1. Transfer EntriesRTI Jammu1 Transfer Entries

2. RTI Jammu2 Session Overview Transfer Entries required to: Correct errors of classification in initial accounts received from treasuries, account compiling officers etc.; Correct errors of classification while compiling the accounts; Carry out periodical adjustments like credit of interest on ‘interest earning balances in DDR heads’

3. Transfer EntriesRTI Jammu3 Session Overview Transfer Entries and records connected therewith are important records to keep a track of various adjustments and to ensure that transfers and adjustments are allowed only on the authorizations of competent authority.

4. Transfer EntriesRTI Jammu4 Session Overview During this session, we will discuss: What is a Transfer Entry? Preparation of Transfer Entry. Object of Transfer Entry. Maintenance of Transfer Entry Book

5. Transfer EntriesRTI Jammu5 Learning objective At the end of the session, the learner will be able to define Transfer Entry, its use and accounting procedure.

6. Transfer EntriesRTI Jammu6 Concept of Debit and Credit in Government Accounts The terms debit and credit or ‘Dr’ and ‘Cr’ used in Government Accounts or used in the transfer entries have the following meaning: -

7. Transfer EntriesRTI Jammu7 Concept of Debit and Credit in Government Accounts Debit to an expenditure head means increase in the expenditure of that head of account. Credit to an expenditure head means decrease in expenditure. Debit to a receipt head means decrease in receipts. Credit to a receipt head means increase in receipts.

8. Transfer EntriesRTI Jammu8 Concept of Debit and Credit in Government Accounts Dr. to a debt means increase in expenditure unless it is clearly stated as “Deduct Receipts”. Credit to a debt head means increase in receipts unless it is clearly stated as “Deduct payments”

9. Transfer EntriesRTI Jammu9 Concept of Debit and Credit in Government Accounts Expenditure booked in Government Accounts under ‘Consolidated Fund’ has to be carefully monitored as it can be incurred only with legislative approval through the Appropriation Act. Any adjustment or correction in accounts has to be carefully examined to determine its effect on the expenditure and appropriations for the year.

10. Transfer EntriesRTI Jammu10 Minus Credit and Minus Debit in Government Accounts There is a concept of ‘Minus Debit’ or ‘Minus Credit’ in Government Accounts. The concept is to clearly adjust the transactions under their proper heads of account, either on receipt side or on payment side.

11. Transfer EntriesRTI Jammu11 Minus Credit and Minus Debit in Government Accounts In commercial accounts, ledgers are maintained for each set of transactions under a particular head and all receipts and payments adjustable under that head are captured under that unit of classification in the ledger. Net effect of transactions (either credit or debit) is eventually taken to the trail balance and then to the annual financial statement (profit and loss account/income and expenditure account or balance sheet).

12. Transfer EntriesRTI Jammu12 Minus Credit and Minus Debit in Government Accounts In Government Accounts separate heads of account are prescribed for receipts and for payments, even though they both, i.e. receipts and payments, relate to the same set of transactions. But total of year-end transactions is shown separately in accounts.

13. Transfer EntriesRTI Jammu13 Corrections and Adjustments Corrections and adjustments within departmental accounts are effected by means of a Transfer Entry; If an items has to be taken to a head in another Departmental Account in the accounts of the same Government it should be classified in the Transfer Entry as pertaining to the Suspense head “Departmental Adjusting Account” relating to the other department.

14. Transfer EntriesRTI Jammu14 Corrections and Adjustments The Transfer Entry with the suspense slip should then be sent, for acceptance and return, to the section which maintains the Detail Book or Departmental Abstract in which the transferred item will be finally adjusted under the proper head. When received back with the acceptance, the transfer entry will be posted in the Combined Transfer Ledger and Abstract.

15. Transfer EntriesRTI Jammu15 Corrections and Adjustments The Section to which a Transfer Entry is sent with a suspense slip for acceptance should retain the suspense slip and deal with it in the same way as if it had been received with the departmental schedules of a treasury.

16. Transfer EntriesRTI Jammu16 Corrections and Adjustments If an item of receipt or payment relating to the Central Government (other than Central Pensions) is wrongly included in the schedule of State receipts or payments, the amount should be credited or debited as the case may be, to the Suspense head “8658 Suspense Accounts PAO Suspense- items adjustable by Ministry/Department in the State Classified Abstract”.

17. Transfer EntriesRTI Jammu17 Corrections and Adjustments At the same time, the relevant particulars of receipts/payments should be passed on to the section dealing with inter-Government Settlement Accounts in the office (which is generally called Account Current Section) for eventual cash settlement with the concerned Pay and Accounts office of the Ministry/Department.

18. Transfer EntriesRTI Jammu18 Corrections and Adjustments In respect of items of receipt/ payment relating to Central Pensions wrongly included in the State schedule of receipts/payments the amount should be credited or debited as the case may be, to the head “8786 Adjusting Account between Central and State Governments” in the State Departmental Classified Abstracts of Pensions.

19. Transfer EntriesRTI Jammu19 Corrections and Adjustments At the same time, the dealing Accountant will prepare a Transfer Entry for incorporation in the Central Section of Accounts in which debit or credit for the amount, should be given to the head “Adjusting Account between Central and State Governments” by corresponding credit or debit either to the appropriate trial head of account or to the relevant Departmental Suspense head, as may be considered necessary or suitable

20. Transfer EntriesRTI Jammu20 Corrections and Adjustments The recoveries of overpayments whether made in cash or from payment vouchers shall be posted direct under the service head concerned in the Compilation Book as reduction of expenditure irrespective of whether they relate to overpayment pertaining to the current year or to any previous year.

21. Transfer EntriesRTI Jammu21 Object of Transfer Entries Transfer entries, which are entries intended to transfer an item from one head of account to another, are necessary: - In order to correct an error of classification in the original accounts; In order to adjust, by debit or credit to its proper head, an item outstanding under a Debt, Deposit or Remittance Head;

22. Transfer EntriesRTI Jammu22 Object of Transfer Entries In order to adjust inter-departmental and other transactions which do not involve the receipt or payment of cash. Transfer Entries are necessary when it is found more convenient to classify items pertaining to more than one head of account under a single head of account in the first instance than to classify them under each head of account from the beginning.

23. Transfer EntriesRTI Jammu23 Preparation of Transfer Entry Prepared in Form AC 23. On one side there should be only one major head to which there may be a debit by credit to sundry heads or vice versa; debit should not be taken against sundry head by credit to sundry heads. Same entry should not contain independent corrections of two major heads; it may not debit A by credit to B, and again C by credit to D.

24. Transfer EntriesRTI Jammu24 Preparation of Transfer Entry In a transfer entry all particulars explaining both the nature of the adjustment and (if it is a correcting transfer) the grounds of the correction must be clearly stated.

25. Transfer EntriesRTI Jammu25 Correction of Accounts If an item which properly belongs to a Revenue or Expenditure head is wrongly classified under another Revenue or Expenditure head in the accounts of the same Government, the error may be corrected at any time before the accounts of the year are closed; After the accounts are closed, no correction is admissible, it being sufficient to make a suitable note of the error against the original entry.

26. Transfer EntriesRTI Jammu26 Correction of Accounts If the error affects the receipts and disbursements of another Government, or the transactions of a Commercial Department it should be corrected by transfer in all cases as soon as the error is discovered. An error, which affects a Debt, Deposit or Remittance head, must be corrected by transfer, however old and however small it may be.

27. Transfer EntriesRTI Jammu27 Correction of Accounts If the accounts of the year in which the error involving DDR Heads took place are closed, then the following procedure should be followed: an item taken to one DDR Head instead of another- the correction should be made by transfer from the one to the other;

28. Transfer EntriesRTI Jammu28 Correction of Accounts an item credited to a DDR Head instead of to a revenue head, or debited to a DDR Head instead of to an expenditure head, the correction should be made by transfer to the head under which it should originally have appeared;

29. Transfer EntriesRTI Jammu29 Correction of Accounts an item credited to a revenue head instead of to a DDR head, correction should be made by debiting the proper head and crediting the relevant receipt head. an item debited to an expenditure head instead of a DDR head, correction should be made by debiting the proper head and crediting the relevant receipt head.

30. Transfer EntriesRTI Jammu30 Correction of Accounts After the accounts of the year are closed, corrections affecting capital major heads, unless they affect the account of different Governments, should usually be effected without financial adjustment by alteration of progressive figures, without passing the debit and credit entries through the accounts of the year’s financial transactions, when the error is detected.

31. Transfer EntriesRTI Jammu31 Procedure of making a TE A correction by a TE may be proposed by any section of an Accounts Office. It should be accepted by the other section concerned if the entry has been drawn up according to rule and necessary particulars are furnished, original vouchers and other documents in support of the entry should be recorded in the section which originally dealt with them and not sent to the other section concerned along with the transfer entry.

32. Transfer EntriesRTI Jammu32 Transfer Entry Book Maintained by a Section to keep record of all TEs; Maintained in Form AC 24; Separate books for Central transactions and for State transactions;

33. Transfer EntriesRTI Jammu33 Transfer Entry Book The TEs proposed by the several sections should be numbered serially by each, a distinctive letter being used by each section and these numbers entered in their respective Number Books. The number to be given to an entry received from another section should be expressed as a fraction, the numerator of which will denote the number as given by the originating section and the denominator will show the number assigned to the entry in the Number Book of the receiving sections.

34. Transfer EntriesRTI Jammu34 Combined Transfer Ledger and Abstract Maintained in Form AC 25; To work out in the case of revenue and expenditure heads, the net outcome of the TEs against each i.e. the balance of the head; Is closed monthly after reconciliation.