Rule 72 of The General Financial Rules 2017 Form of Accounts

Rule 72 of The General Financial Rules 2017 Form of Accounts

Visual Summary

Executive Summary

Rule 72 of The General Financial Rules, 2017, outlines the authority and responsibility for prescribing the form of accounts for the Union and State Governments. In accordance with Article 150 of the Constitution, the President of India, advised by the Comptroller and Auditor General of India (CAG), determines this form. The Controller General of Accounts (CGA) in the Ministry of Finance is then tasked with the practical responsibility of prescribing, framing, and revising the specific rules and manuals for these accounts, also on the advice of the CAG. This rule ensures a standardized and constitutionally compliant framework for government financial record-keeping.

In-Depth Analysis of the Rule

Rule 72 is a foundational provision within the General Financial Rules, 2017, establishing the legal and administrative framework for how government accounts are to be maintained. It draws its authority directly from the Constitution of India, ensuring that the financial record-keeping system is robust and adheres to the highest standards of accountability.

Breakdown of the Rule:

• Constitutional Mandate: The rule explicitly references Article 150 of the Constitution, which empowers the President to prescribe the form of accounts for the Union and States. This highlights the constitutional backing for the structure of government financial records.
• Advisory Role of CAG: The President’s decision on the form of accounts is made “on the advice of the Comptroller and Auditor General of India.” This ensures that an independent constitutional authority with expertise in audit and accounts plays a crucial role in shaping the financial reporting framework.
• Operational Responsibility of CGA: The Controller General of Accounts (CGA) within the Ministry of Finance (Department of Expenditure) is designated as the executive authority responsible for the practical implementation. This includes prescribing the specific forms, framing new rules, and revising existing manuals for both Union and State accounts.
• Continued CAG Advice: Even in the operational phase, the CGA’s actions in framing or revising rules and manuals are to be undertaken “on the advice of the Comptroller and Auditor General of India,” maintaining the CAG’s oversight and advisory function throughout the process.

Practical Example:

Imagine a scenario where the government decides to introduce a new accounting standard for tracking environmental expenditures. Under Rule 72, the process would begin with the Comptroller and Auditor General (CAG) advising the President on the necessity and appropriate form for such an accounting change. Once the President, on this advice, prescribes the general form, the Controller General of Accounts (CGA) would then develop the detailed rules, manuals, and specific formats for all Union and State Ministries and Departments to follow. This ensures that the new environmental expenditure accounts are uniformly maintained across all government entities, adhering to the constitutional mandate and expert financial guidance.

Related Provisions

Understanding Rule 72 is enhanced by considering its connections to other key financial regulations and constitutional articles:

• Rule 71 of The General Financial Rules, 2017 Preparation and Presentation of Accounts: This rule sets the stage for the annual preparation and submission of Union Government accounts, which must adhere to the form prescribed under Rule 72.
• Rule 73 of The General Financial Rules, 2017 Principles of Accounting: This rule details the specific principles and manuals (like Government Accounting Rules, 1990) that govern the maintenance of accounts, all of which operate within the overarching framework established by Rule 72.
• Article 150 of The Constitution of India Form of Accounts of The Union and of The States: This is the constitutional source of authority for Rule 72, explicitly stating that the accounts of the Union and States shall be kept in such form as the President may, on the advice of the CAG, prescribe.

Learning Aids

Mnemonics:

• President Advises CAG, CGA Rules Forms: Helps remember the key authorities and their roles (President, Advised by CAG, CGA Rules Forms).

Process Flowchart:

Multiple Choice Questions (MCQs)

Frequently Asked Questions

Key Takeaways

• Rule 72 mandates the form of Union and State Government accounts as per Article 150 of the Constitution.
• The President prescribes the form of accounts, acting on the advice of the Comptroller and Auditor General of India (CAG).
• The Controller General of Accounts (CGA) is the operational authority for framing and revising specific accounting rules and manuals.
• This rule ensures standardization and constitutional compliance in government financial record-keeping across all levels.

Conclusion

Rule 72 of The General Financial Rules, 2017, serves as a cornerstone for financial governance in India. By clearly delineating the authority and responsibility for account forms, it ensures consistency, transparency, and accountability in the financial operations of both the Union and State Governments. Its direct link to the Constitution underscores the critical importance of standardized financial reporting for effective public administration and oversight.