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Commercialpedia Indian Railways commercial circulars and policies

major heads, under some of the major heads. The major/sub major heads are divided into minor heads, the minor heads into sub-heads, and the sub-heads into…

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TypeCommercial Circular
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major heads, under some of the major heads. The major/sub major heads are divided into minor heads, the minor heads into sub-heads, and the sub-heads into detailed heads. The major and minor heads of account of railway revenue, capital, debt and deposits, and remittance transactions, and all other central transactions which though not pertaining to railways are adjusted in railway books, are given in Appendix IV…

Text of the circular

CHAPTER II 
STRUCTURE OF RAILWAY ACCOUNTS 
Commercial and Government Accounts, 201. Capital and Revenue Accounts, 202. 
Government Accounts, 205. Classification in Government Accounts, 208. Extra Railway 
Transactions, 209. Division by Heads of Accounts, 210. Commercial and Strategic 
Transactions, 211. Exhibition of Recoveries of Expenditure in Government Accounts, 213. 
Exhibition of Inter-Railway Payments in Government Accounts, 214. Inter-Departmental 
Adjustments, 215. Purpose of Detailed Classification in Administrative Accounts, 216, 
Responsibility for Allocation, 217. Allocation of Expenditure, 218. Accounts Heads, 219. 
Account Heads Linking Government and Commercial Accounts-Demands Payable, 220. 
Labour, 221. Traffic Account, 222. 
 
Certain other Accounts Heads.—Misc. Advances, 223 Other Railways, 224 Deposits, 
225. State Railway Provident Funds. 226. Staff Benefit Fund, 227. General Provident fund 
and other Provident Fund, 228. Cash. 229, Capital Outlay, 230. Net Revenue, 231. 
Miscellaneous Government Account, 232. 
 
Reserve Funds—Depreciation Reserve Fund, 233. Railway Revenue Reserve Fund, 
234. Railway Development Fund. 235. Railway Pension F'und. 236. Accident Compensation, 
Safety and Passenger Amenities Fund, 237.

CHAPTER II 
STRUCTURE OF RAILWAY ACCOUNTS 
 
201. Commercial and Government Accounts:- The financial transactions of a commercial 
concern should be recorded in such a way as to show how its capital has been utilised, how it stands in 
relation to its debtors and creditors, whether it is gaining or losing, what the sources of its gains or 
losses are, and whether it is solvent or insolvent. The main requirement of government accounting, on 
other hand, is that a systematic record of all receipts and expenditure classified under certain 
appropriate headings, should be available. The Government owned railways in India are a 
departmental Commercial Enterprise. Railway accounts should, therefore, not only secure the 
essential requirements of commercial accounting but also conform to the practices of government 
accounting. This objective is achieved by keeping the accounts of the railways on a commercial basis 
outside the regular government account and by maintaining a link between the two to show how much 
is coming into Government revenues through the railways and how much is spent by the Government, 
whether as capital of revenue expenditure, in carrying on the activities of the railways. 
 
202 Capital and Revenue Accounts: – The accounts of a railway presented in such a form as 
to facilitate a review of the finances of the railway as a commercial undertaking are known as “Capital 
and Revenue Accounts”. The Capital and Revenue Accounts of a railway are complied every year (see 
Chapter VII) and included in the Annual Report of the Railway. The various processes of accounting 
followed in Railway Accounts offices lead up to these accounts.  
 
203 The financial results of the working of a railway cannot be adequately gauged unless 
separate accounts are maintained of its Capital transactions as distinguished from its Revenue 
transactions. Capital transactions may be broadly described as those which pertain to the acquisition of 
concrete assets while Revenue transactions are those which relate to the working of the railways, 
comprising both earnings and working expenses. 
 
The expenditure incurred on acquiring concrete assets in connection with (i) unremunerative 
projects, (ii) amenities to passengers and other railway users, (iii) amenities to staff, and (iv) safety 
works, financed from the Development Fund, the Accident Compensation, Safety and Passenger 
Amenities Fund and Revenue (Open Line Works-Revenue) is accounted for separately. 
 
The expenditure on renewals and replacements of railway assets is financed from the 
Depreciation Reserve Fund and is accounted for accordingly. 
 
Detailed rules regulating the classifications of transactions under Capital, Revenue, 
Depreciatio

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