Government of India and States carry out several development activities apart from maintaining law and order and delivering justice. Large workforce is engaged to carry out these activities. Apart from regular manpower, there are part time employees, contractual employees, outsourced workers or even the outsourced services to discharge these activities. In this process engagement of manpower, and procurement of services is very common. There are procurements done for good and services for establishment and running the developmental activities. Further, payments are released and accounts are maintained which is audited internally as well as by C&AG.
In this process of engagement of manpower, procurements, payments, accounts and audit, there are several software systems used and plethora of database are maintained. Since states and central government act independently, there are no uniformity in data structure or even processes. Even within the central government organizations, different systems and processes are followed due to historical independence of the organization and lack of concerted effort to create uniform structures. There are several systems like GeM and PFMS being used by all government departments and these have brought uniformity in the processes handled by them. However, there are gaps in backward and forward linkages. In procurement, internal indents are processed by respective departments within its own system or e-office and then final approved indent is uploaded in GeM. Similarly sanctions are processed in standalone systems and final approved sanction is uploaded in PFMS. Similarly scheme related payment processing is done in scheme related software and only payment related data is ported to PFMS for the payment. After payment, data is again taken to the scheme related software. It is often noticed that data structures are not specified in a cohesive manner hence data interoperability is a challenge and it is dealt on case-to-case basis. If data structure is defined for activities carried out by government after a detailed study, then systems would be able to talk to each other and seamless data integration would be possible.
There is a need to improve upon the existing systems of other areas before data integration may be attempted eg. Finance Accounts of the Union, States and the Union Territories with Legislatures, capture information on capital expenditure and depict information on financial assets and liabilities of the Government. However, information on Fixed Assets is not captured in the current cash based system of accounting. Therefore asset data is not readily available in the accounts. In order to create a database for the same, coding of assets and specifying the data structure may be helpful. The Expenditure Management Commission constituted in September 2014 also recommended that the “Government should move towards an IT-enabled e-asset register. While going for e-asset, use of blockchain technology may be tried in asset management as it would bring in transparency, accountability and better disclosure.
Accounts are prepared on modified cash basis. There is no uniformity in the accounting structure and coding followed by the States and GoI and even civil and non-civil ministries. If the pattern of accounting codes and their stricture is specified and followed uniformly by all states and GoI then consolidation of accounting data and reporting will become easy and effective. Apart from coding and stricture of accounts, there is a need to follow the generally accepted accounting principles prescribed by the GoI.
2. Present status in Data Structure in assets, procurement and Accounting etc.
The existing cash basis of accounting in Government merely accounts for capital expenditure in the Finance Accounts.The existing Statements provides information on both the current and cumulative capital expenditure on both Financial and physical assets of the Governments. There is no predefined data structure or process or reporting leading to data collection being done in a manner which is difficult to collate.
It is seen that complete details of Fixed Assets owned/ under construction/ constructed/ purchased/ acquired by a government entity is not available from the accounts. Further, Fixed Assets like computers, furniture etc., booked under revenue object heads viz., Office Expenses and Other Administrative Expenses are currently not captured as Fixed Assets since it is purchased from revenue budget. In addition, Heritage, Intangible and Leased Assets are not recognized and therefore not included in the Fixed Asset Registers. Further, no de-recognition of asset takes place after the useful life is spent or the asset is impaired. These gaps are to be filled with due coding of assets and digitalization of the process of asset maintenance.
For the procurement, items are not codified by the departments. However, GeM has codified the items on its portal and entire procurement is being handled through this portal only. Data structure compatibility is not a big challenge as there is a need to have the linkage with the file processing software for backward integration and with PFMS for forward integration.
For accounting there is 15 digit code followed in GoI. First nine digits are uniformly followed in the States and non-civil Ministries. However for the remaining 6 digits, there is no uniformity and States and non-civil ministries follow different coding pattern and nomenclature. Sundermurthy Committee had recommended modified coding for accounting to capture multi-dimensional accounting. However, it is still under consideration. Problems of recording of expenses in accounting has been complicated due to observance of different coding pattern and non-availability of centralized directory for the codes. For the civil ministries this directory is maintained by CGA but there are decentralized model followed for approval of codes at States and non-civil ministries.
3. WAY FORWARD
Assets:
Since the Fixed Assets in various government entities are of diverse nature, it is difficult to prescribe hard codes for every asset or type of asset. However, broad classification can definitely be done. Broad classification of Fixed Assets as per the prevailing Primary Units of Appropriation (Object Heads) may be prescribed while leaving sufficient flexibility for entities to add additional classes/sub-classes of Fixed Assets keeping in view their nature of operations. Flexibility within the defined boundaries may be made available to departments and ministries to disclose assets keeping the national security also in mind. E-asset project of GoI has been envisaged with asset code pattern of UN. This would make the coding structure uniform and consistent with the global organization.
Procurement:
Backward integration may be facilitated by co-opting the codes and indenting forms in the e-office portal and by developing the system to ensure its integration with GeM. Similarly for the payment, integration with PFMS may be completed to ensure data transition and interchange in a seamless manner.
Accounts:
15-digit accounting codes are found to be not very effective and they have outlived their utility. Sundermurhy committee has already examined this issue in detail and prescribed coding for multi-dimension accounting. Apart from this, there is a requirement to interconnect the scheme specific software, state treasury and financial management software with PFMS for the smooth and seamless interchange of data.
A robust IT system for capturing of complete information of assets, procurement and accounting with least manual interface is highly desirable.
