FINANCIAL STRUCTRE OF INDIAN RAILWAYS.

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FINANCIAL STRUCTRE OF INDIAN RAILWAYS.

• Sanjay upreti
• PAM

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

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ACCOUNTAL OF MONEY 1. HOW EARNINGS ARE ACCOUNTED
COLLECTION AT THE STATIONS
SENDS THE MONEY TO THE CASH OFFICES
DEPOSIT AT THE BANK
BANK ADVICES RBI/NGP
RBI/NGP CREDITS/INCREASES THE RLY.S ACCOUNT
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ACCOUNTAL OF MONEY 2. HOW EXPENSES ARE ACCOUNTED
RBI/NGP DEBITS/REDUCES RLY.s ACCOUNT
CHEQUE ISSUED BY RLY.
CHEQUE DEPOSITED IN BANK BY THE PARTY
BANK GIVES MONEY TO THE PARTY AND
ADVICES RBI/NGP.
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FINANCIAL STRUCTURE OF RAILWAYS. RELATIONSHIP
WITH THE GoI
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Commercial AccountingPara 201 of A-1

• Commercial Accounting is done in a manner so as
  to show
• How capital is utilize.
• Its standing with debtors and creditors.
• Whether it is gaining or losing.
• The reasons for loss and gain.
• Whether it is solvent or insolvent.

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Government AccountsPara 201 of A-1

• The main requirement of government accounting is
  to prepare a systematic record of receipt and
  expenditure.
• Indian Railways is a DEPARTMENTAL COMMERCIAL
  ENTERPRISE.
• Thus we maintain accounts on commercial basis as
  well as government basis and then link the two
  through link accounts.

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Para 202 205 of A-1

• The accounts of a Railway prepared as in a
  commercial unit are known as Capital and Revenue
  accounts.
• Accounts prepared for the government are called
  Finance Accounts.
• To facilitate the preparation of finance accounts
  a detailed structure of accounts has been
  developed which synchronies with the government
  of India Accounting.

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

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

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DEMANDS FOR GRANTS 1. Railway Board makes
policies 2. Miscellaneous expenditure common to
all 3. RAILWAY ADMINITRATION maintains 4.
BUILDINGS TRACKS to run 5. LOCOMOTIVES and 6.
CARRIAGE by using 7. PLANT EQUIPMENTS to
operate 8. ROLLING STOCK by 9. TRAFFIC
DETARTMENT using 10.FUEL and earn money for 11.
STAFF WELFARE and 12. MISCELLANEOUS
EXPENSES. 13. PF, Pension other retirement
benefits. 14. Appropriation to funds.
DRF,Pension 15. Dividend, Repayment of loan
etc. 16. Works expenditure.
FROM 1 TO 12 OWE . FROM 1 TO 14 TWE FROM 1 TO
15 REVENUE EXP FROM 1 TO 16 TOTAL EXP
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(No Transcript)
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EACH DEMAND IS DIVIDED INTO MINOR
HEAD SUBHEAD DETAILED HEAD PRIMARY NO. THUS EXP.
CLASSIFICATION WILL BE 04 220 32
DEMAND No. DETAILED HEAD PRIMARY UNIT
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CLASSIFICATION OF WORKS EXP.

• PLAN HEAD--- MINOR HEADS
• 24 TILL 1999 AFTER WHICH 2 NEW HAVE BEEN ADDED---
  ROB RUB UNDER SAFETY WORKS.
• Thus in all 26 plan heads exists.
• e.g.
• DRF- 2114-09 PROCUREMENT OF
  ELEC. LOCO

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• WORKS EXPENDITURE
• DEFINITION
• Rules for classification of expenditure under
  the various heads are given in chapter 7 of F-1
• FROM WHERE DO WE GET MONEY FOR WORKS EXPENDITURE.

DRF
REVENUE
DF
SURPLUS
CAPITAL FUND
MONEY FROM EXCHEQUER
CAPITAL
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WHILE GIVING ALLOCATION OF WORKS EXPENDITURE WE
GIVE SOURCES OF FUND THEIR APPLICATION
CAP.,CAP.FUND,DRF, DF,
PLAN HEAD LIKE DOUBLING, ST ETC.
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DRF

• STARTED FROM 1.4.1924
• PROVIDES FOR COST OF REPLACEMENT OF ASSETS.
• AMOUNT ON THE BASIS OF RCCs RECOMMENDATIONS.
• SUBJECT TO VOTE OF PARLIAMENT
• FOR 2001-2002 Appropriation to DRF has been
  Budgeted at Rs.2804 Crores and withdrawal from
  the fund is kept at 2704 Crores..

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DF

• STARTED IN 1946---- BETTERMENT FUND AND RENAMED
  AS DF FROM 1.4.1950.
• IT IS OF 4 TYPES TYPES
• DFI PASSENGER AMENITIES
• DF II LABOUR WELFARE
• DF III UNREMUNERATIVE WORKS FOR OPERATIONAL
  EFFICIENCY
• DF IV SAFETY WORKS
• The appropriation to and withdrawal from the fund
  for the year 2001-2002 has been kept at Rs. 511
  crores.

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CAPITAL FUND

• CREATED IN 1992-93
• ALL EXCESS AFTER APPROPRIATION TO DF IS CREDITED
  TO THIS.
• WITH A VIEW TO CREATE INFRASTRUCTRE FROM INTERNAL
  RESOURCES.
• NOW OF NOT MUCH USE
• The appropriation to and withdrawal from the fund
  for the year 2001-2002 has been kept at Rs. 17.43
  crores.

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RULES OF ALLOCATION EARNINGS ABSTRACT X
- COACHING EARNINGS PASSENGER FARES, LUGGAGE
CHARGES, PARCEL COLLECTIONS, LIVE STOCK BY
PASSENGER TRAINS ETC. ABSTRACT Y - EARNINGS
FROM GOODS TRAFFIC, GENERAL MERCHANDISE, COAL,
FERTILIZERS, LIVESTOCK BY GOODS TRAINS,
TRANSHIPMENT CHARGES ETC.
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ABSTRACT Z - SUNDRY OTHER EARNINGS, COLLECTION
OF RETIRING ROOM CHARGES, RECEIPTS FROM CATERING
DEPT., SALE PROCEEDS OF TREES AND GRASS ON LINE,
RENT OF PLOTS GIVEN TO OUTSIDERS, TELEGRAPH
EARNINGS ETC.