Financial mgmt an introduction

1. FINANCIAL MANAGEMENT
- An Introduction -
Resource Person‫׃‬
L.M. Pandey

2. The administration of the University
including its financial administration, is for
the purpose of subserving the needs of
teaching, research and learning. This
purpose should throughout be borne in
mind, and duplication and delays avoided.

3. Efficient financial administration of the
University calls for a coordinated working
of all its component units. The need of all
concerned to work in a spirit of co-
operation and in a co-ordinated manner,
need, therefore, hardly be emphasised.

4. An officer required by Statutes or
Ordinances, or other person approved by
the Board of Management or any other
competent authority to act for it, is to be
responsible for the proper collection and
application of funds at the disposal of a
Division, School Centre/ Unit or other
institution.

5. In exercising this responsibility, the Head
of a Division, School Centre/ Unit or other
Institution must keep in mind the rules
intended to ensure optimal use of the
resources of the University and to
safeguard University funds against
injudicious spending, wastage, misuse or
misappropriation, etc.

6. All transactions involving the taking and
giving of cash, stores, other properties,
rights, privileges and concessions, which
have monetary value, should be brought
to account at once under proper head.
Every University officer is personally
responsible for the money which passes
through his hands and for the proper
record of receipts and payments in the
prescribed accounts as well as for the
correctness of the accounts in every
respect.

7. The financial records and accounts of the
University shall be maintained separately
for each Accounts Year.

8. All financial records and books of accounts
and registers shall be properly bound. No
records or account shall be prepared on
loose sheets or in loosely bound volumes.

9. Receipt of Money
• It is the duty of the Division responsible for
realisation of any particular type of dues to
ensure that the dues of the University are
correctly & promptly assessed, collected
and deposited into the University accounts
under the proper head.

10. • The Head of Division should undertake a
series of surprise checks throughout the
financial year to satisfy himself that the
University dues are being recovered within
a reasonable time and that cash has been
correctly accounted for.

11. • The sums received on behalf of the
University shall forthwith be paid into the
Bank in full and appropriation of
departmental receipts towards expenditure
shall be prohibited.

12. • Moneys which are not University dues or
the deposit of which in the custody of the
University has not been authorised under
any rules or orders shall not be accepted.
Private cash or accounts of the staff shall
not be mixed up with the University cash
or account under any circumstances.

13. • No officer shall incur expenditure or enter
into any liability involving expenditure or
transfer of moneys or investment of
deposit from University account or deposit
from University account unless such
expenditure or transfer has been
sanctioned by general or special orders by
the competent authority.
Expenditure and Payment
of Money

14. General Principles ‫׃‬
• That there should be provision of funds
authorised by competent authority fixing
the limits within which expenditure can be
incurred.
• That the expenditure incurred should
conform to the relevant provisions of the
Act, Statutes, Ordinances, and
Regulations and Rules framed by the
various authorities of the University.

15. • That there should exist sanction, either
general or special, accorded by the
competent authority, authorising the
particular item of expenditure. It must be
clearly understood that mere budget
provision does not automatically carry with
it any authority to incur the expenditure,
for which prior and formal sanction of the
competent authority must invariably be
obtained before incurring it. The budget
provision simply indicates the limit up to
which expenditure is permissible under
any head of account.

16. • No officer of the University to whom
financial powers have been delegated
shall incur any expenditure which involves
or is likely to involve, at a later date,
expenditure beyond his power of sanction.
• No money should be drawn from the Bank
unless it is required for immediate
disbursement.

17. Standards of Financial Propriety
• Every officer shall exercise the same
vigilance in respect of expenditure
incurred from the University moneys as a
person of ordinary prudence would
exercise in spending his own money.
• The expenditure should not be prima facie
more than what the occasion demands.

18. • No authority should exercise its powers of
sanctioning expenditure to pass an order
which will be directly or indirectly to its own
advantage.

19. • University moneys should not be utilised
for the benefit of a particular person or a
section of the people, unless:
1) a claim for the amount could be
enforced in a court of law, or
2) the expenditure is in pursuance of a
recognised policy or custom.

20. • The amount of allowances granted to
meet expenditure of a particular type
should be so regulated that the allowance
are not on the whole a source of profit to
the recipients.

21. Control of Expenditure
• Each Head of Division is responsible for
enforcing financial order and strict
economy at every step. He is responsible
for observance of all relevant financial
rules and regulations both by his own
office and by his subordinate officers and
for guarding against wastage and loss of
University money and property and shall
further see that the prescribed checks
against them are effectively applied.

22. • A Head of Division must see not only that
the total expenditure is kept within the
limits of the authorised appropriation but
also that the funds allotted are expended
in the interest of the University and only
upon the objects for which the money was
provided. In order to exercise a proper
control, he should maintain detailed up-to-
date accounts not only of what has
actually been spent from an appropriation
but also what commitments and liabilities
have been incurred against it.

23. He must be in a position to assume before
the Finance Committee/ Board of
Management complete responsibility for
expenditure and to explain or to justify any
instance of excess or financial irregularity
that may be brought to notice.

24. THANKS