Appropriation Accounts

Appropriation Accounts

         Source: 4th Chapter of Finance Code

·         The statements which are presented to the Parliament (through PAC) ,

·         comparing the amount of actual expenditure with the amount of grants voted by the Parliament and Appropriations sanctioned by the President of India are called Appropriation Accounts

Grants	Voted	As voted by Parliament
Appropriations	Charged	As Sanctioned by the President of India

 

Object:

·         Budget is an instrument of Parliamentary financial control and an important management tool.

·         Parliamentary control not only secured by the fact that all the voted expenditure must receive Parliament’s prior approval, but also by system of reporting back to it (Parliament) through PAC

Prepared & Signed by:

Railway Board level	CRB and Member/Finance
Zonal Railway level	GM and PFA

 

Note: This cannot be delegated to any other authority.

·         Due Date: June/July

·         Submitted to Dy.C&AG/Railways, who has been entrusted by the C&AG with the duty of reporting on these Appropriation Accounts of Railways.

·         2 weeks time for Audit for vetting the Appropriation Accounts.

·         Presented to Parliament during Winter session of the Same Calendar year to which the accounts pertain.  (Example: 2019-20 Appropriation A/cs due 2020 Jan to December)

·         Reconciliation certificate: Certificate should be invariably be given under each SMH that actual have been reconciled with the figures in March Final Account Current.

 

·         Grant 83  - Ministry of Railways  (for 2020-21)  - Two parts i.e., Revenue & Capital

 

 

Form

                            Grant No. 83 (for the year 2020-21)-SMH – 01 – General Superintedence & Servces

(Rs. in thousands)

Minor Head	Final Grant	Actual Exp.	Excess/Saving With ref to FG	Excess/Saving With ref to (O +S)
200 Financial Management   ‘O’  - 80 ‘S”  - 30 ‘R’  -  (-) 10	100	85	(-) 15	(-) 25

 

‘O’ stands for Original Grant

‘S’ stands for Supplementary Grant

‘R’ stands for Residual Modification sanctioned by Competent authority (i.e., Railway Board, GM etc other than Parliament )  i.e., Reappropriations, withdrawals, surrenders etc,

·         Due to merger of Railway Budget with General Budget, Single Grant Account (82 for 2019-20, 83 for 2020-21) shall prepare.

·         Appropriation Accounts – Rs. In thousands

·         Annexures  - Rs in units

Total enclosures in Appropriation Accounts are 44

Description	No of enclosures
Grants/SMH	16
Annexures	10
Statements	15
Annexure G (Final Accounts)	3
Grand Total	44

 

Grants – Total 16 . They are as follows

 

1. MH 3001 (erstwhile Demand No. 1)

2. MH 3001 (erstwhile Demand No. 2)

3 to 14. Erstwhile Demands 3 to  14 (SMH 1 to 12 of MH 3002)

15. MH 5002 (erstwhile Demand No. 16)

16. Civil Grants (Loans & Advances, Pre partition payments, Interest on Debt, Income Tax, Deposits)

 

Annexures (Total 10)

Statements of

A.      Unsanctioned Expenditure

B.      Under charges detected by Audit and Railways

C.      Remission & abandonment of claims

D.      Expenditure on Important Open line Works & New Construction

E.       Expenditure on Strategic Lines

F.       Credits & Recoveries ( Estimated & Actual)

H.      Losses & Ex gratia payments (Rs. 5 Lakhs and above)

I.        Irregular Reappropriations

J.        Important Misclassifications

K.      Defects in Budgeting  (In fact, there is no alphabet K for this annexure. )

 

Statements: (Total 15)

1.       Statement showing Distributable Expenditure and Receipts

2.       Statement showing changes in Forms & Classifications

3.       Operating Ratio

4.       Statement showing credits to Capital for Retired Assets

5.       Statement of annual Voted and Charged expenditure

6.       DRF

7.       DF

8.       Capital Fund

9.       RSF & Debt Service Fund

10.   Pension Fund

11.   Statement of O/s balances under Suspense

12.   Stores A/c

13.   SA A/c

14.   P&L A/c of Catering Dept

15.   Statement of PH wise, Source wise, Works Expenditure (Gross, Credit & Net) and Voted & Charged. (New one - added in 2019-20)

Annexure G - Final Accounts - (complying the Commercial Accounts like Companies)

I - Capital Statement (Block A/c)  -  Part I - Commercial ,  Part II - Strategic

II - P&L A/c or Manufacturing A/c (Commercial & Strategic)

III - Balance Sheet (Commercial & Strategic)

 

 

Important change in Annexure J

(after merger of Railway Budget with General Budget from 2017-18 onwards)

Type	Examples	Dealt at
Misclassifications	Voted to Charged or vice versa Capital to Revenue or vice versa	Railway Board.  Unresolved will become part of Audit Report
Other Mistakes	One SMH to another SMH	Zonal Railway only (Need not send to Railway Board)

 

Explanations for Variations  - Revenue (from 2019-20 onwards – as per 17^th Loksabha recommendations)

Explanations for variations - Revenue

Excesses/Savings	5 Crores & above (irrespective of Percentages	Original Grant
Excesses/Savings	2.5 Crores or 10 % whichever is higher	Original Grant
Savings	1 Crore or 10% whichever is higher	Supplementary Grant
Excesses	Rs. 25 Lakhs and above	Sub Heads

 

·         Minor variations – should be explained. Because at IR level, these may be cumulative and required as such

·         Explanations should not be vague such as due to over estimates or covered by re appropriation etc.  It should be clear, precise and complete description.

Explanations for variations - Capital (for the following Plan Heads only)

1100	New Lines	All works
1400	Gauge Conversion	All works
1500	Doubling	All works
3500	RE	All works

 

3100	Track Renewals	Works of Rs. 20 Crores & above
3200	Bridge Works	Works of Rs. 20 Crores & above
3300	S&T	Works of Rs. 20 Crores & above

 

 

1.       Entire Supplementary Grant – if unutilised

2.       Entire Original  and Supplementary Grant – if unutilised

3.       10 % of Supplementary Grant or Rs. 1 Crore whichever is higher

 

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Classification of Expenditure - Recent changes - PPT prepared on 07.01.2021

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Classification of expenditure recent changes 07.01.2021 from Nageswara Rao M

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McQ on Budget

MCQ on Budget (During Zoom presentation on 27.12.2020)

1. Total number of erstwhile Demands in OWE - Ordinary Working Expenses of Zonal Railways ? 

Answer 1: 13

Answer 2: 11

Answer 3: 15

Answer 4: 16

2. Total number of erstwhile Demands in Indian Railways (prior to merger - including both Revenue and Capital) 

Answer 1: 16

Answer 2: 15

Answer 3: 13

Answer 4: 1

3. Which fund is described as "Reservoir of Government Money" ? 

Answer 1: Public Account of India

Answer 2: Deposit with RBI

Answer 3: Consolidated Fund of India

Answer 4: Central Government Treasury

4. Recovery of Provident Fund is accounted in ? 

Answer 1: Contingency Fund of India

Answer 2: Consolidated Fund of India

Answer 3: Public Account of India

Answer 4: Staff Benefit Fund

5. Commercial Accounts of Indian Railways are known as Capital & Revenue Accounts. Answer True or False 

Answer 1: True

Answer 2: False

6. Government Accounts of Indian Railways are known as Capital & Revenue Accounts. Answer True or False 

Answer 1: True

Answer 2: False

7. One of the options is not example of Charged expenditure 

Answer 1: Salary of Cabinet Secretary

Answer 2: Judgement/award of Court

Answer 3: Pay & allowance of C&AG

Answer 4: Pay & allowance of Chief Election Commissioner

8. Pick out the odd man out 

Answer 1: Staff Benefit Fund

Answer 2: Contingency Fund of India

Answer 3: Public Account of India

Answer 4: Consolidated Fund of India

9. Budget is a ________________ and _______________ document as per Indian Railway Finance Code Volume One (Chapter 3)

Answer 1: Constitutional , Management

Answer 2: Financial, Audit

Answer 3: Financial, Constitutional

Answer 4: Financial, Audit

10. As per Article 112(1) of Constitution of India, A statement of the estimated receipts and expenditure of the Government of India for that year’ referred to as the "__________________________" and popularly called the "__________________". 

Answer 1: annual financial statement, Annual Budget

Answer 2: Annual Budget, Annual Financial Statement

Answer 3: Annual Fiscal document, Management document

Answer 4: None of these

11. Which one is not example of Charged Expenditure in case of Indian Railways 

Answer 1: Salary and allowances of Chairman, RRB - Railway Recruitment Board

Answer 2: The salary, allowances and pension payable to or in respect of the CAG -Comptroller and Auditor General of India;

Answer 3: Any sums required to satisfy any judgement, decree or award of any Court or awards by Arbitrators where made into rule of court

Answer 4: Any other expenditure declared by the Constitution or by Parliament by law to be so charged

12. The Demands shall be for _____expenditure ; the credits or recoveries being shown in the form of _________ Demands. 

Answer 1: Net, footnotes to

Answer 2: Gross, deducted from 

Answer 3: Gross, footnotes to

Answer 4: Net, deducted from

13. The erstwhile Demands No. 1, 2 & 3 are in the nature of _______________ 

Answer 1: covering all Zonal Railways

Answer 2: Covering Railway Board only

Answer 3: Ordinary Working Expenses

Answer 4: General on cost

14. There is a single works erstwhile Demand No. 16 for all works Expenditure irrespective of source of financing. Say True or False 

Answer 1: True

Answer 2: False

15. First two digits in classification/allocation of erstwhile Demand No. 16 is ____________ 

Answer 1: Demand Number

Answer 2: Source of Finance

Answer 3: Plan Head

Answer 4: Activity

16. First two digits in Revenue classification shows ______ 

Answer 1: Source of Finance

Answer 2: Erstwhile Demand Number

Answer 3: Single Demand Number 83 (for 2020-21 FY)

Answer 4: Activity

17. Last two digits in Revenue/Capital classification shows_______ 

Answer 1: Main activity

Answer 2: erstwhile Demand Number

Answer 3: Sub activity

Answer 4: None of these

18. Total digits in Revenue classification/allocation are ____ 

Answer 1: 8

Answer 2: 7

Answer 3: 6

Answer 4: 9

19. Total digits in Capital classification/allocation are ____ 

Answer 1: 6

Answer 2: 7

Answer 3: 8

Answer 4: 9

20. Each erstwhile Demand has two-way classification by activity and by Primary units of expenditure. The activity classification identifies _______an expense item is incurred and Primary unit identifies ______ the expense item denotes 

Answer 1: Why, What

Answer 2: What, Why

Answer 3: Object, Why

Answer 4: What, Object

 

21. Ordinary Working Expenses (OWE) consists of ________ 

Answer 1: Erstwhile Demands 1 to 16

Answer 2: Erstwhile Demands 1 to 15

Answer 3: Erstwhile Demands 3 to 13

Answer 4: Erstwhile Demands 1 & 2

22. GWE - Gross Working Expenses consists of _______ 

Answer 1: Erstwhile Demands 1 to 15

Answer 2: Erstwhile Demands 1 to 16

Answer 3: Erstwhile Demands 3 to 13

Answer 4: Erstwhile Demands 1 to 14

23. Preparation of the Revised and Budget Estimates should commence at the '__________ level ’ 

Answer 1: Railway Board

Answer 2: Zonal Railway Headquarters

Answer 3: Grass Root, i.e., Division, Stores Depot, Workshop etc

Answer 4: Divisional Railway Headquarters

24. Accounts Dept (PFA) responsibility towards Budget is _______ 

Answer 1: Preparation

Answer 2: Compilation and scrutiny

Answer 3: Guidance to Executives

Answer 4: Approving

25. Credits or recoveries shall be __________from the scope of the demands presented for vote of Parliament :- 

Answer 1: Excluded

Answer 2: Included

26. The Grants are distributed by the Railway Board among the railway administrations are called as ______________and the orders by means of which the allotments are made are called as ______________ 

Answer 1: Allotments, Budget Orders

Answer 2: Budget Orders, Allotments

Answer 3: Spending Limit, Allotments

Answer 4: Allotments, Spending Limit

Answers:

1. 2

2. 1

3. 3

4.  3

5.  True

6.  False

7.  1 

8.  1

9.  1

10.  1

11.  1

12.  3

13.  4

14.  True

15.  2

16.  2

17.  4 (Primary Unit - Object of expenditure)

18.  1

19.  3

20.  1

21.  3

22.  1

23.   3

24.  2

25.  1

26.  1

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