA-10

S. N

o.

Des

crip

tio

n

Lo

cati

on

Ref

eren

ce n

um

ber

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

To

tal

no

of

un

its

Co

st p

er u

nit

To

tal

cost

of

acq

uis

itio

n

Lif

e o

f as

sets

as

per

co

dal

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

dat

e 3

1.03

.201

4

Net

bo

ok

val

ue

as o

n 3

1.03

.201

4

(Rs.

)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Notes:

1. Computers & peripherals include desktops/laptops/printers/networking equipments etc.

2. If possible, prepare a separate list for each type of item.


4. If actual date of installation/acquisition is not available but the year of acquisition/installation is available, then year may be given in relevant

column.

Draft


2017


Indian Railways

Details of Medical Equipments

FA-11

S.N

O.

Des

crip

tio

n

Lo

cati

on

Ref

eren

ce n

um

ber

Dat

e o

f a

cqu

isit

ion

/

inst

alla

tio

n

To

tal

no

of

un

its

Co

st p

er u

nit

To

tal

Co

st o

f ac

qu

isit

ion

Lif

e o

f as

sets

as

per

co

dal

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f D

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n

till

31.

03.2

014

Net

bo

ok

val

ue

as o

n

31.0

3.20

14 (

Rs.

)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14

Notes:

1. Medical equipments include all equipment which are using in hospitals maintained by Indian Railways.

2. If possible, prepare a separate list for each type of item.


4. If actual date of construction/acquisition is not available but the year of acquisition/construction is available, then year may be given in

relevant column.

Draft


2017


Indian Railways

Details of Loco/Coach/Wagon

FA-12

S.N

O.

Sto

ck h

old

er c

od

e

Dep

artm

ent

Gro

up

co

de

Su

b G

rou

p c

od

e

Ass

et r

efer

ence

no

.

Ty

pe

of

wag

on

/co

ach

/lo

co

Des

crip

tio

n

Lo

cati

on

Dat

e o

f a

cqu

isit

ion

/

con

stru

ctio

n

Dat

e o

f co

mm

ence

men

t

of

op

erat

ion

To

tal

qu

anti

ty

Co

st o

f ac

qu

isit

ion

/

con

stru

ctio

n p

er

wag

on

/lo

co/c

oac

h

Details of

improvement

To

tal

Co

st

Fu

nd

all

oca

tio

n c

od

e

Lif

e a

s p

er c

od

al

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f D

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

dat

e

31.0

3.20

14

Net

bo

ok

val

ue

as o

n

31.0

3.20

14 (

Rs.

)

Rem

ark

s

Dat

e

Co

st

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Notes:

1. Each coach/wagon/loco should be identified separately.

2. Kindly, prepare a separate list for each type of wagon/coach/loco. For example, sleeper coach/AC coach/coach BG/Coach MG /Wagon BG/ Wagon MG etc.


4. If actual date of construction/acquisition is not available but the year of acquisition/construction is available, then year may be given in relevant column.

5. If any other necessary details are required to be mention in relation to coach/wagon/loco, then same may be given in 'Remark Column'.

6. Here improvement does not mean periodic overhauling (POH). However, improvement includes any major change which increases the life of

coach/wagon/loco.

Draft


2017


Indian Railways

Details of Capital Work in Progress

FA-13

S.NO. Description

of Work Location

Estimated

Cost of work

Cost incurred

till 31.03.2014

Fund

allocation

code

Estimated

date of

completion

of the work

Remarks

1 2 3 4 5 6 7 8

Notes:

1. Whereas possible please provide the separate details of every type of work in progress.

Draft


2017


Indian Railways

Details of Plant, Machinery &Equipments (Signalling)

FA-14

S.N

O.

Des

crip

tio

n o

f M

ach

iner

y

Sp

ecif

icat

ion

/nat

ure

of

mac

hin

e

Lo

cati

on

/Sta

tio

n

Cap

acit

y

Nu

mb

er o

f sh

ifts

in

use

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

Dat

e o

f co

mm

ence

men

t o

f

op

erat

ion

To

tal

Co

st o

f

acq

uis

itio

n/i

nst

alla

tio

n

Fu

nd

all

oca

tio

n c

od

e

Lif

e o

f m

ach

ine

as p

er c

od

al

pro

vis

ion

s

No

of

yea

rs m

ach

iner

y i

s in

use

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Ne

t b

oo

k v

alu

e as

on

31.

03.2

014

(Rs.

)

Giv

e r

efer

ence

of

the

avai

lab

le t

itle

do

cum

ents

Cu

rren

t m

ark

et v

alu

e (

if A

vai

lab

le)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Notes:

1. If actual date of installation/acquisition is not available but the year of acquisition/installation is available, then year may be given in relevant

column.

Draft


2017


Indian Railways

Details of Plant, Machinery &Equipments (Telecom)

FA-15

S.N

O.

Des

crip

tio

n o

f M

ach

iner

y

Sp

eci

fica

tio

n/n

atu

re o

f m

ach

ine

Blo

ck S

ecti

on

(Bet

wee

n t

wo

sta

tio

ns)

Cap

acit

y

Nu

mb

er o

f sh

ifts

in

use

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

Dat

e o

f co

mm

ence

men

t o

f o

per

atio

n

To

tal

Co

st o

f

acq

uis

itio

n/i

nst

alla

tio

n

Fu

nd

all

oca

tio

n c

od

e

Lif

e o

f m

ach

ine

as p

er c

od

al

pro

vis

ion

s

No

of

yea

rs m

ach

iner

y i

s in

use

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Net

bo

ok

val

ue

as o

n 3

1.03

.201

4 (R

s.)

Giv

e r

efer

ence

of

the

avai

lab

le t

itle

do

cum

ents

Cu

rren

t m

ark

et v

alu

e (

if A

vai

lab

le)

Rem

ark

s

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Notes:

1. If actual date of installation/acquisition is not available but the year of acquisition/installation is available, then year may be given in

relevant column.

Draft


2017


Indian Railways

Details of Electrical Equipments& Fittings

FA-16

S.N

O.

Des

crip

tio

n

Sto

ck H

old

er

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Chainage (in

Km)

Len

gth

/No

of

un

its

Dat

e o

f

acq

uis

itio

n/i

nst

alla

tio

n

Co

st p

er u

nit

Details of

Improvemen

t

To

tal

cost

of

acq

uis

itio

n/i

nst

alla

tio

n

Lif

e o

f as

sets

as

per

co

dal

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

14

Net

bo

ok

val

ue

as o

n

31.0

3.20

14 (

Rs.

)

Rem

ark

s

Fro

m

To

Dat

e

cost

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

Notes:


2. If actual date of construction/installation is not available but the year of acquisition/construction is available, then year may be given in

relevant column.

3. All electrical fitting and electrical equipment should be covered here such as power station, water pump etc.

Draft


2017


Notes:

1. Intangible assets include software’s, patents, copyright etc.

2. Antivirus software’s having licence for more than one year should also be mention here.

Indian Railways

Details of Intangible Assets

FA-17

S.NO. Description

Date of

acquisition/

development/

installation

Cost of

acquisition/

development/

installation

Location

No of

year for

which

license is

obtained

Amortizatio

n/

depreciation

Rate

Accumulated

depreciation/

amortization

value till

31.03.2014

Net Book

Value as

on

31.03.2014

(Rs.)

Remarks

Draft


2017


Indian Railways

Details of Conductors (Wire)

Form:- FA-18A

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f C

on

du

cto

rs

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Chainage (in

KMs)

Len

gth

of

Cab

le

Dat

e o

f a

cqu

isit

ion

/

inst

alla

tio

n

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er

cod

al p

rov

isio

ns

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

15

Net

bo

ok

val

ue

as o

n

31.0

3.20

15 (

Rs.

)

Rem

ark

s

Fro

m

To

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Draft


2017


Indian Railways

Details of Transformer

Form:- FA-18B

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f T

ran

sfo

rmer

Cap

acit

y o

f T

ran

sfo

rmer

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Dat

e o

f a

cqu

isit

ion

/in

stal

lati

on

No

. of

un

its

Co

st p

er U

nit

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al p

rov

isio

ns

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

15

Ne

t b

oo

k v

alu

e a

s o

n 3

1.03

.201

5 (

Rs.

)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Draft


2017


Indian Railways

Details of Mast/Portal Structure

Form:- FA-18C

S.N

o.

Sto

ck H

old

er

De

scri

pti

on

of

Mas

t/P

ort

al S

tru

ctu

re

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Dat

e o

f C

on

stru

ctio

n/i

nst

alla

tio

n

Co

st (

Rs.

)

Details of

Improvement

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

15

Net

bo

ok

val

ue

as

on

31.

03.2

015

(R

s.)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 5 6 7 10 11 12 13 14 15 16 17 18 19 20

Draft


2017


Indian Railways

Details of Other Equipment’s (OHE)

Form:- FA-18D

S.N

o.

Sto

ck H

old

er

Des

crip

tio

n o

f O

ther

Eq

uip

men

ts

Ass

ets

refe

ren

ce n

o. (

if a

ny

)

Lo

cati

on

Da

te o

f A

cqu

isit

ion

/in

stal

lati

on

No

. o

f u

nit

s

Co

st p

er U

nit

Co

st (

Rs.

)

Details of

Improvemen

t

To

tal

cost

(R

s.)

Fu

nd

All

oca

tio

n C

od

e

Use

ful

life

of

asse

ts a

s p

er c

od

al

pro

vis

ion

s

No

of

yea

r as

sets

is

in u

se

Rat

e o

f d

epre

ciat

ion

Acc

um

ula

ted

dep

reci

atio

n t

ill

31.0

3.20

15

Net

bo

ok

val

ue

as

on

31.

03.2

015

(R

s.)

Rem

ark

s

Dat

e

Co

st (

Rs.

)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19

Draft


2017


14.2 Annexure 2 - Formats of Financial Statements

Indian Railways

Statement of Financial Position

As at 31st March 2015

(Figure in

Rs.)

Schedule 2015 2014

Liabilities

Equity

Capital at Charge (Loan in perpetuity) 1

Safety Funds 2

Designated Funds (Internally Generated Funds) 3

Investment Financed from Designated Fund

(Internally Generated Funds) 4

Reserves and Surplus 5

XX XX

Non-current liabilities

Finance Lease Obligations 6

Deposits 7

Provident Fund and Other Funds

XX XX

Current Liabilities

Finance Lease Obligations

Employee Benefits Payable 8

Other Liabilities 9

XX XX

Total Liabilities XXX XXX

Assets

Draft


2017


Non Current assets

Fixed Assets

Tangible Assets 10

Gross Block

Less: Accumulated Depreciation

Net Block

Intangible Assets 11

Gross Block

Less: Accumulated Amortisation

Net Block

Capital work in progress (CWIP) 12

Loans and advances 13

XX XX

Current Assets

Cash and cash equivalents 14

Receivables 15

Inventories 16

Other assets 17

Adjustment Accounts (Annexure C)

XX XX

Total Assets XXX XXX

Draft


2017


Indian Railways

Statement of Financial Performance

For the year ended 31st March 2015

(Figure in Rs.)

Particulars Schedule 2015

Revenue

Revenue from operations

Transfer of Coaches to Railways 18

Sale of Coaches to Non Railway Customers 19

Coaching Earnings-Passenger 20

Coaching Earnings- Other than passenger 21

Goods earnings 22

Sundry Other Earnings 23

Total Revenue (A) XX

Expenses

Cost of Material Consumed 24

Establishment Expenses 25

Power and Fuel 26

Repair & Maintenance - other than Stores 27

Repair & Maintenance – Stores 27

Finance Lease Charges

Operational Expenses 28

Other expenses 29

Changes in Inventories of Finished Goods, Stock in Process &

Stock in Trade 30

Statutory Audit

Expenditure on Survey

XX

Profit before Depreciation and Appropriation to Funds and

payment of Dividend

Draft


2017


Depreciation and Amortization 10, 11

Profit after Depreciation and before Appropriation to Funds

Appropriation to Pension Fund

Appropriation to Depreciation Reserve Fund

Dividend Paid

Surplus/(Deficit) After contribution to Reserve Fund XX


2017


Indian Railways

Schedules forming part of Financial Statements

Schedule 1 Capital at Charge (Loan in Perpetuity)

(Figure in Rs.)

Particulars Opening Balance as

on 1st April 2014

Addition During

the Year

Adjustment during

the Year on account

of TWFA

Closing Balance as

on 31st March 2015

Loan Capital

Total

Schedule 2 Safety Funds

(Figure in Rs.)

Particulars

Opening Balance

as on 1st April

2014

Addition during

the year

Closing Balance

as on 31st March

2015

Special Railway Safety Fund

Railway Safety Fund

Total

Draft


2017


Schedule 3 Designated Funds (Internally Generated Funds)

(Figure in Rs.)

Particulars Opening Balance

as on 1st April 2014

Additions during

the year

Interest earned

during the year

Deduction during

the year

Closing Balance as

on 31st March

2015

Depreciation Reserve

Fund

Pension Fund

Total

Schedule 4 Investment Financed from Designated Fund (Internally Generated Funds)

(Figure in Rs.)

Particulars

Opening Balance as

on 1st April 2014

Additions during

the year

Adjustment during

the year on account

of TWFA

Closing Balance as

on 31st March 2015

Railway Capital Fund

Depreciation Reserve Fund

Development Fund

Open Line Works Revenue

Total

Draft


2017


Schedule 5 Reserves and Surplus

(Figure in Rs.)

Particulars Opening Balance as

on 1st April 2014

Additions during the

year

Interest earned

during the year

Deduction during

the year

Closing Balance as

on 31st March 2015

Surplus carried

forward from P & L

account

Total

Schedule 6 Deposits

(Figure in Rs.)

Particulars As on 31st March

2015

As on 1st April

2014

Security Deposits of Subordinates

Security Deposits of Contractors & others

Contribution for work done for Private persons and Public bodies

Sums due to Contractors on closed accounts

Private Companies

Miscellaneous Deposits

Total

Draft


2017


Schedule 7 Provident Fund and other Funds

(Figure in Rs.)

Particulars As on 31st

March 2015

As on 1st April

2014

General Provident Fund

State Railway Provident Fund (Non-Contributory)

Staff Benefit Fund

Total

Schedule 8 Employees Benefits Payable

(Figure in Rs.)

Particulars

Non-current Current

As on 31st

March 2015

As on 1st April

2014

As on 31st

March 2015

As on 1st April

2014

Salary Payable

Wages Payable

Dearness Allowance Payable

Incentive Payable

Total

Draft


2017


Schedule 9 Other Liabilities

(Figure in Rs.)

Particulars

Non-current Current

As on 31st

March 2015

As on 1st April

2014

As on 31st March

2015

As on 1st April

2014

Expenses Payable (Annexure A)

Advance Earnings (Annexure B)

Commercial claims pending payments

Deposit of Govt. Companies

New Pension Scheme

Unpaid Wages

Payable to contractor and Suppliers

Total

Draft


2017


Schedule 10 Tangible Assets

(Figure in Rs.)

Particulars

Gross Block Depreciation/Amortization Net Block

Opening

Balance as

on 20X4

Additions/

Adjustment

during the

year

Deduction/

adjustment

during the

year

Gross

block as

on 20X5

Accumulated

Depreciation

as on 20X4

Depreciation

for the year

Deduction/

Adjustment

Accumulated

depreciation

till 20X5

As on

20x4

As

on

20x5

Land

Buildings

Bridge/Flyover/

Tunnel/Subways

Road/Street

Railway Tracks

Furniture and

Fixtures

Office

Equipments

Vehicles

Computers and

Peripherals

Locomotives

Coaches

Plant, Machinery

and Equipments-

Signal

Plant, Machinery

and Equipments-

Telecom

Draft


2017


Plant, Machinery

and Equipments-

Electrical

Plant, Machinery

and Equipments-

Medical

Plant, Machinery

and Equipments-

Mechanical, Civil

and Others

Total (A) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX

Leased Assets

Locomotive

(Leased)

Coaches (Leased)

Wagons (Leased)

Total (B) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX

Grand Total

(A+B) XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX

Draft


2017


Schedule 11 Intangible Assets

(Figure in Rs.)

Particulars

Gross Block Depreciation/Amortization

Net

Block

Opening

Balance as

on 20X4

Addition/

Adjustment

during the

year

Deduction/

Adjustment

during the

year

Gross

block as

on 20X5

Accumulated

amortization

as on 20X4

Amortizatio

n for the

year

Deduction/

Adjustment

Accumulated

amortization

till 20X5

As on

20X4

As on 20X5

Software

Total XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX


2017


Schedule 12 Capital Work in Progress (CWIP)

(Figure in

Rs.)

Particular

Opening

Balance as on

1st April 2014

Addition/

Adjustment

during the year

Transfer to

fixed assets

during the year

Closing

Balance as on

31st March

2015

Capital work in Progress

Total

Schedule 14 Cash and Cash Equivalents

(Figure in Rs.)

Particulars

As on 31st March

2015

As on 1st April

2014

Cash Imprest

Departmental Cash Balances

Cheques and Bills

Remittance into Bank

Saving Account with Government

Account with RBI

Public Sector Bank Suspense

Total

Schedule 13 Loans and Advances

(Figure in Rs.)

Particulars

As on 31st

March 2015

As on 1st April

2014

Misc. Advance Revenue

Departmental Advances

Advance against State Railway Provident Fund

Total

Draft


2017


Schedule 15 Receivables

(Figure in Rs.)

Particulars

As on 31st

March 2015

As on 1st April

2014

Pay and Accounts Office

Accountant General

Controller of Defence Accounts (Defence CDA)

Postal and Telecom Department

Rajasthan Tourism Development Corporation Limited (RTDC)

FSC Recoverable

CUG Recoverable

Adjustment account with Pakistan Railways

Traffic Suspense

Interest Receivable from PSPCL

Rent & Other Charges Receivable

Receivable from Parties

DRDO Receivable

Total

Schedule 16 Inventories

(Figure in Rs.)

Particulars

As on 31st

March 2015

As on 1st April

2014

Store Suspense

Workshop Manufacturing Suspense

Diesel

Stores and Spares

Raw Material

Work in Progress

Finished Goods

Scrap

Total

Draft


2017


Schedule 17 Other Assets (Figure in Rs.)

Particulars Non-Current Current

As on 31st

March 2015

As on 1st

April 2014

As on 31st

March 2015

As on 1st

April 2014

Security and Earnest Money

Deposit

Deposit with Central Government

(Contra to Schedule 6)

Total

Schedule 18 Transfer of Coaches to Railways (Figures in Rs.)

Particulars As on 31st March 2015

Coaches

Shell

Bogies

Total Sales/Transfers

Less: Excise Duty

Total

Schedule 19 Sale of Coaches to Non Railway Customers

(Figures in Rs.)


Gross Sales

Less: Excise Duty

Total

Draft


2017


Schedule 20 Coaching Earnings- Passenger (Figure in Rs.)


Earning from passenger traffic

Add: Advance apportioned earning for ticket booked in 2013-14 and

travel take place in 2014-15

Less: Advance apportioned earning for ticket booked in 2014-15 and

travel take place in 2015-16

Total

Schedule 21 Coaching Earnings- Other than passenger (Figure in Rs.)


Parcel

Luggage

Special Train reserve carriage - Other than Military

Special Train reserve carriage – Military

Carriage of live stock by passenger

Haulage of Postal Vans & Compartments

Penalty Levied for irregular travelling

Wharfage

Receipt of left luggage

Platform Ticket

Misc. Coaching receipt

Total

Draft


2017


Schedule 22 Goods Earnings (Figure in Rs.)


Coal, Coke etc.

Steel

Iron

Fertilizers

Wharfage and Demurrage

Other Goods Traffic

Add: Advance apportioned earning (FY 2013-14)

Less: Advance apportioned earning (FY 2014-15)

Total

Schedule 23 - Sundry Other Earnings

(Figure in Rs.)


Receipts from Railway Recruitment Board

Advertisement receipts

Rental Income

Catering Income

Sale of Scrap

Reimbursement of Operating Loss on Strategic Lines

Subsidy from General Revenue towards Dividend Relief and Other

concessions

Medical Receipt

Interest & Penalty

Share of Misc. Receipts

Profit on Sale of Fixed Assets

Other Miscellaneous Income

Add: Income received in Advance (2013-14) and considered as income in

2014-15

Less: Income received in Advance (2014-15) and pertains to income for

2015-16

Total

Draft


2017


Schedule 24 - Cost of Material Consumed

(Figure in Rs.)


Direct Purchases

Material Issued

Raw Material Adjustment Account

Manufacturing Expenses as per Annexure- E

Total

Schedule 25 Establishment Expenses

(Figure in Rs.)


Salary, Wages and other benefits (Annexure D)

Pension and other Retirement benefits

Staff Welfare expenses

Administrative Expenses

Miscellaneous Establishment

Bonus & Allowance

Incentives

Medical Expenses

Govt Contribution to Pension fund (NPS)

Fees & Honorarium

Workmen Compensation

Cost of Railway Board

Total

Schedule 26 Power and Fuel (Figure in Rs.)


Diesel Traction (Demand 10)

Total

Draft


2017


Schedule 27 Repair and Maintenance

(Figure in Rs.)


A) Stores

Locos (Demand 5)

Wagons (Demand 6)

Coaches (Demand 6)

EMU/DMU (Demand 6)

Plant, Machinery and Equipment (Signal and Telecom) (Demand 7)

Plant, Machinery and Equipment (Mechanical) (Demand 7)

Plant, Machinery and Equipment (Electrical) (Demand 7)

Tracks (Demand 4)

Bridge/Tunnel (Demand 4)

Building (Demand 4)

Repair and Maintenance - Others (Demand 4 to Demand 6)

B) Other than Stores

Locos (Demand 5)

Wagons (Demand 6)

Coaches (Demand 6)

EMU/DMU (Demand 6)

Plant, Machinery and Equipment (Signal and Telecom) (Demand 7)

Plant, Machinery and Equipment (Mechanical) (Demand 7)

Plant, Machinery and Equipment (Electrical) (Demand 7)

Tracks (Demand 4)

Bridge/Tunnel (Demand 4)

Building (Demand 4)

Repair and Maintenance - Others (Demand 4 to Demand 6)

Total

Draft


2017


Schedule 28 Operational Expenses (Figure in Rs.)


Locomotives (Demand 8)

Carriage and Wagons (Demand 8)

Train Operations (Demand 9)

Yard Operations (Demand 9)

Station Operations (Demand 9)

Other Operational Expenses (Demand 8 and Demand 9)

Total

Schedule 29 Other Expenses

(Figure in Rs.)


Security Expenses

Compensation and Claim paid

Workmen compensation

Catering Expenses

Misc. Expenses

Less: Outstanding expenses of 2013-14 and paid in 2014-15

Add: Outstanding expenses of FY 2014-15 and paid in FY 2015-16

Adjustment for increase in security deposit

Adjustment for Decrease in FSC Charges

Increase in CUG recoverable

Decrease in Pending commercial Claim

Total

Schedule 30 Changes in Inventories of Finished Goods, Stock in Process & Stock in Trade

(Figure in Rs.)


Opening Inventories

Less: Closing Inventories

Opening Inventories Diesel

Less: Closing Inventories Diesel

Net Consumption


2017


Annexure A : Expenses Payables

(Figure in Rs.)

Particulars As on 31st March 2015 As on 1st

April 2014

Hiring of vehicles

Telephone Bills

Advocate Dues

Electricity Bills

Water Charges

Other Expenses

Total

Annexure B : Advance Earnings

(Figure in Rs.)

Non-Current Current

Particulars As on 31st

March 2015

As on 1st

April 2014

As on 31st

March 2015

As on 1st

April 2014

Advance income from Catering/

Advertisement/ ATM contractors at Station

Way Leave Charges

Advance apportioned earning - Freight

Advance apportioned Earning - Passenger

Total


2017


Annexure C - Adjustment Accounts

(Figure in Rs.)

Particulars Amount

Opening Balance on account of Adjustments

a) Within Indian Railways

Inter Zonal Railway Transactions (Dr.)

Inter Zonal Railway Transactions (Cr.)

Railway Capital Fund

Development Fund

Total Adjustment within Indian Railways

b) With Reserve Bank of India

Deposit with RBI

Total Adjustment with RBI

c) With Government of India

Loan Capital

Railway Safety Fund

Advance to Employee

Tax Deducted at Source (TDS)

Service Tax

Excise Duty

Central Government Health Scheme

Employee Insurance Scheme

Employee Group Insurance Scheme

Interest on Civil Advances

Dividend Payable to General Revenue

Subsidy Receivable

Family Welfare

Total Adjustment with Government of Indian

d) Misc. Adjustments

Adjustment on account of difference between Opening and Closing

balance in Saving A/c with Govt.

Draft


2017


Adjustment on account of difference between Opening and Closing

balance in Deposit with Government.

Total Misc. Adjustment

Total Adjustment Accounts

Annexure D - Salary, Wages and other benefits (Figure in Rs.)

Particulars Total

Demand 3 - General Superintendence and Services

Demand 4 - Repair and Maintenance of Permanent Way and Work

Demand 5 - Repair and Maintenance of Motive Power

Demand 6 - Repair and Maintenance of Carriage and Wagons

Demand 7 - Repair and Maintenance of Plant and Equipment

Demand 8 - Operating Expenses of Rolling Stock and Equipment

Demand 9 - Operating Expenses – Traffic

Demand 10 - Operating Expenses – Fuel

Demand 11 - Staff Welfare and Amenities

Demand 12 - Misc. Working Expenses

Total

Annexure E : Manufacturing Expenses (Figure in Rs.)

Particulars Total

Chemicals

Chemicals Return

Consumables

Consumables Stores

Custom Duty

Excise Duty

Freight Charges

Gases

Inspection Charges

Material Return

Draft


2017


Non Ferrous Return

Other Expenses

Petroleum , oil & lubricants

Power , Fuel and Other Utilities

Production expenses

Stores & Spares

Testing Charges

Tools Consumption

Total


2017


14.3 Annexure 3 - Accrual Impact Sheet (Current Assets and Liabilities)

S. No. Accrual Element Form No.

1 Detail of Investment CA-1

2 Details of Advances to employees CA-2

3 Details of Misc. Advances other than employees CA-3

4 Details of EMD and Security Deposit CA-4

5 Transfer Certificate-Debit CA-5

6 Transfer Certificate-Credit CA-6

7 Siding charges CA-7

8 Details of Bank Balances CA-8

9 Details of Cash and Cash Equivalents CA-9

10 Inventory at shop floor sub store CA-10

11 Diesel Stock in Railway Diesel Installation (RDI) CA-10A

12 Imprest CA-11

13 Any Receivable from State Government, Central Government,

Private Parties etc. CA-12

14 Details of Foreign service contribution CA-13

15 Advances against State Railway Provident Fund CA-14

16 Details of Warranty Charges CA-15

17 Details TDS Payable Under Section 192 CL-1

18 Details TDS Payable Under Section 194C CL-2

19 Details TDS Payable Under Section 194J CL-3

20 Details of Service Tax Payable CL-4

21 Details of Sales Tax/Vat Payable CL-5

22 Details of Wages Payable CL-6

23 Demand payable/Salary Payable CL-7

24 Details of Provident Fund CL-8

25 Details of other Employee Benefits Payable CL-9

26 Expenses Payable CL-10

27 Details of amount payable to Contractors/Suppliers CL-11

28 Indian railways deposit CL-12

29 Details of Various Fund Balances CL-13

30 Details of Loan Payables CL-14

Draft


2017


31 Payable to Contractor/Supplier-Supply contract CL-15

32 Contractual Liabilities for works contract CL-16

33 Details of Earning Contracts CL-17

34 Details of Income Received in Advance/Way Leave Charges CL-18

35 Details of pending claims CL-19


2017


Indian Railways

Details of Investments

Form:- CA- 1

S.No. Description Specify the

fund from

which

Investment

made

Nature

of

Deposit

Date of

Investment/

Deposit

(DD/MM/YY)

Duration

of

Investment

Amount

Invested

(Rs.)

Accrued

Interest

upto

31.03.2014

(Rs.)

Closing

Bal. as on

31.03.2014

(Rs.)

Accrued

Interest

upto

31.03.2015

(Rs.)

Closing

Bal. as on

31.03.2015

(Rs.)

1 2 3 4 5 6 7 8 9 10 11

Prepared By:- Checked By:-

Note:

1. Under column 'Description' name of Financial Institution/Bank/P.O. where amount has been deposited is required to be provided.

2. Under Column 'Nature of deposit' nature of investment made like Fixed Deposit/Recurring Deposit etc. is required to be given.

3. Under column 7, please compute the interest between the periods of last receipt of the interest till the cut-off date i.e. 31.03.2014, even if

the interest is not due, or the investment has not matured.

Draft


2017


Indian Railways

Details of Advance to Employees

Form:- CA-2

S.No. Name of

Employee

Nature of

Advance

Amount

Advanced

(Rs.)

Principal

outstanding

as on

31.03.2014

(Rs.)

Interest

receivable

as on

31.03.2014

(Rs.)

Total

amount

outstanding

as on

31.03.2014

(Rs.)

Principal

outstanding

as on

31.03.2015

(Rs.)

Interest

receivable

as on

31.03.2015

(Rs.)

Total

amount

outstandin

g as on

31.03.2015

(Rs.)


Note:

1. Under column 'Nature of Advance' type of advance like 'House Building Advance', 'Computer Advance', 'Festival Advance' etc., is

required to be given.

Draft


2017


Indian Railways

Details of Misc. Advance

Form:- CA-3

S.No. Name of

Supplier/

Contractors

Nature of

Advance

Date of

Advance

(DD/MM/YY)

Amount

Advanced

(Rs.)

Interest

receivable as

on 31.03.2014

(if any) (Rs.)

Total amount

outstanding as

on 31.03.2014

(Rs.)

Interest

receivable as

on 31.03.2015

(if any) (Rs.)

Total amount

outstanding as

on 31.03.2015

(Rs.)


Indian Railways

Details of Earnest money and Security Deposit

Form -CA-4

S.No. Particulars Nature of

Deposit

Amount of Deposit as

on 31.03.2014 (Rs.)

Amount of Deposit as

on 31.03.2015 (Rs.)

Remark(s)


Draft


2017


Indian Railways

Transfer Certificate (TC) Debit

Form:- CA-5

S. No. Name of

Accounting

Unit

Particulars

of TC

Specify

whether

inward or

outward

Date of

TC

TC reference

no. (if any)

Total amount

outstanding as on

31.03.2014 (Rs.)

Total amount

outstanding as on

31.03.2015 (Rs.)

Remarks

Prepared By:- Checked By:

Note:

1. Detail of all pending TC as on 31.03.2014/31.03.2015 for which no accounting is done will required to be given in this format.

2. If TC Pertains to the Previous year than year of TC should be mentioned in the Remarks column.

Draft


2017


Indian Railways

Transfer Certificate (TC) Credit

Form:- CA-6

S. No. Name of

Accounting

Unit

Particulars

of TC

Specify

whether

inward or

outward

Date of

TC

TC

reference

no. (if any)

Total amount

outstanding as on

31.03.2014 (Rs.)

Total amount

outstanding as on

31.03.2015 (Rs.)

Remarks


Note:

1. Detail of all pending TC as on 31.03.2014/31.03.2015 for which no accountal is done will required to be given in this format.

2. If TC Pertains to the Previous year than year of TC should be mentioned in the Remarks column.

Draft


2017


Indian Railways

Details of Demand Recoverable

Form:- CA-7

S. No. Name of Parties Nature of

Demand

Due date of

Payment

(DD/MM/YY)

Total amount

outstanding as on

31.03.2014 (Rs)

Total amount

outstanding as on

31.03.2015 (Rs)


Notes:

1. Only details of any amount due as on 31.03.15 on account of land license fee, building rent, etc. for which bill has not been raised

will be included here.

Draft


2017


Indian Railways

Details of Demand Recoverable

Form: CA-8

S. No. Name of

Account(s)

Name of the

Bank

Branch Balance as on

31.03.2014 (Rs.)

Balance as on

31.03.2015 (Rs.)


Indian Railways

Details of Cash and Cash Equivalents

Form: CA-9

S. No. Particulars Closing Balance as on

31.03.2014 (Rs.)

Closing Balance as on

31.03.2015 (Rs.)


Draft


2017


Indian Railways

Details of Inventory/Closing Stock

Form: CA-10

S.No. Name of

Item/

Material

Specification

(if any)

Unit of

Measurement

Qty/No. of

units of item

in stock as

on 31.03.2014

Unit

Cost

(Rs.)

Total Value

as on

31.03.2014

(Rs.)

Qty/No. of

units of item

in stock as

on 31.03.2015

Unit

Cost

(Rs.)

Total Value

as on

31.03.2015

(Rs.)


Notes:

1. Inventory at shop floor sub store will also be provided here.

2. Detail of any unconsumed material lying at site may also be provided.

3. Detail of any scrap lying in store is to be given separately in this format.

Draft


2017


Indian Railways

Diesel at Railway Diesel Institution

Form: CA-10A S

.No

.

Tan

k N

o.

Cap

acit

y

Quantity as

on 31st

March 2014

Rate of

purchase

Unit of

Measurement

(UOM)

Total

Amount

(Rs.)

Quantity as

on 31st

March 2015

Rate of

purchase

Unit of

Measurement

(UOM)

Total Amount

(Rs.)


Note:

1. Detail of fuel as on 31.03.2014 and 31.03.2015 at RDI is to be given in this format.

Indian Railways

Details of Imprest

Form: CA-11

S. No. Particular of

employees

Purpose of

Imprest

Amount of

Imprest Given

Closing Balance as

on 31.03.2014 (Rs.)

Closing Balance as on

31.03.2015 (Rs.)


Draft


2017


Indian Railways

Details of Receivables

Form - CA 12

S.

No

.

Particulars Opening Balance

as on 01.04.15

(Rs.)

Amount of Bill

raised during the

Year

Amount

Received during

the Year

Total amount

outstanding as on

31.03.2015 (Rs)


Notes:

1. Any amount receivable from State Government, Central Government, Private Parties, RTDC etc. will be included here.

Draft


2017


Indian Railways

Details of Foreign Service Contribution

Form: CA - 13

S.

No.

Name of

Employee

Date of

Deputation

Amount to be

received

Amount

Recovered

Outstanding

Balance


Indian Railways

Advance Against State Railway Provident Fund

Form:- CA-14

S.

No.

Name of Employee Total amount

outstanding as on

31.03.2014 (Rs.)

Total amount

outstanding as on

31.03.2015 (Rs.)


Note:

1. Details of advances which are given to employees form State Railway Provident Fund will be provided in this format.

Draft


2017


Indian Railways

Details of Warranty Charges

Form:- CA-15

S. No. Particular of

Warranty

Period of warranty Amount charged

exclusively for

warranty

Amount to be carried

forward in next

Financial Year From To


Draft


2017


Indian Railways

Details of TDS payable Under Section 192 (Salary Payment)

Form:- CL-1

S.No

.

Particulars TDS payable as

on 31.03.2014 (Rs.)

TDS payable as on

31.03.2015 (Rs.)

Remarks


Indian Railways

Details of TDS payable Under Section 194C (Payment to Contractors)

Form:- CL-2

S.No. Name of

Contractor

Nature of

Expenditure

TDS Payable as

on 31.03.2014

(Rs.)

TDS Payable

as on

31.03.2015 (Rs.)

Remark

s


Draft


2017


Indian Railways

Details of TDS payable Under Section 194J (Payment for Professional Services)

Form:- CL-3

S.No. Particular of

Services

Name of Service

Provider

TDS Payable as

on 31.03.2014

(Rs.)

TDS Payable as

on 31.03.2015

(Rs.)

Remarks


Indian Railways

Details of Service Tax Payable

Form:- CL-4

S.No

.

Particulars Balance

Outstanding on

31.03.2014 (Rs.)

Balance Outstanding

on 31.03.2015 (Rs.)

Remarks


Draft


2017


Indian Railways

Details of Sales Tax/ VAT Payable

Form:- CL-5

S.No

.

Particulars Balance

Outstanding on

31.03.2014 (Rs.)

Balance

Outstanding

on 31.03.2015

(Rs.)

Remarks


Indian Railways

Details of Wages Payable

Form:- CL-6

S.No. Particular of Wages Balance Outstanding

on 31.03.2014 (Rs.)

Balance Outstanding

on 31.03.2015 (Rs.)

Remarks


Draft


2017


Indian Railways

Details of Salary Payable/Demand Payable

Form:- CL-7

S.No

.

Particulars Balance Outstanding

on 31.03.2014 (Rs.)

Balance Outstanding

on 31.03.2015 (Rs.)

Remarks

(If any)

Prepared By:-

Checked

By:-

Notes:

1. Details of any amount payable in respect of salary, arrear of salary, VRS, NPS, compensation, etc., is to be given in this format.

Draft


2017


Indian Railways

Details of Provident Fund (PF)

Form:- CL-8

S.No. Opening Balance

as on 01.04.2014

Subscription

received during

the year

Interest earned

during the year

Withdrawal/Payment to

subscriber made during the

year

Closing Balance

as on 31.03.2015


Draft


2017


Indian Railways

Details of other Employee Benefits Payable

Form:- CL-9

S.No

.

Particulars Balance

Outstanding as on

31.03.2014 (Rs.)

Balance

Outstanding as on

31.03.2015 (Rs.)

Remarks

1 Pension Benefit

2 New Pension Scheme

3 Employee Insurance scheme

4 Deposit linked insurance scheme

5 Others (if any)


Draft


2017


Indian Railways

Details of Expenses/Bills Payable

Form:- CL-10

S.No. Particulars of Expenditure Balance Outstanding

as on 31.03.2014 (Rs.)

Balance Outstanding as

on 31.03.2015 (Rs.)


Notes:

-

1. All unpaid expenditure such as electricity, telephone, Hiring of Vehicles, Advocates bill, Water Charges, etc. will be covered

here.

Draft


2017


Indian Railways

Details of amount payable to Contractors/Suppliers

Form:- CL-11

S.No. Name of

Contractors/

Suppliers

Nature of

Expenditure

Balance

Outstanding as on

31.03.2014 (Rs.)

Balance

Outstanding as on

31.03.2015 (Rs.)

Remarks


Notes:-

1. Any amount payable to contractor on account of any expenditure should be mentioned here. For example payable for material &

supply, works contract etc.

Draft


2017


Indian Railways

Details of Deposits

Form:- CL-12

S.No. Particulars Purpose of

Deposits

Balance Outstanding

as on 31.03.2014 (Rs.)

Balance Outstanding as

on 31.03.2015 (Rs.)

Prepared By:-

Notes:

1. Details of all deposits like Deposit P, Deposit W, Deposit E, Deposit PF, etc., will be provided here.

Draft


2017


Indian Railways

Details of Various Funds Balances

Form:- CL-13

S.No. Particulars of Fund Opening Balance

as on 01.04.2014

(Rs.)

Contribution

to during FY

2014-15

Deduction

from Funds

during FY

2014-15

Balance

Outstanding

as on

31.03.2015 (Rs.)

Remarks

1 Depreciation Reserve Fund

2 Development Fund

3 Special Railway Safety Fund

4 Others (if any, Please specify)


Draft


2017


Indian Railways

Details of Loans Payable

Form:- CL-14

S.No.

Nam

e o

f F

inan

cial

Inst

itu

tio

n/

Ban

k

Nat

ure

of

Lo

an

Wh

eth

er s

ecu

red

or

un

secu

red

Pu

rpo

se o

f L

oan

Amount

of loan

outstandi

ng as on

31.03.2014

Amount of

interest

payable as

on 31.03.2014

Amount of

penal

interest

payable (If

any) as on

31.03.2014

Amount of

loan

outstandin

g as on

31.03.2015

Amount

of interest

payable as

on

31.03.2015

Amount

of penal

interest

payable

(If any) as

on

31.03.2015

Rem

ark

s


Notes:

1. If any loan is taken for acquiring any assets, than it should be mentioned separately.

2. Nature of loan mean type of loan such as term loan, Cash credit etc.

3. Any amount taken from central government for creating fixed assets should also be given here.

4. If any loan is taken in foreign currency, than it should also be mentioned separately

Draft


2017


Indian Railways

Details of Payables to Contractors/Suppliers

Form: CL - 15

S. No. Name of Supplier/

Contractor

Receipt Order

No.

Date of Receipt

Order

Bill

No. Date of Bill

Total Amount

(Rs.)

Note:

1. Detail of any amount payable in respect of material received but bill not received or bill received but the payment is not made will be

given in this format.

2. Details of unpaid bills in respect of Fuel are to be given by concerned RDIs.

Draft


2017


Indian Railways

Contractual Liabilities for Works contract

Form: CL - 16

S.No.

Par

ticu

lars

of

Co

ntr

act

Wo

rk O

rder

No

.

Nam

e o

f C

on

trac

tor

Lo

cati

on

Period

of

Contract Total

Contract

Value

Measurement of work done

but bill not submitted

Bill submitted but

not Paid

Remarks

Fro

m

To

Date of

Measurement

Amount for

Bill

Date of

Bill

Amount

of Bill

Note:

1. Detail of works liability in respect of where work is done and bill is not submitted or bill is submitted but payment is not made will

be given in this format.

2. Detail in respect of unpaid bill pending on 31.03.2015/31.03.2014 whose CO6 is not made will be given here.

Draft


2017


Indian Railways

Details of Earning Contract

Form: CL – 17

S.No.

Name of

Contractor Nature of Contract Location

License

Fees

Cycle of

License Fees

Period of Contract

Remarks From To

Note:

1. Detail in respect of all earning contract like Parking contract, Catering Contract, Advertisement contract, etc., is to be given in this

format.

2. If amount of contract/license fee is required to be paid in advance then same is to be mentioned in the Remarks Column.

3. Nature of Contract means type of contract, i.e., parking, catering, etc.

Draft


2017


Indian Railways

Details of Income Received in Advance/Way leave Charges

Form - CL-18

S. No. Particulars Amount Received

during the Year

Date of Advance

Received

Period of

Advance

Remark


Notes:

1. Details of any advance income received for retiring rooms, cloak rooms etc.

Draft


2017


Indian Railways

Detail of pending claims

Form: CL - 19

S. No. Particulars of

Claimant

Amount of

Claim Lodge

Whether claim

accepted

Amount of

Claim accepted

Whether claim

accepted is paid Remarks

Note

1. Only detail of those claim which are unpaid as on 31.03.2014 and 31.03.2015 is required to be given irrespective of whether paid or not

2. Disputed claim will form part of notes to accounts.

Draft


2017


14.4 Annexure 4 – Notes to Accounts

# Accrual Element

1 Recognition of earnings from coaching- Passenger (in lieu of Cash)

2 Recognition of earnings from coaching- Other Than Passenger (Cash)

3 Recognition of earnings from Goods Traffic

4 Amount of any extraordinary item

5 Capital Commitments (Net of Advances) (NTA-1)

6 Deposit Expenditure (EMD Converted in to Income during FY 2013-14 and

2014-15) (NTA-2)

7 Disputed commercial claims (CL-21)

8 Disputed Statutory Dues (NTA-3)

Draft


2017


Indian Railways

Capital Commitments

Form: NTA-1

S.No Particular of

the project

Total

estimated cost

of project

Cost incurred till

31.03.2014

Balance as

on

31.03.2014

Cost

incurred

till

31.03.2015

Balance as on

31.03.2015 Remark

Note:

1. Details of all projects exceeding Rs. 2.5crores will require to be given.

Draft


2017


Indian Railways

EMD Converted into Income

Form: NTA-2

S.No. Name of contractor/Supplier Amount Remarks

Notes:

1. Detail of EMDs which is recognized as income in the FY 2013-14 and FY 2014-15 will be provided in

this format.

Draft


2017


Indian Railways

Disputed Statutory Dues

Form: NTA-3

S.No. Particular of Dues Amount Remarks

Notes:

1. Detail of all disputed statutory dues, i.e., Service Tax, Excise, etc., is required to be given here.

Roll Out of Accrual Accounting over Indian Railways ...irastimes.org/Article_pdf/CSER-IR_V11 28062017.pdf · Indian Railways - Comprehensive Scope Evaluation Report 2017 1 | ICAI

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