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Regional Training Institute, Ranchi Structured Training Courseware on Treasury Inspection

Regional Training Institute, Ranchi Structured Training Courseware on Treasury Inspection. Session - 3 Internal Controls and Registers in Treasury. Learning Objectives. At the end of the session, the participants will be able to Define internal controls

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Regional Training Institute, Ranchi Structured Training Courseware on Treasury Inspection

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  1. Regional Training Institute, RanchiStructured Training Courseware on Treasury Inspection Session - 3Internal Controls and Registers in Treasury

  2. Learning Objectives • At the end of the session, the participants will be able to • Define internal controls • List and explain different types of controls, in particular controls relevant to a Treasury • Describe the important registers and records maintained at the Treasury and their nature and purpose

  3. Internal Control – Institute of Internal Auditors’ Definition • Process within an organisation designed to provide reasonable assurance regarding achievement of the following primary objectives • Reliability and integrity of information • Compliance with policies, plans, procedures, laws and regulations • Safeguarding of assets • Economical and efficient use of resources • Accomplishment of established objectives and goals for operations or programs

  4. Types of Internal Controls • Preventive • Detective • Directive

  5. Types of Internal Controls – Another Categorisation • Organisational controls • Rules, Regulations and Policies • Procedures and Instructions • Personnel • Accounting and Budgeting • Monitoring and Reporting

  6. Main Internal and External Controls in Treasuries • Participants to suggest examples for each Category • Internal Controls • Organisational Controls • Rules and Regulations • Procedures and Instructions • Personnel • Reporting and Monitoring • External Controls

  7. Review of Internal Controls • Adequacy • Appropriately designed to provide reasonable assurance regarding achievement of organisational objectives • Effectiveness • Controls operating as intended

  8. Treasury Registers and Records - Categorisation • Cash Book and related Registers • Allotments and LOCs • Cheque-Drawing Officers • Settlement with other Governments • Deposits

  9. Treasury Records – Categorisation (Contd.) • AC Bills and Ad-interim payments • Valuables and sensitive payments • Pay and Pension Payments • Miscellaneous

  10. Cash Book and Related Registers • Complete account of cash transactions and book transfers • Receipts • Disbursements • Non-banking Treasuries • Immediate entries on authorisation • Banking Treasuries • Entered on the basis of bank’s daily accounts, after reconciliation with

  11. Cash Book (Contd.) • Register of Challans Issued • Register of Orders for Payment • Banking Treasuries • Subsidiary Registers • Register of Receipts • Register of Payments • Net Daily Receipt/ Payment posted into Register of Reserve Bank Deposits

  12. Cash Book – Control Issues • Erasures / Overwriting forbidden • Accountant • Personal responsibility for cash book • Examines totalling of cash book and carry forward to subsidiary registers/ schedules • Totalling verified by another officer, nominated by TO

  13. Other Registers Related to Cash Book • Register of Challans Issued • Register of Orders for Payment • Register of Receipts • Register of Payments • Register of Reserve Bank Deposits • Posted from Bank’s Daily Scrolls • Verified with Bank Passbook on daily basis • Register of Adjustments by Transfer • For items posted by TO through book transfer

  14. Register of Allotment Orders • DDO-wise allotment order file • Allotment from Original Grants • Allotment from Supplementary Grants • Re-appropriation Orders • Critical to preventing excess drawal of funds by DDOs

  15. Register of Letters of Credit • Counterpart of Allotment Register for Cheque-Drawing Officers • For preventing excess drawals • Introducing greater financial control and discipline • Introduced in Bihar in 1983 for DDOs with cheque drawing powers

  16. Register of LOC (Contd.) • Three Form Register • Form I • Allotments received from HOD • Form II • LOCs issued to Sub-treasury • Form III • Progressive expenditure against allotment • For Banking Treasury / Sub-Treasury • Withdrawal against LOC watched by Bank

  17. Register of Consolidated Receipts-cum-Schedules for Forest Cash Remittances • Remittances by Forest Officers in the Register • Also used for Consolidated Receipts sent to DFOs • Register of Forest Cheques Paid • For recording funds supplied to Forest Disbursing Officers

  18. Registers for Inter-Government Settlements • Register of Adjustments between Central and State Government • For transactions under “Adjusting Account between Central and State Government • Register of Adjustments with other State Transactions • For transactions under “Inter-State Settlement Suspense Account” • Separate Registers for Transactions with Railways, P&T and Defence

  19. Deposits • Revenue Deposits • Civil Court Deposits • Criminal Court Deposits • Personal Deposit Accounts / Personal Ledger Accounts • Under Consolidated Fund / Under Public Account • Special Permission of Government & AG • Should not be misused for transfer of money from Consolidated Fund to prevent lapse of funds

  20. Deposit Registers • Register of Deposit Receipts • Every item of receipt entered in this register • Daily Total carried to Cash Book • Register of Repayment of Deposits • Repayment of deposit recorded here, as also against original entry in Receipt Register • Daily Total carried to Cash Book • Verification of identity, before repayment

  21. Register of Personal Deposits • Banking Accounts at Treasury • Government Officials • Autonomous /Quasi-Government Bodies • Sanction of Govt. and AG’s Concurrence • To be closed on 31st March, and balances transferred by –Debit to Expenditure Head • Except for Accounts of Non-Governmental Bodies

  22. Maintenance of PDA Register • Separate Ledger Page for each Account • Daily Totals from each account • Carried to Register of Personal Deposits • Daily Total carried to Cash Book • Account of Cash orders issued on Sub-treasuries maintained like a PDA • Personal Ledger for each Treasury • Payments at sub-treasury posted in PLA as repayment of deposits

  23. Registers of Civil and Criminal Court Deposits • Receipts and Repayments based upon orders of Competent authority • Details for each individual deposit to be recorded in the Deposit Registers

  24. Register of Deposit of Local Funds • Administrator-wise Deposit Register • Separate Column for each fund • Accounts of Local Funds (including Municipal Funds) to be kept distinct from Personal Deposit Accounts

  25. Plus-Minus Memoranda for Deposit Accounts • At the end of each month, plus-minus memoranda for • Revenue, Civil and Criminal Court Deposits • Each Personal Deposit Account • To be rendered to AG, along with monthly accounts

  26. AC Bill Register • Register of Abstract Contingent Bills maintained to • Prevent drawal of future AC bills, without settlement of earlier bills • Ensure submission of Detailed Contingent Bills within 2 months, and in any case, before the year-end

  27. Register of Ad-interim Payments • Separate register of ad-interim payments for bills presented and encashed at the Treasury • To be verified once a week by the Collector

  28. Register of Valuables • Receipt and return of chests, packets etc. • Received for safe custody from other Departments • Contents to be verified annually by the Department and the TO • Certificate of verification on the register

  29. Stamp Registers • Stamp Register for keeping account of receipts, issues, and balance of stamps • Sale Register, with names of Stamp Vendor • Register for receipt and disposal of unused/ damaged stamps • Monthly check of stamp balances at Sub-Treasuries by TO

  30. Other Registers of Sensitive Items • Register of Cheque Books • Register of Issue of Book of Drawals • Bill Transit Register, used by DDO for sending bills to Treasury • Register of Padlocks and Keys

  31. Gazetted Salary Register and Guard Files • Pay slips of gazetted officers entered in Salary Register • To prevent overpayment • Separate Guard Files for • Payslips issued by AG • LPCs of Gazetted Officers • To be cancelled, when they are transferred

  32. Register of Pension Payment Orders (PPOs) • Maintenance of PPOs • Guard Files for PPOs in loose sheets • In proper manner for book-form PPOs • PPO with full details to be entered in PPO Register

  33. PPOs - Control issues • Details of pension payment to be entered in Disburser Portion of PPOs • Proper identification of pensioner at the time of payment • Pensioners not drawing pension for 6 months

  34. PPOs – Control Issues (Contd.) • Closing of cases for dead pensioners • Return PPO to AG • Correct classification of pension payment • Up to Sub-Head Level

  35. Miscellaneous Registers • Guard File of Specimen Signatures of DDOs • To be used for verification of signatures of DDOs on Bills • Register of Misclassification by the Bank • Token Register • Register of Treasury Voucher Slips • Register of Zamindari Compensation Bonds

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