Indian Railway Codes and Manuals-Accounts Code-Chapter-2 (II)
CHAPTER-2
STRUCTURE OF RAILWAY
ACCOUNTS
201.
Commercial and Government Accounts:- The
financial transactions of a commercial concern should be recorded in such a way
as to show how its capital has been utilised, how it stands in relation to its
debtors and creditors, whether it is gaining or losing, what the sources of its
gains or losses are, and whether it is solvent or insolvent. The main
requirement of government accounting, on other hand, is that a systematic
record of all receipts and expenditure classified under certain appropriate
headings, should be available. The Government owned railways in India are a
departmental Commercial Enterprise. Railway accounts should, therefore, not
only secure the essential requirements of commercial accounting but also
conform to the practices of government accounting. This objective is achieved
by keeping the accounts of the railways on a commercial basis outside the
regular government account and by maintaining a link between the two to show
how much is coming into Government revenues through the railways and how much
is spent by the Government, whether as capital of revenue expenditure, in
carrying on the activities of the railways.
202
Capital and Revenue Accounts: – The accounts
of a railway presented in such a form as to facilitate a review of the finances
of the railway as a commercial undertaking are known as “Capital and Revenue
Accounts”. The Capital and Revenue Accounts of a railway are complied every
year (see Chapter VII) and included in the Annual Report of the Railway. The
various processes of accounting followed in Railway Accounts offices lead up to
these accounts.
203
The financial results of the working of a railway cannot be adequately gauged
unless separate accounts are maintained of its Capital transactions as
distinguished from its Revenue transactions. Capital transactions may be
broadly described as those which pertain to the acquisition of concrete assets
while Revenue transactions are those which relate to the working of the
railways, comprising both earnings and working expenses. The expenditure
incurred on acquiring concrete assets in connection with (i) unremunerative
projects, (ii) amenities to passengers and other railway users, (iii) amenities
to staff, and (iv) safety works, financed from the Development Fund, the
Accident Compensation, Safety and Passenger Amenities Fund and Revenue (Open
Line Works-Revenue) is accounted for separately. The expenditure on renewals
and replacements of railway assets is financed from the Depreciation Reserve
Fund and is accounted for accordingly. Detailed rules regulating the classifications
of transactions under Capital, Revenue, Depreciation Reserve Fund, Development
Fund, Accident Compensation, Safety and Passenger Amenities Fund and Revenue
(Open Line works Revenue) are prescribed in Chapter VII of the Indian Railway
Financial code, volume I.
204.
Expenditure of a capital nature incurred on railway assets is classified under
five heads viz., Capital, Depreciation Reserve Fund, Development Fund, Accident
compensation, Safety and Passenger Amenities Fund and Revenue (Open Line
works-Revenue). To give an overall picture of the expenditure of a capital
nature incurred by the Railways as distinguished from the expenditure actually
charged to Capital (loan account) a separate account is compiled namely, a
block Account which exhibits the entire expenditure of a capital nature
irrespective of the head of account to which it has actually been charged (see
paragraph 428 of the Indian Railway Financial Code). The Loan Account will give
only the extent of expenditure actually charged to capital.
205.
Government Accounts: – The accounts maintained in accordance with the
requirements of Government Accounts are collectively termed as the “Finance
Accounts.” The Finance Accounts of a railway are compiled annually, for the
purpose of presenting in a condensed form, the various transactions brought to
account in the books of the railway duly classified in accordance with the
heads of account prescribed for Government accounting (see Chapter VII).
206.
According to Article 266 of the Constitution of India, the Central Government
have a consolidated fund entitled the “Consolidated Fund of India”, into which
flow all the revenues (for the railways traffic earnings are the main source of
income) received by the Central Government, loans raised by the Government by
the issue of treasury bills, loans or ways and means advances, and moneys
received by the Government in repayment of loans and form which all expenditure
of the Central Government is met when so authorised by the Parliament in
accordance with law. The Central government have also a public account entitled
the “Public Account of India” into which all other public moneys received by or
on behalf of government are credited and from which disbursements are made in
accordance with the prescribed rules. The procedure to be followed for the
payment into, and the withdrawal, transfer or disbursement of moneys from, the
consolidated Fund and the Public Account and for the custody of moneys standing
in that Fund and Account, is regulated by law made by Parliament and pending
such legislation, by the rules made by the President under Article 283 of the
Constitution.
207.
The Central Government have also, as authorised in Article 267 of the
Constitution, a Contingency Fund entitled the “Contingency Fund of India”. This
Fund will be at the disposal of the President to enable advances to be made by
him for meeting unforeseen expenditure, pending authorization of such
expenditure by Parliament under Article 115 or Article 116. The procedure to be
followed for the custody of the payment of moneys into, and the withdrawal of
moneys from, the Fund is regulated by law made by parliament. (The procedure
for granting advances to meet unforeseen expenditure of railways is laid down
in paragraph 382 of the Indian Railway Financial Code.) Note – Though the
transactions of the Railway Ministry form part of the Consolidated Fund, the
Contingency fund and the Public Account of India, they are accounted for in the
“Railway Fund” which has been created proforma in the books of the Reserve Bank
of India
208.
Classification in government Accounts: – The government accounts are thus kept
in the following three parts:- Part I - Consolidated Fund of India. Part II -
Contingency Fund of India. Part III – Public Accounts of India.
(a)
Consolidated Fund of India. – In this part of
the Account there are three main divisions, namely:- (1) Revenue, (2) Capital
and (3) Debt (comprising public Debt and Loans and Advances). The first
division deals with the proceeds of taxation and other receipts, classed as
revenue and the expenditure therefrom. (In the case of the Railways, the
traffic earnings are the main source of revenues). The second division deals
with expenditure incurred with the object of increasing assets of a material
character (see paragraph 203) also and also receipts intended to be applied as
a set-off to capital expenditure. The third division comprises, so far as
Railway Accounts are concerned, of loans and advances made by Government
together with the repayments of the former and recoveries of the latter
(b)
Contingency Fund of India. – In this part are
recorded transactions connected with the Contingency Fund set up by the
Government of India under Article 267 of the Constitution.
(c) Public Account of
India – Here there are two main divisions, namely (I) Debt
(other than those included in Part I) and Deposits; and (2) Remittances. The
first division comprises receipts and payments other than those falling under
“Debt” heads pertaining to Part I, in respect of which Government incurs a
liability to repay the moneys received or has a claim to recover the amounts
paid, together with repayments of the former and the recoveries of the latter
such as Contributory/Non-Contributory Provident Fund Accounts, Staff Benefit
Fund, and all Railway Funds like the Development Fund, the Depreciation Reserve
Fund etc. The second division comprises all adjusting heads, such as transfers
between different accounting circles (for transactions appearing in the first
instance in the books of one Accounts Officer but finally transferred to those
of another).
209.
Extra-Railway Transactions.-Besides those mentioned in the preceding paragraph,
there are certain other transactions which, for convenience, are adjusted in
the books of Railway Account Offices, though they do not appertain to the
“Revenue” or “Expenditure” on Railways e. g., 216-Audit-Railway Audit Offices.
210.
Division by Heads of Accounts. – Within each of the divisions mentioned in
paragraph. 208, the transactions are grouped into sections, further sub-divided
into major heads of account. The main unit of classification is the major head
which has been allotted a distinct code number. There are sub-major heads,
under some of the major heads. The major/sub major heads are divided into minor
heads, the minor heads into sub-heads, and the sub-heads into detailed heads.
The major and minor heads of account of railway revenue, capital, debt and
deposits, and remittance transactions, and all other central transactions which
though not pertaining to railways are adjusted in railway books, are given in
Appendix IV to this code.
211.
“Commercial” and “Strategic” transactions – “Revenue” and “Capital”
transactions are further classified as “Commercial” and “Strategic” according
to the class of section of the railway line to which they pertain. A similar
classification is observed in regard to the Depreciation Reserve Fund
transactions also. A list of Strategic Railway lines in given below: -
212.
(I) Subject to such detailed instructions as have been prescribed with the
approval of the Comptroller and Auditor General of India, the working expenses
should be distributed between commercial and strategic sections of a Railway.
The actual expenses are to be charged to be the commercial and strategic
section where these can be ascertained. The remaining expenses are to be
apportioned between them on the following basis:- ( a) Engineering expenses to
be divided in proportion to engine track kilometrage. (b) Locomotive expenses
to be divided in proportion to engine kilometrage. (c) Carriage and wagon
expenses to be divided in proportion to vehicle kilometrage. (d) Traffic
expenses to be divided in proportion to train kilometrage. (e) Electrical,
Signal and Tele-communication expenses to be divided on the basis prescribed
for the department to which the service is rendered, vide clauses (a) to (d)
above. As regards Electrical and Signal workshops half of the expenditure may
be apportioned on the basis of engine kilometres and the other half in proportion
to the wagon/vehicle kilometres. (f) Expenses of other departments to be
divided in proportion to gross tonne kilometrage. (2) The Stores balances of
the Railway should be distributed between “Commercial” and “Strategic” on the
basis of the average issues of stores to the commercial and strategic sections
during the preceding three years. This distribution should be shown in the
schedule of expenditure (A-331) accompanying the monthly capital accounts.
213.
Exhibition of recoveries of Expenditure in government Accounts. – The general
rules regulating the exhibition of recoveries of expenditure in government
Accounts have been printed as Appendix V to this code. Subject to the detailed
instructions contained in this and other Indian Railway codes, these rules
should be followed in classifying recoveries. Note:- (1) Recoveries on account
of over-payment made in the previous year, other than over payments relating to
works-in-progress (i. e. works, the accounts of which are still open), stores
and other suspense accounts, should be recorded as “Earnings” under Z-650.
Other unclassified receipts. However, over-payment due to difference between
actual and assumed attendance should, when recovered, be adjusted in reduction
of expenditure even though the recovery is made in a subsequent year. (2)
Credit upto Rs. 10,000 relating to works, the accounts of which have been
closed should also be treated as “Earnings”.
214.
Exhibition of Inter-Railway payments in Government Accounts. – Payments
andrecoveries made by a Railway for the hire of goods vehicles to other
railways or for other items of expenditure for which adjustments between
railways are authorised by the railway board should be accounted for under one
and the same detailed head of account in the expenditure abstracts of both the
railways which are involved in the transaction.
215.
Inter-Departmental Adjustments – The principles and rules prescribing the
conditions under which one department may charge another department for
services rendered or article supplies, and the procedure to be observed in the
settlement of such charges have been laid down in Appendix VI to this Code.
216.
Purpose of Detailed Classification in Administrative Accounts. – A careful and
wellplanned analysis of all items of receipt and expenditure is a condition
precedent to an effective financial control and is the primary object of any
accounting classification. Such a classification will secure the requisite
degree of uniformity of accounting, a mid the volume and variety of the financial
transactions of railways. So as to render the accounts of different railways
comparable over the same time periods and to enable preparation of budget
estimates or forecasts of receipts and payments.
217.
Allocation of receipts and expenditure. – The primary responsibility for the
allocation of all receipts and payments rests with the concerned departmental
officers. Each bill or voucher received from them should show the correct
allocation of the receipt/expenditure in the fullest detail. The Accounts Department
is responsible for seeing, to the extent it is possible for them to do so, that
the allocation shown on the initial document is not prima facie incorrect.
218.
Correct classification should be followed in recording the expenditure in
accounts irrespective of whether provision in the budget has been made under
correct budget head. In order, however, to avoid undue variation between the
budget and accounts figures, changed in accounting classification will not
ordinarily be introduced during the course of the year. Note – In the case of
works, the allocation of which has to be changed during the course of a year
from one head of expenditure to another, classification of expenditure in that
year should follow the original allocation. The change should be given effect
to from the beginning of the next financial year only after making necessary
provision in the Budget at the Budget stage or at the Revised Estimate stage to
cover not only the estimated expenditure for the budget year but also write back
of the expenditure incurred from the commencement of the work to the end of the
previous year.
219.
Account Heads . – Some of the account heads in the railway books are operated
for purpose of maintaining a link (see paragraph 201) between the commercial
Accounts of the railway and the government Accounts. These heads are dealt with
in paragraphs 220 to 222. Other account heads, which need some explanation have
been dealt with in paragraphs 223 to 237.
ACCOUNT HEADS LINKING COMMERCIAL & GOVERNMENT ACCOUNTS
220
Demands Payable. – Unlike government accounts
which record expenditure only when actually disbursed or receipts only when
actually realised the railway accounts maintained on a commercial basis will
record the expenditure incurred or earnings accrued in a month irrespective of
whether they have actually been paid or realised. On the Expenditure side, the
revenue liabilities of the railway for a month, which are not payable within
the same month, are brought to account as working expenses for the month by
taking contra credit to a suspense head called “Demands Payable”. When the
railway’s liabilities are actually discharged by payments, this suspense head
is debited with the amount of the payment so made.Thus, the balance at the end
of the month in this suspense head will represent liability of the railway
incurred, but not actually discharged, during that month. Demands Payable is a
suspense head of account under the major head 346/347, Indian
Railway-Commercial Lines/Strategic Lines-Working Expenses. A separate account
should be opened for each month, such as “Demands Payable for April”, “Demands
Payable for May” etc. The accounts of a month are generally kept open upto the
end of the following calendar month. The journal entries exhibiting the debits
to the working expenses (for liability incurred) by credit to the suspense head
Demands Payable may be made actually in the following calendar month but will
be adjusted in the accounts of the relevant (previous) month. However, the
liability may be discharged by payment in the following calendar month, and
this transaction will be accounted for by debit to the head Demands Payable in
the accounts for the month in which the payment is made. This is because the
cash book for the month is closed at the end of the same month, whereas the
ledger and the journal for a month are kept open upto the end of the following
month. This is explained through the illustration given below: -It is important
that all working expenses, properly appertaining to a year, should be charged
to the Revenue Accounts of that year. For this purpose, it will be necessary to
estimate the probable charges for such items as Telegraph Department charges
for rent, maintenance and inspection, telephone, water and electricity bills,
overtime bills of staff and all other similar bills payable etc. In such cases,
the proper head of expenditure will be debited and “Demands Payable” credited,
the latter account being cleared in the accounts for the month in which the
actual payment is made. If the amount has been under-estimated a further entry
debiting the expenditure head by credit to "Demands Payable” will be
necessary; but if the estimate was too high “Demands Payable” will be debited
by Cash or Transfer only to the extent of the actual payment and a journal
entry debiting “Demands Payable” by credit to the head of expenditure
previously over debited will be made. Note: The following items of revenue
payments should be debited direct to final heads in the accounts of the month
in which the payments are made, without operating on the suspense head “Demands
Payable”.- (1) Special contributions to the State Railway Provident Fund and
gratuties. (2) Settlement dues. (3) Supply of Sundry materials. (4)
Advertisement charges. (5) Law charges. (6) Payment of Compensation under
Workman’s Compensation Act. (7) Service Postage stamps and other postal
charges. (8) Payment of Compensation for goods etc. lost or damaged. (9)
Stationery, Forms, Books, News Papers and Publications. (10) Repairs to
typewriters and office equipment. (11) Printing and Binding charges.
221.
Labour.- The
wages and allowances for a month of workshop staff are paid to them only in the
beginning of the following month. However, to ascertain the cost incurred on a
job in a month, it is essential that the value of the labour employed in the
shops is charged in the same month to the specific jobs on which the workshop
staff have been engaged. For this and other purposes therefore, the operation
of a suspense head similar to “Demands Payable” is necessary. The total wages
and allowances of staff employed in the shops during any month will, in the
first place, be credited to a head under the workshop manufacture suspense
(capital 7210) termed “Labour”. As the Labour Pay Sheets are passed in the Accounts
office for payment, the amount passed will be debited in the General Books of
the railway (paragraph 302) to the head “Labour” by credit to “Transfers
Revenue” (c.f. paragraph 404). The balance of the account “Labour” at the end
of the month will consequently represent liabilities on account of the wages
and allowances charged, but not as yet cleared by actual payment to the labour.
222.
Traffic Accounts. – This is a suspense head of
account under the major head 146/147 Indian Railway-Revenue Receipts-commercial/strategic
lines. This account serves the same purpose for earnings as “Demands Payable’
does for expenses. This head is debited with all earnings for the realisation
of which a Railway Administration is responsible, irrespective of whether the
earning relate to its own traffic or to traffic inter-charged with other
Railways. This account is credited with the realisation of all such earnings.
The balance in this account thus represents unrealised earnings either at the
stations or in the Accounts Office.
CERTAIN OTHER ACCOUNTS HEADS
223.
Miscellaneous Advances – this is a suspense
head of account under the major head 346/347 Indian Railway-Commercial
Lines/Strategic Lines-Working Expenses. This head is intended for the booking
temporarily, of the following classes of transactions pending adjustment to
final heads of account. (a ) Charges the allocation of which is not known or
which cannot immediately be adjusted to a final head; (b) Inter-departmental
transactions awaiting acceptance. Note – Transactions of outward monthly
accounts (vide paragraph 441) pertaining to other Government Departments should
as far as possible, be adjusted directly under “Remittance Account with State”
and not through “Miscellaneous Advances”. (c) Expenditure incurred for other
than Government Works in anticipation of receipt of deposits or pending
realisation of the amount expended. (d) Payments made in advance for stores to
be supplied. (e) Payments made in advance to Railway officials for local
purchases of material and other purposes pending rendering of accounts. Note -
This head is not to be mixed up with capital 7300 Miscellaneous Advances
appearing in the Classification of Capital and Other Works – Expenditure.
224.
“Other Railway” – this is a suspense account under
the major head 146/147- Indian Railway Revenue Receipts-commercial
Lines/Strategic Lines. All transactions regarding division of earnings between
Government railways will be passed through this account. The balance of this
account represents unadjusted through traffic transactions with such railways.
225.
Deposits –
Under the major head 845 Railway Deposit (in K-Deposit and Advances (b)-
Deposits not bearing interest), there are separate minor heads for Deposits of
Branch Line companies and unclaimed Provident fund Deposits. The sub-heads
under the Minor head “Other Deposits” are described in the subsequent
paragraphs. (1)Unpaid Wages – Wages and allowances of staff not paid to them by
the Cashier within the stipulated period (see para 1989) are taken to the
credit of the railway under this head of account. This head is debited with all
subsequent payments made to staff and is also debited with the amount of unpaid
wages transferred to Revenue or Capital heads of account in accordance with
para 319. (2)“Private Companies” – When, under orders of the competent
authority, through booking is permitted with companies or other carries who do
not bank with a government Treasury moneys due to them on the apportionment of
traffic for the month will credited to this sub head of the Deposit account.
This credit will be cleared by actual payment or by debit (by credit to
earnings) against moneys collected by private companies on behalf of Indian
Railways. (3) “Miscellaneous” – Under this sub-head are included Cash Security
Deposits, earnest money paid by tenderers for contracts, court attachment
recoveries, deposits by other parties on account of estimated cost of works to
be executed for them by the railway etc. Unpaid bills of contractors will also
be credited to this sub-head. The debits will consist of the refund or
repayment of previous credits and of amounts written-off under paragraph 321.
226.
State Railway Provident Fund – this is minor
head of account under the major head 805 State Provident Funds-C-Railways
(under I-Small Savings, Provident fund etc.). The transactions relating to
State Railway Provident fund, both contributory and non-contributory, will be
shown as sub-heads under this minor head. Unpaid Provident fund accounts will
be credited to this head of account (unless they relate to closed accounts, in
which case they will be credited to “Deposits”) Subsequent payment of such
amounts will only be made on pay orders drawn out by the Provident fund Section
in the usual manner.
227.
Staff Benefit fund. – This is a minor head of
account under the major head 821 General and other Reserve Funds (under
J-Reserve Funds (a)-Reserve Funds bearing interest). It will be operated in
accordance with the Staff Benefit Fund rules prescribed in the Indian Railway Establishment
Code. It will be credited, besides other items, with all fines realised from
employees of the Railway.
228.
General Provident Fund and other Provident Funds
– These heads record the credits to and payment from, the respective funds. The
rules in paragraph 226 to these funds mutatis mutandis.
229.
Cash – This head represents the amount held by
the Cashier for payment into treasury and the total of cash imprests with the
departmental officers. There is a minor head “Railways” under the major head
871-Departmental Balances under L-Suspense and Miscellaneous (c) Other Accounts
which is debited and credited with all cash transactions as recorded in the
General cash Book (A-304) and summarised in the General Cash Abstract Book
(A-306): the balance under this account will represent the amount held by
Cashier for payment into bank. Similarly, there is a minor head “Railways”
under the major head No. 872- Permanent Cash Imprest (under L-Suspense and
miscellaneous (c) Other Accounts) which represents cash imprests held by the
Railway Officers.
230.
“Capital Outlay” – All capital transactions
under final heads (i. e. with the exception of those under final heads
“Suspense heads” which will be closed to balance) will be closed to this
account.
231.
“Net Revenue” – All revenue transactions on
account of receipts and expenditure under final heads (i. e. with the exception
of those under “Suspense Heads” which will be closed to balance) will be closed
to this account.
232.
Miscellaneous Government Account – This is a
major head No. 880, under LSuspense and miscellaneous (e) miscellaneous, and is
operated along with the following minor heads: ---Ledger Balance Adjustment
Account. --Write Off from heads of Accounts closing to balance. This Account
will be used for closing of all heads of accounts which do not record Railway
revenue or expenditure. The balances, if any, under the debt and remittance
heads, with the exception of ‘Transfer Railways’ will, however, be closed to
‘Balance’. The transaction under the head ‘Transfer Railways’ will be closed to
a minor head of “Miscellaneous Government Account”, in the books of the
individual railways and to ‘Balance’ if there is any balance in the books of
the Railway Board. The transactions under the head ‘Deposits with Reserve Bank
(Railways)’ will be closed to minor head of “Miscellaneous Government Account”.
RESERVE FUNDS
233.
Depreciation Reserve Fund – Railways – This is
a minor head under the major 815 Depreciation/Renewal Reserve Funds. The
accounts of this fund will be maintained in the books of the Railways and in
the office of the Railway board. The receipts, which mainly consist of
contributions from Revenue on the basis of the recommendations of the Railway
Convention Committee and the interest on the Fund balances, will be credited to
the fund. The payments from the fund, mainly on account of replacement and
renewal of assets in accordance with the rules of the fund, will be debited to
the Fund. The Balance will be carried forwarded from year to year.
234
Railway Revenue Reserve Fund – This is a minor
head under the major head 816- revenue Reserve Funds (under J-Reserve Funds-(a)
Reserve Funds bearing interest) the account of the Fund will be maintained in
the Office of the Railway Board only. The Fund will be credited mainly with
appropriation from revenue surplus, interest on the balances of the fund and
loans from General Revenues. The accounts of the Fund will be debited with (i)
such sums as may be required for dividend equalisation that is to say to make
up the shortfall in the revenue surplus available for payment of dividend to
the General Revenues, (ii) repayment of loans form General Revenue and interest
on loan. The balance of the fund will be carried forward from year to year.
235.
Railway Development Fund- This is a minor head
under the major head 817- Development Funds (under J-Reserve Funds-(a)-Reserve
Funds bearing interest). The accounts of the Fund will be maintained in railway
board’s Office. The Fund will be credited with appropriation from revenue
surplus, interest on Fund balances and loans from General Revenue. The
withdrawals from the Fund will be in accordance with the rules of the Fund,
namely to meet the expenditure on providing amenities for passengers and other
railway users, labour welfare works, unremunerative operating improvements etc.
The balance of the Fund will be carried forward from year to year.
236.
Railway Pension Fund – This is a minor head
under the major head 821 General and other Reserve Funds (under J-Reserve Funds
(a) Reserve Funds bearing interest). Receipts into the Fund will consist of
appropriation from revenue/capital account, transfer from contributory
Provident Fund and interest on Fund balances. All payments relating to pension
and other retirement benefits to pensionable employees will be debited to the
accounts of the Fund. The balance of the Fund will be carried forward from year
to year.
237
Accident Compensation, Safety and Passenger Amenities Fund
- This is a minor head under the major head 821-General and other Reserve Funds
(under J-Reserve Funds, (a) Reserve Funds bearing interest). The Fund will be
credited with the amount collected as surcharge on passenger tickets (towards
accident compensation etc.) and interest on the balance in the Fund. The Fund
will be debited with (a) payments of compensation to passengers involved in
railway accidents, (b) expenditure on safety works such as Track Circuiting or
Axle Counters, Automatic warning System, Vigilance Control Device, Lifting
Barriers at level crossings, inter-locking of level crossing gates with signals
and such other safety works as may be authorised to be financed out of this
fund from time to time and (c) expenditure on specified items of passenger
amenities and allied works such as provision of platforms and covers there on,
Train indicator Boards, Rest Shelters for licensed porters etc. The balances of
the Fund will be carried forward from year to year.
Multiple choice questions:
Paragraph 201
- What
is the main requirement of government accounting?
- A) To show how capital is utilized
- B) To maintain a systematic record of all receipts and
expenditures classified under certain headings
- C) To determine if a business is solvent or insolvent
- D) To track the sources of gains or losses
- Railway
accounts in India must:
- A) Only conform to commercial accounting practices
- B) Only conform to government accounting practices
- C) Conform to both commercial and government
accounting practices
- D) Maintain separate records without any links
Paragraph 202
- The
accounts of a railway presented to facilitate a review of its finances as
a commercial undertaking are known as:
- A) Finance Accounts
- B) Block Accounts
- C) Capital and Revenue Accounts
- D) Public Accounts
- The
Capital and Revenue Accounts of a railway are included in the:
- A) Monthly Report
- B) Annual Report
- C) Quarterly Report
- D) Weekly Report
Paragraph 203
- Capital
transactions pertain to:
- A) Earnings and working expenses
- B) Acquisition of concrete assets
- C) Day-to-day operational expenses
- D) Debt and equity management
- Expenditure
on renewals and replacements of railway assets is financed from the:
- A) Development Fund
- B) Revenue (Open Line Works-Revenue)
- C) Depreciation Reserve Fund
- D) Accident Compensation Fund
Paragraph 204
- Expenditure
of a capital nature incurred on railway assets is classified under how
many heads?
- A) Three
- B) Four
- C) Five
- D) Six
- The
Loan Account shows the extent of expenditure:
- A) Actually charged to capital
- B) Financed from the Development Fund
- C) For renewals and replacements
- D) For unremunerative projects
Paragraph 205
- The
accounts maintained in accordance with the requirements of Government
Accounts are termed as:
- A) Railway Accounts
- B) Finance Accounts
- C) Public Accounts
- D) Block Accounts
Paragraph 206
- The
Consolidated Fund of India includes:
- A) All revenues received by the Central Government
- B) Public moneys received by or on behalf of the
government
- C) Unforeseen expenditure funds
- D) All other public accounts
Paragraph 207
- The
Contingency Fund of India is at the disposal of:
- A) The Prime Minister
- B) The Finance Minister
- C) The President
- D) The Comptroller and Auditor General
Paragraph 208
- Which
of the following is not a part of the government accounts?
- A) Consolidated Fund of India
- B) Contingency Fund of India
- C) Public Accounts of India
- D) Finance Accounts of India
Paragraph 209
- Extra-Railway
Transactions refer to transactions:
- A) Related to railway revenue
- B) Not pertaining to the "Revenue" or
"Expenditure" on Railways
- C) Pertaining only to government receipts
- D) Included in the block account
Paragraph 210
- In
government accounts, transactions are grouped into sections under:
- A) Major heads
- B) Minor heads
- C) Detailed heads
- D) All of the above
Paragraph 211
- Revenue
and capital transactions are further classified as:
- A) Commercial and Departmental
- B) Financial and Operational
- C) Strategic and Non-strategic
- D) Commercial and Strategic
Paragraph 212
- Locomotive
expenses should be divided in proportion to:
- A) Vehicle kilometrage
- B) Engine kilometrage
- C) Train kilometrage
- D) Wagon kilometrage
Paragraph 213
- Recoveries
on account of over-payment made in the previous year should be recorded
as:
- A) Earnings under Z-650
- B) Revenue transactions
- C) Capital transactions
- D) Loan recoveries
Paragraph 214
- Payments
and recoveries for the hire of goods vehicles to other railways should be
accounted for under:
- A) Different detailed heads of account
- B) The same detailed head of account
- C) Capital expenditure heads
- D) Revenue expenditure heads
Paragraph 215
- The
principles and rules for inter-departmental adjustments are laid down in:
- A) Appendix IV
- B) Appendix V
- C) Appendix VI
- D) Chapter VII
Paragraph 216
- The
primary object of any accounting classification is:
- A) Financial reporting
- B) Effective financial control
- C) Budget estimation
- D) Uniformity of accounting
Paragraph 217
- The
primary responsibility for the allocation of all receipts and payments
rests with:
- A) Accounts Department
- B) Finance Department
- C) Departmental officers concerned
- D) Railway Board
Paragraph 218
- Correct
classification should be followed in recording expenditure in accounts:
- A) Only if provision in the budget has been made
- B) Irrespective of budget provision
- C) Only at the end of the financial year
- D) Based on the initial document
Paragraph 219
- Some
account heads in the railway books are operated for:
- A) Maintaining a link between commercial and
government accounts
- B) Tracking only commercial transactions
- C) Tracking only government transactions
- D) Maintaining a link between revenue and expenditure
Answer keys:
Paragraph 201
- B)
To maintain a systematic record of all receipts and expenditures classified
under certain headings
- C)
Conform to both commercial and government accounting practices
Paragraph 202
- C)
Capital and Revenue Accounts
- B)
Annual Report
Paragraph 203
- B)
Acquisition of concrete assets
- C)
Depreciation Reserve Fund
Paragraph 204
- C)
Five
- A)
Actually charged to capital
Paragraph 205
- B)
Finance Accounts
Paragraph 206
- A)
All revenues received by the Central Government
Paragraph 207
- C)
The President
Paragraph 208
- D)
Finance Accounts of India
Paragraph 209
- B)
Not pertaining to the "Revenue" or "Expenditure" on
Railways
Paragraph 210
- D)
All of the above
Paragraph 211
- D)
Commercial and Strategic
Paragraph 212
- B)
Engine kilometrage
Paragraph 213
- A)
Earnings under Z-650
Paragraph 214
- B)
The same detailed head of account
Paragraph 215
- C)
Appendix VI
Paragraph 216
- B)
Effective financial control
Paragraph 217
- C)
Departmental officers concerned
Paragraph 218
- B)
Irrespective of budget provision
Paragraph 219
- A)
Maintaining a link between commercial and government accounts
Paragraph 220
24. What is the purpose of the
"Demands Payable" suspense head in railway accounts?
A) To record the earnings
accrued in a month
B) To account for the
revenue liabilities of the railway for a month
C) To maintain a record of
payments made to staff
D) To manage cash
transactions of the railway
Answer: B) To account for the
revenue liabilities of the railway for a month
25. What happens when the
railway’s liabilities are actually discharged by payments?
A) The working expenses head
is credited
B) The suspense head
"Demands Payable" is debited
C) The revenue account is
credited
D) The cash book is closed
Answer: B) The suspense head
"Demands Payable" is debited
26. What is an example of an
item that should be debited directly to final heads without operating on the
"Demands Payable" suspense head?
A) Telegraph Department
charges
B) Law charges
C) Electricity bills
D) Overtime bills of staff
Answer: B) Law charges
Paragraph 221
27. Why is a suspense head
similar to "Demands Payable" necessary for workshop staff wages and
allowances?
A) To ensure timely payment
to staff
B) To ascertain the cost
incurred on a job in a month
C) To manage
inter-departmental transactions
D) To clear unpaid wages at
the end of the month
Answer: B) To ascertain the cost
incurred on a job in a month
28. What represents liabilities
on account of wages and allowances charged but not cleared by actual payment to
labor at the end of the month? A) Transfers Revenue B) Labour Pay Sheets C) The
account "Labour" D) The General Cash Book
Answer: C) The account
"Labour"
Paragraph 222
29. What is the purpose of the
"Traffic Accounts" suspense head?
A) To record all expenses of
the railway
B) To account for
liabilities not discharged within the month
C) To serve the same purpose
for earnings as "Demands Payable" does for expenses
D) To manage
inter-departmental transactions awaiting acceptance
Answer: C) To serve the same
purpose for earnings as "Demands Payable" does for expenses
30. What does the balance in the
"Traffic Accounts" suspense head represent? A) Realised earnings B)
Paid wages C) Unrealised earnings D) Cleared advances
Answer: C) Unrealised earnings
Paragraph 223
31. Which of the following is
NOT an example of a transaction booked under "Miscellaneous
Advances"?
A) Payments made in advance
for stores to be supplied
B) Charges the allocation of
which is not known
C) Payments made in advance
to Railway officials for local purchases
D) Payments of compensation
under Workman’s Compensation Act
Answer: D) Payments of compensation
under Workman’s Compensation Act
Paragraph 224
32. What does the balance in the
"Other Railway" suspense account represent?
A) Payments made in advance
B) Unadjusted through
traffic transactions with other railways
C) Cleared
inter-departmental transactions
D) Realised earnings from
other railways
Answer: B) Unadjusted through
traffic transactions with other railways
Paragraph 225
33. Under which major head is
the "Deposits" account categorized?
A) 346/347 Indian
Railway-Commercial Lines/Strategic Lines-Working Expenses
B) 845 Railway Deposit
C) 146/147 Indian
Railway-Revenue Receipts-commercial/strategic lines
D) 880 Miscellaneous
Government Account
Answer: B) 845 Railway Deposit
34. What is included under the
"Miscellaneous" sub-head of the "Deposits" account?
A) Unpaid Provident fund
accounts
B) Cash Security Deposits
and earnest money paid by tenderers
C) Payments made in advance
for stores to be supplied
D) Charges the allocation of
which is not known
Answer: B) Cash Security Deposits
and earnest money paid by tenderers
Paragraph 226
35. Under which major head is
the "State Railway Provident Fund" categorized?
A) 805 State Provident
Funds-C-Railways
B) 821 General and other
Reserve Funds
C) 872 Permanent Cash
Imprest
D) 880 Miscellaneous
Government Account
Answer: A) 805 State Provident
Funds-C-Railways
Paragraph 227
36. The "Staff Benefit
Fund" will be credited with all fines realized from employees under which
major head?
A) 346/347 Indian
Railway-Commercial Lines/Strategic Lines-Working Expenses
B) 845 Railway Deposit
C) 821 General and other
Reserve Funds
D) 880 Miscellaneous
Government Account
Answer: C) 821 General and other
Reserve Funds
Paragraph 228
37. What do the "General
Provident Fund and other Provident Funds" heads record?
A) Credits to and payments
from the respective funds
B) Unpaid wages and allowances
of staff
C) Unrealised earnings from
traffic inter-charged with other railways
D) Payments made in advance
for stores to be supplied
Answer: A) Credits to and payments
from the respective funds
Paragraph 229
38. What does the minor head "Railways" under the major head 871-Departmental Balances represent?
A) Amount held by the Cashier for payment into the treasury
B) Credits and payments of Provident Funds
C) Unpaid wages and allowances of staff
D) Realised earnings from traffic inter-charged with other railways
Answer: A) Amount held by the Cashier for payment into the treasury
Paragraph 230
39. What will all capital
transactions under final heads be closed to?
A) Miscellaneous Government
Account
B) Capital Outlay
C) Net Revenue
D) Suspense Heads
Answer: B) Capital Outlay
Paragraph 231
40. What will all revenue
transactions on account of receipts and expenditure under final heads be closed
to?
A) Miscellaneous Government
Account
B) Capital Outlay
C) Net Revenue
D) Suspense Heads
Answer: C) Net Revenue
Paragraph 232
41. Which head of account is
used for closing all heads of accounts that do not record Railway revenue or
expenditure?
A) Ledger Balance Adjustment
Account
B) Write Off from heads of
Accounts closing to balance
C) Miscellaneous Government
Account
D) Remittance Account with
State
Answer: C) Miscellaneous Government
Account
Paragraph 233
42. What does the
"Depreciation Reserve Fund" mainly consist of?
A) Appropriation from
revenue surplus
B) Loans from General
Revenues
C) Contributions from
Revenue and interest on Fund balances
D) Payments for replacement
and renewal of assets
Answer: C) Contributions from
Revenue and interest on Fund balances
Paragraph 234
43. What is the "Railway
Revenue Reserve Fund" credited with?
A) Appropriation from
revenue surplus
B) Expenditure on safety
works
C) Payments relating to
pension and other retirement benefits
D) Replacement and renewal
of assets
Answer: A) Appropriation from
revenue surplus
Paragraph 235
44. What is the "Railway
Development Fund" used for?
A) Payment of compensation
to passengers involved in railway accidents
B) Replacement and renewal
of assets
C) Providing amenities for
passengers and other railway users
D) Repayment of loans from
General Revenue
Answer: C) Providing amenities for
passengers and other railway users
Paragraph 236
45. What are the receipts into
the "Railway Pension Fund" composed of?
A) Contributions from
Revenue and interest on Fund balances
B) Payments of compensation
to passengers involved in railway accidents
C) Appropriation from
revenue/capital account and interest on Fund balances
D) Payments made in advance
for stores to be supplied
Answer: C) Appropriation from
revenue/capital account and interest on Fund balances
Paragraph 237
46. What will the "Accident
Compensation, Safety and Passenger Amenities Fund" be debited with?
A) Contributions from
Revenue and interest on Fund balances
B) Payments relating to
pension and other retirement benefits
C) Expenditure on specified
items of passenger amenities and allied works
D) Appropriation from
revenue surplus
Answer: C) Expenditure on specified
items of passenger amenities and allied works
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