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Accounting Procedure of Execution of Works through PSU’s

Procedure of drawal and disbursement of fund and preparation of accounts related to execution of works by non-works departments of the Govt through PSU’s/ autonomous bodies/ development authorities.

Amendment: Release of Payment to Executing Agency by Administrative Dte

Government of West Bengal
Finance Department
Audit Branch

No. 1240-F(Y), Dated: 18.02.2013

MEMORANDUM

Sub:- Accounting procedure of execution of works through PSU’s.

Works execution by Government Departments other than Works Departments through Public Sector Units, Autonomous Bodies and Development Authorities being a new concept, various Government Departments have been approaching the Finance Department for advice on the procedure to be followed for drawal of fund and accounting for the same in the books of accounts of the Departments and the offices subordinate to them. Government has devised the procedure of drawal of fund from the Treasury, disbursement of the same to the executing agencies, and accounting for the same in the books of accounts of the Government Departments and offices.

Accordingly, the undersigned is directed by order of the Governor to prescribe the procedure as follows:-

PROCEDURE OF DRAWAL AND DISBURSEMENT OF FUND AND PREPARATION OF ACCOUNTS RELATED TO EXECUTION OF WORKS BY NON-WORKS DEPARTMENTS OF THE GOVT THROUGH PSU’s/AUTONOMOUS BODIES/DEVELOPMENT AUTHORITIES.

1. Non-Works departments of the state Government need to enter into an Agreement/ MOU with the selected PSU/state autonomous body/ development authority for terms and conditions of the works contract a model of which is given at Annexure-A.

2. Rough cost estimate and detailed estimate will be prepared by the selected PSU/autonomous body generally on the basis of the SOR of the state PWD and submit the estimates to the civil department concerned for administrative approval and technical sanction.

4. Procedure of expenditure sanction to the project and drawal of fund for the purpose by the civil department concerned will be regulated by the existing WBTR and WBFR.

5. Expenditure for the purpose will be sanctioned by the competent authority in lump, i.e., the total project cost administratively approved and technically sanctioned.

6. Administrative approval to the project/ work and Financial Sanction will be accorded by the Administrative Department following the procedure laid down in rule 165 of West Bengal Financial Rules, vol-1 and Delegation of Financial Power Rules as amended by Finance Department order nos. 1880-F dt. 7.3.2007, 8651-F(Y) dt. 24.8.2010, 8325-F(Y) dt. 24.8.2011, 9144-F(Y) dt. 22.9.2011, 95-FB dt. 18.4.2012, 10184-F(A-II) dt. 13.12.2012, 10257-F(A-II) dt. 18.12.2012, 96-FB dt. 18.4.2012, 3053(14)-FB dt. 17.3.2012, 152-FB dt. 27.4.2012, 1056-FB dt. 10.9.2012, 2895-F(Y) dt. 5.4.2012.

7. Technical sanction may be accorded by the engineers of the non-works department. In case of projects of the Departments having no such engineering expertise and also in all cases of the projects with the estimated cost of Rs. 5 crore and above shall be vetted for Technical sanction by a duly constituted Technical Committee in the Finance Department.

8. Agreement/ MOU (Memorandum of Understanding) shall be entered into by the nonworks department with the agency, i.e., the selected PSU/ autonomous body/ Development Authority etc., only after drawing, designing and estimate of the work has been prepared by the agency, administrative approval has been accorded by the department and Technical sanction to the work given in the manner specified at paras 6 and 7 above.

9. The project execution will be regulated under the terms and conditions of the Agreement/ MOU between the employing non-works department and the selected PSU/ autonomous body/ Development Authority etc. The detailed procedure of drawal of fund and accounting of expenditure is prescribed below:-

(i) A requisition for fund as per the payment schedule supported by a bill in format given at Annexure B1 shall be submitted by the agency to the employing Department. The officer in charge of the work in the Department shall certify the claim in the following format under his/her signature.

“Certified that ………………(name of the agency) has done the work upto……………………..(mention the stage of the work) as on………….. as per prescribed drawing, specifications and original estimate in respect of construction of ………………………………. of ……………………………………..and is/ are entitled to the payment claimed as per the payment terms of the agreement/ MOU”.

(ii) fund placed to the Department with budgetary provisions shall be drawn as per Agreement/ MOU from the treasury in TR form no. 26 by the Department concerned to make payment to the executing agency as per the payment terms scheduled in the MOU/Agreement;

(iii) details showing the name of the work, the number and date of the order of administrative approval, technical sanction and financial sanction of the work, the amount of the sanctioned estimate, name of the agency executing the work and the no. and date of the Agreement/ MOU should invariably be mentioned in the bill to be submitted to the treasury;

(iv) the requisition along with Annexure B1 and the certificate mentioned at item no, (i) above shall be treated as supporting sub-voucher of the claim in TR form no. 26 for drawal of fund from the treasury;

(v) disbursement of the fund to the agency organisation may be made either by cheque drawn in its favour or by transfer credit to its deposit account maintained in the treasury;

(vi) In case of final claim after 100% completion of the work, a requisition along with a bill in format given at Annexure B2 and a completion certificate in format given at item (i) above certifying 100% completion of the work as per prescribed drawing, specifications and original/ revised estimate signed by the officer in charge of the work in the employing Department shall be treated as voucher for the purpose of drawal of fund from the treasury;

(vii) In cases where approved estimate has been exceeded in the process of execution of work or where additional work has been done, administrative approval, technical sanction and financial sanction to the revised estimate for the additional work/ excess over original estimate shall be obtained from the competent authority of the administrative department concerned. A Detailed Completion Report of the work in format given at Annexure-C signed by the authorised official of the agency organisation and countersigned by the competent authority of the employing Government Department shall be submitted to the AG., WB along with the accounts mentioned at (xi) below;

(viii) The agency engaged for execution of the work shall do so by engagement of contractors to be selected through tender process;

(ix) The agreement to be entered into between the agency and the contractor shall be in the same line as done in case of Public Works contract,

(x) The agency PSU/ autonomous body will submit accounts for the fund received and utilised by them for the purpose of execution of the works to the employing Department;

(xi) The accounts to be submitted will be prepared by the employed agency supported by all the contractors’ vouchers in terms of the codal provisions under TR 4.222 and submitted to the employing Government Department who in its turn shall submit the same to AG, WB, in the manner and within the time as prescribed under TR 4.223 of WBTR, 2005 after necessary checking and countersignature by the authorized officer.

(xii) The officer-in-charge of supervision of the work in the employing department shall maintain and submit to the Head of the Department/ Departmental Secretary works Slip in format given in Annexure-D at periodic interval to closely monitor the progress of the work and its expenditure in the interest of taking timely steps for revised estimate, if situation so demands.

(xiii) Total cost of the works as ascertained from the accounts submitted by the employed agency and as checked and accepted by the employing Departmental authority shall be entered in the Asset Register as its value with full description of the asset created or value added to, as the case may be.

Necessary amendment in West Bengal Financial Rules and West Bengal Treasury Rules will be made in due course.

Sd/-H.K. Dwivedi
Principal Secretary
Finance Department

No. 1240-F dated 18.02.2013