Effective Administration of Accounts - A solution to get rid of Economic Crimes

Effective Administration of Accounts - A solution to get rid of Economic Crimes

By Dr. Lalit Kumar Setia |  @drlalitsetia  |  drlalitsetia@gmail.com  |  March 4, 2018 1:26 a.m. PST

The administration of accounts is a great job in itself. The Accounts Administrators bear the responsibilities of supervising the accounting functions at their work-space including keeping accounts through proper book-keeping method, deduction of taxes, invoicing, and management of inventory. In public sector organizations, the role of Accounts Administrators becomes more tedious with the intervention of bureaucrats and dealing public in addition to supervising the accounting operations. They trust upon the accounting staff and assign duties to the staff members. Around the world, there is huge demand of Accounts Administrators and the category includes the Accounts officers and Auditors. Even in India, most of the students are opting engineering and science streams after matriculation, and the area of finance, accounts is becoming more lucrative now-a-days. Due to globalization and growing Indian economy, it is must to have an exposure to the various applications relating to accounts administration.

The Faculty of Financial Administration, Gurugram (Delhi-NCR), India (Asia) designed a module to sharpen the accounting and financial skills of executives working in the public sector organizations of Haryana state in order to reduce the number of scams, embezzlement, and financial irregularities by spreading awareness on tips to effective accounts administration and investigation of economic crimes at the work-space. The duties and responsibilities with regard to effective accounts administration covers:

(i) Monitoring bills, receipts, and expenditures: 

The Accounts Administrators are responsible for receiving and verifying billing (e-billing) and requisitions (invoices) for goods and services. They ensure that accounts receivable and payable are taken care of in a timely manner and they contact clients (citizens) and vendors (sellers) to achieve and accomplish the desired operations.

(ii) Analyzing data and extracting information

It is required to ensure the compliance of financial rules, policies, and procedures in financial transactions. In order to ensure compliance, it is required to analyze the transactions keeping in view the required information. The Accounts Administrators use the analyzed information as basis of financial decisions.

(iii) Keeping Organized Financial Records

It is duty of the Accounts Administrator to keep the financial records as per accounting standards. In public sector organizations, the standards are formulated by Government Accounting Standards Advisory Board (GASAB), working under Comptroller and Auditor General of India.

(iv) Invoicing and Tracking of Vouchers

The Government of India is transforming the manual vouchers into digital vouchers and the e-sign implementation is also under progress. Proper invoicing, coding and processing of vouchers is must for ensuring the accuracy of accounting entries. Tracking invoices, digitalizing vouchers and detecting financial irregularities is major duty of an Accounts Administrator.

(v) Supporting Accounting Staff and inculcating team-spirit

The Accounts Administrator requires leadership skills to inculcate team-spirit among the accounting staff working under his/her control. The accounting staff requires support to work independently for ensuring fair accounting principles to be followed in recording financial transactions.

Skills to be imparted in Accounts Administrators: The Accounts Administrators should be equipped with following skills to perform their duties effectively:

(i) Payroll Administration(ii) Monitoring of Expenses as per allocated funds or cash budget(iii) Consistent watch over maintenance of Cash Book(iv) Proficiency in Accounting Software(v) Managerial Skills including Supervision, Negotiation, and Leadership(vi) Auditing(vii) Public Speaking(viii) Information Technology (IT) Skills(ix) Spreadsheet Modeling(x) Quality and Financial Control

Challenges in front of Accounts Administrators:  

The Accounts Administrators require playing various roles for the success of organization. From purchase procedures to enforcement of financial control mechanisms, they require to stay firm in controlling cost of operations. The first challenges is to ensure fair purchases at the workspace, the pooling and malpractices by the contractors and vendors with involving senior officers or staff or ministers or other influential people make their job hard. Secondly, they require keeping accuracy in the vouchers as well as in entries of vouchers in financial books, the unusual expenses if required to be adjusted by management, their role to keep the vouchers and entry safe, becomes tedious. A single mistake can lead to bursting of whole scam in light like in case of Punjab National Bank scam, 'Rotomac' Scam, Coal Scam and Scam in Common Wealth Games. In today’s age of governance through Citizen Charter, C.M. Window, Right to Information Act etc; further made their role tough and difficult.

The course on “Accounts Administration and Investigation of Economic Crimes” covers a lot and includes 20 sessions to be covered by the trainees at Haryana Institute of Public Administration. At the end of the course, there are difficult and practical group interactions to further enrich the knowledge and skills of Accounts Administrators through discussions on practical problems at workspace. The Canberra Institute of Technology provides a certificate course entitled, “Certificate III in Accounts Administration FNS30315 [i]” used to provide knowledge and skills to work effectively as Accounts Administrator. The Cost of the certificate of Canberra Institute of Technology takes from the participation is $880 for one semester (20-hours) face-to-face classes per week plus up to 15 hours per week of online study and independent learning. While, this course designed by Faculty of Financial Management of Haryana Institute of Public Administration (HIPA) only charges training fees of Rs. 3000 (Three Thousands only) equivalent to $60 for 20-hours face-to-face classes per week. However, the course is meant for only Government officers/officials of Haryana Government Offices.

*Copyright © 2018 Dr. Lalit Kumar. All rights reserved. Dr. Lalit Kumar is a free-lance writer with publication of research papers in various esteemed and reputed journals. Presently he is working as Course Director (Faculty of Financial Management), HIPA, Gurugram (Delhi-NCR), India (Asia). 

You might also be interested in reading the following:

1. Duties of a Clerk in Government Departments or Public Sector Entities  2. Social Responsibilities of Business  3. Effective Administration of Accounts - A solution to get rid of Economic Crimes  4. Untold story of IL&FS  5. Purchase Procedures including Government e-Marketplace and Combating Corruption 6. Government Accounting and Audit Mechanisms 

Corruption and Public Financial Management

Corruption and Public Financial Management

By Lalit Kumar.

The Government ensures the administration over citizens as per the rules laid by legislature and provides the public services, security through armed forces, and justice through judiciary services. How the Executive System works in Government of India?

The executive system ensures the control over corruption in providing goods and services through Government Organizations. It ensures availability of goods and services for fulfillment of basic needs of the public or citizens. It regulates all sectors of the economy and also ensures control over the State Governments.

Each State Government further functions to ensure proper governance in providing goods and rendering public services:

The ultimate goal of political and administrative functionaries in Centre as well as in States; is to ensure quality service delivery to the citizens. The Constitution also directs to fulfill the needs of citizens through political and administrative setup. The administrative setup includes the following:

The Chief Secretary is the head of administration and there are Additional Chief Secretaries work under him for one or multiple Government departments. In most of the States, there is Human Resource Management System (HRMS) working to establish these functions more effectively.

Each field office works with commitment towards achievement of a common goal provided by their administrative secretaries:

Each field office works towards individual excellence and with trust over each other to get the benefit of collective functions. The team-spirit and motivation works in groups and the instructions are passed by Commissioners and Deputy Commissioners by organizing meetings, workshops, and giving written directions through orders.

Role of Accounts Administrator:

The role of Accounts Administrator has become more challenging due to increase in financial irregularities and involvement of external bodies in ensuring good governance through using information technology. The corruption is usually originated by involving the employees of an organization. Earlier it was considered that employees provided higher salary packages don't make corruption but the scams through involving banking officers in case of PNB scam and Rotomac scam had proved it wrong. The misuse of public funds, bribery, and means of abusing office; are most prominent issues in financial administration for each state government in India. The Administrative Training Institute (ATI) i.e. Haryana Institute of Public Administration (HIPA) and the Chief Secretary Office have been putting full efforts to sort out the problems relating to corruption in public offices. The corruption in itself contains either the ways to divert public resources for private or personal uses or abusing of authorities for personal interests.

The Public Financial Management (PFM)

It explains the managerial aspects relating to acquisition of public resources, safeguarding pubic resources, and effective & efficient utilization of public resources. It comprises the systems of revenue collection, assets and debt management, budget preparation and execution, preparing and maintaining accounts, internal and external control for effective compliance of budget and audit mechanisms. In case, the PFM is strongly enforced, there will be very little scope of corruption. In other words, it is relaxation in PFM that generate the conditions for happening of corruption.

Wherever the financial rules have not been defined and enforced; the officers take decisions with their discretion and such discretion gives scope for corruption. Wherever the control mechanisms are absent or unavailable, the utilization of resources may lead to corruption by increasing the probability of individuals to be engaged in corruption practices like theft, misuse of resources, and abusing powers for personal interests. Wherever the executives are incompetent or less qualified as per the requirement; others including employees, citizens, and other stakeholders become empowered to get benefit from the in-competencies of the executives. If there is more potential for happening of corruption, then definitely there is weak public financial management system.

The only key solution to corruption in public organizations is to develop effective PFM systems, refine PFM systems, and strengthening transparency, accountability, and enforcement. 

Understanding Group Dynamics for Success:

The executives are trusted to perform their duties by taking work from others. The principle of success in each department is, “You can accomplish anything in life provided you don’t mind who gets the credit”. The civil servants are trained in training institutes to share their abilities to the subordinates and getting work in best ways. They are trained to make a difference and leave their footprints in the sand for others to follow.

There are seven Cs to get success in each government office i.e. Commitment towards Goals, Competence to achieve goals, Character to stay work hard in office, Compassion to deliver continuous effective results, Credibility to get the work done from others, Clarity on what to do and what not to do, and Courage to deliver 100% in each function.

*Copyright © 2018 Dr. Lalit Kumar. All rights reserved. 

1. Role of Clerks in Financial Administration
2. Economic Problems of the United States
3. Public Sector Reforms : Solution for Revival of Public SectorUndertakings
4. Duties of a Clerk in Government Departments or Public SectorEntities
5. Employees-Friendly Governance can reduce Corruption 

6. Organizational Performance depends upon Accountability and Compliance of Rules