All government higher educational institutions will have to mandatorily follow a standardised accounting system from the 2013 academic session to bring in more transparency, accountability and good governance.
All central institutions, universities under the University Grants Commission, institutions recognised by the All-India Council for Technical Education and the National Council for Teacher Education and schools affiliated to the Central Board of Secondary Education will have to follow the new accounting system, Human Resource Development Minister Kapil Sibal said here on Wednesday.
Negotiations with private institutions
The government would hold negotiations with private institutions before making the system mandatory for them also.
“We would like all schools in the country to follow the new accounting system for which we will take the matter to the Central Advisory Board of Education to arrive at consensus.”
It has been recommended by the Institute of Chartered Accountants of India, which was asked by the Ministry last year to suggest a transparent accounting system.
Helpful format
The new format will be helpful in presenting general purpose financial statements to ensure accountability, financial discipline and end-use of funds and to meet stakeholders' needs. It will define transparently the revenue earned through various sources — tuition fee and other charges, income from consultancy or from intellectual property owned by the institution. It will also identify costs and revenue separately for undergraduate and postgraduate programmes and for research and teaching activities.
It will help to define relevant financial ratios derived from accounts for comparison on research to total expenditure, income from fees to total income, and salary expenditure to total expenditure.
