Expenditure Management

1.0 2.0 a) b) Objective: Expenditure Management utilization of available funds. ensures optimum

Registers used in Expenditure Management are BCR Budget Control Register ECR Expenditure Control Register

3.0 Processes: 3.1 3.2 3.3 3.4 3.5 Expenditure Initiation Process Bill Preparation Bill Processing and Payments Personal Deposit Accounts Pension Management 3.1 Expenditure Initiation Process All the Expenditure initiation should start with Administrative/Expenditure Sanction, where as in a works project, in addition to the administrative sanction, technical sanction is also required.

Each Sanction will have sanction ID (Alpha numeric)

Steps involved in Expenditure Initiation Process. 3.1.1 Office concerned/Wing will prepare Expenditure Sanction Note (Including Proposal) through the system and sends it for Approval of Sanctioning Authority. Sanctioning Authority checks the sanction note if it is as per the limits of DFPR / GO (Delegation of Financial Power Rules) / Government Orders, he will approve and send back to office concerned else if it is not as per DFPR / GO Limit he will escalate it upwards If HoD is the sanctioning authority, he will sanction else he will escalate it to the Administrative Secretary for such sanction. Admin Sec checks if its defined in his limits in DFPR / GO he will approve and send back to HOD., or else will forward to Finance Department (Subsequently data flows in reverse direction) Finance Dept checks if it is as defined in his limits as per DFPR/GO he will approve and send back to Administrative Section or else will forward to ESC (Expenditure Sanction Committee). (Subsequently reverse flow will be done) ESC will take a final decision and sends back to Finance Department and subsequently the data flows in reverse direction

3.1.2

3.1.3

3.1.4

3.1.5

3.1.6

Questions: 1) How many types of Expenditure/Bill forms are prevailing currently, Please explain and give me the Hard Copy / Screen shots of it. 2) What is the Logic behind getting the Sanction ID. 3) Who is the Authorized persons to give the Administrative / Expenditure Technical Sanctions & what is the Process flow / workflow. 4) Please give the full list of Stakeholders.

5) What is the approval limits for Expenditure Sanctions., (Is it mentioned in DFPR) 6) What is the Checklist to be attached, (Supporting Documents for Bill Forms). 7) What is ESC? Is there any fixed committee above Finance department if so who are the people who will be comprised of or else what is the strategy for forming this committee? Who deals with ESC ? 8) Who is the Authorized person for Cabinet Sanctions 9) Who will give more information of DFPRs / GOs. 10) Who is the concern person in Finance TFR (Treasury Finance Rules) 11) How many Sections are there in Finance for Expenditure. 12) . Documents information: 1) 2) 3) 4) to be attached / Review or need more

Expenditure Initiation Form (Administrative/Expenditure/Technical Sanction Note). Other supporting Documents (for Sample) Minutes of the meetings of ESC (Sample) Cabinet Resolutions

7) 8) 10) .

References: 1) DFPR 2) AP Financial Rules 3) Budget Manual 4) 5) Green Channel Budget GO 6) Quarterly / Monthly Regulation GO List of Items Exempted from budget control. Treasury Code 9) Cabinet Resolutions (and also need to know who will upload these into the CFMS system) Any other GOs on Expenditure Initiation and Sanction. Interactions held with the following Business process owners for Initiation Process. Name Designatio Contact no Region Remarks n

3.2

Bill Preparation:

Bills are categories into two: 3.2.1Personnel Bills: (1)Pay bills and (2)Bill for Employee advances and claims. (Will be Handled by HCM Team) 3.2.2Other Bills: (Fully Vouched Contingency Bill / Abstract Contingency Bill / Detailed Bill) Pay Bills Process Steps: (Will be Handled by HCM Team) 3.2.1.1 Bills Section updates Payroll details of Employee and generates, reviews & the online pay bill Deduction schedules through the system and submit to HOO(Head of Office) / DDO(Drawing and Disbursements Office). 3.2.1.2HOO / DDO will check and Approve this bill and give alert to PAO(Pay and Accounts Office)/DTO(District Treasury Office)/STO(Sub Treasury Office) Documents to be attached / Review or need more information: 1. 2. APTC Form 47 Treasury Bill Register (TBR)

Bills for Employee Advances and Claims: (Will be Handled by HCM Team) 3.2.1.3Employee enters Allowance/advance Details with Supporting Documents (if any) and sends to HOD/Approving Authority 3.2.1.4 HOD /AA will review and Approve the claim and forward to Bill section for Payment (in case of GPF advance and email alert will be sent to AG on approval). 3.2.1.5Bills Section will Review the supporting documents and Generate online bill from CFMS and forward the same to DDO for his approval. 3.2.1.6 DDO will review and Approves using Digital signature and sends an alert to PAO/DTO/STO for further payment process. Other Bills 3.2.2.1 Fully Vouched Bill/Work Bill: The sanction note raised by officer concerned for office furniture requirements (ex. Purchase

of Office Chairs). After getting the approval from sanction authority, Officer concerned will survey the market and get the Quotations. After selecting the L1 quote a PO has been raised against the successful firm. (Follows the Flow chart Page 58). After receipt of the furniture and if it is as per specifications of PO Bill will be prepared by the Bills section after receipt of Invoice/delivery challans etc. for their submission in the Treasury to clear the vendor obligation of payment for the furniture supplied. Note: Fully Vouched Bills are made for office contingencies and not for work orders. Work Flow: Page 58 of 02.CFMS_RFP Vol I_annex II_FRS 3.2.2.2Abstract Contingency Bill: For any unforeseen, urgent expenditure (Dilsuknagar Bomb Blast) the AC Bill is drawn without detailed vouchers. The money drawn on AC Bills need to be adjusted by submission of Detailed Contingent Bill with all the vouchers etc. in any case before 30 days of drawl of money by way of AC Bill.

Work Flow: Page 61 of 02.CFMS_RFP Vol I_annex II_FRS References 1) Bill forms GO and All Bill forms 2) DDO List (Available in DTA Office ) 3) Settlement of AC Bill GO Questions 1) What is One Fourth Quarter in Impact system? 2) What is the approval process for each kind of Vouched Bill. 3) Timelines for settlement of AC bills (and also for triggering Alerts) 4) Needs clarification on point 42 page 67 for FRS Document(System shall facilitate adjustment of pending DC Bills amount from employees / DDO salary in case of default) 5) How many bills types are exists and how you are differentiating from each others.

Interactions held with the following Business process owners for Initiation Process. Name Designatio Contact no Region Remarks n

3.3 Bill Processing and Payment The payment of the bills prepared by the respective departments is made by DTO, STO, PAO (Hyderabad), and PAO (W&P). There are standard processes for processing the bills and payment to be followed across DTO, STO, PAO (Hyd) and PAO (W&P). On receipt of the bill at the DTO/STO/PAO, the front office will acknowledge the receipt of the bill through the system and generated Token Number. Then the bill is subjected to 3 level review: Case Worker-Accountant or Auditor), Immediate Supervisor-STO / Superintendent and Treasury Officer /PAO/Works PAO. After the review if the bill is in order it is approved the TO/PAO and depending on the mode of payments(Treasury/PD/ RTGS/ECS/NEFT/Cheque) and sends to Agency Bank for making payment to the vendor or else bill is rejected and return to DDO. Work Flow: Page 68 of 02.CFMS_RFP Vol I_annex II_FRS References: a) Bill forms GO and All Bill forms b) . c) . Interactions held with the following Business process owners for Initiation Process. Name Designatio Contact no Region Remarks n

3.4

Personal Deposit Accounts

(The Amount is allocated but not distributed or deposited in bank. Ie the funds will be available to the allocated limit but will be available only at the time of realization or on certain date)

PD Accounts are like bank accounts maintained at the Treasuries for local bodies, State Government Undertakings, Grant-in-aid institutions etc. Based on balance available in the PD Account, the PD Account holder makes the payment to the contractor/Vendor / employees. Note: The amounts in the PD Accounts also have time limit within which they are to be utilized else they will be lapse. Processes in PD accounts 1. Creation of PD A/c 2. Credit of Funds in PD A/c 3. Payment through PD A/c 3.4.1 Creation of PD Account At the request of HOD/HOO/DDO/PD Account Administrator for creation of PD a/c, based on the perceived needs of the PD Account Administrator sends for the approval to Administrative Secretary where he will review and forward to Finance Dept for Approval then the Finance Dept will review, approve and send to AG for concurrence. After AGs concurrence will review and create an ID (PD Account Number). HOD/HOO/DDO will have the transparency of the work flow. Work Flow: Page 74 of 02.CFMS_RFP Volume I Annexure II FRS Questions What is Education, Court, Revenue Deposit accounts and are there any other types of Deposit accounts. (How many types of Deposit accounts exists and what are there) 2) What is the base for the time frame(is it based on treasury rules and GOs or have any other rules). 3) Is there any K account as like in Madhya Pradesh. 4) Please provide the details of LOC, who they are maintaining and how many kinds if LOC prevails. 5) Who is authorized for issuing the LOC. 6) Please provide the formats / Forms related to Deposit accounts 1)
3.4.2 Credit of Funds in PD Account There are primarily three source of funds transfer to PD A/c viz. i. Grantin-Aid from the Government ii. Devolution of revenue collected by Government like property tax, professional tax, entertainment tax, etc.

iii. User Fee/ Service Charge/ Tax collected by or on behalf of PD A/c administrator and deposited in bank through treasury challan or direct receipts in the PD Account.

3.4.3 Payment through PD Account

PD A/c administrator is authorized to make eligible payments from the PD A/c. The payment from PD A/c is made in either of the following two ways: 1) Payment requiring prior enfacement by DTO/ STO/ PAO 2) Payment based on Letter of Credit (LoC) issued by DTO/ STO/ PAO to Agency Bank

Interactions held with the following Business process owners for Initiation Process. Name Designatio Contact no Region Remarks n

Pension Management:
Pension is give for service rendered to the Government. Hence Government Servants with required service will get the pension for the rest of their life after their retirement. On the death of the pensioner the family also gets the pension which is known as Family Pension. Pension Management Process 1) Pension Initiation 2) Pension Payment 3) Transfer of Pension Case 4) Pension Grievance 5) Contributory Pension Fund. 1) Pension Payment : For first pension from treasury APTC Form 75/76 is manually prepared by STO/PPO and forwarded to the bank. STO issues a Token Document. On presentation of the Token, Agency bank makes payment to pensioner either by account credit or by issue of cheque For Regular Pension Payment STO generates a report thru the Pen12 software system generating pensioner wise bank branch

wise payables for a month and sends to DTO for further validation and merger. DTO reviews and forwards the same along with a pay order to the Agency Bank to credit the link bank to credit the pay banks which credits the account of the pensioners.

Work Flow: Page 94 of 02.CFMS_RFP Vol I_annex II_FRS

References: 3.5 APTC forms 75 / 76(This is Prepared by STO for first pension payment. 3.6 PPO/GPO/CVPO forms/Documents 3.7 Revised Pension Rules. 3.8 GOMS no 213 3.9 Latest GOs on Life certificates and payment methods. 3.10 Latest orders on mustering of the pensioners. 3.11 Any other orders on pensions.

Abbreviations.
AA AC AG APTC BCO BCR CCO CFMS CVPO DC DDO DFPR DTA DTO ECR ESC FRS GO GOMS GORT GPF GPO HOD HOO Appropriation accounts Abstract Contingencies Accounting General Andhra Pradesh Treasury Code Budget Controlling Officer Budget Control Register Chief Controlling Officer Comprehensive Financial Management System Communication Value Payment Order Detailed Contingencies Drawing and Disbursement Office Delegation of Financial Power Rules Directory of Treasury and Accounts District Treasury Office

Expenditure Control Register Expenditure Sanction Committee

Functional Requirements Specifications Government Order Government Order Miscellaneous Government Order Routine General Provident Fund Gratuity Payment Order Head of the Department Head of the Office

LOC PAO PD PM PO PPO PPV PSA RFP STO TBR WP

Letter of Credit Pay and Accounts Office Personal deposit Pension Management Purchase order Pension Payment Order Pension Payment Order Pension Sanction Authority Request for Proposal Sub treasury Office Treasury Bill Register Works and Pay

For Ravi Further reference only 1) GO No 213 (unified Pension Payment scheme) 2) GO No 43 (Rationalization of Deposits) 3) GO No 517(Enforcing Financial Accountability on DDOs / COs / CCOs) 4) Ways and Means Handling in Payments/Expenditure Model. List of DDO, STO, DTO will be available in DTA office (Abids)

If you dont fight for what you want then dont cry for what you got.