Para 10.13 — MSO (A&E)
Original Rule Text
10.13 It should also be seen whether adequate arrangements are made by Government for amortisation of debt particularly in cases where borrowed moneys are utilised on objects or Works which cannot be regarded as productive and should bring to notice instances in which amortisation is ignored or appears to be prima facie inadequate.
What This Means
The Accountant General must check whether the government has made adequate arrangements to repay its debt (amortisation), especially when borrowed money is spent on non-productive purposes or assets that do not generate revenue. If the government is ignoring debt repayment or the repayment plan appears insufficient, the AG must bring this to the government's attention.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1AG must verify that adequate debt amortisation arrangements exist
- 2Special attention is needed when borrowed funds finance unproductive works or assets
- 3Cases where amortisation is ignored or appears inadequate must be reported to government
- 4This is a fiscal responsibility check on government borrowing practices
Practical Example
A State Government borrows Rs. 500 crore to construct a government office complex (a non-revenue-generating asset). The Accountant General reviews whether the government has set aside annual amounts in a sinking fund or revenue budget to repay this loan. Finding that no repayment provision exists in the budget, the AG writes to the Finance Department flagging the absence of amortisation arrangements and recommending that a repayment schedule be established.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What does amortisation mean in government accounting?▼
Why is amortisation more critical for unproductive borrowings?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.