General Financial Rules Overview

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Questions and Answers

What financial authority is responsible for powers not delegated to a subordinate authority?

Cabinet Committee for Economic Affairs

Public Investment Bureau

Ministry of Commerce

Finance Ministry (correct)

What are General Financial Rules (GFRs)?

A compilation of financial regulations for international trade.

A set of general guidelines for budget allocation in private sectors.

A set of instructions for individual banking transactions.

A set of rules for managing public finances in governmental organizations. (correct)

What should be included in draft memoranda circulated to the Cabinet Committee?

Confirmation of expenditure propriety (correct)

Approval from the Prime Minister

Input from financial analysts

Details of past expenditures

When were the General Financial Rules first issued?

1947 Signup and view all the answers

What significant change was made to the budgeting process in the government?

Removal of the distinction between non-plan and plan expenditure. Signup and view all the answers

Which entity should be consulted before circulating draft memoranda?

Financial Advisers Signup and view all the answers

What was one of the main objectives of revising the GFRs?

To facilitate efficiency in the implementation processes. Signup and view all the answers

What principle guides officers incurring or authorizing expenditure from public moneys?

High standards of financial propriety Signup and view all the answers

Which body was set up to recommend ways to increase public expenditure efficiency?

Expenditure Management Commission. Signup and view all the answers

What principal document governs standards of financial propriety?

General Financial Rules 2017 Signup and view all the answers

Which recommendation was made by the PAC in April 2015 regarding the GFRs?

To set up a Task Force to review the GFRs. Signup and view all the answers

Which committee is responsible for evaluating draft memoranda concerning expenditure?

Public Investment Bureau Signup and view all the answers

What is required for a subordinate authority to issue an order related to finance?

Consent from the Finance Ministry Signup and view all the answers

What has been the impact of the Direct Benefit Transfer (DBT) Scheme?

It ensured efficient delivery of entitlements. Signup and view all the answers

What is a main focus of the General Financial Rules?

Ensuring accountability and financial discipline. Signup and view all the answers

Which rule emphasizes the importance of standards of financial propriety?

Rule 21 Signup and view all the answers

What is required to be done as soon as a suspicion arises that a loss has taken place?

An initial report should be made. Signup and view all the answers

What should the final report indicate after an investigation has been conducted?

Nature and extent of loss. Signup and view all the answers

Who is responsible for finally disposing of the complete report of loss?

The Head of the Department. Signup and view all the answers

What can happen to reports that cannot be disposed of under delegated powers?

They shall be submitted to the Finance Ministry. Signup and view all the answers

According to the provisions, what must an initial report consist of?

A suspicion of loss being raised. Signup and view all the answers

What does Rule 32 address in relation to overpayments made to government servants?

It describes the process of writing them off. Signup and view all the answers

What is emphasized in Rule 33 regarding loss reports?

They will not lapse if not drawn by concerned officers. Signup and view all the answers

What is the process after concluding the investigation according to Rule 31?

Submission of a two-stage report. Signup and view all the answers

What should be assumed as correct figures when accounts are prepared?

The figures indicated by the PAOs. Signup and view all the answers

Who is responsible for preparing the monthly statement showing expenditure vis-à-vis the Budget provision?

The Principal Accounts Officer of each Ministry. Signup and view all the answers

What details must the monthly statement from the PAO include?

Physical progress and reasons for shortfalls or excess. Signup and view all the answers

What is the deadline for the DDO to furnish the certificate of agreement?

Last day of the month following the month of accounts. Signup and view all the answers

Who receives the monthly statements from the Principal Accounts Officer?

Heads of Departments responsible for overall control. Signup and view all the answers

What should be included in the estimates of revenues expected to be raised during the financial year?

All anticipated revenues Signup and view all the answers

What is required if there is a deviation from established principles regarding user charges?

Documentation of reasons for the deviation Signup and view all the answers

How often should the rates of user charges be reviewed?

At least every three years Signup and view all the answers

What must the estimating authority provide for each Major Head of Account?

A detailed estimate of receipts in prescribed form Signup and view all the answers

What is a major component of non-tax revenues according to the content?

Dividends and profits including the transfer from the Reserve Bank of India Signup and view all the answers

How should the user charge rates be fixed?

Fixed through Rules or executive orders Signup and view all the answers

Which type of information may be required alongside the estimates?

Any other prescribed information Signup and view all the answers

What is the purpose of preparing the estimates of receipts?

To manage the financial year budget effectively Signup and view all the answers

Study Notes

Overview of General Financial Rules (GFRs)

GFRs are guidelines issued by the Government of India for managing public finances across all departments and organizations.
Introduced in 1947, GFRs have undergone modifications, with versions issued in 1963 and 2005.

Recent Reforms and Changes

Government budget reforms include:
- Elimination of the differentiation between non-plan and plan expenditure.
- Merger of the Railway Budget with the General Budget.
- Development of an improved Outcome Budget document focusing on efficiency.
Enhanced integration of Public Finance Management System (PFMS) and techniques like Direct Benefit Transfer (DBT) to improve service delivery.
Introduction of platforms such as the Central Public Procurement Portal and Government e-Marketing (GeM) Portal to adapt to modern needs.

Objectives of GFRs

Aim to enhance efficiency in the execution of financial operations while ensuring accountability, discipline, and administrative diligence.
The Expenditure Management Commission (EMC), established in 2014, provided recommendations to increase the efficiency of public expenditure, particularly regarding Autonomous Bodies.

Recommendations for GFR Review

The Public Accounts Committee (PAC), Group of Secretaries, and EMC have suggested forming a Task Force for a comprehensive review and update of the GFRs.

Key Rules and Provisions

Rule 19: Authority for remissions and abandonments of revenue rests with the Finance Ministry if not delegated.
Rule 21: Financial propriety standards mandate that all expenditure by officers should maintain high standards.
Rule 25: Establishes the requirements for the provision of funds before sanctions are made.
Rule 31: Ensures that additions to a permanent establishment do not lapse in funding.
Rule 32: Addresses audit disallowances and overpayments to government servants, detailing processes for remission by competent authorities.

Reporting and Oversight

Rule 33: Details the protocol for reporting losses, emphasizing initial and final reports regarding identified losses and their recovery.
Rule 45: Mandates the preparation of detailed estimates of receipts for organizational budgeting.
Rule 48: Highlights the importance of dividends and profits from the Reserve Bank of India as a substantial source of non-tax revenue.

Monitoring and Accountability

Monthly statements tracking expenditure against budget provisions required from all ministries, detailing:
- Names of schemes and budget allocations.
- Progressive expenditure and physical progress of each scheme.
- Explanations for any discrepancies in financial and physical targets.

Importance of Financial Discipline

Emphasizes adherence to the principles of financial discipline in managing public funds to enhance governmental transparency and accountability.

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Description

Explore the General Financial Rules (GFRs) of India established in 1947 and their evolution through subsequent reforms. This quiz covers key objectives, recent changes in budgeting practices, and technological advancements in public finance management. Test your knowledge on how these guidelines enhance efficiency and accountability in government financial operations.