Rule 71 of The General Financial Rules 2017 Accounts Preparation and Presentation

Rule 71 of The General Financial Rules 2017 Accounts Preparation and Presentation

Visual Summary

Executive Summary

Rule 71 of The General Financial Rules, 2017, mandates the annual preparation of Union Government accounts. These accounts must detail receipts, disbursements, surplus or deficit, and changes in liabilities and assets. The Controller General of Accounts is responsible for their preparation, while the Comptroller and Auditor General of India certifies them. The certified accounts, along with the C&AG’s report, are then submitted to the President, who ensures they are laid before both Houses of Parliament, ideally within six months of the financial year’s close. This rule ensures transparency and accountability in government financial operations.

In-Depth Analysis of the Rule

Rule 71 is a cornerstone of financial governance, establishing the framework for the Union Government’s annual financial reporting. It outlines the scope, responsibilities, and timeline for presenting a comprehensive picture of the government’s financial health to both the executive and legislative branches.

Breakdown of the Rule

• Annual Accounts Preparation: The rule mandates that the Union Government’s accounts must be prepared every year. These accounts are not merely a record of cash flow but must also reflect the overall financial position, including receipts, disbursements, any surplus or deficit, and changes in government liabilities and assets. This ensures a holistic view of the government’s financial activities.
• Roles and Responsibilities: The primary responsibility for preparing these accounts rests with the Controller General of Accounts (CGA). This ensures a standardized and consistent approach to government accounting. The Comptroller and Auditor General of India (C&AG), an independent constitutional authority, then certifies these accounts, providing an external validation of their accuracy and compliance.
• Submission to the President: The certified accounts, along with the C&AG’s report, are to be submitted to the President of India. This step underscores the executive’s ultimate accountability for the nation’s finances.
• Parliamentary Oversight: The President is then obligated to cause these accounts and the C&AG’s report to be laid before each House of Parliament. This ensures legislative scrutiny and public accountability, allowing elected representatives to review and debate the government’s financial performance.
• Timeliness: A crucial aspect of the rule is the timeline for submission. The accounts should be presented to the President “preferably within six months of close of the Financial Year.” This emphasizes the importance of timely reporting for effective oversight and decision-making.

Practical Example

Imagine the Ministry of Finance concludes its financial year on March 31, 2024. According to Rule 71, the Controller General of Accounts would then compile all financial transactions for the year, detailing all tax collections, government spending, outstanding debts, and acquired assets. Once prepared, these accounts would be sent to the Comptroller and Auditor General of India for an independent audit and certification. The C&AG would verify the accuracy and compliance of these accounts with financial rules. By September 30, 2024 (six months after year-end), the certified accounts and the C&AG’s audit report would be submitted to the President. The President would then ensure these documents are presented to both the Lok Sabha and Rajya Sabha, allowing Members of Parliament to review the government’s financial performance and hold it accountable.

Related Provisions

Rule 71 is closely related to several other rules that govern financial management and accounting in the government:

• Rule 72 of The General Financial Rules, 2017 Form of Accounts: Details the form in which the Union Government accounts shall be kept, as prescribed by the President on the advice of the C&AG.
• Rule 73 of The General Financial Rules, 2017 Principles of Accounting: Outlines the main principles for maintaining Government of India accounts, referring to Government Accounting Rules, 1990.
• Rule 90 of The General Financial Rules, 2017 Presentation of Annual Accounts: Specifies the preparation and submission of Appropriation and Finance accounts to the President by the C&AG.

Learning Aids

Mnemonics

• “CGA Prepares, C&AG Certifies, President Presents to Parliament Promptly” – Helps remember the key actors and actions in Rule 71.

Process Flowchart

Multiple Choice Questions (MCQs)

Frequently Asked Questions

Key Takeaways

• Rule 71 mandates annual, comprehensive financial reporting for the Union Government.
• The Controller General of Accounts prepares, and the Comptroller and Auditor General of India certifies these accounts.
• Accounts and the C&AG’s report are submitted to the President, who lays them before Parliament.
• Timely submission (preferably within six months of year-end) is crucial for effective financial oversight.

Conclusion

Rule 71 of The General Financial Rules, 2017, is fundamental to maintaining fiscal discipline and public trust. By clearly defining the responsibilities for preparing, certifying, and presenting the Union Government’s annual accounts, it ensures that the financial activities of the state are transparent, accountable, and subject to rigorous parliamentary scrutiny. Adherence to this rule is vital for sound financial governance and informed decision-making.