Controller General of Accounts is the principal Accounts Adviser to the Government of India and is responsible for establishing and maintaining a technically sound management accounting system.
He prepares a critical analysis of expenditures, revenues, borrowings and the deficit for the Finance Minister every month.
He also prepares annual Appropriation Accounts and Union Finance Accounts for presentation to the parliament.
Overview of the organization
The accounting setup is highly decentralised in the civil Ministries. A Chief Controller of Accounts or a Controller of Accounts heads Civil Accounts Units at the Ministry level and report to CGA. The CCAs/ CAs function through a Principal Accounts Office at the Ministry headquarters and several Pay and Accounts Officers at the field level spread all over the country.
The PAOs have the authority to release payments on behalf of the Government and to collect revenues of the government.
Overview of accounts
The Constitution of India provides for the manner in which the accounts of the Government have to be kept. An Article of the Constitution provides for creation of a Consolidated Fund of India, Contingency Fund and Public Account.
All revenues received, loans raised and all moneys received by the Government in repayment loans are credited to the Consolidated Fund of India and all expenditures of the Government are incur from this fund. Money can be spent through this fund only if appropriated by the Parliament. Consolidated Fund has further been divided into ‘Revenue’ and ‘Capital’ divisions.
All other moneys received by or on behalf of Government are credited to the Public Account.
Contingency Fund enables the Government to meet unforeseen expenditure, which cannot approval of the Parliament. For meeting such exigencies, advances are made to the executive from Contingency Fund which are subsequently reported to the Parliament for recoupment from t Consolidated Fund of India.
One of the most distinctive features of the Government accounts in India is the minute detail w which the financial transactions are recorded in the account books. All transactions are classified on six tier functional classification with Major Heads representing a broad function of the Government the top and an Object Head representing the activity at the bottom. The intermediate levels sub-functions, programmes, schemes and sub-schemes. The functional classification is applicable receipts as well as payments.
Since the country follows a Plan based model of economy, the expenditure of Government is division into Plan and non-Plan. As the name suggests, the Plan expenditure is directly related to expenditure on schemes and programmes envisages in the Plans. The non-Plan expenditure is the expenditure incurred on establishment and maintenance activities.
Further distinction is made between the expenditure, which under the provisions of the Constitution, is subject to the vote of the legislature and the rest which is charged upon the Consolidated Fund of India.
Since the budget is on an annual basis, the accounts have to conform to it. The accounts are maintained on cash basis. Only the actual receipts realised and the payments made during the year are recorded.
The following duties and functions are performed by CGA.
Receipts &, payments
As collections agent of the government of India, the CGA through CCAs and their PAOs is responsible for proper accounting of collections of revenue and ensuring that the amounts are quickly credited to the government account.
One of the main functions performed by the Civil Accounts Units under the CGA is budgetary control over the expenditure. The control is exercised through the Pay and Accounts Offices who have the authority to release payments of all claims arising out of Governments operations. In certain cases where it is not possible to open a Pay and Accounts Office, departmental authorities at appropriate level are authorized to incur expenditure subject to the limits prescribed in the letter of assignments issued from time to time by the concerned Pay and Accounts Office.
Controller General of Accounts is the apex accounting body in the Government of India. The accounts of the Civil Ministries are compiled and maintained by the Pay and Accounts Offices, the basic accounting units.
The Pay and Accounts Offices maintain line item-wise accounts of all the transactions involving Consolidated Fund of India, Contingency Fund of India and Public Account of India. Various subsidiary accounts such as Loan accounts, Fund accounts etc. are also maintained by these units.
The accounts compiled by the Pay and Accounts Offices are consolidated on a monthly basis in the Principal Accounts Offices at the Ministry’s headquarters. The consolidated accounts of the Ministry are rendered to the Controller General of Accounts. The accounts received from various Ministries are consolidated in the office of the Controller General of Accounts to generate the accounts of the Government of India as a whole.
These monthly accounts are reviewed and a critical analysis of expenditure, revenue collection, borrowings and deficit is prepared for Finance Minister.