RRSK – Rashtriya Rail Sanraksha Kosh

RRSK – Rashtriya Rail Sanraksha Kosh

·         Dedicated fund for Railway Safety.

·         Established in the year 2017-18 (announced in Budget speech of 2017-18)

·         Based on the recommendations of High Level Safety Review Committee, 2012 headed by Shri Anil Kakodkar, former chairman of Atomic Energy Commission.

·         Period – Five years

·         Fund proposed – Rs.1,00,000 Crores (i.e., Rs.20,000 Crores for every year)

·         Rs.20,000Crores for this year i.e., 2017-18 is proposed to be funded as follows.

Central Road Fund	Rs.10,000 Crores	So far, the amount goes to SRF.
Ministry of Finance	Rs.5,000 Crores	Promised
Railway Internal Resources	Rs.1,000 Crores	(from Budget document 2017-18)
By collecting Cess on fares ( proposed)	Rs.4,000 Crores
Total	Rs.20,000 Crores	For FY 2017-18

·         Objects: 1 ) Strengthen the safety measures on the Rail Network to prevent accidents in order to accomplish the “ZERO ACCIDENT MISSION”

·         Unique feature of this Fund is Non-lapsable .  That means the grant allotted for this Fund is not lapsed with the completion of financial year.

·         Works falling under this Fund category: -

1.       Track renewals &upgradation

2.       Bridge rehabilitation

3.       Elimination of LC gates on BG routes by 2022  

4.   Construction of ROBs/RUBs     

5.       Replacement & Improvement of Signaling system.

6.       Improvement & up gradation of Rolling Stock.

7.       Replacement of Electrical assets

8.       HRD – Human Resources Development.

·         Likely probability:

 SRF – Special Railway Safety Fund may be merged with the above Fund.  This conclusion arrived based on the two factors.  1) CRF – Central Road Fund – so far it is a source of finance for existing RSF – Railway Safety Fund.  Now it is going to be credited to new Fund that is NRSF or RRSK.  2 ) LC Gates (Plan Head 2900) and ROBs/RUBs (Plan Head 3000) so far met from the existing fund RSF.  Now these two objects are included in the proposed new Fund NRSF or RRSK.  Don’t come to any conclusion. Let’s wait and see for further guidelines from Railway Board.

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Subsidiary Accounts Records

Subsidiary Accounts Records

5 marks question in 2016 Books & Budget (with books)

«  Para 311 of Indian Railways Accounts Code   Clickfor Chapter 3 of Accounts Code Vol. one

«  In addition to General Books i.e., 1) Daily Cash Book 2) Monthly Cash Book 3) The Journal 4) The Ledger, the following Subsidiary Accounts Records should be kept by each Accounting circle.

1.       Register of Earnings - Should record the earnings of the Railway under all the detailed heads of classification prescribed in Volume II of the Indian Railway Financial Code. These registers may be kept in convenient parts to facilitate application of statistics of earnings.

2.       RAR - Revenue Allocation Registers - A separate Allocation Register should be maintained for Abstracts A to N.   Posted separately for expenses whether by cash or book adjustment (through journal voucher -JV).

3.       Registers of Works - A collective record of expenditure designed

A.      Control of expenditure with reference to the Estimates

B.      For effecting budgetary control

C.      To enable any material modification occurring being spotted.

4.       Suspense Registers - Reflect transactions which cannot immediately be charged to final heads. Examples are 

A.      Demands Payable Register

B.      Misc. Advances Register

C.      Loans & Advances Register

D.      Deposits unpaid Register

E.       Deposits Miscellaneous Register

5.       Register of Works expenditure classified under different sources of finance i.e., Capital, DRF, DF etc

«  These records are of the utmost importance in as much as they are designed to exhibit the details of the transactions under Revenue, Capital, DRF, DF & Suspense heads.

«  Separate set of the above subsidiary registers should be maintained to record the expenditure met from the contingency Fund.

«  Posted directly from the Vouchers or Summary statement of vouchers like CO7.

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Allocations - Practical question - 2016 - Books & Budget (with books)

Allocations - Practical question - 2016 - Books & Budget (with books)

For the following items of expenditure/earning give: Abstract of Allocation, Demand No. (Where applicable), Minor Head and Detailed Head.     20 marks

Answer:

Note:

1)   Due to merger of Rly.Budget with General Budget, all Demands 3 to 13 are now subsumed into Single Demand No.80 - Ministry of Railways.  The erstwhile Demands 3 to 13 are now named as Sub Major Heads (SMH) 01 to 11 under Major Head 3002 - Indian Railways Working Expenses (Commercial Lines) respectively. 

2)   Description of Demand/Minor Head/Sub Head/Detailed Head is given for the purpose of understanding.  Need not be furnished in answer sheets.

3)   Sub Head is not asked, yet furnished herein for perusal.

4)   For attempting these type of Allocation questions, hard copy of Finance Code Volume 2 (F2) is must for preparation.  Click for F2

5)   Answers are furnished accurately.  Still any discrepancy, please brought to the notice to me.

	QUESTION	ANSWER
S.N		Abstract	Demand	Sub Major Head (SMH)	Minor Head (MH)	Sub Head(SH)	Detailed Head
a	Running repair of traction motor of Electric Locomotive (A.C)	C	05 R & M of Motive Power	03	500 Electric Locomotives	510 Running repairs in sheds.	512 Traction motors and other electrical rotating machines.
b	Imported stores purchased in India	P (Capital)	16 Assets-Acquisition, 'Construction and Replacement.	_	7100 Stores Suspense	7120 Purchases-Indigenous purchase by Railways including Railway Board	7121 Imported stores purchased in India
c	Salary payment of FA&CAO	A	03 General Superintendence and Services.	01	200 Financial Management	210 Accounts	211 Officers
d	Difference between the ledger balance & ground balance discovered by the stock verifier	P (Capital)	16 Assets-Acquisition, 'Construction and Replacement.	_	7100 Stores Suspense	7180 Stock Adjustment A/c	7182 Difference between the ledger balances and the ground balances, discovered during departmental stock verification
e	Penalties levied for irregular travelling by the TTEs in train	X Coaching Earnings	-	-	700 Misc Coaching Receipts	710 Penalties levied for irregular travelling	712 Penalties levied for Irregular travelling by T. T.Es. in trains
f	Expenditure on consultancy services for Passenger Reservation System (Computerisation).	-	16 Assets-Acquisition, 'Construction and Replacement.	_	1700 Computerization	1720 Passenger Reservation System	1725 Consultancy Software
g	Cost of Medicines.	J	11 Staff Welfare & Amenities	09	200 Medical services	230 Cost of Medicines	231 Cost of Medicines
h	Repair and working cost of staff car of General Department	E	07 R & M of Plant and Equipment	05	800 Other Plant & Equipment - General & Traffic Depts	830 Other repairs & Misc expenses	831 Service Motor Cars and Trolleys (Rail and Road)-Repairs and working cost.
i	Contribution towards cost of order police.	K	12 Misc. Working Expenses	10	100 Security	130 Order Police	131 Contributions towards the cost of order police
j	Receipt from car/scooter/cycle parking at stations/Rly. Premises.	Z Sundry earnings	-	-	200 Rents & Tolls	240 Land	246 Receipts from car/scooter/cycle parking at Stations/Rly premises

Z B B – ZERO BASED BUDGETING

Z B B – ZERO BASED BUDGETING

Salient Features:

ü  A technique of planning and decision making which reverses the working process of traditional budgeting.

ü  In traditional budgeting (incremental budgeting), Managers justify only increases over the previous year’s budget and what has been already spent is automatically sanctioned.  No reference is made to the previous level of expenditure.

ü  By contrast, in Zero-based budgeting, every department function is reviewed comprehensively and all expenditures must be approved, rather than only increases.

ü  Requires the budget request be justified in complete detail by each Manager starting from the Zero-base.

ü  The zero base is indifferent to whether the total budget is increasing or decreasing.

ü  ZBB is especially encouraged for Government budgets because expenditures can easily run out of control if it is automatically assumed what was spent last year must be spent this year.

ADVANTAGES:

ü  Efficient allocation of resources, as it is based on needs and benefits.

ü  Drives Managers to find cost effective ways to improve operations.

ü  Detects inflated Budgets.

ü  Useful for especially Service Departments like Telecom, Railways etc, where the output is difficult to identify.

ü  Identifies and eliminates wasteful and obsolete operations.

ü  Eliminates the “spend it or lose it” mentality of traditional budgets/incremental budgets.

DISADVANTAGES:

ü  Difficult to define decision units and decision packages.

ü  Time consuming and exhaustive.

ü  Difficult to understand and communicate the budgeting because more managers are involved in the process.

ü  Forced to justify the every detail related to the expenditure.  So not suitable for R & D depts.

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