FAR - Fixed Asset Register

FAR  - Fixed Asset Register

·         Fixed Assets occupies significant portion of Total Assets (Fixed Assets + Current Assets) in Indian Railways.

·         Compiling FAR is the important stage in the implementation of Accrual Accounting in Indian Railways.

·         All the Fixed Assets that are in existence as at the end of the year i.e., before adopting the Accrual Accounting in IR shall have brought to the FAR.  So that closing balances of previous year Asset Heads forms Opening Balances of current year Balance Sheet.

·         Definition of Fixed Assets   - IGFRS 2 (Indian Govt Financial Reporting Standards) issued by GASAB – Govt Accounting Standards Advisory Board  is

1.       The Property Plant & Equipment

2.       It should be tangible

3.       Held by an entity for use in Production / Supply of Goods & Services / for Rental to others / Administrative purpose (Office Building like Zonal Hqrs, Divisional Hqrs etc)

4.       Expected to be used during more than one reporting / financial year.

·         Fiduciary control  - Leased Assets in IR i.e., Rolling Stock from IRFC are also brought under FAR (though IRFC is the legal owner)

·         Not covered under FAR  - Insignificant items like Library Books, Computer peripherals, small items of equipments. However major spare parts and standbys equipment used more than one year are comes under FAR.

·         FAR  - The following information includes about Fixed Assets

1.       Description (in detail)

2.       Stockholder code (i.e., SSE, Sr.DEN, TXR etc)

3.       Block Section  (Between two Railway stations to trace the location in open line)

4.       Cost of Acquisition / Construction ( Acquisition Cost = Purchase Price + Import duties + Taxes + Incidental expenses – Trade discounts)  -“Where an Asset does not have a determinable cost, a nominal value of Re One may be taken for financial statement purpose” .  But this is the last alternative.

5.       Improvements should add to the cost  (But not POH or repair charges)

6.       Date of Acquisition (for Civil works – Completion of Construction.  For others – Purchase date)

7.       Mode of Acquisition  ( Construction, Purchase, Transfer, Gift etc)

8.       Reference of Title Documents

9.       Codal Life  (as per codes)  - useful for calculation of Depreciation

10.   Allocation Code – (Source of Allocation i.e., CAP., DRF, DF etc and Allocation i.e., Plan Head, Sub Head etc)

11.   Depreciation Rate   (Cost minus salvage value /codal life)

12.   Accumulated Depreciation  - From the date of acquisition to preparation of FAR

13.   WDV – Written Down Value / Net Book Value  ( Total cost minus Accumulated depreciation)

14.   Remarks  - Any other significant remarks (example encroaching of land )

FAR – Different formats for different category of Assets

FA 1 – Land		FA 2 – Buildings		FA 3 – Bridges, Tunnels, ROB
FA 4 – Roads and streets		FA 5 – Track /P Way (Source: TMS – Track Management System  Separately for Rails, Sleepers & Ballast)		FA 6 – Furniture  (source: T & P register)
FA 7 – Office equipments (Source: T & P Register)		FA 8 – Commercial Vehicles		FA 9 – Plant & Machinery and Equipment (Except for S&T Dept)
FA 10 – Computers & Peripherals (Source: T&P register)		FA 11 – Medical equipments		FA 12 – Rolling Stock (compiled by ICAI-ARF  central team duly taking the records from Zonal Rlys)
FA 13- CWIP – Capital Works In Progress (at present no concept in IR)		FA 14 – Plant, Machinery & Equipment of Signal Dept		FA 15 – Plant, Machinery & Equipment of Telecom Dept
FA 16 – Electrical equipment & fittings of Commercial Dept		FA 17 – Intangible Assets (Copy rights, patents, Goodwill, Software etc)		FA 18 – OHE (Over Head Equipment)

·         T & P Register for source of FA 6 (Furniture), FA 7 (Office equipments) & FA 10 (Computer peripherals)

·         FA 13 – CWIP - Capital Works In Progress is new concept for Indian Railways

·         FA 12 – Rolling Stock - ICAI ARF (Institute of Chartered Accountants of India – Accounting Research Foundation) Central team collects the details from Zonal Hqrs records – Most of the Rolling stock is leased from IRFC

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MBE - Management By Exception - for LDCE

MBE  - Management By Exception   -  for LDCE

      Concept by Frederick W. Taylor ( 1856 – 1915) – An American Mechanical Engineer and one of the first Management Consultants.

      He was instrumental in the creation and development of branch of engineering that is now known as “Industrial Engineering”.   “The Principles of Scientific Management” authored by him was voted as the Most influential Management book of the 20^th Century by the Fellows of the Academy of Management.

      Key feature: Attention only to material deviations, which requiring investigation.

      Routine decisions making should be handled by Lower Level Managers, who report only exceptional cases to Higher Management.

      A policy by which Management devotes it’s time to investigate only those situations which actual results differ significantly from the planned results. Creating the Right conditions /Benchmarks in the first place, then only intervening when things are not going as per Bench marks.

      Use of MBE in Project Management: The Project Board should meet when key decisions about the Project should be taken, and not on regular intervals. For this, the Manager should produce “Exception Reports” (like RAR – Revenue Allocation Registers and Price Ledgers in Indian Railways) to summon the Board for such meetings.

      MBE gives Management more opportunity to evaluate the administrative ability of their lower level Managers.

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Ways and Means

Ways and Means

      Meaning: Methods & Resources for raising the necessary revenues for the expenses of a Nation/Country.

      Monitoring by: Budget Division of Department of Economic Affairs under Ministry of Finance.

      Object: To keep a watch over the progress of Actual with the Estimates (Budget) and follow up Ways & Means position of Govt of India.

      Financial Review of Govt of India, wherein the Receipts and Expenditure position is monitored closely.

      Ways & Means in IR - Account Current of Indian Railways as a whole is sent to Ministry of Finance for incorporating the figures of Railways Receipts and Expenditure as a part of Ways and Means of Govt of India.  

      The Review should be as realistic as possible.  That is the reason; IR is switching over from Double Account Current to Single Account Current from the year 2017 October onwards, duly dispensing the Approximate Account Current.

      For the purpose of Ways & Means, the Ministry of Finance receives Monthly Report (in the form of Account Current) consisting of Cash inflows and Cash outflows from all Ministries including Indian Railways.

Ways and Means – 4 parts
Revenue		Expenditure		Debt		Remittances

 

IROAF - Indian Railways Organization for Alternate Fuels

IROAF

ü  Source: Click for IROAF Website

ü  Stands for Indian Railways Organization for Alternate Fuels

ü  Hqrs: New Delhi

ü  Headed by CAO – Chief Administrative Officer (HAG Officer)

ü  Vision: To emerge as a world class organisation in setting standards, development, research and execution in fuel and energy efficient and eco-friendly technologies, primarily for assimilation in IR. 

ü  Main Object: Search for viable alternatives to Fossil fuels.

ü  Indian Railways, being the largest single entity, which buys and uses energy in various forms, has the potential to become a leader in promoting the green economy and stimulate growth in the alternate energy industry.

ü  Nodal agency in India – Ministry of New and Renewable Energy

ü   Apart from alternate fuels, it is being progressively realized that saving of petroleum fuels is “another source” of fuel.

  Missions of IROAF

1.       Bio Diesel

2.       CNG – Compressed Natural Gas

3.       LNG – Liquefied Natural Gas

4.       Fuel Cell - The first prototype small scale fuel cell is operational in an ALCo locomotive in the TKD diesel shed. It is a 2KW system which provides auxiliary power when the main engine of the locomotive is shut down. This is the first ever initiative in Indian Railways

5.       Solar energy

6.       Other emerging technologies

 Role of IROAF

ü  Emerge as a leader in introduction of Alternate Energy, Fuel efficient and emission control technologies. 

ü  Function as single window entity for knowledge and database on technologies, CDM – Clean Development Mechanism.

ü  Set and review of Missions (as stated above) and updated.

ü  Create a Knowledge centre.

ü  Tie up with leading institutions and coordinate with concerned Ministries, Depts., Research laboratories, Universities and International entities

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Green Railways - REMCL

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·        ·         Indian Railways  vision is to become Green Railways

·         Click for REMCLCorporate Website

·         Stands for Railway Energy Management Company Limited.

·         Established in 2013 year (under the Companies Act, 1956)

·         as a joint venture (JV) company Indian Railways (49%) and RITES ltd ( 51 %)

·         Object : Tap the business potential in the energy sector.

·         Renewable Power projects in Solar and Wind sectors

·         Hqrs - Gurgaon, (New Delhi)

·         2018-19 Financials

1.       Profit  - Rs. 49.46 Crores

2.       Turnover - Rs. 83.03 Crores

3.       Share Capital - Rs. 70 Crores

·          Solar Power Projects: 1000 MW of solar roof top & ground mounted power plants to harness the untapped potential of roof-top spaces on Railways buildings, stations, hospitals etc. and vacant Railways land lying with different ZR.

BINA Plant  - Record break - First of its kind project in the World

·         1.7 MW Solar Plant - TSS - Traction Sub Station at Bina, Madhya Pradesh.

·         A CSR project (Corporate Social Responsibility) of BHEL - Bharat Heavy Electricals Limited

·         Connected directly to Overhead Traction system for running of Trains - First time in the World

·         Innovative technology for converting DC - Direct Current to single phase AC - Alternating Current for feeding directly to Railway's Overhead traction system.

·         It can produce approx. 25 lakh units of energy annually and savings to IR exchequer for Rs. 1.37 Crores every year.  

Indian Railways & Solar power

·          Indian Railways - Going to transform itself as "Net Zero" Carbon Emission Mass Transportation Network - by 2030 year.

·          Planning Solar projects on un utilized Railway land on mega scale.

·         IR wants to become a Green mode of Transportation - by meeting its entire traction power requirements

·           Here after RE Projects means, not only Railway Electrification Projects, but also Renewable Energy Projects.

·         Land based Solar Power Plants - Planned by REMCL

1.       50 MW Solar power plant - Bhilai

2.       2 MW Solar power plant - Diwana (Haryana)

·         1 GW solar plants - Planning installation of solar projects along operational Railway Track to enable to injection of solar power into traction network directly - innovative concept. 

·         Already REMCL floated Tenders for 2 GW of Solar projects on unutilized Railway lands.

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