All government higher educational institutions will have to mandatorily follow a standardised accounting system from 2013 academic session to bring in more transparency, accountability and good governance.
Announcing this here on Wednesday, Human Resource Development Minister Kapil Sibal said all central educational institutions, universities under the University Grants Commission (UGC), and institutions recognised by the All India Council for Technical Education (AICTE), the National Council for Teacher Education (NCTE) and the schools affiliated to the Central Board of Secondary Education (CBSE) will have to follow the new accounting system. The government will go for negotiations with the private institutions before making it mandatory for them.
“We would like all schools in the country to following the new accounting system for which we will take the matter to Central Advisory Board for Education (CABE) to arrive at a consensus,’’ he said.
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The accounting system has been recommended by the Institute of Chartered Accountants of India (ICAI) that had been asked by the Ministry last year to suggest a transparency accounting system in the educational institutions.
The new format will be helpful for presenting general purpose financial statements to ensure proper accountability, financial discipline, end-use of funds and to meet the needs of stakeholders. 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 under graduate and post graduate programmes and for research and teaching activities. It will help define relevant financial ratios derived from accounts for comparison on research to total expenditure, income from fees to total income, salary expenditure to total expenditure among other things.