Defence Accounts Department( DAD) is responsible for audit, payment and accounting of all Receipts and charges pertaining to Defence Services and Defence Organizations.

Compilation Work in DAD offices

The accounting information in DAD are classified into various accounting heads as given in the List of Major and Minor Head of Account (LMMH) published by Controller General of Accounts.

The last element of accounting classification in DAD is in the form of code heads. The code-heads are unique identification for accounting transaction which are given by DAD.

The accounting code-heads operated by DAD in respect of Defence Organisations are contained in Classification Hand Book- Defence Services Receipts and Charges (CHB) and code heads other than Defence budget relating to DAD, CGO, BRO, CSD, MOD(Sectt) and Public Account and Contingency Fund of India are contained in Pamphlet of Revenue, Debt and Remittance Heads (RD & R Pamphlet).

Five tier classification of Defence expenditure.

Compared to six tier classification followed in Civil departments, where the object head is the sixth tier of classification, DAD follows 5 tier classification with last tier classification- detailed head- treated as object head.

Sectors

Major Heads (Sub-Major Head in case of Capital Outlay)

Minor Heads

Sub-Heads

Detailed Heads

The codification pattern for detailed code heads under each Minor Head of CHB and R D & R Pamphlet. consists of 7 digits. The first two digits denote category prefix, the next three digits denote the main part of the code head and the last two digit denote suffix to the main code head. There are about 1800 code heads in  use in CHB and 900 code heads in R D & R Pamphlet.

Punching Medium and its elements

The basic document that goes into the compilation of accounts is called the Punching Medium(PM). It is the most elementary document prepared in the DAD offices  that goes into the preparation of the accounts for the Defence Services.  It contains information relating to Month, CDA(code) booking the transaction, classification code head, class of voucher, serial number of the voucher, whether a Receipt  or a charge and the amount.

The various class of vouchers and the respective code numbers assigned to them are as under:

Class 1- Cash vouchers.
Class 2  Transfer entries
Class 3  Civil inter-departmental schedules
Class 4  Abstract of receipts and charges
Class 5  Cash accounts
Class 6 Railway bills
Class 8 Defence inter-departmental schedules
Class 9 MES bills paid by main office

Distributed Data Processing Centres.

The present Financial information System revolves round Distributed Data Processing (DDP) centers located all over the country, co-located with Controller offices and in the CGDA EDP Centre. The PM are forwarded  by CsDA offices to DDP Centres for data entry and processing and onward transmission to CGDA, EDP Centre for final compilation. The following compilation reports are generated for distribution to various authorities at MOD, Service Head Quarters and CGDA.

1.All India Printed compilation

2. Consolidated RDR

3. Analysis

4. command –wise Report

5. Directorate-wise Report

6. Charged Expenditure Report

7. Fictitious Head Report

8. Category 13 and 16 Report

Adjustment of 0/020/80 (MROs)

Cash tendered by an officer of the Defence Services to banks/treasury shall be accompanied by a Military Receivable Order (MRO) in triplicate. The original copy will be delivered to the tenderer and the duplicate sent to CDA concerned by the bank/treasury through the Focal Point Branch. The triplicate will also be returned to the depositor.

While the Original copies of MROs sent by the depositor will be received in Audit Section, the Duplicate copies of MROs(DMROs) along with Credit Scrolls/ Schedule of Receipts will be received in Accounts Section. Since DMROs  are received faster from banks , its adjustment preceeds adjustment of OMROs. The adjustments by Accounts Section and Audit section are carried out as under:

Accounts Section- Adjustment of DMROs

Remittance into Banks & Treasuries            Reserve Bank Deposits-Defence
  0/020/80 (-) Ch                                             0/021/00     (+) Ch

Audit Section-Adjustment of OMROs

Service Head (+) Rt                                      Remittance into Banks &Treasuries
                                                                         0/020/80        (+) Ch

While a closing balance of (+) Charge to 0/020/80 represents adjustment of OMROs for which adjustment of DMROs are yet to be carried out by Accounts Section, whereas closing balance of (-) Charge to 0/020/80 represents adjustment of DMROs by Accounts Section for which adjustment of OMROs are yet to be carried out by Audit Section.

At the end of the year, amounts for which credit scrolls/MROs or RBI  advice has not been received, the unadjusted amount is transferred as (+) Receipt to 0/020/83-‘RBI suspense unclassified’. On receipt of credit scrolls/ MROs or RBI  advice, 0/020/83  and 0/020/80 are relieved by (-) Receipt and (-)Charge respectively. With the introduction of Focal Point Branch System, a new suspense head known as “PSB suspense” has been opened under code head 0/020/76 to identify the wanting scrolls and advices relating to Public Sector Banks(PSB). However the procedure for its booking and clearance remains the same as applicable to 0/020/83.       

 Adjustment of 0/020/81 (Cheques & Bills)

All payments on behalf of Defence Services are either made at a treasury or the bank by means of cheque etc drawn by officers of the Defence Accounts Department and in certain cases by officers of Defense Services. Each dealing branch of SBI and Associate bank will furnish to the Focal point branch(FPB) daily scrolls supported by paid cheques/MROs. The dealing branches of RBI will act as FPB and send their main scroll direct to CDA concerned. The Focal point Branch of SBI will prepare Main Scrolls based on the daily scrolls received from dealing branches and send them daily to CDA duly supported by paid cheques/MROs. However this procedure is not applicable in respect of pension transactions, where scrolls are sent direct to PCDA, Allahabad by the SBI branches.

 The daily scrolls will be received in the Accounts Section of the CDA’s office and after agreeing with the monthly DMS total and total reflected by RBI,CAS Nagpur, paid cheques/MROs are handed over to staff for linking and pairing with schedule III. The adjustment carried out by Audit section while issuing cheque and by Accounts section while carrying out adjustment on receipt of debit scrolls/ paid cheques are as follows.

Audit Section- while issuing cheques

0/020/81 (Cheques & Bills)   (+)Receipt       Service Head  (+) Charge

Accounts section- while adjusting debit scrolls/paid cheques

0/020/81    (-) Receipt              0/021/00 (RB deposits)  (+) Receipt

At the end of the year, amounts for which debit scrolls/paid cheques or RBI   advice has not been received, the unadjusted amount is transferred as (+) Charge to 0/020/83-‘RBI suspense unclassified’. On receipt of debit scrolls/ paid cheques or RBI t advice, 0/020/83 and 0/020/81 are relieved by (-) Charge to 0/020/83 and (-) Receipt to 0/020/81 respectively. With the introduction of Focal Point Branch System, a new suspense head  known as “PSB suspense” has been opened under code head 0/020/76 to identify the wanting scrolls and advices relating to Public Sector Banks(PSB). However the procedure for its booking and clearance remains the same as applicable to 0/020/83.

Focal Point Branch Scheme (FPB)

The Focal Point Branch Scheme( FPB)  introduced from 1.10.93 is a revised system of reporting, settlement and reconciliation of transactions of non-Civil ministries such as Defence, Railways and Posts.  In the earlier procedure, all individual bank branches were sending scrolls with paid cheques directly to the concerned Defence Accounting Circle(DAC) leading considerable delay in its receipt and reconciliation . The revised procedure is intended to make reconciliation work faster and easier. Under the revised procedure, each Defence Accounting Circle( DAC) is accredited to one bank branch functioning as FPB for all SBI branches as well as its Associated banks, which will be co-located with DAC. The RBI branches will be acting both as dealing as well Focal Point Branches and forward main scrolls and DMS to DACs on the prescribed dates. The FPB will be receiving daily scrolls from dealing branches duly supported by Cheques/MROs. These FPBs  will prepare a main scroll each day in r/o all scrolls received from all dealing branches as well as their own scrolls. A copy of the main scroll will be returned to FPB by DAC duly certifying its correctness/pointing out discrepancies within 24 hrs. The FPB will be reporting the amount included in the main scroll to the SBI/GAD link Cell, Nagpur. A Date wise Monthly Statement (DMS) will be prepared by FPB and sent to DAC by 3rd of the following month, which will be returned by DAC duly certifying the correctness/pointing out discrepancies. A copy of the certified DMS will be sent to CGDA by DAC to reach them by 8th of the following month.

SBI, GAD/ Link Cells RBI branches will intimate the DAC the monthly settlement account figure put through by them to RBI,CAS Nagpur. RBI, CAS Nagpur will continue to send monthly closing balance statement to the DACs by 20th of the following month. Since the Verified Date wise Monthly statement (VDMS) is the mutually accepted document, it forms the basic document for reconciliation of Government transactions handled by FPBs. The FPB Scheme does not cover pension payments made through Public Sector Banks.