1 Responsibility for Finance and Accounting 1 - 14
25
P R E F A C E
These Financial Instructions are issued with the authority of the Minister of Finance and it is the duty of the Permanent Secretaries and Accounting Officers to ensure that all their officers who have financial responsibility are conversant with the contents and have access to a copy.
The purpose of the Instructions is to set out the methods by which funds are made available to the executive, the ways in which control is exercised within and over the executive, and the financial duties and responsibilities of public officers.
The general rules embodied in the Instructions are to be supplemented by the issues of Departmental Instructions to cover detailed procedures within the ambit of these rules. These instructions will be issued on the authority of the Permanent Secretary after confirmation by the Ministry of Finance acting in consultation with the Accountant General and the Director of Audit. Regulations concerning General Accounting procedures will be issued by the Accountant General as required, after approval of the Ministry of Finance.
Amendments to the Instructions approved by the Ministry of Finance will be serially numbered for each year of issue, and officers to whom the Instructions have been issued are required to ensure that these are inserted immediately. Similar action is required in respect of Departmental Instructions and General Accounting Regulations issued by the Accountant General.
Section C o n t e n t s Financial
Instructions
1 RESPONSIBILITY FOR FINANCE AND ACCOUNTING 1 - 14
2 ESTIMATES 15 - 17
3 AUTHORITY FOR EXPENDITURE 18 - 38
4 CONTROL OF EXENDITURE 39 - 51
5 PAYMENTS (GENERAL) 52 - 68
6 PAYMENT OF WAGES 69 - 78
7 PAYMENT OF SALARIES 79 - 92
8 PENSIONS 93 - 102
9 IMPRESTS 103 - 107
10 REMITTANCES 108 - 115
11 ADVANCES 116 - 124
12 DEPOSITS 125 - 131
13 REVENUE 132 - 170
14 REVENUE COUNTERFOIL BOOKS 171 - 182
15 REFUND OF REVENUE AND OVERPAYMENTS 183 - 190
16 ADJUSTMENTS 191 - 195
17 ACCOUNTS 196 - 229
18 STATEMENTS 230 - 255
19 CUSTODY AND SECURITY OF PUBLIC FUNDS 256 - 283
20 BOARDS OF SURVEY 284 - 288
21 LOSSES AND SHORTAGES AND SURPLUS 289 - 302
22 BOARDS OF ENQUIRY 303 - 306
23 INSURANCE AND ACCIDENTS TO GOVERNMENT
MOTOR VEHICLES 307 - 317
24 TENDERS BOARD AND TENDERS 318 - 332
25 CONTRACTS AND JOBBING ORDERS 333 - 346
PAPER MONEY REGISTER APPENDIX
S E C T I O N 1
RESPONSIBILITY FOR FINANCIAL AND ACCOUNTS
The Minister
Under Section ...... of the Constitution of...... The Governor General, acting in accordance with the recommendation of the Prime Minister, assigns to a particular Minister responsibility for the financial affairs of the Government, and this Minister is the Minister of Finance; it is the function of the Minister of Finance to give effect to the decisions and instructions of the Minister taken or issued in accordance with his responsibilities.
The Permanent Secretary Ministry of Finance
2. The Permanent Secretary (Finance) is the chief adviser to the Minister of Finance on all financial matters and is the permanent head of the Treasury. He is responsible for the implementation of all policy decisions of the Minister of Finance and of the Cabinet insofar as there is a financial consideration involved. He is responsible for the preparation of the consolidated estimates of revenue and expenditure in accordance with any directions given him by the Cabinet and the Minister of Finance.
3. All correspondence and communications on financial matters must be addressed to the Permanent Secretary (Finance). Permanent Secretaries of Ministries shall communicate with the Permanent Secretary (Finance) when addressing the Minister of Finance.
4. One of the main duties of the Ministry of Finance is to secure compliance with the Financial Instructions. Whenever the Permanent Secretary (Finance) considers that there has been a contravention for which formal disciplinary action is desirable and that
(1) the action taken by the Permanent Secretary excising any delegated disciplinary powers has been inadequate, or
(2) a Permanent Secretary is willing to refer the matter to the Public Service Commission or to the Judicial Service Commission, as may be appropriate,
he may himself refer the case to the appropriate Commission, stating explicitly whether it is one in respect of which any delegated power
have already been exercised.
The Accountant General
5. The accounting operations of the Government are under the general management and supervision of the Permanent Secretary (Ministry of Finance) and he shall, through the Accountant General,
(1) ensure that a proper system of accounting is established in every government Ministry and department;
(2) exercise supervision over the receipt of public revenue and ensure that it is collected with the least delay;
(3) bring promptly to account, under the proper Heads and subheads, all money, whether revenue or other receipts, paid into the Treasury or accounted for to him;
(4) ensure that roper provision is made for the safe keeping of public monies, securities, stamps, stamp dies, revenue counterfoil books and such valuable documents as may be entrusted to his care;
(5) exercise supervision over all the officers of the Treasury entrusted with the receipt or expenditure of public money, and over the sub-accountants.
(6) Take precautions, by maintenance of efficient checks, including surprise inspections, against the occurrence of fraud, embezzlement or carelessness;
(7) Supervise the expenditure and other disbursements of the government, and in particular, ensure that no payment is made which is not covered by proper authority, expressed or referred to on the voucher relating to it, and call attention in writing to any apparent extravagance or any apparent defect in the provision for the charge owing to the exhaustion of a vote;
(8) Promptly charge his accounts under the proper Heads and subheads all disbursement of the Government, whether they be expenditure or other payments;
(9) Prepare the financial statements and returns, and render the accounts for audit by the Director of Audit.
6. The Accountant General shall report immediately to the Permanent Secretary (Finance) any material irregularity connected with the public accounts that may have been brought to his attention.
Director of Audit
7. The Director of Audit is responsible for the Audit and inspection of all public accounts of the Government, whether such accounts be of general revenue and expenditure or accounts of special funds or departmental accounts.
8. The Director of Audit is not responsible for the accuracy of the books of account, or for the efficacy of accounting procedures, so as to relieve the Accountant General, Permanent Secretaries, Heads of Departments or other accounting officers of the responsibility therefore, which primarily rests with them. He shall nevertheless apply such an examination as will enable him to ascertain that the accounts are kept on a proper and adequate system, that they are functionally and properly posted and that the checks against irregularity and fraud are adequate and effective.
Accounting Officers
9. Any Permanent Secretary, Head of Department, officer controlling expenditure, sub-accountant, imprest holder, collector of revenue or other office whose duties involve responsibility in connection of public money, must, insofar as the following requirements may be applicable to his particular duties,
(1) see that the proper system of accounts as prescribed by or under the authority of the Minister of Finance is established and maintained;
(2) exercise supervision over the receipt of public revenue and ensure its punctual collections;
(3) bring promptly to account, under the proper classification all money, whether revenue or other receipts, accounted for to him;
(4) see that proper provision is made for the safe-keeping of public money, securities, stamps, revenue counterfoil books, licences, etc;
(5) exercise strict supervision over all officers under his authority entrusted with the receipt or expenditure of public money, and take precautions by the maintenance of efficient checks, including surprise inspections against the occurrence of fraud, embezzlement of careless ness;
(6) bring to notice without fail, any incompetence or repeated carelessness on the art of his subordinates;
(7) report to the Accountant General (or to the Head of his Department if appropriate) any apparent defect in the procedure of revenue collection, or any apparent defect in the procedure of revenue collection, or any apparent waste or extravagance in expenditure which comes to his notice in the course of his accounting duties;
(8) take care that no payment is made that is not covered by proper authority, expressed or referred to on the voucher relating to it;
(9) promptly charge in his accounts under the proper Heads and subheads of the estimates of other approved classifications all disbursements of the Government, whether expenditure or other payments;
(10) promptly prepare such financial statements as are required by the Finance and Audit Ordinance and by these instructions;
(11) produce when required by the Accountant General or by the Director of Audit or any such officers as may be authorized by them, all cash, stamps, books, records or vouchers in his charge;
(12) promptly reply to any queries addressed to him by the Accountant General or by the Director of Audit giving full particulars or information required; a reply must be furnished within fourteen days; if a complete reply cannot be given, and interim reply must be submitted;
(13) check daily all stamps and cash in his charge and verify the amounts with the balances shown in the stamp register or cash book
(14) promptly bring to account as revenue any cash or stamps found in his charge in excess of the balances shown in the cash book or register;
(15) promptly make good any deficiency in cash or stamps for which he is responsible;
(16) ensure that all books are correctly posted and are kept to date;
(17) study the public convenience and institute such arrangements as may properly be made to facilitate the transaction of business with the public.
10. All accounting officers are personally and peculiarly responsible for the due performance of the financial duties of their departments or offices, for the proper collection and custody of all public money receivable by them, and for the accuracy of the accounts rendered by them.
11. No officer will be relieved from any portion of his responsibility should he depute to his subordinates the performance of duties which he should have performed himself but which he considers reasonable to depute, and the responsibility of the Director of Audit for checking and reporting any shortcomings in connection with the public accounts or finances does not absolve any officer from his responsibility for complying or securing compliance with instructions within the scope of his own authority.
12. Negligence in carrying out the requirements of Financial Instruction 9 shall form the basis for disciplinary measures.
13. The Director of Audit or any officer deputed by him is at all times entitled to have access to all books, records or returns relating to accounts, and to all accounting officers shall give him every facility for inspecting such documents. He shall also have authority to carry out surveys of cash, stamps, stores and all accounting procedures.
Sub-accountants
14. A sub-accountant is an officer who is entrusted with the receipt, custody and disbursement of public money, and who is required to keep one of the recognized cash books, the transactions in which are accounted for to the Accountant General and subsequently entered in the final accounts. He is required, in particular, to
(1) receive public money direct from the public, or from a revenue collector or from any other source;
(2) issue a receipt from an official receipt book for all sums paid to him;
(3) enter the amounts promptly in his cash book, and
(4) put the money in his safe if he does not pay it into the appropriate bank account;
(5) be sure his disbursements are in;
(6) obtain properly completed payment vouchers, with the recipients’ receipts thereon, for all payments he makes;
(7) enter his disbursements promptly in his cash book;
(8) balance his cash book daily;
(9) check the balance with the cash on hand;
(10) reconcile the bank balance shown in the cash book with the bank pass book;
(11) prepare a monthly account and send it supported by the receipt and payment vouchers, sorted and listed on schedules as may be required, and accompanied by any other necessary documents, to the Accountant General;
(12) ensure that all revenue collectors at his station pay their collection to him, or to the appropriate bank account, at the proper time;
(13) require revenue collectors paying in, the imprest holders recouping their imprests, to present their cash books;
(14) advise the Accountant General of any cases brought to his attention of departmental supervision not being maintained.
(15) check, from time to time, the stocks of revenue counterfoil books and licence and fee books, and any stocks of stamps and other items of value;
(16) ensure that the official cheque book is locked up when not in use;
(17) Retain in his possession the keys of strong-room or safe, or of any cupboards containing receipt and licence books or other articles of value:
(18) Lock up all money not in immediate use in the safe;
(19) Always lock the safe immediately he has completed the purpose for which he opened it, and after locking it, try the handle to make sure all is secure.
S E C T I O N 2
ESTIMATES
15. Draft Estimates of Expenditure for the forthcoming year must be sent by the Permanent Secretaries of each Ministry to reach the Permanent Secretary (Finance) not later than the 1st August in each year. A full explanation must be given of any appreciable differences between any figures submitted and those approved in the Estimates for the previous year. Similar draft Estimates of Revenue for the forthcoming year will be sent to the Permanent Secretary (Finance) when these are required.
16. It is most important that a Head of Department or Permanent Secretary should personally supervise the preparation and accuracy of any estimates that may be called for: under-estimation and over-estimation alike are the cause of considerable embarrassment to the Government. The officers will be held responsible if any necessary expenditure, which could reasonably have been foreseen, is overlooked.