Bills Payable and Enfacement Overview

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Questions and Answers

What should not be entered in the Register of Bills?

Bills for internal check

Bills payable in cash

Bills adjusted in accounts (correct)

Bills submitted by Accounts Officers

What is the purpose of the enfacement on bills?

To show the total amount due to the vendor

To present bills in a summarized format for approval

To indicate the deductions made (correct)

To cancel incorrect claims

Who should sign the Accounts Office enfacement if the main Accounts Officer is unavailable?

Another Accounts Officer

The Treasurer of the office

Any Section Officer

The Section Officer (Accounts) (correct)

Which form is used for the Accounts Office enfacement?

Form A. 1106 Signup and view all the answers

What is the main objective of the Abstract of Bills Passed?

To condense bills for cheque signature approval Signup and view all the answers

What should be indicated above the enfacement in the case of bills requiring payments through another Accounts Officer?

Not to be included in A. 1107 Signup and view all the answers

Which entry should be sufficiently full and clear in the Abstracts of Bills Passed?

Details of each bill and voucher Signup and view all the answers

What should be done with a cheque that has expired after three months from its issue date?

It should be returned to the drawer for destruction. Signup and view all the answers

How should the cancellation of a cheque be documented?

On the cheque counterfoil and making an entry in the cash book. Signup and view all the answers

What action should be taken if a cheque is lost and the cheque's currency has expired?

The drawer must still notify the bank to stop payment. Signup and view all the answers

What must be included on the counterfoil of a new cheque issued after the original is lost?

Details of the new cheque including its number and date. Signup and view all the answers

After cancelling a cheque, how should the cash book entry be adjusted?

It should reflect the cheque amount only as a 'Refund of Expenditure'. Signup and view all the answers

What should be done when an Officer authorized to sign cheques is relieved of that duty?

Intimate all banks and treasuries. Signup and view all the answers

What is the implication of the phrase 'under thirty rupees' on a cheque?

The cheque is for a sum between twenty and thirty rupees. Signup and view all the answers

When is a cross entry not necessary on a cheque?

When a special cheque writing machine is used. Signup and view all the answers

How should amounts in rupees only be written on a cheque?

With 'only' inserted after the number. Signup and view all the answers

What should be done if a correction is necessary on a cheque?

Cancel the incorrect entry in red ink and insert the correct one. Signup and view all the answers

What should the Cheque Disbursement Cell do after generating the Cheque Abstract?

Send the Cheque Abstract Report and cheques to the RBI/SBI for payment Signup and view all the answers

How should cheques drawn in favor of Government officers and departments be crossed?

A/c payee only - not negotiable. Signup and view all the answers

Which document generates a Disbursement Cell Number (DCN) for each Co-6 Bill?

System generated document Signup and view all the answers

Which of these options is incorrect regarding cheque writing?

Abbreviate amounts, for example, use 'eleven hundred'. Signup and view all the answers

What common form of fraud should be avoided when writing amounts on a cheque?

Altering words and figures to change values inappropriately. Signup and view all the answers

What color ink should be used for entering the Disbursement Number on each bill?

Red Ink Signup and view all the answers

What is required for each alteration made on a cheque?

The Accounts Officer must attest the change. Signup and view all the answers

What action is taken upon the completion of cheque disbursements?

Records of the number of cheques disbursed are maintained Signup and view all the answers

For cheques drawn in favor of private persons, what should be the default procedure?

Cross them unless a specific request states otherwise. Signup and view all the answers

Whom does the Cheque Disbursement Cell send the Disbursement Report of a Day in duplicate?

Post Audit Cell Signup and view all the answers

What is a required component of the Cheque Abstract Report sent to the Cheque Cell?

Cheque numbers and total amount payable Signup and view all the answers

Which payment methods are correctly associated with cheque disbursement?

NEFT, ECS, and Cash Signup and view all the answers

Which document should be stamped as 'Cheque issued'?

Cheque Abstract Signup and view all the answers

What document is maintained for reconciliation with the Disbursement Report of the day?

Cheque Abstract Report Signup and view all the answers

What role does the Cashier play in cash payments?

The Cashier sends cheques for cash payments to the Pay office Signup and view all the answers

On which days should the Statement A. 1110 be prepared?

11th, 21st, and the last day of each month Signup and view all the answers

What is the purpose of the Statement A. 1110?

To ensure no delays occur in checking and passing bills Signup and view all the answers

Who should offer reasons for delays in passing the bills?

Sections responsible for internal check Signup and view all the answers

What must be done with the prepared Statement A. 1110?

It must be submitted to the Officer-in-charge for scrutiny Signup and view all the answers

What document is used for requisitioning cheques?

Form A. 1111 Signup and view all the answers

Which institutions can cheques be drawn on?

The Reserve Bank of India or its agent banks Signup and view all the answers

What should accompany Form A. 1111 when submitted?

Abstracts of Bills Passed (A. 1107) Signup and view all the answers

For what reason will funds required for cash payments be obtained?

Cheques drawn in favour of the Cashier Signup and view all the answers

What information is required in the Statement A. 1110 regarding each bill?

Remarks of the Accounts Officer Signup and view all the answers

What is the Accounts Bill Number referred to as?

AB No. Signup and view all the answers

Which of the following accurately describes bills which do not involve cash payments?

They are adjusted in the accounts without actual cash settlement. Signup and view all the answers

What should happen to bills received during each month?

They should be distinctly shown in the register. Signup and view all the answers

After a bill is checked, where should the passed amount be entered?

In the appropriate column of the register. Signup and view all the answers

What is the purpose of maintaining a register of Bills?

To track all types of bills submitted for payment. Signup and view all the answers

What action is necessary once a cash payment bill has been registered?

Prepare an abstract based on the registered bills. Signup and view all the answers

In terms of payment recovery, how are 'Bills Recoverable' primarily defined?

Bills recoverable from external parties. Signup and view all the answers

What should be done with the outstanding balance of amounts due from each party at the close of the year?

They should be carried forward into the new register. Signup and view all the answers

What information must be included in the Register of Bills Recoverable for each party?

Initials of the Accounts Officer responsible. Signup and view all the answers

What happens if the payment due date is not adhered to?

Interest will be charged on the outstanding balance. Signup and view all the answers

Which part of the Register of Bills Recoverable outlines the specific charges against a party?

Particulars of the charges Signup and view all the answers

What is the required action for changes regarding the terms and conditions of a claim?

Make the changes in the register under the initials of the Accounts Officer. Signup and view all the answers

What must be included in the Disbursement Report of a Day generated by the Cheque Disbursement Cell?

Disbursement Cell Number along with cheque details and total amount Signup and view all the answers

What action should be taken with the Cheque Abstract Report of the day?

It must be reconciled with the Actual Receipt & Payment figures Signup and view all the answers

Which of the following best describes the role of the Accounts Office in the cheque disbursal process?

Generating Cheque Abstracts and managing cheque disbursement records Signup and view all the answers

What is the primary responsibility of the Post Audit Cell in the cheque disbursement process?

To verify and acknowledge receipt of disbursement reports Signup and view all the answers

When should the Cheque Disbursement Cell maintain a register of cheques disbursed?

Daily, to track the number of cheques issued Signup and view all the answers

Which document serves as the basis for the Cashier's entries in the Cash Book?

Abstracts of Bills and Requisition for Cheques Signup and view all the answers

What distinguishes the NEFT/ECS cheque disbursement procedure from cash payments?

NEFT/ECS payments are processed through banks and do not involve physical cheques Signup and view all the answers

What should be done with the cheque numbers and total amounts payable reported in the Cheque Abstract?

They must be included in daily reconciliation with the disbursed amounts Signup and view all the answers

What critical information must be recorded on each bill processed by the Accounts Office?

Disbursement Number, Date, and Amount Signup and view all the answers

What is a significant consequence of errors in the Disbursement Cash Book?

Discrepancies in cheque reconciliation and accountability Signup and view all the answers

When should the Statement A. 1110 be compiled for the internal check?

11th, 21st, and the last day of each month Signup and view all the answers

What should be included in the Statement A. 1110 for each bill?

Remarks from the Accounts Officer about the bill Signup and view all the answers

Who is responsible for submitting statements with reasons for delays in passing bills?

The Officer-in-charge of the sections Signup and view all the answers

What specific schedule is set for preparing the statements from the Register of Bills?

11th, 21st, and the last day of each month Signup and view all the answers

What should be done if a cheque has not been presented within its valid period?

It should be destroyed and a new cheque drawn. Signup and view all the answers

Which officer is responsible for scrutinizing submitted statements for unchecked bills?

The Deputy Chief Accounts Officer Signup and view all the answers

Which action is required when a cheque needs to be cancelled?

Record the cancellation on the cheque counterfoil. Signup and view all the answers

In what form must cheques be classified before submission for signature?

Bank-wise Signup and view all the answers

How should a new cheque be documented in the cash book after the cancellation of the original cheque?

It should be entered in red ink parenthetically. Signup and view all the answers

For what type of payments are cheques drawn in favour of the Cashier used?

Payments in cash Signup and view all the answers

What should happen if a cheque reported lost has its currency expired?

No acknowledgment of the Stop Order is required beyond postal acknowledgment. Signup and view all the answers

What kind of information is required in the statement for unchecked bills?

A brief description of the bills Signup and view all the answers

What is necessary to do if there are delays in passing the bills according to internal checks?

Provide reasons and submit for scrutiny Signup and view all the answers

What happens after the replacement of a lost cheque?

The old cheque's details must be noted on the counterfoil of the new cheque. Signup and view all the answers

What is necessary to document when a cheque is cancelled?

A counter-reference in the cash book is required. Signup and view all the answers

Who must be notified to stop payment if a cheque is reported lost?

The Bank issuing the cheque. Signup and view all the answers

How long are cheques generally considered valid after their issue date?

Three months. Signup and view all the answers

What should be done immediately upon the determination that a cheque payment has been stopped?

Adjust the cash book to reflect the cancellation. Signup and view all the answers

Which statement is true regarding the registration of ‘Stop Orders’ for lost cheques?

Only a postal acknowledgment is necessary if the cheque's currency has expired. Signup and view all the answers

Study Notes

Bills Payable

Bills are documents used to claim payment
Bills payable are those the railway has to pay
Bills recoverable are those payable by other parties
Some bills involve cash transactions, others just account adjustments
Bills settled by cash need registration, checks, and abstract preparation
Bills payable are numbered, dated, and sent for section-specific checks
A register (Form A. 1104) tracks all bills received monthly
Bills not payable in cash are recorded separately

Bills Enfacement

Bills need an enfacement (Form A. 1106) detailing the amount authorized, deducted, and balance payable
The enfacement should be signed by the concerned officer, if multiple officers exist, or the section officer (Accounts) can sign in the absence of the Accounts Officer
The designated officer is responsible for accurately indicating the head of account for the claim and deductions.
In some cases (bills paid by another officer), the notation "Not to be included in A. 1107" should be prominently displayed on the enfacement

Abstracts of Bills Passed

Bills passed for payment or by cheque are recorded in an abstract (Form A. 1107) for condensed status presentation
This abstract details bill details, amounts, and payee
The abstract should be for each bill, and the necessary accounts details
The officer signing the abstract must cross off entries from the original document

Abstract of Allocation

This abstract (Form A. 1108) summarizes debit and credit entries on bills for payment
A separate abstract is for each form A. 1107
The totals are consolidated into a daily abstract (Form A. 1109) for reduced daily postings to the cash transaction abstract

Statement of Unchecked Bills

All claims against the railway need prompt checking and payment
A statement (Form A. 1110) shows bills received but not processed by 1st, 11th, 21st, or last of month
The statement includes sections, reasons for delays, and comments from concerned officers
The statement is submitted to the relevant divisional or deputy chief accounts officer

Issue of Cheques

Payment methods are typically cash through the pay office or cheques
Cheques are issued by authorized accounts officers to banks approved by financial advisors
Cheque books must be kept safe and properly registered
Cheque details must include railway names for bank processing
Cheques should be classified by payment method (NEFT, ECS/NECS, third-party checks, cash)
Separate cheque books are required for each bank, head treasury, or sub-treasury. Accounts Officers must notify the relevant treasury or bank of the cheque book numbers

Specimen Signatures

Specimen signatures of authorized officers are required by banks and treasuries
This is important for cheque processing, to ensure proper authorization
The relieved officer must notify of any changes connected with this

Writing of Cheques

Cheques should have a cross-entry indicating the amount
No abbreviations like "eleven hundred" for "one thousand one hundred" are allowed
Cheques must be written in words and figures and should clearly display there are no paise
Cheques should be written in indelible ink only

Crossing of Cheques

Government officer cheques are crossed (payee only, not negotiable)
Cheques to other entities are crossed and designated "Not negotiable"
Special marking is required when the method of crossing cheques is required
If the payee is a bank or Treasury, the cheque should be crossed “account payee only, not negotiable”
Other cheques should be crossed with "and Co." with addition of "Not Negotiable"

Cheque Receipt

Accounts Officers should add "Received payment by credit transfer to..." statement before a cheque is sent for processing
This is to stop fraudulent payment appropriation
If the payee is authorized, special procedures and documentation are required

Date of Payment

Payment is deemed made on cheque presentation or on the date the payee (or their authorize) accepts the cheque
When payments are by postal or money order, the date is the mail receipt / despatch date respectively
This is valid unless explicitly mentioned otherwise

Government Drafts

These drafts are common for railways and other quasi-government activities
There are two forms: Reserve Bank and State Bank drafts
These are issued for expenses and are marked as 'Government account only', these should not be transferable
The minimum amount is Rs. 50
Applications are required with details of the payment purpose and the account is used only for bona fide activities

Authorization for Payments

If necessary, another account officer can handle a bill/liability
An official authorization letter/telegram/enfacement is required, signed by the head of department
A seal and signatures must be provided for any modifications
Records for the authorization must be kept for future use

Bills Recoverable

This register (Form A. 1139) records outstanding amounts from external parties, including dates and amounts, reasons for delays, and all relevant particulars.
The register is reviewed monthly
Bills' realization needs prompt action, handling delays, and specific attention to high-value or contentious bills
The bills payable register should be reviewed monthly to ensure proper handling of all parties involved in the bill process

Daily Cash Outgo

Daily cash outflows are recorded in a dedicated register (Form A. 1137) to keep track of subheads or demands, in a chronological manner
The totals of the cash outgo must be reported regularly to financial advisors
All bills passed for payment must be entered into the abstract. This serves as a chronological overview of the daily cash outflow

Duplicate Cheques

If a cheque is lost, a new one can be issued with an indemnity bond (Form A. 1125)
The lost cheque should be tracked, and its payment stopped
The new cheque's creation should be correctly reflected in the records and documents
A certificate stating that the lost cheque has not been received must be obtained before issuing a replacement.

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Description

This quiz covers the essentials of bills payable and enfacement, detailing how bills are processed within an organization like the railway. It explores the types of bills, registration processes, and the roles of various officers in managing these financial documents. Test your knowledge on the critical aspects of bill management and accountability.

Bills Payable and Enfacement Overview

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Podcast

Questions and Answers

What should not be entered in the Register of Bills?

What is the purpose of the enfacement on bills?

Who should sign the Accounts Office enfacement if the main Accounts Officer is unavailable?

Which form is used for the Accounts Office enfacement?

What is the main objective of the Abstract of Bills Passed?

What should be indicated above the enfacement in the case of bills requiring payments through another Accounts Officer?

Which entry should be sufficiently full and clear in the Abstracts of Bills Passed?

What should be done with a cheque that has expired after three months from its issue date?

How should the cancellation of a cheque be documented?

What action should be taken if a cheque is lost and the cheque's currency has expired?

What must be included on the counterfoil of a new cheque issued after the original is lost?

After cancelling a cheque, how should the cash book entry be adjusted?

What should be done when an Officer authorized to sign cheques is relieved of that duty?

What is the implication of the phrase 'under thirty rupees' on a cheque?

When is a cross entry not necessary on a cheque?

How should amounts in rupees only be written on a cheque?

What should be done if a correction is necessary on a cheque?

What should the Cheque Disbursement Cell do after generating the Cheque Abstract?

How should cheques drawn in favor of Government officers and departments be crossed?

Which document generates a Disbursement Cell Number (DCN) for each Co-6 Bill?

Which of these options is incorrect regarding cheque writing?

What common form of fraud should be avoided when writing amounts on a cheque?

What color ink should be used for entering the Disbursement Number on each bill?

What is required for each alteration made on a cheque?

What action is taken upon the completion of cheque disbursements?

For cheques drawn in favor of private persons, what should be the default procedure?

Whom does the Cheque Disbursement Cell send the Disbursement Report of a Day in duplicate?

What is a required component of the Cheque Abstract Report sent to the Cheque Cell?

Which payment methods are correctly associated with cheque disbursement?

Which document should be stamped as 'Cheque issued'?

What document is maintained for reconciliation with the Disbursement Report of the day?

What role does the Cashier play in cash payments?

On which days should the Statement A. 1110 be prepared?

What is the purpose of the Statement A. 1110?

Who should offer reasons for delays in passing the bills?

What must be done with the prepared Statement A. 1110?

What document is used for requisitioning cheques?

Which institutions can cheques be drawn on?

What should accompany Form A. 1111 when submitted?

For what reason will funds required for cash payments be obtained?

What information is required in the Statement A. 1110 regarding each bill?

What is the Accounts Bill Number referred to as?

Which of the following accurately describes bills which do not involve cash payments?

What should happen to bills received during each month?

After a bill is checked, where should the passed amount be entered?

What is the purpose of maintaining a register of Bills?

What action is necessary once a cash payment bill has been registered?

In terms of payment recovery, how are 'Bills Recoverable' primarily defined?

What should be done with the outstanding balance of amounts due from each party at the close of the year?

What information must be included in the Register of Bills Recoverable for each party?

What happens if the payment due date is not adhered to?

Which part of the Register of Bills Recoverable outlines the specific charges against a party?

What is the required action for changes regarding the terms and conditions of a claim?

What must be included in the Disbursement Report of a Day generated by the Cheque Disbursement Cell?

What action should be taken with the Cheque Abstract Report of the day?

Which of the following best describes the role of the Accounts Office in the cheque disbursal process?

What is the primary responsibility of the Post Audit Cell in the cheque disbursement process?

When should the Cheque Disbursement Cell maintain a register of cheques disbursed?

Which document serves as the basis for the Cashier's entries in the Cash Book?

What distinguishes the NEFT/ECS cheque disbursement procedure from cash payments?

What should be done with the cheque numbers and total amounts payable reported in the Cheque Abstract?

What critical information must be recorded on each bill processed by the Accounts Office?

What is a significant consequence of errors in the Disbursement Cash Book?

When should the Statement A. 1110 be compiled for the internal check?

What should be included in the Statement A. 1110 for each bill?

Who is responsible for submitting statements with reasons for delays in passing bills?

What specific schedule is set for preparing the statements from the Register of Bills?

What should be done if a cheque has not been presented within its valid period?

Which officer is responsible for scrutinizing submitted statements for unchecked bills?

Which action is required when a cheque needs to be cancelled?

In what form must cheques be classified before submission for signature?

How should a new cheque be documented in the cash book after the cancellation of the original cheque?

For what type of payments are cheques drawn in favour of the Cashier used?

What should happen if a cheque reported lost has its currency expired?

What kind of information is required in the statement for unchecked bills?

What is necessary to do if there are delays in passing the bills according to internal checks?