Rule 117 of The General Financial Rules 2017 Crucial date for closure of Inter Governmental adjustments
Original Rule Text
Visual Summary
Focuses on financial adjustments between government entities.
Must be completed by April 10th or specified date.
Aims to settle all State Government transactions before year-end.
Executive Summary
Rule 117 of the General Financial Rules, 2017, establishes the critical deadline for completing inter-governmental financial adjustments. These adjustments, particularly with State Governments, must be finalized by April 10th (or a date specified by the Controller General of Accounts in consultation with the Reserve Bank of India), which marks the closure of the Reserve Bank’s books for March. The rule emphasizes the importance of settling all such transactions before the financial year concludes to ensure accurate accounting.
In-Depth Analysis of the Rule
Introduction: Rule 117 addresses the crucial aspect of timely financial reconciliation between different government entities, particularly the Central Government and State Governments.
Breakdown of the Rule:
- Scope: Applies to inter-governmental adjustments.
- Deadline: Specifies a crucial date, typically April 10th, or a date set by the Controller General of Accounts in consultation with the RBI. This date aligns with the closure of the RBI’s books for the month of March.
- Purpose: Mandates that all efforts be made to settle transactions with State Governments before the close of the financial year.
Practical Example: Imagine a Central Government department owes money to a State Government for a jointly funded project. According to Rule 117, this financial adjustment must be processed and settled by April 10th to ensure it is reflected in the accounts before the financial year officially closes. Failure to meet this deadline could lead to discrepancies in year-end financial statements for both the Central and State Governments.
Related Provisions
To fully understand the context of inter-governmental financial adjustments, consider these related provisions:
- Rule 108 of The General Financial Rules 2017 Adjustments with State Governments: Details the manner and extent of financial adjustments with State Governments.
- Rule 75 of The General Financial Rules 2017 Period of Accounts: Defines the financial year for government accounts, which is crucial for understanding year-end settlement deadlines.
Learning Aids
Mnemonics
- ACPA: Adjustments Close Promptly Annually – April 10th is the key.
Process Flowchart
Multiple Choice Questions
1. What is the crucial date for the closure of Inter-Governmental adjustments as per Rule 117 of the General Financial Rules, 2017?
- A) March 31st
- B) April 1st
- C) April 10th
- D) May 1st
Show Answer
Correct Answer: C) April 10th
2. Who specifies the date for the closure of Inter-Governmental adjustments if it’s not April 10th, according to Rule 117 of the General Financial Rules, 2017?
- A) Ministry of Finance
- B) Reserve Bank of India
- C) Controller General of Accounts in consultation with Reserve Bank of India
- D) State Governments
Show Answer
Correct Answer: C) Controller General of Accounts in consultation with Reserve Bank of India
3. Rule 117 of the General Financial Rules, 2017, emphasizes settling all transactions with which entities before the close of the year?
- A) Foreign Governments
- B) Public Sector Undertakings
- C) State Governments
- D) Private Contractors
Show Answer
Correct Answer: C) State Governments
4. The date specified in Rule 117 of the General Financial Rules, 2017, for Inter-Governmental adjustments aligns with the closure of whose books for the month of March?
- A) State Treasuries
- B) Reserve Bank of India
- C) Ministry of Finance
- D) Comptroller and Auditor General
Show Answer
Correct Answer: B) Reserve Bank of India
5. What is the primary objective of Rule 117 of the General Financial Rules, 2017?
- A) To extend deadlines for financial reporting.
- B) To ensure timely financial reconciliation between government entities.
- C) To reduce the number of inter-governmental transactions.
- D) To allow flexibility in year-end accounting.
Show Answer
Correct Answer: B) To ensure timely financial reconciliation between government entities.
Frequently Asked Questions
Q: What is the significance of April 10th in Rule 117 of the General Financial Rules, 2017?
A: April 10th (or a date specified by the Controller General of Accounts in consultation with the RBI) is the crucial deadline for completing inter-governmental adjustments, as it marks the closure of the Reserve Bank of India’s books for the month of March.
Q: Why is it important to settle inter-governmental transactions before the close of the financial year as per Rule 117 of the General Financial Rules, 2017?
A: Settling these transactions promptly ensures accurate financial accounting and reporting for both the Central Government and State Governments, preventing discrepancies in year-end statements.
Key Takeaways
- Rule 117 sets a crucial deadline (typically April 10th) for inter-governmental financial adjustments.
- This deadline is tied to the closure of the Reserve Bank of India’s books for March.
- The primary goal is to ensure all transactions with State Governments are settled before the financial year ends.
- Timely adherence is vital for accurate financial reporting and reconciliation across government entities.
Conclusion
Rule 117 of the General Financial Rules, 2017, serves as a critical directive for maintaining financial discipline and transparency within the government’s multi-tiered structure. By establishing a firm deadline for inter-governmental adjustments, it ensures that financial transactions are reconciled promptly, contributing significantly to the accuracy and integrity of public accounts at the close of each financial year.