Cash Imprest

Cash Imprest

Authority: 1) Para No.1050 of Indian Railways Finance Code Volume 1

                     2) ACS No.83 vide Railway Board Letter No.2016/F(X)II/10/27 dated 13.03.2018

                   3) Item No.1 (A) of Part C of Model SOP (Schedule of Powers)

·         What is the meaning of Imprest in general ?  A sum of money advanced to a person for a particular purpose or  A fund used by a business for small items of expenditure and restored to a fixed amount periodically (say one month)

·          

·         Definition of Cash Imprest by Railways is “ An Imprest is standing advance of a fixed sum of money placed at the disposal of an Individual (Officer or Supervisor) to meet the following types of expenditure.

1.       Petty Office expenses

2.       Cost of raw materials for the diet of Indoor patients of Hospitals

3.       Emergent charges which cannot be foreseen

4.       Other petty expenses up to an amount of Rs. 15,000 /- in each case subject to a certificate recorded by procuring official/Imprest holder in the format given below.

“I am personally satisfied that these goods are of the requisite quality and specification and have been purchased from a reliable supplier at a reasonable price”  

·         GM has full powers in respect of sanctioning cash imprest to the Officers & Supervisors.

·         As per Model SOP, PHOD, HOD, DRM, ADRM,CWM & SAG officers in field units have full powers to sanction the Cash Imprest to the Officers & Supervisors.

·         Finance concurrence is required for fixing the Cash Imprest amount.

·         Cash imprest amount to be created purely on the need basis.

·         Cash Imprest amount to be reviewed periodically.

·         The amount of an Imprest must not be larger than is absolutely necessary.

·         It should be reckoned at the lowest possible figure calculated to suffice for meeting the office expenses.

·         Total amount of expenditure through cash imprest should not be exceeded the Budget grant for the purpose during the year.

·         The Cash Imprest holder may sanction emergent petty advances out of Imprest money placed at his disposal. ( that is Mini cash Imprest out of Cash Imprest sanctioned to the Officer/Supervisor)

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EMD – Earnest Money Deposit (as per GCC for Works – Nov, 2018)

EMD – Earnest Money Deposit

(as per GCC for Works – Nov, 2018)

ü  Earnest means – Showing sincere interest/serious in participating the Tender process, if awarded executing the Work for Organizations like Indian Railways.

ü  EMD – Earnest Money Deposit – means an earnest payment as specific form of Deposit to demonstrate that the applicant is serious/sincere to participate the Tender work and complete the work for orgnisations like Indian Railways, if awarded.

ü  EMD Rates are as follows.

Value of the Work	EMD Amount ( Rounded to a nearest Rs.100)
Up to Rs.1 Crore	2 % of value of the work
Beyond Rs. 1 Crore	Rs. 2 lakhs + 0.5 % of the excess of the estimated cost of work beyond Rs.1 Crore

ü  Maximum EMD is Rs. One Crore only.

Examples for calculation of EMD under different circumstances: -

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1.       Value of Work  - Rs. 25,60,520

2 % of Rs.25,60,520  - Rs. 51,210

Answer is Rs. 51,200 /- (Rounded off to a nearest Rs.100)

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2.       Value of Work  - Rs. 4,00,00,000 ( Rs. Four Crores)

First one Crore	Rs.2,00,000 (Rs. Two Lakhs)
One Crore to Four Crore ( 3 Crores)	Rs.3 Crores x 0.5 % = Rs. 1,50,000 (Rs.1.5 Lakhs)
For Value of Rs.4 Crores	Rs.2 Lakhs plus Rs.1.5 Lakhs = Rs.3.5 Lakhs

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3.       Value of Work  - Rs. Two Hundred Crores

First one Crore	Rs.2,00,000 (Rs. Two Lakhs)
One Crore to Two Hundred Crore ( 199 Crores)	Rs.199 Crores x 0.5 % = Rs.99,50,000
For Value of Rs.200 Crores	Rs.2,00,000 plus Rs.99,50,000 = Rs.1,01,50,000.  However maximum EMD is Rs.1 Crore.  So EMD is Rs.1,00,00,000/- ( Not Rs.1,01,50,000)

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ü  EMD is applicable to all modes of Tenders such as Open, Limited, Single etc.

ü  Exemption for Submission of EMD – Firms recognized as “STARTUPS” by DIPP (Dept of Industrial Policy & Promotion.

ü  EMD of Successful Tenderer – Retained as part of Security Deposit.  But Railway shall return the EMD, if a Successful Tenderer submit “Term Deposit Receipt (TDR) / Bank Guarantee Bond towards the Full Security Deposit.

ü  EMD shall be deposited in Cash (through E-Payment Gateway) or as mentioned in Tender documents.

ü  EMD of unsuccessful Tenderers – Returned to them. But Railway is not liable to pay the depreciated value, if any or any interest on EMD.

ü  Forfeit of EMD:

1.       If the successful tenderer unable to submit the PG – Performance Guarantee within validity of time, or

2.       If the successful Tenderer resile/abandon from his offer, Or

3.       Modify the terms and conditions there of in a manner not acceptable to the Railways.

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Video Lesson - Allocations - Practical examples

Letter of Credit - Most Important Question

LC - Letter of Credit

(Most important question for Expenditure and Stores optional)

·         New initiative in Indian Railways

·         With effect from - 01.04.2018

·          Applicable for supplies/ works, including all service and maintenance contracts

·         letter of credit (LC)  - mode of payment as an option in supply/works contracts to improve transparency and the ease of doing business.

·         Apply for tenders having an estimated value of or above Rs. 10 Lakhs

·         Shall include in tender conditions an option for the contractors to take payment from railways through LC arrangements

·         The incidental costs towards issue and operation of LC shall be borne by the supplier /contractor.

·         SBI - State Bank of India - to assess the value of LC and terms and conditions of LC.

·         The DA - Document of Authorisation will be issued against each bill submitted for payment by supplier/ contractor after exercising laid down checks as per Railway codes and manuals in executive and accounts offices .

·          Accounts Officer responsible for passing claim will issue the DA. issue of they will be captured in IPAS and IREPS to ensure that there is no duplicate payment against the said bill.

·         The introduction of the Letter of Credit (LC) payment method for supply/work contracts will significantly increase transparency and improve the ease of doing business.

·         The Sellers should bear a cost of 0.15 %

oo   How it works:  Flow of Letter of Credit transactions:

1.      SBI issues LC to a Seller

2.      Railways will issue DA - Document of Authorisation to the supplier/contractor for completed work

3.      The supplier /contractor will present the DA to his banker for necessary payment

4.      After release of payment to the supplier/contractor, the banker will send this DA to the Railways' banker (SBI) for release of payment to them

5.      The Railways banker (SBI) will reimburse the supplier/contractor bank, against the original DA issued by railway and the bill of exchange issued by the supplier/ contractor, after verifying the signatures.

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WTR - Wagon Turn Around with Practical example

WTR - WAGON TURN ROUND

ü  Definition:  The interval of time between two successive loadings of a wagon is called Wagon Turn Round.

ü  Wagon Turn Round performance is denoted in terms of "Days".

ü  If the No. of Wagon Turn Round days is reduced, the performance considered to be more  or vice versa.

ü  In simple terms, "calculated from the time a wagon is placed for loading till the time it again becomes available for reloading", is the actual wagon turn-round.

ü  Thus, all detentions to a wagon, from the time it is placed for loading till it is again placed for reloading after passing through the cycle of loading, dispatch, transit, unloading and again made available for reloading, enter into the calculation of turn-round.

ü  Means wagon turn round is 11 days means, the wagon could be loaded around 32 times a year. (360 days/11 days). 

ü  If wagon turn round is reduced from 6 days to 5 days, the same wagon could be loaded around 72 times a year. (360 days/5days).

Year	1950-51	2013-14
Wagon Turn Round	11 days	5.13  days

ü  This (Reduction of Wagon Turn Round days) has been achieved as a result of

a)    improved mobility of wagons.

b)    quick loading & unloading of wagons.

c)    reduction in detentions.

d)    and improvement in speed of goods trains.

ü  Formulae for WTR - Wagon Turn Round  = WB/(L+R)   

ü  WB is Wagon Balance (effective average),  L is Daily average number of wagons Loaded, R is Daily average number of wagons Received.

Practical example of WTR:

Calculate Wagon Turn Round from the following data:

1.    Daily Average Wagon balance: 15500

2.    Average daily non effective wagons  A) Sick - 200 B) Departmental -300

3.    Average daily loading - 800

4.    Average daily received - 700

Answer:

1.    Effective average wagon balance daily = Wagon balance minus Sick & Dept

                                                              = 15500 - (200+300)

                                                               = 15000

2.    WTR = WB/(L+R)   

WTR= 15000/(800+700)

WTR= 10

ü  Wagon is the bread earning horse of the Railways, load it adequately. Make it run and don’t stable it.

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Question papers - General Expenditure - Appendix 3 examination

Click here for Question papers of 

General Expenditure - previous years

Important questions - General Expenditure

General expenditure - Most Important Short notes (5 marks) in  Appendix 3A Exam.

My advice is to read and cover entire syllabus irrespective of Important or Not Important.  Subsequently put more preference for important ones because they are repeatedly asked in previous examinations as well as for importance they associated with in working of Indian Railways.

1. Two packet system of Tendering  - Click here

2. Asset Register - 2006 (WO)   Click here 

      3. Measurement Book 

4. Contractor's Measurement Book Click here

5. Cost over runs & Time over runs 

6. Development Fund 

7. Development Reserve Fund 

8. Capital Fund 

9. Railway Liability Reserve Fund /  Debt Service Fund Click here

10. RRSK  Click here

11. Public Private Partnership - PPP 

12. Differences between Demands Recoverable & Bills Recoverable  Click here

13. Differences between Lease and License Click here

14. Differences between Concurrence and Vetting Click here

15. EBR -Extra Budgetary Resources  

16. EBR(IF)  Click here

17. EBR(IRFC) Click here

18. EBR(PPP)

19. FDI - Foreign Direct Investments  

20. Development Order Click here

21. Unremunerative / Uneconomic Branch Lines Click here

22. Standards of Financial Propriety   Click here

23. Sources of Finance - Capital, Capital Fund, DRF, DF, RSF, EBR like IRFC, PPP, FDI etc,Click here

24. Seigniorage Charges Click here

25. RLDA - Rail Land Development Authority Click here

26. Model SOP Click here

27. Umbrella Works

28. GeM

29. New GCC for Works - Nov, 2018

30. GCC for Services

31. IRPSM - Indian Railways Projects Sanctions & Management Click here

32. Transformation cell Click here

33. Joint Ventures

34. COE - Control Over Expenditure

35. Tender/Contract documents Click here

36. IRSDC  Click here 
37. GFR - General Financial Rules Click here
38. GST - Goods & Service Tax Click here
39. OOT - Out Of Turn Works Click here
40. RSF - Railway Safety Fund Click here
41. Advances to Contractors  Click here
42. Tender Notice  Click here
43. Responsibility Accounting Click here
44. LHC - Line Haul Cost Click here
45. Cost Plus Tender / Cost Plus Contract Click here
46. Differences between IRCA and IRFA transactions Click here
47. Performance Guarantee Click here
48. Differences between SD and PG Click here
49. Price Variation Clause - PV clause Click here
50. Negotiation  Click here
51. Differences between Variation and Vitiation Click here
52. Counter Offer  Click here
53. Way Leave charges Click here
54. Line Capacity Works Click here

General expenditure - Important Essay questions(20 marks) in  Appendix 3A Exam.

My advice is to read and cover entire syllabus irrespective of Important or Not Important.  Subsequently put more preference for important ones because they are repeatedly asked in previous examinations as well as for importance they associated with in working of Indian Railways.

1.     What are the Measurement Books ? How are these maintained and what is their utility ? 1988 (WO)

2.     Under what circumstances can works be started before preparation of detailed estimates ? How are these regularised ?  1988 (WO)    

3.     What are the various types of tenders for contracts of civil engineering dept ? Give critical comments on each of these and mention the checks exercised in the Accounts Office while letting out such contracts.   1988 (WO)

4.     What are the Works Registers and what purpose do they serve ?  Bring out the pros and cons of single set and double set of Works Registers.  1988 (WO)

5.     Explain the term " Unsanctioned expenditure" with suitable examples.  What is the machinery for watching such expenditure and how is it ultimately regularised ? 1988 (WO)

6.     What are the Completion Reports (CRs) for works drawn up ?  What are the points that are looked into while certifying CRs ?  What are the implications of non-drawal of CRs expeditiously after the completion of works ?  1988 (WO)

7.     What is a Material -at-Site account (MAS) and what purpose does it serve ?  Explain briefly how it is maintained and reviewed .   1988 (WO)

8.      What is Railway Safety Fund (RSF) ?  For what types of work is it used ? How does RSF get credit for the use of Railway projects? - 2012 (W)

9.     What are the items to be verified while vetting a Revised Estimate ? - 2012 (W)

10.   What is meant by earnest money, security deposit and Performance Guarantee ? What are these important for ? - 2012 (W)

11.   What is a special limited tender ? How is it processed ? Explain in detail. - 2012 (W)

12.   What is the difference between RECT and PECT surveys ? How are these conducted?  What is the importance of survey in the sanction of a project?  - 2012 (W)

13.   What are the canons of financial propriety ? In this regard, how is irregular expenditure regularized ?  - 2012 (WO)

14.   What are the checks exercised by Accounts Office on: i) On account bills ii) Final Bills - 2012 (WO)

15.     What are the various records checked during the inspection of a PWI's Office ?  In case any irregularity is detected, what action is to be taken. - 2012 (WO), 1999 (WO)

16.  What do you understand by a Zonal contract ? How is it different from other works contracts ? - 2012 (WO)

17.  What is two packet system of tendering  ?  Discuss the advantages and disadvantages of this system ? - 2012 (WO)

18.   What role does the accounts department play with regard to control over revenue

     expenditure ? - 2012 (WO)