The CA Institute’s Accounting Research Foundation (ARF) has signed an agreement with Railways for the national rollout of accrual accounting in Railways.
The agreement seeks to introduce accrual accounting at 17 Railway zones and 8 production units across the country, sources said. The agreement will be valid for 18 months.
The interesting aspect is that accrual based financial statements will serve as an additional set of accounts to existing cash based accounting.
Accrual based financial statement will support Indian Railways in better utilisation of available resources, estimation of future liabilities and prioritisation of spending. It will also pave way for best financial management practices to be introduced in Indian Railways.
Finance Minister Arun Jaitley had in this year’s budget speech announced that as part of accounting reforms, accrual based financial statements will be rolled out in Railways by March 2019.