Note on New Accounting System

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The Syaha Sresta Pranali became failure to maintain the systematic record due to the increasing number of financial transactions. As a result, Bhuktani Sresta Pranali was introduced in 2017 B.S. But this system also became unsuitable and unable to fulfill the requirement of financial administration of the government.

For studying and recommending the scientific, modernized, improved and decentralized accounting system in Nepal, on May 20, 2017, B.S. a committee was formed by the government. A four member committee was formed comprising Comptroller General, Joint Secretary of Ministry of Finance, Public Administration Advisor of US Aid and Accounting Specialist of the UN. The committee made a detailed study for about 288 days and presented a draft to the finance secretary on Kartik 18, 2018 B.S. The Auditor General on Magh approved this draft. After the approval of His Majesty King Mahendra on Chaitra 2, 2018 B.S. the system was introduced as the New Accounting System. This was firstly implemented in the government offices of Kathmandu valley since the fiscal year 2019/20. In the second phase, it was implemented in the offices of Narayani zone and the rest of Bagmati zone since the fiscal year 2020/21. In the third phase, it was implemented in the offices of Janakpur and Gandaki zone since the fiscal year 2021/22. Finally, it was implemented all over the country since Shrawan 2025 B.S.

The new accounting system is being applicable in Nepalese government offices since the fiscal year 2019/020. It is based on the principle of the double-entry system of bookkeeping. It records every transaction of government offices based on the principle of double entry system. This system emphasis on banking transaction. All the receipts and payments of public funds are made through the bank. This system is based on budgeting system, which keeps a record of financial transactions, according to the budget heads. This system is simple to understand and easy to operate. It maintains uniformity in accounting by using a number of printed forms to record the financial transactions of the government.

  • The new accounting system is being applicable in Nepalese government offices since the fiscal year 2019/020.
  •  The new accounting is based on the principle of the double-entry system of bookkeeping. 
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Very Short Questions

The new accounting system has been implemented in Nepal to overcome the drawbacks of payment of accounting system. The main features of new accounting system are as follows:

  1. Based on double entry concept
    The new accounting system is based on the principle of the double-entry system of accounting. It records the every financial transaction of government office by showing double effect i.e. debit and credit. Thus, it is called modern and scientific system of accounting.

  2. Emphasis on banking transactions
    Under new accounting system, all the government revenue and expenditures are performed through the bank. Every government office should deposit all its revenues into the bank and make expenditures through cheque. It helps to prevent the misuse of cash in government offices.

  3. Based on budget heads
    The new accounting system has the provision of various budget heads for keeping records of the transaction. The transactions are recorded according to their budget and subheads. It helps to maintain the effective control over the budget.

  4. Use of bracket
    The bracket is used to show the amount to be credited. This is used especially while recording the clearance of advance in bank cash book and budget sheet.

  5. Inter-head transfer of budget
    Budget is allocated under the different heads of expenditures by central level offices. Sometimes, one budget head may have the surplus and another budget head may have an insufficient amount. In such condition, the amount can be transferred from the budget head having the surplus budget to the budget head lacking the required amount.

  6. Simplicity and uniformity
    The new accounting system is a simple and uniform type of accounting system. It follows same forms, formats and procedures for recording, classifying and reporting the financial transactions. It is used and followed by all the government offices throughout the country. Thus, it is considered as simple and uniform accounting system for maintaining the record of the financial transaction.

  7. Based on cash transaction
    New accounting system performs the transactions only on a cash basis. It does not keep the record of credit transactions. It keeps the record of the transaction at the time of cash receipts and payments not at the time of receiving goods or services. Due to this feature, the amount of advance given is also recorded by assuming it as expenditure until its clearance.

  8. Use of prescribed forms
    The new accounting system uses different accounting forms for keeping the record. Such forms are designed and prescribed by the office of the auditor general and implemented by all government offices. All the government offices are legally liable for using such forms and formats. Some of the forms under this system are journal voucher (AGF no. 10), bank cash book (AGF no. 5) and budget sheet (AGF no. 8) etc.

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  • Bhuktani Sresta Pranali was introduced in ______.

    2018 B.S


    2025 B.S


    2017 B.S


    2021 B.S


  • When was the New Accounting System introduced?

    Chaitra 2, 2017 B.S.


    Chaitra 2, 2046 B.S.


    Chaitra 2, 2018 B.S.


    Chaitra 2, 2007 B.S.


  • New Accounting System was implemented all over the country since ______.

    Srawan 2025 B.S.


    Srawan 2019 B.S.


    Srawan 2020 B.S.


    Srawan 2046 B.S.


  • New Accounting System is based on the principle of ______.

    single entry system of bookkeeping


    double entry system of bookkeeping


    budgeting system


    none of the options are correct


  • Which one of them is not the objective of new accounting system?

    Based on double entry concept


    Based on budget heads


    Emphasis on banking transactions


    Based on credit transaction


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Defination

New accounting system


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Stuti Sen

On which principle does business accounting work?


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