1. 1 Regional Workshop On Model Accounting System for Panchayats (Himachal Pradesh, Jammu & Kashmir, Punjab, Haryana, Uttrakhand, Chandigarh and Lakshadweep) Ministry of Panchayati Raj & C & AG of India 2 nd December, 2009 At HIPA-SIRD, Shimla

2. 2 Agenda for the day TimeTopic/Presentation 10.00-10.30Registration 10.30-10.35Welcome Pr Secy (PR), HP & Dir / HIPA 10.35-10.40InaugurationDG (LB) 10.40-11.00 Model Accounting System for Panchayats JS, MoPR 11.15-11.30Model Accounts Formats Dir (LB) 11.30-12.00 PRIASoftNIC, New Delhi 12.00-14.00Presentations by Himachal Pradesh, Haryana, Punjab and Chandigarh 14.00-14.45LUNCH 14.45-15.15Presentations by Jammu & Kashmir, Uttrakhand and Lakshadweep 15.15-15.45Discussion 15.45-15.55Summing up & way forwardJt. Secy., MoPR, GoI 15.55-16.00Vote of thanks

3. 3 To deliberate on a Roadmap for… Adoption of Model Accounting Formats Deployment of PRIAsoft Action Plan for clearance of arrears in Accounts finalisation & Audit Action plan to fill up vacancies in accounts departments in PRIs Training needs of accounts staff in PRIs Outsourcing experiences & options State regulations – modifications required?

4. 4 Presentation Outline Need for a sound Accounts & Audit system in PRIs Observations & recommendations of 11 th & 12 th Finance Commissions Model Formats- Salient features PRIAsoft- Salient features Flow Chart for Deployment of Model formats Options for Training

5. 5 Need for a sound Accounts & Audit system in PRIs Large amounts flowing and to flow to PRIs (CSS’s, ACA’s, CFC grants, state budget etc) Sound accounting & audit system will ensure transparency induce accountability enhance credibility of PRIs leading to devolution of 3Fs enable aggregation of data for better decision making at higher levels enable track flow & usage of funds help decide subsequent releases help devise strategies to make PRIs financially viable.

6. 6 11 th Finance Commission Commented about: Unsatisfactory system of accounts & audit in PRIs &- CAG’s supervision ( TGS) Lack of trained staff in PRIs Set aside Rs 10,000 cr. for LBs including- 98 cr p.a.for maintenance of VP & IP accounts (Rs 4000 /VP / year & accounts preparation to be outsourced) 200 cr for databases relating to finances Accounts & databases – 1 st Charge Additional Requirement to be met from FC grants

7. 7 12 th Finance Commission Observed: States donot have credible information on the finances of LBs LBs continue to need support for building data bases & maintenance of accounts States to assess the requirement & earmark funds out of total allocation for LBs

8. 8 Technical Committee on Budgeting & Accounting for PRIs Based on 11 th FC recommendations- formats for accounts & databases prescribed by CAG in 2002, simplified in 2007 A committee of C&AG, MoPR, Planning Comm., Finance Ministry, CGA, NIC, Pr. Secretaries WB, UP, AP & Gujarat constituted for further simplification. Simplified formats suggested. Details to be presented by Director (LB)

9. 9 Model Formats- Salient features Three tier classification A sub-head incorporated for schemes Major heads devised in equivalence with 29 subjects Flexibility to States to open object head Simplified procedure for rectification of errors

10. 10 Initially accounts to be prepared on cash basis Features built in to enable transition to Accrual basis. These include: – Bank/ Treasury reconciliation statements – Register of receivables & payables – Register of inventories – Register of Demand, Collection & balance Model Formats- Salient features

11. 11 Model formats- introduction Intended to switchover wef 1/4/2010 Opening balances on 1/4/2010 will be required If accounts in arrears- Statement of Affairs to be prepared & necessary corrective entries to be made subsequently

12. 12 PRIAsoft A software that will make the process of accounting simple & easy An integral part of e-pri. Software- web enabled & also off line version Mapping of state specific classification to the model classification (one time activity) States that have their own applications- PRIAsoft will provide an interface between existing software & new system Details to be presented by NIC

13. 13 Deployment strategy 1.Preparation of Manuals 2.Capacity Building 3.Application Development & Deployment 4. BPR

14. 14 Preparation of Manuals Identifying Agency for preparing Prepare Accounts Manual Translate in Local Languages Distribution

15. 15 Capacity Building Identify Institutes/Organizations Assess Training Needs Prepare Training Manuals Train Master Trainers Conduct Training

16. 16 Application Development Application to integrate with e-lekha and Run on e-PRI platform PRIA soft to be modified Testing in a few States Modify if required Internalize Deploy (through outsourcing ?) Deployment thru Panchayat’s Own staff Integrated with State/Central Govt. Accounts

17. 17 BPR Circulation to States/UTs/Ministries Obtain Feedback Modify Rules/Regulations/ Administrative Guidelines

18. 18 Options for Training For Formats etc- SIRDs along with Regional Training Institutes of C & AG For PRIA soft- NIC will partners with Training Instts. Request for options Funds- RGSY, BRGF & Others (FC grants etc.)

19. 19 Outsourcing MoPR would circulate to States – draft bid documents – draft Service level agreements – Outline of Monitoring mechanism

20. 20 Categories of States & proposed Strategy Category 1Category 2Category 3 Willing to adopt the model codes along with PRIASoft Have their own format of accounts but no software Have their own format of accounts and also own software Proposed Strategy Use Model Account formats and PRIASoft Map the accounts to model accounts and use PRIASoft Map the accounts to model accounts and build interface between their software and PRIASoft

21. 21 Thank you