Rule 73 — General Financial Rules 2017 (amended July 2024) - Rule 73

GFR 2017

Rule 73
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Preparation and presentation of Accounts. Accounts of the Union Government: shall be prepared every year showing the receipts and disbursements for the year, surplus or deficit generated during the year and changes in Government liabilities and assets. The accounts shall be prepared by Controller General of Accounts, certified by the Comptroller and Auditor General of India and along with the report of the Comptroller and Auditor General of India on these accounts, shall be submitted to the President of India, preferably within six months of close of the Financial Year, who shall cause them to be laid before each House of Parliament.
Form of Accounts. By virtue of the provisions of Article 150 of the Constitution, the Accounts of the Union Government shall be kept in such form as the President may, on the advice of the Comptroller and Auditor General of India, prescribe.
The Controller General of Accounts in the Ministry of Finance (Department of Expenditure) is responsible for prescribing the form of accounts of the Union and States, and to frame, or revise, rules and manuals relating thereto on behalf of the President of India in terms of Article 150 of the Constitution of India, on the advice of the Comptroller and Auditor General of India.
Principles of Accounting. The main principles according to which the accounts of the Government of India shall be maintained are contained in Government Accounting Rules, 1990; Accounting Rules for Treasuries; and Account Code Volume-Ill. Detailed rules and instructions relating to the forms of the initial and subsidiary accounts to be kept and rendered by officers of the Department of Posts and other technical departments are laid down in the respective Accounts Manuals or in the departmental regulations relating to the Departments concerned.
Cash based Accounting. Government accounts shall be prepared on cash basis. With the exception of such book adjustments as may be authorised by Government Accounting Rules, 1990 or by any general or special order issued by the Central Government on the advice of the Comptroller and Auditor General of India, the transactions in Government
accounts shall represent the actual cash receipts and disbursements during a financial year as distinguished from amounts due to or by Government during the same period. Period of Accounts. The annual accounts of the Central Government shall record transactions which take place during a financial year running from the 1st April to the 31st March thereof. Currency in which Accounts are kept. The accounts of Government shall be maintained in Indian Rupees. All foreign currency transactions and foreign aid shall be brought into account after conversion into Indian Rupees. Main Divisions and structure of Accounts. The accounts of Government shall be kept in three parts, Consolidated Fund (Part-1), Contingency Fund (Part-I1) and Public Account (Part-II)). Part-l - Consolidated Fund is divided into two Divisions, namely, 'Revenue' and "Capital' divisions. The Revenue Division comprises the following sections: 'Receipt Heads (Revenue Account)' dealing with the proceeds of taxation and other receipts classified as revenue and the section 'Expenditure Heads (Revenue Account)' dealing with the revenue expenditure met therefrom. The Capital Division comprises three sections, viz., "Receipt Heads (Capital Account)', Expenditure Heads (Capital Account)' and 'Public Debt, Loans and Advances, etc.'. These sections are in turn divided into sectors such as "General Services', 'Social and Community Services', 'Economic Services', etc., under which specific functions or services are grouped corresponding to the sectors of classification and which are represented by Major Heads (comprising Sub-Major Heads wherever necessary). In Part-Il = Contingency Fund- are recorded transactions connected with the Contingency Fund set up by the Government of India under Article 267 of the Constitution or Section 48 of Government of Union Territories Act, 1963. There shall be a single Major Head to record the transactions thereunder, which will be followed by Minor, Sub and/or Detailed Heads. In Part-Ill - Public Account- transactions relating to debt (other than those included in Part-1), reserve funds, deposits, advances, suspense, remittances and
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What This Means

These rules establish the fundamental framework for how the Indian government manages and records its financial transactions. First, all government accounts must adhere to specific accounting principles, which are detailed in important documents like the Government Accounting Rules, 1990, and the Account Code Volume-III. For specialized departments, such as the Department of Posts, there are additional, more specific instructions found in their own Accounts Manuals or departmental regulations for maintaining their initial and subsidiary accounts.

Secondly, and critically, government accounts are primarily maintained on a "cash basis." This means that you should only record money when it actually comes into the government's bank account or when it physically leaves the account to pay for something. You generally do not record amounts that are simply "due" to the government or "owed" by the government until the actual cash transaction takes place. There are very few exceptions to this cash basis, and any non-cash adjustments must be specifically authorized by the Central Government, typically on the advice of the Comptroller and Auditor General of India.

Finally, all these financial transactions are recorded within a clearly defined period. The government's financial year consistently runs from April 1st of one year to March 31st of the following year. Therefore, any money received or paid out between these specific dates will be accounted for within that particular financial year's records.