The Institute of Chartered Accountants of India (ICAI) and its Accounting Research Foundation (ICAI ARF) have been pivotal in Indian Railways’ transition to accrual-based accounting since 2014. This initiative aims to enhance financial transparency, accountability, and alignment with Generally Accepted Accounting Principles. On December 19, 2024, ICAI ARF submitted the 2022-23 accrual-based financial statements for all zonal railways and production units, reflecting efforts towards environmental, social, and governance (ESG) goals. Indian Railways, the first Indian ministry to adopt such reforms across its entirety, collaborates with ICAI ARF to develop a transaction-based accrual accounting system for the 2023-24 financial year. Officials from Indian Railways and ICAI highlighted the importance of sustainability and asset verification in future financial practices. ICAI ARF’s role underscores its commitment to research-driven advancements in accounting and governance.
Institute of Chartered Accountants of India
Public Relations Committee
The Institute of Chartered Accountants of India
20th December 2024
ICAI Press Release
ICAI Drives Indian Railways’ Accounting Reforms with Environmental Sustainability
- Supporting Accrual-Based Financial Statements for All Zonal Railways and Production Units
- Developing Transaction-Based Accrual Accounting
Indian Railways, the fourth largest railway network in the world after the United States, Russia and China, is undertaking several initiatives towards Accounting Reforms in line with Generally Accepted Accounting Principles. In its journey of accounting reforms, the Indian Railways had initiated exercise of preparation of its Accrual Based Financial Statements in 2014, marking a major shift towards enhanced financial transparency and accountability. Since the inception of this initiative, the Institute of Chartered Accountants of India (ICAI) and its Accounting Research Foundation (ICAI ARF) has played a pivotal role in supporting these reforms.
ICAI ARF has been instrumental in guiding Indian Railways through the migration to an accrual-based accounting system. ICAI ARF has successfully prepared the Accrual Based Financial Statements for all Zonal Railways and Production Units from the financial year 2015-16 to 2022-23.
On December 19, 2024, during an event held in New Delhi, ICAI ARF submitted Accrual Based Financial Statements of Indian Railways for the financial year 2022-23 to the officials of Indian Railways. The event was graced by the presence of Ms. Nirupma Kumar, I.R.A.S, Chief Administrative Officer, Accounting Reform (CAO/A/R), Mr. Rohit Parmar, Chief Project Manager (CPM), Accounting Reforms and team of CAO/AR cell along with CA. Ranjeet Kumar Agarwal, President ICAI and Chairman ICAI ARF accompanied by Council Members of ICAI and team of ICAI ARF.
On this occasion Ms. Nirupma Kumar, CAO/AR appreciated the work done by ICAI ARF and said, “It will be a milestone in the history of Government of India that accrual based financial statements has been prepared for a ministry. Indian Railways is the first Ministry to take this initiative at entire ministry level and has undertaken various step towards environmental Sustainability, the same has been reflected for the first time in the accrual based financial statements for Financial Year 2022-23”
Ms. Nirupma also informed that the Indian Railways in collaboration with the ICAI ARF has initiated to develop Transaction Based Accrual Accounting System to facilitate the preparation of financial statements for the financial year 2023-24 onwards including the initiatives being undertaken by Indian Railways towards Environmental, Social, and Governance (ESG) goals.
During this event CA. Ranjeet Kumar Agarwal, President, ICAI, said, “Indian Railways partnership with ICAI ARF since 2014 has been a cornerstone in its journey towards accrual accounting, starting with successful pilot studies and evolving into a system-wide transformation. It is a matter of pride for the ICAI and ICAI ARF to submit the Accrual Based Financial Statements of Indian Railways for the financial year 2022-23. I appreciate Indian Railways for raising the bar of financial statements and incorporating sustainability reporting in the financial statement. This initiative of Indian Railways would encourage other Government organisations/entities to adopt accrual accounting by recognising the benefits of such accounting.
Further, President ICAI also suggested Indian Railways should also consider the physical verification of their assets. The journey of partnership of ICAI ARF with Indian Railways is long lasting. For the financial year 2023-24, the ICAI ARF is geared up for preparation of Accrual Based Financial Statements which are to be prepared from the transactional data.
About ICAI
The Institute of Chartered Accountants of India (ICAI) is a statutory body set up by an Act of Parliament under the Chartered Accountants Act, 1949 for the regulation and development of the profession of Chartered Accountancy in India. The Institute functions under the administrative supervision of the Ministry of Corporate Affairs, Government of India. With around 9.85 lakh students and over 4 lakh members, today ICAI is the largest professional accountancy body in the world. ICAI has a wide network of 5 Regional Councils and 177 Branches within India and a global presence with 52 Overseas Chapters and 29 Representative Offices spanning 81 cities across 47 Countries worldwide.
About ICAI ARF
The ICAI ARF is incorporated by the ICAI in January 1999 to serves as a premier research body specializing in accounting, auditing, capital markets, fiscal and monetary policies, and related disciplines. Since its inception, ICAI ARF has completed numerous projects encompassing both basic and applied research, aiming to enhance corporate governance, management, accounting practices, and financial reporting. ICAI ARF is committed to conducting high-quality research that combines practical experience with theoretical insights
