Levels of New Accounting System
The accounting system of government offices is classified into two levels under the new accounting system. Those are central level accounting and operating level accounting. This note has information about the levels of new accounting system.
Summary
The accounting system of government offices is classified into two levels under the new accounting system. Those are central level accounting and operating level accounting. This note has information about the levels of new accounting system.
Things to Remember
- The accounting system which is maintained by Central Level Offices like Ministries Department and Constitutional Bodies is known as central level accounting.
- The accounting of central level offices is concerned with the recording the budget received from the Ministry of Finance and the release made to operating level offices.
- The accounting system which is maintained by operating level offices like Zonal, Districts and Regional Offices is known as operating level accounting.
- Operating level offices are responsible towards the central level offices.
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Levels of New Accounting System
The accounting system of government offices is classified into two levels under the new accounting system. Those are central level accounting and operating level accounting.
Central Level Accounting
Central Level Accounting system refers to the accounting system which is maintained by Central Level Offices like Ministries Department and Constitutional Bodies.Under this accounting, the budget received from the ministry of financial and released to operating level officer in terms of advance basis and cleaning the advances as against their monthly reports are recorded.
The following are the major accounting documents, which are used by the central level offices for the purpose of recording and reporting the transactions:
- Journal voucher
- Ledger
- Subsidiary books
- Bank statement
- Statement of advance given
- Control ledger for the amount deposited into consolidated fund
Operating Level Accounting
The accounting system which is maintained by operating level offices like Zonal, Districts and Regional Offices is known as operating level accounting. Operating level offices receive the budget from central level accounting and make expenditure according to the budget heads.
The following are the major accounting documents, which are used by operating level offices for the purpose of recording and reporting the transactions:
- Journal voucher
- Bank cash book
- Budget sheet
- Subsidiary ledger
- Statement of expenditures
Differences between Central Level Accounting and Operating Level Accounting.
| Bases of differences | Central Level Accounting | Operating Level Accounting |
| Offices | It is maintained by central level offices. | It is maintained by operating level offices. |
| Responsibility | They are responsible towards the Ministry of Finance. | They are responsible towards the central level offices. |
| Forms | Only a few numbers of forms are used under this system. | A larger number of forms are used under this system. |
| Recording | It records the budget received from the ministry of finance and the release made to operating level offices. | It records the budget received from the central level offices and the expenditures made on different budget heads. |
| Controlling | It is the accounting for controlling budget. | It is the accounting for executing the budget. |
| Coverage | It includes the accounting of operating level offices. | It does not include the accounting of operating level offices. |
| Complexity | It is comparatively simple to prepare. | It is comparatively difficult to prepare. |
| Central accounts | It helps the Office of the Comptroller to prepare central accounts directly. | It helps the Office of the Comptroller to prepare central accounts indirectly. |
Forms Used in New Accounting System
Some of the important accounting forms used under this system is as follows:
- Journal voucher (AGF No. 10)
- Cash receipts (AGF No. 11)
- Cash payment slip (AGF No. 6)
- Budget sheet (AGF No. 8)
- Bank cash book (AGF No. 5)
- Ledger accounts (AGF No. 22)
- Cash receipt book (AGF No. 23)
- Statement of Expenditure (AGF No. 13)
- Monthly report regarding revenue (AGF No. 9)
- Requisition form for the reimbursement of cash payment (AGF No. 6(A))
- Monthly report of uncleared advance (AGF No. 14)
- Statement of bank account (AGF No. 15)
- Summary of position of fund (AGF No. 16)
- Statement of budget sheet (AGF No. 17)
- Statement of outstanding payments (AGF No. 18)
- Monthly report of security deposit (AGF No. 19)
- Cash payments and receipts controls (AGF No. 7)
- Budget requisition form (AGF No. 21)
Lesson
Government Accounting
Subject
Accountancy
Grade
Grade 10
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