THE Comptroller and Auditor General of India (CAG) plans to move from cash to accrual basis accounting in government within a five year time frame. A National Round Table Conference on Accrual Basis Accounting was held in CAG office yesterday. The Conference, convened by Government Accounting Standards Advisory Board (GASAB) of CAG of India, deliberated the issue of migration from cash to accrual basis accounting and laid down the roadmap for migration process.Online GST Certification Course by TaxGuru & MSME- Click here to Join
The accrual based financial statements are expected to provide more appropriate presentation of financial performance and position of the government. The Union and States would have a common format of financial statements that would include a Balance Sheet, a Statement of financial performance and a Cash flow statement. The framework for the accrual accounting shall be Indian Government Financial Reporting Standards (IGFRS) issued by GASAB. IGFRS are harmonized with International Public Sector Accounting Standards (IPSAS), the international standards for governments.
Department of Posts in Government of India and selected departments of Andhra Pradesh, Madhya Pradesh, Haryana and West Bengal have embarked on accelerated pilot studies on accrual basis accounting. These pilot studies would be precursor to a national rollout which is aimed for within a five year time frame. The pilot studies would be conducted by teams from the State Accountant General offices with international and national consultants with the support of state governments. The World Bank is funding these pilot studies.
Principal Secretaries from State Governments, officials from Department of Posts, Accountant General of various states, and World Bank officials participated in the National Round Table Conference.