Concept. Sources of Funds. Scope of Government Accounting. NPSAS Cash. Exercise. Financial Control Measures SUTRA

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1 1 Managing Finance efficiently, Financial Control Measures II Concept Sources of Funds Scope of Government Accounting NPSAS Cash Exercise Financial Control Measures SUTRA l Trilochan Poudyal Sundar Shrestha

2 Financial Control Measures 2 Financial control is concerned with tracking and reporting on allocation, disbursement, and utilization of financial resources, using the tools of budgeting, accounting and auditing. Financial controls are the means by which an organization s resources are directed, monitored, and measured.

3 Reimbursement Account 3 ADB s reimbursement is made only to the GON Central A/C For Reimbursable Loan Financial Comptroller General Office A/C No: For Reimbursable Grant Financial Comptroller General Office A/C No:

4 Financial Controls Measures 4 Objectives of Financial Control Measures Maintain Financial Discipline Ensuring the accuracy of reporting Allocation of Resources in Strategic Priorities Ensuring Value for money Eliminating fraud and protecting Protecting the organization s resources

5 Scope of Government Accounting 5 Expenditures Accounting Revenues Accounting Deposit Accounting Inventory Accounting Project Accounting

6 6 Integrated Finance Code, Classification and Explanation It has been approved by OAG on 2074/7/1 From FY 2074/75 implementation at provincial government and local government From FY 2075/76 at Federal Government Revenue, Expenditure, Assets and Liabilities: Federal Government, Provincial government and local government It is used in planning, budgeting, accounting and reporting

7 NPSAS Cash 7 Nepal Public Sector Accounting Standard Cash Basis Receipt and Payment Account Recording of Inter Entity Transactions Comparison of Budget and actual Expenditures Accounting policies and notes to accounts Basis to convert into NPSAS accrual basis

8 8 Managing Finance efficiently, Financial Control Measures III & IV Sundar Shrestha Gobinda Bhandari Exercise

9 Existing Mechanism of Financial Control Measures 9 Policies Documents Process Tools and Techniques Information Technology Structure Bodies

10 Financial Control Measures through Budgeting 10 Budget making process (Plan & program submit), Implementation, Public hearing, overview of annual progressive report. Maintain macro economic goal Budget Ceiling Guideline Formulation of Budget

11 Financial Control Measures through accounting 11 Accounting: Record Keeping and Reporting Reporting System: (Monthly, Quarterly and Yearly), Social audit and Public audit Inventory Inspection Report.

12 Financial Control Measures through auditing 12 Auditing Approaches Auditing Process Internal audit guideline 2073

13 Auditing Process 13 Notification Planning Implementation Reporting Follow Up Quality assurance

14 14 Exercise

15 Project Accounting Project Accounting Policy 15 Basis of Accounting: Cash Basis of Government Accounting System Mode of Payment: Within Approved budget on project of foreign aid: Cash, Direct payment, Letter of Credit (LC) and commitment letter will be payment methods Recognition of Project Expenditure Value Date Source and application of Fund Fiscal Year

16 GoN Cost Vs Donor s Category 16 GON budget classification and code will be applied for budgeting, record keeping and reporting to the GON agencies Whereas donor s category will be applied for record keeping, reporting and disbursement purpose (donor s requirement) PMU/DPOs should keep the record both for GON and donor s requirement

17 Reporting 17 Full document Procedures Non Statement of Expenditures (Non SoE ) Statement of Expenditure Procedures Project Management Report (PMR) or Financial Management Report (FMR) Performance Based

18 Unaudited Project Account 18 Sources and Uses of Funds Anusuchi ( Including Statement of Designated/ Imprest Account) 1. Signed By: A/C officers & Project Coordinator of PCT/PCU Name and Project Name 2. Signed By: Director General (Department) and Secretary General (Ministry):Office and Name 3. Signed By: Financial Comptroller ( FCGO ) : Name Supplement of Summary of Sources and Uses of Funds (Anusuchi ) WB- Cumulative up to last year, Total of current year and cumulative up to date ADB Total of the previous year, Current year and Cumulative up to date Schedule No - 1 Statement of Release ( Anusuchi ) Schedule No - I A

19 Audited Project Account 19 Sources and Uses of Funds Anusuchi ( Including Statement of Designated/ Imprest Account) 1. Signed By: A/C officers & Project Coordinator of PCT/PCU :Name and Project Name 2. Signed By: Director General (Department) and Secretary General (Ministry ) :Name 3. Signed By: Financial Comptroller ( FCGO ) : Name 4. Signed By: Deputy Auditor General (OAG) Name Supplement of Summary of Sources and Uses of Funds ( Anusuchi ) Schedule No - 1 Statement of Release ( Anusuchi ) Schedule No - I A

20 Financial Monitoring Report Statement of Source and fund 2. Financial Statement 3. Statement of Designated Account/ Imprest Account 4. Summary of Trimester wise Budget Allocation 5. Statement of Cash Withdrawal (Disbursement) 6. Statement of Exchange Gain/Loss

21 Financial Reporting of Project Accounting 21 Monthly SOE (source wise): OAG Form NO 213 Monthly statement of outstanding advance: OAG Form NO 14 Annual financial statement (Source wise): OAG Form NO 208 Annual statement of retention money: OAG Form No 19 Annual statement of outstanding advance: OAG Form NO 14 Statement of outstanding payment: OAG Form No. 18

22 Receiving Model of Property 22 Purchased by the Government Receiving from foreign aid (Commodity) Turnkey Commodity Thing to be considered while receiving commodity and if that commodity has to allocate and handover to project Per unit cost Receiving Date Detail descriptions of goods Discount on Custom

23 Accounting of Turnkey Assets 23 After completion of project the government will take over and record management will be maintained according to commodity procedures.

24 स थ न य सञ च त क ष ब यवस थ पनप रण ल Sub-national Treasury Regulatory Application-SUTRA Budgeting 2. Accounting 3. Reporting 4. DTCO 5. Monitoring 1, 2 and 3 for Local level and 4 & 5 for DTOs, FCGO and MoF and others entities for reporting Deposit and revenue models are preparing.

25 25 Thank You

Current Status of Accounting Basis in the Government of Nepal

Current Status of Accounting Basis in the Government of Nepal Sundar Shrestha Deputy Director of Studies NASC Presentation Outline Introduction Purpose and Research questions Research Methods Assumptions