PAO Manual

PAY & ACCOUNTS OFFICE
(WORKS ACCOUNTS) MANUAL
THIRD EDITION
2000
By
FINANCE AND PLANNING
(PROJECTS WING) DEPARTMENT
HYDERABAD-22
FIRST EDITION - 1969
SECOND EDITION – 1983
YANAMALA RAMAKRISHNUDU
MA., LL.B
MINISTER FOR FINANCE &

LEGISLATIVE AFFAIRS
FOREWORD
The endeavour of a welfare State is to provide a strong, healthy and effective governance.
Our Government is gearing up the official machinery to provide a responsive, transparent, clean
and people-friendly administration. It is necessary that in a democratic polity, the executive wing
of the Govt. is accountable to people. Thus public accountability is a key ingredient which
means, the obligation of persons and authorities entrusted with public resources for proper
management of such resources and be answerable for the fiscal, managerial responsibilities. Our
Govt. is providing formalized set-up in the shape of Public Audit to ensure that Public funds are
properly used and report back to the Government.
I am very happy-to learn that this 3rd edition of PAO (WA) Manual is brought out in tune
with the Government policy to update the Manuals and codal provisions and also bring
transparency in Government transaction as part of administrative reforms. Pay and Accounts
Office (WA) Manual has its roots in the Audit Manual of C & AG. This edition has taken care of
all the reforms and innovations made in the recent past to cleanse the tender process and other
Administrative reforms undertaken by the Government.
This Manual not only serves as Beacon for the PAO Organization, it also guides the
engineering and other departments under its payment control about the correct procedure and
rules to be followed to avoid future legal and audit complications. If these provisions of the
manual are followed in true spirit, it will go a long way in making success of our Zero Based
Budgeting exercises.
I hope that the Staff and Officers of PAO Organization as well as executive will follow
the provisions of this Manual scrupulously. It is
expected that this updated Manual will serve as a hand book for those who deal with Works and
Accounts. Our Govt. is trying to create machinery which ensures that public officials
scrupulously follow laid down financial rules and procedures. The staff of PAO shall strive from
present soft audit approach to effective audit as that alone act as a powerful instrument in
enforcing public accountability.
The comprehensive revision of this manual has called for collaborative efforts by group
of specialists and officers who have done a good job. I congratulate them all.
(Y.RAMAKRISHNUDU)
PREFACE TO THIRD EDITION
(2000)
The first edition of the Manual titled as “PAO Manual for NS Projects” was released in
1968 incorporating the accounting systems to be followed in NSP as a replacement of Audit code
and Audit Manual of C&AG. Later with the extension of audit and accounting system of PAO to
other Major Projects 2nd edition of the Manual was released in 1983 with the Title “PAO (W&P)
Manual” to make it more broad based to meet the needs of accounting of all Major Projects.
Subsequently the Pay & Accounts Office organization has been entrusted with the pre
check and accounting functions of entire Irrigation Sector and also the external aided Projects /
Schemes taken up by various other engineering departments. Several revolutionary changes have
also been made in respect of sanctions and tendering process. Thus the need for updating the
manual to cater to the needs of changed circumstances was felt and a committee of three retired
Directors of Accounts was constituted vide G.O.Ms. No. 46, F&P (PW) Department, dated
07.11.1998.
The committee has thoroughly examined the provisions in the existing manual and gave
their suggestion for making it more viable. The recommendations of the committee were
examined and this manual is brought out. The important feature of this edition is that.
1. The Numbering of paras has been done on computerized way on the lines of Budget
Manual.
2. Regrouping of paras in certain chapters specially those relating to works &

establishment duly deleting the separate provisions relating to Gazetted establishment and fusing
them with that of N.G.O. Claims
3. All important Government orders on various subjects relating to works and
establishment have been compiled subject wise and appended as part II executive instructions so
that they can act as ready reference.
Since this manual has been compiled to serve as a hand book on the works accounts, it is
titled as Accounts Organization Works Accounts) Manual and is expected that it will be received
well. A.P. Works Accounts Service special rules have been issued vide G.O.Ms. No. 86, Fin &
Plg. (PW) Dept., dt. 22.05. 1998 creating 6 tier structure for the department starting form
Divisional Accounts Officer (W.G.II) upto Director of Works Accounts who will be the head of
the department. The posts of Director of Accounts have been re-designated as Joint Director of
Works Accounts and where ever Director of Accounts is referred to in the Manual it is to be read
as Joint Director of Works Accounts. Efforts are on to make it a full pledged works Accounts
Service.
Any suggestions to improve upon the working of Accounting System and constructive
ideas to modify any of the provisions of the Manual are welcome.
P.K. RASTOGI, IAS

Prl. Secretary to Govt.
(Works & Projects)
Fin & Plg (P.W.) Dept.
PREFACE TO FIRST EDITION
(1968)
This manual is prepared for the guidance of Officers and staff of the Pay and Accounts
Office in the Nagarjunasagar Project. The Pay and Accounts Office is responsible for the
documentation and pre -check of all the transactions of the Project. This work is similar to that of
the combined Audit and Accounts Offices. In its duties, the Pay and Accounts Office was
generally guided by the Audit Code and the Audit Manual. With the replacement of the Audit
Code and the Audit Manual by the M.S.O. (Technical) which is available to the combined Audit
and Accounts Offices only, it is considered necessary to compi1 a separate manual detailing the
duties and functions of the Pay and Accounts Office.
2. The manual is divided into four parts.

PART A - General
PART B - General Procedure and Administration
PART C - Principles and Procedure of check conducted
by the Pay and Accounts Office
PART D - Miscellaneous
3. PART - A explains the principles undelying scheme of separation of accounts

from audit and defines the functions and responsibilities of the Chief Accounts Officer. Part - B
brings together all matters relating to the administration and control of the routine work in the
Pay and Accounts Office and lays down the mechanics Of the Office procedure. Part - C
embodies the theory and practice of the various checks conducted by the Pay and Accounts
Office. Part - D deals with miscellaneous matters.
4. The rules and instructions in this Manual are supplementary to those contained in
the codes and manuals issued by the Government of Andhra Pradesh, the Financial and
Accounting Instructions and the General Instructions (Accounts) issued by the Financial Adviser.
For convenience, reference to the relevant provisions of these codes and manuals have been
given wherever necessary, but the provisions themselves have not been reproduced.
5. The Deputy Chief Accounts Officer will be responsible for keeping this manual
up-to-date by issue of necessary correction slips after obtaining the orders of Financial Adviser
and Chief Accounts Officer.
6. The Chief Accounts Officer will gratefully acknowledge suggestions for

improvement in the procedure detailed in this Manual.
PREFACE TO SECOND EDITION
(1983)
The first edition of this Manual incorporating the Accounting system to be followed in
Nagarjunasagar Project was approved in G.O. Ms. No. 186, P.W.D. (PW), dated 25-5-1968 and
the title of the Manual was adopted as Pay and Accounts Office Manual for Nagarjunasagar
Project. Subsequently the Accounting system as approved in G.O.Ms.No.446, PWD (PW), dated
8-10-1965 was made applicable to all the Projects in G.O.Ms.No.271, M.P.D., dated 28-6-1977.
As the provisions of the Manual are made applicable from time to time to all Projects having Pay
and Accounts Organization, the title of the manual has been changed as “Pay and Accounts
Office (Works and Projects) Manual.
2. Subsequent to the printing of the first edition of this Manual in 1969, several changes
have taken place in the accounting set up as also in the provisions of the several paragraphs of
the Manual the post of the Financial Adviser and Chief Accounts Officer (Projects Wing) has
been re-designated as Secretary (Works and Projects) who is assisted by a Deputy Financial
Adviser and Ex - officio Deputy Secretary, Finance and Planning (Projects Wing) Dept. The post
of Deputy Chief Accounts Officer of each Project has been re-designated as Director of
Accounts and he is made the Principal disbursing Officer and the Chief Accounting Authority of
the Project.
3. Based on the orders issued by the Government from time to time which affected the
provisions of the Manual and taking into consideration the suggestions made by the Directors of
Accounts of the various Projects, the provisions of the several paragraphs of this Manual have
been updated by issuing amendments wherever necessary.
4. The importance of this Manual has grown in the recent past, due to grounding of many
major Projects and also because this Manual has been made part and parcel of the syllabus to the
Divisional Accounts Tests under the new regulations.
5. It is expected that this Manual which serves as a hand book to all those who deal in
Works Accounts will be well received.
6. Any suggestions to improve upon the working of the Accounting system and
reasonable suggestions to modify the existing provisions of this Manual are welcome.
I
TABLE OF CONTENTS
PART A - GENERAL
CHAPTER-1
Pg.No.
Introductory 1-1-1 to 1-1-2 1
CHAPTER-2
Detailed scheme of Separation of Accounts from Audit relating to
Transactions of the Project
Principles of Separation 2-1-1 to 2-1-3 1

Duties and functions of Director of Accounts 2-1-2 a, b, c 1
PART B - GENERAL PROCEDURE AND ADMINISTRATION

CHAPTER- 3
General Procedure
Constitution of the Office 3-1-1 & 3-1-2 7

Duties and responsibilities of the staff 3-2-1 to 3-2-3 8
Office Discipline 3-3-1 10
Casual leave 3-4-1 11
System of correspondence 3-5-1 & 3-5-2 12
Signing of communications and Recording of letters 3-6-1 & 3-6-2 12
Receipt and Distribution of Dak 3-7-1 & 3-7-2 13
Purport Register 3-8-1 & 3-8-2 14
Despatch Register 3-9-1 14
Bills Register 3-10-1 to 3-10-4 15
System of recording correspondence 3-11-1 to 3-11-6 16
Miscellaneous 3-12-1 to 3-12-8 17
Change in Staff 3-13-1 19
Auditor‟s Note Book 3-14-1 20
Responsibilities on taking or Handing over charge 3-15-1 to 3-15-2 20
Inspection of Subordinate Offices under the control of
Director of Accounts 3-16-1 21
CHAPTER 4
Administration
Introductory 4-1-1 22
Functions 4-2-1 & 4-2-2 22
Staff Position 4-3-1 & 4-3-3 22
Conditions of service and problems of staff 4-4-1 22
Regularization of Services 4-5-1 23
Maintenance of personal files,
Service Books and Leave Accounts of staff 4-6-1 & 4-6-2 23
II
Sanction to leave (other than Casual leave) 4-7-1 & 4-7-2 23

Sanction of Increments 4-8-1 24
Register of Increments 4-9-1 to 4-9-3 24
Departmental Tests 4-10-1 25
Postings and Transfers 4-11-1 25
Drawal of Bills 4-12-1 25
Bills for Pay and Allowances 4-13-1 25
T.A. Bills, Medical Reimbursement Bills etc. 4-14-1 25
Register of Bills 4-15-1 25
Drawal of Cash and Disbursement 4-16-1 26
Register of Un-disbursed Pay and Allowances 4-17-1 26
Review of Acquaintance rolls 4-18-1 27
Office expenses 4-19-1 & 4-19-2 27
Stationery 4-20-1 to 4-20-3 28
Furniture 4-21-1 to4-21-3 28
Receipts and Distribution of Dak 4-22-1 to 4-22-5 29
Fair - Copying 4-23-1 & 4-23-2 30
Despatch 4-24-1 30
Stamp Account 4-25-1 30
Filing and Custody of Records and Vouchers 4-26-1 & 4-26-2 31
Budget and control of Expenditure 4-27-1 & 4-27-2 33
Duplicate Keys 4-28-1 34
Control of Last Grade Government Servants
and Contingent staff 4-29-1 & 4-29-2 34
CHAPTER-5
Check against regularity sanction and classification -
Check of Expenditure
Check of Sanctions to Expenditure 5-2-1 to 5-2-11 35
Check against provision of funds 5-3-1 to 5-3-5 38
Ex-Chequer control 5-4-1 to 5-4-3 39
Check against rules & orders 5-5-1 to 5-5-3 40
(Check against regularity)
Scrutiny of rules and orders 5-6-1 to 5-6-5 41
Check of classification 5-7-1 to 5-7-2 42
III
CHAPTER - 6
Claims of Non-Gazetted and Gazetted Officers
Gazetted Officers 6-2-1 to 6-2-2 44
General 6-3-1 to 6-3-2 47
Service Books and leave accounts 6-4-1 48
Check of pay bills 6-5-1 to 6-5-4 48
Audit Registers (Form PAO. 11) 6-6-1 to 6-6-3 49
Detailed instruction regarding Check 6-7-1 to 6-7-3 50
Provisional Payments 6-8-1 51
Check Posting of Supplementary bills 6-9-1 52
Payment of leave salary 6-10-1 53
Other cheques to be exercised while scrutinizing bills 6-11-1 to 6-11-2 53
Compensation allowances and Honoraria 6-12-1 to 6-12-2 55
Medical reimbursement claims 6-13-1 55
Traveling allowances 6-14-1 to 6-14-5 56
Leave Travel concession 6-15-1 57
Encashment of surrender leave 6-16-1 59
Advances 6-17-1 to 6-17-2 59
Preparation of duplicate bill in place of
original bills presented lost 6-18-1 60
Payments to Government Servants
transferred to or from a project, to a
non-project area 6-19-1 to 6-19-2 60
Retirement Benefits 6-20-1 61
Anticipatory Pensions 6-21-1 61
Adjustment of objections 6-22-1 62
CHAPTER -7
Check of claims relating to works expenditure

Scrutiny of sanctions 7-2-1 to 7-2-12 63
Procedure in regard to preferring and payment of Bills 7-3-1 to 7-3-3 67
Check of bills 7-4-1 to 7-4-5 68
Provisional payments in case of Emergency 7-5-1 to 7-5-4 70
Work charged establishment 7-6-1 72
Payments made by EEs and other Civil
Departmental Offices under the limited checking
drawing powers scheme 7-7-1 to 7-7-9 72
Payments made by Special Deputy
IV
Collectors from land acquisition

and rehabilitation 7-8-1 to 7-8-15 75
Accounting 7-9-1 to 7-9-9 81
Suspense 7-10-1 to 7-10-9 87
P.W Deposits and Receipts & recoveries
on capital account 7-11-1 to 7-11-11 93
Stores 7-12-1 to 7-12-13 98
Imprest and Office expenses 7-13-1 to 7-13-4 101
Some Special instructions and orders relating to works 7-14-1 to 7-14-33 102-160
CHAPTER - 8
Transfers entries
General 8-1-1 161

Procedure for adjustment 8-2-1 to 8-2-4 162
Abstract of stock receipt and issues 8-3-1 to 8-3-3 163
Stores received books 8-4-1 164
Receipts in Pre-check Section dealing
with Stores Division 8-5-1 164
Adjustment in Pre-check section 8-6-1 to 8-6-3
Final adjustment in the Pre-check section dealing with
Stores Division 8-7-1 & 8-7-2 166
Adjustment of Hire charges statements 8-8-1 to 8-8-5 166
Adjustment of Workshop suspense schedules 8-9-1 to 8-9-5 167
T.W.P. adjustments 8-10-1 to 8-10-8 168
Weekly closing of Sectional T.E. Register 8-11-1 170
CHAPTER- 9
Cash Section

Functions of the Cash section 9-2-1 172
Organization of Cash Section 9-3-1 172
Selection of Cashiers 9-4-1 to 9-4-4 173
Duties & responsibilities of the staff of
the cash section 9-5-1 173
Indenting, Receipts and Safe
custody of cheque pads 9-6-1 to 9-6-3 175
Forms of Cheques to be used by the separated
Accounts Officer 9-7-1 to 9-7-6 176
Drawal, Delivery and despatch of Cheques
Transmission of Bills to the cash section 9-8-1 to 9-8-7 177
V
Delivery of Despatch of Cheques 9-9-1 to 9-9-2 180

Delivery of Cheques at the counter
of PAO (when authorized) 9-10-1 to 9-10-4 181
Despatch of Measurement Books 9-11-1 to 9-11-2 183
Statement of Bills paid 9-12-1 to 9-12-2 185
Receipts and Disposal of valuables 9-13-1 to 9-13-5 186
Register of interest bearing securities 9-14-1 187
Periodical verification of the securities 9-15-1 187
Annual valuation of G.P. notes etc. 9-16-1 187
Bank Guarantees 9-17-1 & 9-17-2 188
Issue of permanent receipts 9-18-1 to 9-18-5 189
Passing on deduction from bills 9-19-1 to 9-19-5 191
Register of miscellaneous Deposits of PAO 9-20-1 to 9-20-2 193
Procedure of settlement through Bank Drafts 9-21-1 194
Time-Barred cheques 9-22-1 194
Lost cheques 9-23-1 195
Cancelled Cheques 9-24-1 195
Cash Book extracts received from
the Executive Engineers by
Land Acquisition Officers and
other civil departmental
Officers having limited cheque drawing powers 9-25-1 195
Alternate Cash books 9-26-1 196
Bill returned with objections 9-27-1 196
Post-dated cheques 9-28-1
CHAPTER: 10
Results of Check Raising and Pursuance of Objections
PART - I - GENERAL PRICIPLES AND RULES

Pursuance and clearance of objections 10-2-1 to 10-2-4 198
Report on defalcation and other losses 10-3-1 to 10-3-3 200
PART-II
DETAIL PROCEDURE IN CONNECTION WITH
THE COMMUNICATTION OF RESULTS OF CHECK TO
EXECUTIVE AND CONTROLLING AUTHORITIES

Objection books 10-5-1 to 10-5-7 200
Registration of Objections in Form PAO 47 10-6-1 to 10-6-3 201
VI
Clearance of Objections 10-7-1 202

Monthly closing 10-8-1 to 10-8-2 202
Annual closing 10-9-1 203
Registration and clearance of objection
of Book-Form PAO, 48 10-10-1 to 10-10-3 203
Objection of books of stamped receipts 10-11-1 to 10-11-3 203
CHAPTER -11
Compilation of Accounts

Organization and Scope of work 11-2-1 207
Periodicity of compilation 11-3-1 to 11-3-4 207
Procedure for compilation - Receipt of Vouchers 11-4-1 208
Receipt of T.E.Os 11-5-1 208
Posting of Division-wise classified abstracts 11-6-1 208
Posting of the weekly abstract registers 11-7-1 209
Tallying with Cash Book 11-8-1 209
Preparation of classified abstract 11-9-1 210
Preparation of Monthly accounts 11-10-1 210
Rendering of monthly accounts 11-11-1 to 11-11-3 211
Division-wise consolidated abstract 11-12-1 to 11-12-2 212
Transmission of vouchers and TEOs
to the Record section 11-13-1 to 11-13-2 212
Schedule of settlement with treasuries 11-14-1 to 11-14-4 213
Reconciliation of Cheques 11-15-1 to 11-15-2 215
Reconciliation of remittances 11-16-1 to 11-16-2 216
Preparation of schedule of Settlement with treasuries 11-17-1 to 11-17-4 216
Account current 11-18-1 217
Transaction arising in the accounts of PAO
Office with are adjustable by other accounts Officers 11-19-1 to 11-19-5 218
Inward accounts 11-20-1 to 11-20-3 219
Payment in March 11-21-1 220
Allocation of Expenditure in respect of schemes
the cost of which is initially debited to projects funds 11-22-1 221
Appropriation accounts and Finance accounts 11-23-1 221
Check against appropriation 11-24-1 to 11-24-6 222
Closing of accounts 11-25-1 224
Miscellaneous & Pensionery charges 11-26-1 to 11-26-6 225
Expenditure on common establishment 11-27-1 227
VII
CHAPTER -12
Reconciliation
Procedure for reconciliation 12-2-1 228
Reconciliation of works Expenditure, works abstract
and works audit Registers 12-3-1 to 12-3-2 228
Suspense Deposit, R & R and other contingent registers 12-4-1 229
Reconciliation of establishment expenditure 12-5-1 to 12-5-6 230
Rectification of Miss-classification / Miss-postings 12-6-1 232
CHAPTER -13
Internal test Check
Functions 13-2-1 233
Scrutiny of estimates 13-3-1 234
Project Estimate register 13-4-1 to 13-4-3 234
Scrutiny of Agreements 13-5-1 235
Scrutiny of Supplemental agreements 13-6-1 235
Comparison of rates 13-7-1 236
Post review of vouchers 13-8-1 236
Review of Measurement Books 13-9-1 236
Review of Organization and Methods 13-10-1 237
Review of work in sections and review of Registers 13-11-1 to 13-11-4 237
CHAPTER -14
Inspection and Local check
Scope of inspection and local check 14-2-1 239
General Instructions 14-3-1 to 14-3-2 241
Responsibility for inspection and local check 14-4-1 242
Staff for inspection party 14-5-1 243
Drafting of inspection report 14-6-1 to 14-6-6 243
Framing programme and disposal of inspection reports 14-7-1 to 14-7-3 245
Disposal of inspection reports 14-8-1 to 14-8-6 246
CHAPTER -15
Check of accounts of Stores and Stock
General 15-1-1 to 15-1-2 248
Detailed Instructions for check of stores and stock 15-2-1 to 15-2-11 248
CHAPTER -16
Co-ordination section
Functions 16-2-1 to 16-2-6 253
VIII
PART - D MISCELLANEOUS
CHAPTER- 17
Financial Stock Taking
Financial Stock Taking 17-1-1 to 17-1-3 256
CHAPTER -18
Relations with Audit
Relation with Audit 18-1-1 to 18-3-3 258

Audit Objection 18-2-1 259
Audit committee 18-3-1 259
CHAPTER -19
Budget Classification and Letter of Credit
General 19-1-1 260

Budget 19-2-1 260
Consolidated Fund 19-3-1 260
Contingency Fund 19-4-1 to 19-4-2 260
Public Account of the state 19-5-1 260
Charged expenditure 19-6-1 261
Classification 19-7-1 261
Letter of Credit 19-8-1 261
Guiding Principles 19-9-1 261
PART -A GENERAL
CHAPTER -1
INTRODUCTORY
1-1-1 The instructions in this manual are based on the principles and rules prescribed in the
Codes and Manuals and various orders issued from time to time by the Government of
Andhra Pradesh. The detailed schemes of separation of accounts from audit, described in
Chapter II of this Manual, provide necessary background to the detailed instructions
given in part “C” - Principles and Procedures of Check exercised by the Pay and
Accounts Office.”
1-1-2 “The Pay and Accounts Office functions as pre-check-cum-treasury office in respect of
scheme offices under its Payment jurisdiction. Every effort should, therefore, be made by
it to settle all the objections raised by Statutory Audit as speedily as possible, and also to
afford necessary facilities, including prompt production of records, for the conduct of
audit. It is the duty of the Pay and Accounts Organization to exercise the prescribed
check, make payments and maintain the accounts and various account records with
references to rules and regulations thereby avoiding the scope for the statutory audit to
raise objections.
CHAPTER-2
Detailed scheme of separation of Accounts from Audit relating to transactions of the
offices under the payment control of Pay and Accounts Office Organization.
Principle of separation: -
2-1-1 The principles of separation of account from audit in relation to the offices attached to the
payment control of the PAO are as follows:-
i) (a) The overall administrative control over the Accounts organization in various
Major Projects at. The first level shall vest with the Secretary (Works and Projects),
Finance and Planning (PW) Department, Secretariat.
b) The Chief Engineers will exercise administrative control over the Accounts
Organizations as laid down in G.O.Ms.No.271, M.P.D., dt.28.6.77, they have to send
proposals in respect of all administrative matters pertaining to Accounts
Organizations to secretary (Works and
2 PAO (WA) Manual
projects) Finance and Planning (PW) Department, Secretariat for decisions at

Government level.
ii) All payments relating to offices attached to the payment control of the Pay and
Accounts Officers are centralized in the Pay and Accounts Office and are subject to
Cent percent Pre-check. All payments are made by Cheques/Bank drafts. All receipts
of the offices are also to be finally accounted for in the books of Pay and Accounts
Office.
Exceptions: -
The Executive Engineers, Land Acquisition Officers and other Civil Department
Officers specially entrusted with specific function of the offices can draw cheques for
limited purposes to the extent of powers delegated to them from time to time.
The Executive Engineers are authorized to receive in respect of such Works, Earnest
Money Deposit in their favour instead of Pay and Accounts Officer /Assistant Pay
and Accounts Officer to avoid delay in refunding tender deposits to unsuccessful
tenderers.
These officers should render cash book extracts with vouchers once in a fortnight
promptly to the Pay and Accounts Offices.
iii) One of the duties of the Director of Accounts is that as a prelude to the introduction
of exchequer control which will require a law, he sees that no payment is made in
excess of budget allotment unless it is covered by an advance from the Contingency
Fund.
iv) All transactions with the offices other than those under the payment control of the
PAO are settled on cash basis. This means the avoidance of book adjustments
between the offices under the PAO‟s payment control and other offices.
v) As all payments are closely related to appropriations at the very point of authorizing
payments, the chances of error in classification requiring rectification entries in
accounts are considerably reduced, if not totally eliminated;
vi) The Secretary (Works and Projects) will have an inspection cell under him which will
undertake surprise and regular inspection of the Offices of Directors of Accounts and
Pay and Accounts Officers of the Projects. The Secretary‟s (Works and projects),
inspection will normally be confined only to the Officers of the Directors of
Accounts. The inspection
CHAPTER-2 3
of the pay and Accounts Offices will be got conducted under the general supervision
of Assistant Financial adviser / Deputy Financial Adviser.
The inspection will include among other things the following items of works at the
discretion of the Secretary (Works and Projects of Pay and Accounts).
i) Checking of Cash book and Compilation of monthly accounts.
ii) Whether the recoveries effected towards subscriptions like General Provident Fund,
State Life Insurance, Postal Life Insurance etc., and all other recoveries effected in
Pay bills are properly accounted for in the accounts of Pay and Accounts Office and
the same are passed on to concerned departments with due promptitude.
iii) Whether the items classified under Miscellaneous Public Works Advances of Pay and
Accounts Office and the Divisions have been cleared during the financial year.
iv) Whether the reimbursement claims from other departments are watched through the
register of reimbursement maintained in Pay and Accounts Office and whether the
reimbursement have been obtained by the pay and Accounts Officer/Assistant Pay
and Accounts Officer initially classified under Miscellaneous Public Works
Advances, promptly and periodically.
v) Remittance Registers: - Whether the register is maintained to watch for the receipted
challans in respect of the remittances made in treasuries/banks.
vi) Any other item which the Secretary (Works and Projects may like to see.
(G.O.Ms.No.41, Fin. & Plg. (PW) Dept., dt.12. 8.1980)
Duties and Functions and powers of the Director of Accounts:-
2-1-2(A) The duties and functions of the Director of Accounts are broadly indicated below:
(i) He should ensure that payments are made in accordance with the rules and orders
issued by competent authorities.
(ii) He should ensure that expenditure is incurred on estimates sanctioned by competent

authority and that the estimates so sanctioned are identifiable with the Project
estimate.
4 PAO (WA) Manual
(iii) He should arrange for a cent per cent check of claims before payment.
(iv) (a) “He should with-hold payments which he considers to be irregular i.e. , Payment
against the orders of the Government and also payment not due as per the terms and
conditions of the Agreement concluded etc.,
b) However, whenever there is a difference of opinion between the Director of

Accounts and the Executive about the correctness of any payment due to
interpretation of rules, orders and conditions of the Agreement concluded etc., the
authority competent to remove the objection will authorize the payment and give a
written assurance that he will take steps to remove the objection and the Director of
Accounts shall make payment provisionally on the basis of such an assurance given
by the Executive as required in G.O.Ms.No.446, PWD Dept., dt.18.10.1965 read with
Memo.No.766/F.VII(i)/82-1, Fin & Plg. (PW) Dept. Dt.02.07.1982. However, final
payment on any bill should not be made on the basis of such an assurance the
authority competent to remove the objection in respect of items which require the
approval of Government is the respective Chief Engineer for purpose of giving
written assurance. A list of such payments should be sent monthly by the Director of
Accounts, direct to the Government to Fin. & Plg. (Pr.W) Dept. and Irrigation &
CAD Dept, with a copy to the Chief Engineer.
c) A periodical review of such list of payments should be made at Government level

by Fin. & Plg. (Pr.W) Dept., and by I & CAD Dept., at least every quarter and
suitable instructions to the Chief Engineers/Directors of Accounts are issued in cases
where the assurance can be considered improper/incorrect. After issue of such
instructions, subsequent assurances for similar payments should not be given by the
Executive and even if any given, payment should not be made but the issue is to be
referred to Government by the Director of Accounts for orders.
(v) He should bring to the notice of Government through Chief Engineer any expenditure
which he considers to be outside the scope of the Project estimate so that the Budget
estimates do not contravene the rules and orders. The Chief Engineer should offer his
remarks while forwarding the same to the Government.
(vi) He is the chief accounting authority and the Chief Internal Auditor.
CHAPTER-2 5
(vii) He should bring to the notice of the Chief Engineer, probable large savings/excesses
anticipated against the provision in the Project/Budget Estimate.
(viii) He should send timely warnings of probable excesses over Reserve Stock limits.
(ix) He should arrange to send monthly and other consolidated accounts as may be
required to the Accountant General/Government.
(ix) He should be responsible for value accounting as regards stores.
(x) He should keep a constant watch over the State of initial accounts and bring delays
and irregularities to the notice of the Chief Engineer/Secretary (Works and Projects),
(PW) Finance and Planning Department.
(xi) He is responsible for the accounts documentation of all the transactions.
(xii) He should furnish material for appropriation accounts and finance accounts to the
Accountant-General.
(xiii) He should assist the Chief Engineer in framing the budget estimates, financial
analysis of the schemes, purchase of stores and also in the methods avoiding wasteful
expenditure. He should scrutinize the budget estimates/revised budget estimates and
supplementary budget estimates of the respective project before they are sent to
Government.
(xiv) As member of Negotiation) Tender and Stores Purchase Committees, he should

render advice and carefully peruse the comparative statements prepared by the
Departmental Officers. His role is not that of a mere observer.
(xv) He is a member of the panel of the arbitrators in respect of cases relating to the
projects & I & CAD, R&B etc. as ordere1y the Government from time to time.
2-1-2 B) The duties and responsibilities of AOs/CAOs and DAOs (was/are furnished in
Appendix-XV and XVI respectively.
Powers Delegated to the director of Accounts:
2-1-2(C) 1. To exercise all powers under Rule (9) of the Andhra Pradesh Ministerial Services
Rules in respect of all the Ministerial posts.
6 PAO (WA) Manual
2. To exercise powers under the Andhra Pradesh Civil Service (Classifications Control
and Appeal) Rules, 1963 in respect of all Ministerial staff and other members of the
Sub-ordinate Staff including the last grade servants.
3. To act as Controlling Officer under Andhra Pradesh Manual of Special Pay and
Allowances for himself and also for officers and staff under him.
4. To purchase Non- Government Publications (Books) for Office use, Subject to a limit
of Rs. 100/- (Rupees one hundred only) per annum.
5. To purchase Government printed publications required for office use and reference
subject to a limit of Rs. 100/- (rupees one hundred only) per annum.
6. To buy isolated copies of news papers subject to a limit of Rs. 5/- (Rupees five only)
on each occasion.
7. To purchase stationary articles for office use otherwise than by indent subject to a limit
of Rs. 2, 400/- (Rupees Two thousand and four hundred only) per annum.
8. To incur expenditure on repairs and maintenance of Type writers, Calculators,

Duplicating Machines, Pin Point Type Machines etc. (Full powers).
9. To purchase furniture upto a limit of Rs. 10,000/- (Rupees Ten Thousand only) per
annum.
10. To incur expenditure on repairs to office furniture (full powers).
11. For further delegation of powers to the Directors of Accounts and Pay and Accounts
Officers/ Assistant Pay and Accounts Officers Please See Para 7-14-30
7
PART-B
GENERAL PROCEDURE AND ADMINISTRATION
CHAPTER -3
General procedure
Constitution of the Office:-
3-1-1. The Director of Accounts is the head of the Pay and Accounts Organization. He is assisted by
Pay and Accounts Officer /Assistant pay and Accounts Officer and other categories of Staff.
The Pay and Ac- counts Officer / Assistant Pay and Accounts Officer will control the day /
today work of the Organization. The work is distributed among various sections headed by
Superintendent in each section and each Superintendent is assisted by Senior Assistants
/Junior Assistants / Typists etc. The general distribution of work among the sections of the
Pay & Accounts Office working under the control of Director of Accounts is indicated below:
1. Administration Section: - This Section deals with all establishment matters, record,
stationery, forms, general diary and despatch and budget of the Pay and Accounts Office.
2. Establishment Pre-Check Sections: - These Sections deal with all types of claims of
Gazetted Officers and Non-Gazetted establishment.
3. Works Pre-Check Section: - The number of Works Pre -Check sections will depend
upon the number of divisions and the works they execute.
4. Cash Section: - This Section deals with the preparation and despatch of cheques, all
items of works relating to “P.A.O Deposits" and all Valuables.
5. Compilation Section: - This section deals with the compilation of accounts and rendering
of compiled accounts to Accountant General/ Government /Chief Engineer and other
allied matters.
6. Co-ordination Section: - This section deals with the co ordination of all the sections in
the Pay and Accounts Office and with all general Matters.
7. Internal Test Check Section: - This section deals with internal test checking of the work
done by all the sections in the Pay and Accounts Office,
8 PAO (WA) Manual
the maintenance of the Project Estimate Registers and scrutiny of all important estimates
and agreements.
8. Local Inspection : - Local Inspection Parties :- These Parties are intended for the
Inspection and Local check of the Divisions /Offices in the project excepting Direction
offices i.e. Chief Engineer‟s Office Superintending Engineer‟s Office and the Special
Collector‟s Offices.
In respect of outstation Pay & Accounts Offices /APAO, the work may be distributed by
the PAO/APAO concerned with the approval of the DOA among the sections according
to the work load attached to the office.
3-1-2. The required number of Senior Assistants (Auditors / Junior Auditors J.As) are posted to
each Section which is placed in charge of a Superintendent. Three or Four Sections are to
be placed in the Charge of Pay & Accounts Officer / Assistant Pay & Accounts Officer.
The Co-ordination and the Internal Test Check / Sections are under the direct charge of
the Director of Accounts. The local inspection party is headed by a Pay & Accounts
Officer / Asst. Pay Accounts Officer.
Duties and Responsibilities of the staff: -
3-2-1. Pay & Accounts Officers/APAOs: - A Pay & Accounts Officer/APAO is responsible for
the satisfactory functioning by the sections placed under his charge. He should so arrange
the work that all items are attended to promptly and properly. He should guide the
Superintendents and the Auditors (Sr. Assistants / Jr. Auditors) and keep in touch with
them as often as possible. The Pay & Accounts Office/APAO is responsible for the
overall accuracy and correctness of the claims admitted by him for payment.
3-2-2. Superintendents: - A Superintendent is responsible for maintaining discipline in his

Section and also for the efficient conduct of its business as a whole. He will be
particularly responsible for the proper maintenance of the sectional calendar of returns
and for seeing that each item of work is taken up, completed and submitted in time and
each return is despatched on the due date. He should see that the work in the Section is
kept current and also that work is carried out in accordance with the prescribed
procedure. He is responsible for the accuracy of the claims passed for adjustments made
in his section and the correctness of
CHAPTER-3 9
classification adopted and accuracy of the postings made in various accounts registers.
He is also responsible for training the Senior Assistants / Junior Assistants, in his section
to make them fit to do their work efficiently and promptly.
Care should be taken to preserve uniformity of procedure in all the processes of work
carried out in the works Pre -Check --Sections. For this purpose it is necessary that
Superintendents of pre-check sections should freely compare notes on all important
points. Superintendents are required to maintain close watch over all their sub-ordinates
on this point and are required to enquire frequently into the practice of other sections so
as to ensure uniformity in the application of modes of check and documentation in all the
works pre-check sections.”
3-2-3. Senior Assistant and Junior Assistant (Auditors, Junior auditors):- The Senior
Assistants only are responsible for arithmetical accuracy of the claims passed or
adjustments made by them for proper application of the various checks to the claims in
accordance with the rules and orders in force, and for posting maintenance of various
accounts registers as per posting and maintenance of various accounts registers as per the
prescribed procedure. They accurately carry out the duties entrusted to them with utmost
promptitude. They should do the work methodically and always keep their charge current
in all respects. They are held responsible for the accuracy of the information furnished in
the calendar of returns and Monthly progress report.
Junior Assistants (Junior Auditor):- All inward bills/letters and other correspondence of
the Section after perusal and marking of the units by the Superintendent should be
received by the Junior Assistant (Junior Auditor) and distribute them to the concerned
units after entering in the appropriate registers of the units. He should maintain the
common register of the section. The Senior Assistant (Auditor) should verify the
papers/bills so entered into the registers on the same day and take further action for their
disposal. The Junior Assistant should assist the Senior Assistant (Auditors) and
Superintendent of the section to whom 1he has been attached in attending the routine
work of arising despatch and incidental work such as verification of enclosures etc. not
involving audit check. He should do his work promptly and efficiently and in a
responsible manner.
PAO (WA) Manual 10
Attenders: - The attenders should see that the tables, chairs and records of the Sections/
Officers to which/ whom are attached are kept clean. They should carry out the duties
entrusted to them with utmost promptitude and sense of responsibility.
Office Discipline:-
3-3-1. i) All officers and staff should be conversant with the Government Servants Conduct
Rules”. All officers and staff should strictly observe rules regarding office hours,
attendance, cleanliness and discipline as embodied in the District Office Manual and
orders issued by Government from time to time. In their conduct with the officers and
the staff of Divisions / Offices, the Pay & Accounts Officers / Assistant Pay &
Accounts Officers and Staff should be well polished and courteous.
ii) Hours of Work: - The hours of work in the office will be as prescribed by Government
and the Section heads should see that the staff members of his section should avail the
lunch break for the specified period only.
iii) Absence during Office Hours: - No member should leave the office during official
hours without the permission of the Superintendent and a Superintendent without the
Permission of the next higher officer or the Officer under whose control he is attending
to his entrusted duties.
iv) Attendance register: - The Attendance Register will be maintained in the, standard
form prescribed. Strict punctuality is expected of all members of the Office. This is
necessary not only for the general discipline of the Office but also on account of the
dealings of the office with the public. The attendance register maintained in each office
should be initialled into appropriate column by as they arrive. The register should be
closed ten minutes after the commencement of the office hours by the Superintendent in
charge of Administration section (or in his absence by the senior most Sr. Asst. present)
and submitted to the Pay & Accounts Officer/ Asst. Pay & Accounts Officer. Any
member who has not arrived that time will be marked by the Pay & Accounts Officer /
Asst. Pay & Accounts Officer as ” late” by putting a cross across the column against
his/ her name or as P.C.L. (Permitted to come late) if he / she had already obtained
permission to do so. Permission to attend office late, upto one hour, which will be
granted sparingly and for good reasons, should be obtained in advance in writing from
the Pay & Accounts Officer / Asst. Pay & Accounts Officer
CHAPTER -3 11
The Pay & Accounts Officer & Asst. Pay & Accounts Officer will keep a late
attendance register till an hour after the commencement of office hours and all late -
comers will have to sign the register in the room of the Pay & Accounts Officer, noting
the actual time of arrival.
v) Penalty for late attendance: - If an employee attend office late by more than one hour
after the commencement of the Office hours but before the lunch interval, he / she has
to forfeit half day casual leave. Attendance after the lunch interval will entail forfeiture
of one day casual leave. This will be in addition to any disciplinary action that ray be
taken for absence without permission. A member of the staff maybe permitted to attend
office late for valid reasons, three times in a month, provided that the period of absence
does not exceed one hour. For every three subsequent occasions or less of the late
attendance during a month, one day Casual Leave will be deducted from the Casual
Leave Account.
vi) Report on Late Attendance: - A report of late attendance for each month should be
submitted to the Pay & Accounts Officer / APAO on the 7th of the following month.
For this purpose the column of the right hand side of the Attendance Register should be
filled in and the initials of the Officer obtained at the foot there Forfeiture of Casual
Leave for late attendance should, however, be entered in the Casual Leave Register
then an4 there and submitted to the Pay & Accounts Officer / APAO for attestation.
vii). Attendance of Last Grade Government Servants : - Last Grade Government Servants
attached to the sections and those doing duty under Pay & Accounts Officers, will
attend office at least half an hour before the commencement of Office hours. The care
taker / Record Assistant will keep the attendance Register of these staff who will also
sign in the register of Attendance.
viii) Holidays : - The Pay & Accounts Office will decide with due regard to the state of
work of the office whether there is any need for attendance of a part of whole of the
office as the case may be, in the case of each holiday, and take action accordingly. Any
way skeleton staff of one Sr. Asst., Jr. Asst. and one Last Grade Servant will have to be
asked to attend the office to receive urgent tappals and to attend to urgent work if any.
3-4-1 Casual Leave: - Casual Leave to the Pay and Accounts Officer /
12 PAO (WA) Manual
Assistant Pay and Accounts Officer / Staff working directly under Director of Accounts
will be sanctioned by the Director of Accounts. Casual leave to the Staff working in the
Pay and Accounts Office will be sanctioned by the Pay and Accounts Officer / Assistant
Pay and Accounts Officer.
System of Correspondence:-
3-5-1 The rules laid down in the District Office manual regarding forms of correspondence,
methods of writing office notes and drafts should be strictly followed.
3-5-2 While submitting notes to the Director of Accounts, it should be seen (i) that the points for
orders are clearly mentioned (ii) that rules and orders having a bearing on the matter are
referred to and (iii) that the facts of the case are briefly but fully explained. Before
finalizing the note for submission to the Director of Accounts the Superintendent and the
Pay and Accounts Officer / Assistant Pay and Accounts Officer should discuss the matter
fully and arrive at an agreed note. (However, in case of difference of opinion between the
Superintendent and the Pay and Accounts Officer / Assistant Pay and Accounts Officer
persisting even after the discussion, the points of difference may be explained in the note).
Signing of Communications and recording of letters: -
3-6-1 Letters addressed to the Government and the Chief Engineers should be submitted to the
Director of Accounts for approval. All other communications which are approved by the
Pay and Accounts Officer / Assistant Pay & Accounts Officer in draft stage should be
signed by the Pay and Accounts Officer / Assistant Pay & Accounts Officers themselves
in all cases. Fair copies of letters approved by the Director of Accounts should be got
signed by the Director of Accounts. The documents mentioned below may be approved at
the draft stage (except to where something is specifically mentioned to the contrary) and
the fair copies signed by the Superintendent.
(1) Reminder cards and routine reminders.
(2) Acknowledgment of letters and documents received.
(3) Fair copies of ordinary and express telegrams after the Office copies have been approved
by the Gazetted Officer.
(4) Communication of adjustments made in the books in rectification of errors in

classification.
CHAPTER -3 13
(5) True extracts from letter/vouchers.
(6) Routine correspondence relating to Land A ward Statements, viz. calling for dates of
taking possession of land etc.,
(7) Cheque forwarding slips when no objection is conveyed.
3-6-2. “All D.O. letters received in the name of Director of Accounts, all communications
received from Government / Head of the Department / Accountant General including
Resident Audit Officer addressed to Director of Accounts, should be recorded under the
orders of Director of Accounts. All other Correspondence addressed to the Pay and
Accounts Officer / Assistant Pay & Accounts Officer may be recorded under the orders
of the Pay & Accounts Officer / Assistant Pay & Accounts Officer. However, wherever,
it is felt necessary to bring it to the notice of Director of Accounts, such papers may be
submitted to the Director of Accounts by the pay & Accounts Officer / Assistant Pay &
Accounts Officer.
Receipt and Distribution of Dak:-
3-7-1 Each Superintendent should arrange to acknowledge the daily dak received in the section
from the inward unit of the Administration Section. The dak should then be sent to the
Pay and Accounts Officer/Assistant Pay and Accounts Officer who will set his dated
initials on each letter and return the dak to the section. The Superintendent should, as
soon as the dak is received from the Pay and Accounts Officer/Assistant Pay and
Accounts Officer examine each letter and mark the units and hand over to the Asst.
responsible for the distribution of letters in the Section for delivering the letters to
concerned Assistants. The letters from Coordination Section are routed through Pay and
Accounts Officer/Assistant Pay and Accounts Officer and the Superintendent to the
Assistant concerned. All letters should be diarised in the purport Register maintained by
each Assistant.
3-7-2 No letters sent to a section through the transit register should be refused and any letter
wrongly marked should be sent to the correct section through the transit register of the
section. In case of any doubt, the letter should be sent to the Superintendent
(Coordination) for correct marking of the section.
Purport Register: -
3-8-1. Each Assistant should maintain a purport Register for all the papers received by him. In
addition a consolidated purport Register may be
PAO (WA) Manual 14
maintained in each section for diarising urgent letters, and letters received from
Government/ Accountant General/ Head of the Department.
3-8-2. The Purport Registers should be closed fortnightly in respect of all letters received
detailing out the pendency and submitted to the Pay & Accounts Officer / APAO through
the Superintendent. An item in the purport Register should not be treated as closed until
the disposal number file order is noted against each item. Each item should be closely
scrutinized by the Superintendent to ensure, that all the letters received are duly purported
and dealt with promptly. Letters pending for more than three days should be personally
scrutinized by him. Letters pending for more than a week should be called for by the Pay
& Accounts Officer / APAO and suitable instructions given for their disposal. The urgent
purport Register should be submitted to the Director of Accounts after closing on the first
day of every week in case of offices at the Head-Quarters of the Director of Accounts.
The ordinary purport Register should also be submitted to the Director of Accounts if any
reference is pending for more than one month.
In respect of outstation Pay & Accounts Offices the urgent purport Register should be
maintained for watching the disposal of letters received from Government, Chief
Engineer, Accountant General, if any and invariably those from Director of Accounts and
Resident Audit Officers and the closing should be put-up to the Pay & Accounts Officer,
every Monday and the Director of Accounts during his local visits.
Despatch Register:-
3-9-1 A despatch register should be maintained by each Assistant in the proper form. The fact
whether the communication issued requires a reply or not should be noted against each
item in the relevant column. All letters due for despatch should be sent to the central
despatch unit f the Administration Section along with the despatch register. The dispatch
register should be closed once in a month detailing out the items for which replies are due
but are not received. Suitable reminders should also be issued promptly calling for
replies. D.O. Letters should be issued in respect of items pending for considerable time
depending on the nature and importance of each case. A Memory Tickler Register should
also be maintained by each Assistant to indicate the dates, on which further action on
important pending cases should be assigned, it being sufficient to repeat the despatch
number of the original letter, with a suffix A 1 to indicate the first reminder, A 2 to
indicate the second reminder and so on.
CHAPTER -3 15
Details of the reminders should also be noted against the original number in the despatch
register.
Bills Register:-
3-10-1 The bills are directly received in the concerned Pre-check section. They should first be
perused by the Superintendent who should set his dated initials. They will be
acknowledged by the Assistant concerned who should immediately purport them in the
Bill Register maintained by him. The bills should be taken up for disposal in the order of
time of receipt for each category of bills and disposed of within the time limits fixed for
each kind of bills as shown in Appendix - 1. The time limits shown in the appendix are
only the maximum limits beyond which no bill should be kept pending. Bills received for
a second or subsequent time should not be treated in the same way as bills received for
the first time, as, such bills would have already been detained in the office for some time
before they were returned and most of the checks would have been applied. Such bills
should therefore be given priority over the bills received for the first time and the
seniority for such bills should be considered separately category - wise
3-10-2 After the bills are passed for payment by the PAO /APAO they should be sent to the Cash
Section along with the cheque forwarding slip in Form PAO-1 indicating the amount of
disallowance and reasons there for if there are any disallowances. If the bill passed
involves deduction of Income Tax, Sales Tax, the Income Tax, Sales Tax deduction
certificate should be sent along with the cheque forwarding slip for transmission to the
concerned through the Division. In regard to the adjustment made in the Pay & Accounts
Office should invariably be sent by the Pay & Accounts Officer to the Division / Office
in Form PAO-6.
3-10-3 Bills to be returned un-passed together with Measurement Books in respect of such bills
should be sent through the messengers of the Divisions/Offices, without routing them
through the cash section. Bills of outstation offices should be returned by “Registered
Post”, through the central despatch Unit. A separate despatch - cum - transit register
should be kept for this purpose and all the precautions taken by the cash section in this
regard should be observed by the pre - check section concerned.
3-10-4 In order to enable the Pay and Accounts Officer/Assistant Pay and Accounts Officer to
exercise effective control over the progress in the
16 PAO (WA) Manual
disposal of the bills received in the sections and to ensure their expeditious disposal, a
progress report in Form P.A.O. 3 should be submitted to him weekly in respect of all bills
received in the section as at the end of the last day of the week, during the month of April
to end of February. However in the month of March, the progress report in Form P.A.O.
3 should be submitted daily.
Note: - Separate serial number should be assigned in the purport, despatch and bill registers in
respect of each financial year commencing from 1st April.
System of Recording Correspondence:-
3-11-1 All correspondence will be filed in “files” or “cases”.
3-11-2 Files: - The unit for recording correspondence will be the “files” The list of Sectional
files as sanctioned by the Director of accounts is given in Appendixes. However if any
file with a new subject is required to be opend it may done with the approval of
Government. All papers, both outward and inward, will be classified according to the file
to which they belong. Cases will be subordinate to some file and are separate integral
parts of the files and will be sub-numbered serially. Thus all papers belong prima facia to
some file or other. If they are unimportant they go straight into the file and are arranged
chronologically with the other papers in the file. If important they are formed into a
separate case but they still belong to the file and will be indicated by the number of the
file as well as the number of the case.
3-11-3 Thus at the end of the year each file will consist of the “file” proper containing the
Unimportant and routine correspondence on the subject to which the file relates, plus one
or more separate cases dealing with important questions under the same subject.
3-11-4 Cases :-(a) Cases should be formed whenever it is necessary to keep together the paper
connected with a subject either on account of its importance or because it is especially
convenient to do so. Only correspondence of a purely routine character will go into the
files proper without being cased.
(b) Whenever it appears to a Superintendent that the correspondence on any subject is likely
to be protracted or is of sufficient importance to be formed into a case, he should note the
word „Case‟ on the paper under reference or disposal and the concerned Assistant should
form the case
CHAPTER -3 17
forth with so that the case may be completed and no paper which ought to get into it, is
omitted. Gazetted Officers also should note “Case” on any paper coming to them which
seem to deserve to be treated.
(c) The papers (notes and letters) forming a case should be arranged in strict chronological
order, the paper bearing the oldest date commencing first, and the page numbered so that
the complete correspondence inclusive of the office notes is arranged like a book.
3-11-5 Register of cases:- Every section should maintain a register of cases. One or more pages
should be allotted to each file and the subject and number of the files be written at the top
of the page or pages concerned. Each case will be entered when it is formed. In the
remarks column the date of closing the case may be entered. If the correspondence is not
finished within the year, the remark “continued in 198 - 198” may be entered in the last
column. At the close of the year, a line should be drawn in red ink across all the pages of
the register and a fresh set of entries made for the next year. -
3-11-6 All cases in which the correspondence is not finished but is still continuing after the close
of the year should immediately be brought forward to the register of the next year under
the same numbers as they bore in the previous year and figure of the should be added in
the case cover. The case will then be treated in all respects as a case of the New Year.
Thus, if 10 cases were formed under any particular file in any year and all, except
numbers 3 and 8 of the next year and new cases formed in next year should be numbered
1, 2, 4, 5, 6, 7, 9, 10 omitting the numbers 3 and 8 already allotted to the cases brought
over from the previous year.
Miscellaneous:-
3-12-1 Calendar of Returns:- All items of work such as returns due to or from outside offices
or other sections of the Office, submission of registers, reports etc., to Pay and Accounts
Officers/Assistant Pay and Accounts Officers should be collected and watched through a
Calendar of Returns (Appendix - III) which should be maintained in each section. It
should be kept with the Superintendents and submitted to Pay and Accounts Officer /
Assistant Pay and Accounts Officer weekly and to Director of Accounts monthly, (with
an abstract indicating the returns due but not
18 PAO (WA) Manual
submitted and those submitted late) along with the Monthly Progress Report. The
Calendar of Returns of the sections of the Pay and Accounts Offices in the Office of the
Director of Accounts should be sent to Co - ordination Section on due date for review and
submission to „Director of Accounts In case of other Pay and Accounts Offices an extract
of the monthly abstract of Calendar of Returns may be sent to Co-ordination Section
along with Monthly Progress Report.
3-12-2 The following arrangement should be adopted in the form of the Calendar:-
Section I: All returns of a permanent or recurring nature due to outside authorities.
Section II: All registers and reports etc., of a permanent or recurring nature due for
submission to Director of Accounts, Pay & Accounts Officers /APAO or other section
within the Office.
Section III: All returns, accounts registers, etc., of a permanent or recurring nature due
either from outside authorities or other sections of the Office.
Section IV : Unforeseen entries which a section is required to make in the Calendar in

respect of matters to be taken up for disposal on or about again date or in respect of
occasional matters on which information or reports are expected from outside offices or
other Sections.
3-12-3 Section I, II, and III should be sub-divided into (a) Annual (b) Half-yearly (c) Quarterly,
(d) Monthly (e) Fortnightly and (f) weekly, the entries in each of these sub-divisions
being arranged in the order of dates on which they are due and sufficient space being
allowed after each subdivision for new entries to be made during the course of the year.
3-12-4 The first four columns of the calendar should be entered at the beginning of each year
from the previous year‟s calendar.
Note:- Any additions due to orders received in the course of the year should be made at the end
of the sub-division concerned without altering the serial numbers of the existing items.
3-12-5 The Superintendents will be held personally responsible for seeing that the calendars are
at all times complete and up-to-date.
3-12-6 To have a picture of the state of affairs in the sections as also to ensure
CHAPTER-3 19
that the registers relating to all the units of the section have been properly submitted,
section Superintendents should see that all the units of the section are separately detailed
in the Calendar and to note the dates of submission of all the relative registers (e.g.,
Purport Register, Despatch Register, Bills Register) to the Pay and Accounts
Officer/Assistant Pay and Accounts Officer.
3-12-7 Monthly Progress Report:- In order to enable the Director of Accounts to have a picture
of the State of work in the office as a whole, each section Superintendent should submit
to him every month through the Pay & Accounts Officers/Assistant Pay & Accounts
Officer a monthly report (Appendix-IV) detailing the state of work in the Section. The
Superintendent will be personally responsible to show the true state of affairs of the
section in the progress report. The monthly progress report will indicate the degree of
efficiency, control and management of work by the Superintendent of the section
concerned with the cooperation of his staff. To enable the Director of Accounts to mark
the progressive improvement or deterioration of the work of the section the report should
be prepared from month to month from the reports of the previous month, the sectional
calendar of returns, purport and other registers maintained in the section for watching
progress of the work.
A consolidated review report for all sections in respect of PAO/APAO should be

submitted by the Director of Accounts to Secretary (Works & Projects), Fin. & Plg.
(Pr.W) Dept., every month by 15th of succeeding month.
3-12-8 The report completed in all respects and certified to be correct by the Superintendent over
his dated signature should be laid before the Pay and Accounts Officer / Assistant Pay
and Accounts Officer who will scrutinize the report (Particularly the explanations and
other remarks) with a view to seeing that the entries are completed and accurate in
respect of all items of work for which the section is responsible and then sign it after
recording his remarks for the guidance of the Superintendent for the information and
orders of the Director of Accounts. The report should then be sent to the Co-ordination
Section. The procedure for the reckoning of manday in respect of each item of work is
given in Appendix-V.
3-13-1 Change in Staff:- Each (Auditor) Assistant and Superintendent should maintain a record
of the points he has to watch but which are not required
20 PAO (WA) Manual
to be noted in any of the prescribed registers. This record should be handed over to the
successor whenever there is a change in incumbency.
3-14-1 Auditor’s Note Book: - A Note Book (in P.A.O. Form No. 64) should be maintained by
each auditor for noting all points which have to be kept in mind as requiring action to be
taken, but which cannot be noted in the Works Audit Register. Each entry should be
made concisely but in full detail, so that action to be taken may be readily understood. A
note, with necessary references, should be made against each entry in due course to
indicate action taken so that all points still requiring attention may be known at any time.
The Note Book should be reviewed monthly by the Superintendent and the Pay and
Accounts Officer/Assistant Pay and Accounts Officer.
Responsibilities on taking or handing over charge:-
3-15-1 Whenever there is a change in any Gazetted charge (either because of redistribution of
work or because of transfer), the outgoing Officer should hand over to his successor all
keys, valuables, character rolls, other confidential documents etc., and report the fact of
having done so to the Director of Accounts. He should also prepare a report to his
successor in the form of a note containing:-
(i) State of work: - Brief details of the Office viz, Office set - up, Scope of work etc.
(ii) Arrears to be cleared (i.e.,) Bills pending, suspense Balances outstanding and other
important arrears.
(iii) Brief Particulars of inspection /Audit Paras and Audit reports outstanding.
(iv) Important irregularities generally coming to notice of the Officer handing over charge
and to be looked into by the new incumbent.
(v) Pending Court cases if any and
(vi) Important cases or items of work which art pending and are likely to call for the Officer‟s
special attention for scrutiny.
Any serious defect that may exist in any of the sections in his charge should also be
mentioned in the report. The handing over reports so prepared by Pay and Accounts
Officer/Assistant Pay and Accounts Officers
CHAPTER-3 21
whenever there is change of incumbency should be sent to the Director of Accounts

under intimation to the respective Chief Engineer. The Director of Accounts should
scrutinize the report and issue suitable instructions to the Pay and Accounts
Officer/Assistant Pay and Accounts Officer whenever necessary. The exhaustive handing
over reports of Directors of Accounts should be sent to the concerned Chief Engineer
with a copy marked to the Government/Secretary, (W&P) Finance and Planning (Projects
Wing) Department.
3-15-2 Every Superintendent or Clerk when handing over charge of his duties to another should
prepare a memorandum of cases, papers etc., pending disposal and items of work which
are in arrears or which require the special attention of his Successor. A list of files letters
etc., handed over should also be prepared. The memorandum (including the list) should
be submitted to the Pay and Accounts Officer/Assistant Pay and Accounts Officer for
information and orders. Superintendents should also see that the furniture and various
codes and manuals and other books of reference exist as per the list maintained in the
sections.
Inspection of Sub-ordinate Offices under the control of the Director of Accounts:-
3-16-1 The Director of Accounts should inspect the Pay and Accounts Offices under his control
once in a year and issue suitable instructions as he deems fit for rectifying the defects and
send his reports to the Government regularly.
22 PAO (WA) Manual
CHAPTER-4
ADMINISTRATION
Introductory:-
4-1-1 The Administration Section deals with all establishment matters, records, stationery,
general diary and despatch, budget and accounts and general management of the Pay and
Accounts Office.
Functions:-
4-2-1 ”All important matters relating to staff and problems of general nature involving policy
decision arising in both the Head-quarters and outstation Pay and Accounts Offices are
dealt with in the Administration Section while the routine items of work relating to the
outstation offices are dealt with by the respective offices.
4-2-2 The orders of the Director of Accounts are obtained on all important matters including all
cases which affect staff while the routine items of work are disposed off by the Pay and
Accounts Officer/Assistant Pay and Accounts Officer in charge of the Administration
Section.
Staff Position:-
4-3-1 The Staff of the Office consists of Pay and Accounts Officers, Assistant Pay and
Accounts Officers, Superintendents, Senior Assistants, Junior Assistants, Stenographers
Typists and Steno-Typists, Record Assistants, Roieo-duplicating Operators and
Attenders.
4-3-2 Every month a staff position statement indicating the sanctioned strength, actual working
strength and vacancies in each cadre should be submitted to the Director of Accounts
through the Co-ordination Section to enable him to review the position.
4-3-3 The term of deputation in respect of the deputations, is initially fixed for a limited period.
A register should be maintained in the section to watch the dates of expiry of the periods
of deputation and take action to obtain extension of the periods of deputation. Proposals
for such extension should be submitted to the Director of Accounts two months in
advance of the expiry of the term of deputation.
Conditions of Service and Problems of Staff:-
4-4-1 The conditions of service of the staff drawn from other departments of
CHAPTER -4 23
the State Government and the Staff recruited by the Pay and Accounts Officer/Assistant
Pay and Accounts Officer are covered by the Fundamental Rules, and the Service Rules of
the State Government and orders issued by the Government from time to time.‟
Regularization of Services:-
4-5-1 Action for the commencement and declaration of the prescribed period of probation in
respect of posts with definite conditions of probation should be taken by the
Administration Section in respect of all regular candidates in accordance& with the rules
and procedure laid down in the Services Manual Volume-I and Service Rules for the Last
Grade Government Servants.
Maintenance of Personal Files, Service Books and Leave Accounts of Staff:
4-6-1 A personal file should be maintained for each member of the staff. Service Books should
be opened for all recruits as early as possible. The service books and leave accounts
should be maintained in accordance with the Subsidiary Rules under F.Rs. of the State
Government and other relevant rules. Personal files containing the confidential reports of
the staff should be kept in the personal custody of the Director of Accounts.
4-6-2 A register of service books should be maintained in Form P.A.O. 4 to watch the
movements of the service books. In the month of January each year the service books held
in the custody of the section should be verified with the register of service books by the
Pay and Accounts Officer / Assistant Pay and Accounts Officer in charge of the
Administration Section and the fact recorded in the register over his dated signature.
4-7-1 Sanction of Leave (Other than casual Leave)
i. The rules and the procedure for grant of leave are laid down in the relevant leave rules
of the State Government. All kinds of leave applied for by the staff require the sanction of
the respective Directors of Accounts. The leave applications with the recommendation of
the Pay & Accounts Officer /Asst. Pay & Accounts Officer should be sent to the Director
of Accounts through the administration section for certifying eligibility to the leave
applied for.
iii) The Pay & Account Officers/Asst. Pay & Accounts Officers in charge of PAO stationed at
places other than the Head Quarters of the Director of Accounts may sanction leave other
than special disability leave not
24 PAO (WA) Manual
exceeding 30 days to the non-gazetted staff upto and including Sr.Assistants Cadre subject
to the conditions that :-.
a) No Substitute is posted in the place of the incumbent proceeding on leave and b) the work
should not be allowed to fall into arrears during the period of the leave by distributing the
work among the other existing members of staff.
4-7-2 A leave Register should be maintained in the Section in form P.A.O 5 to ensure posting of
entries in the leave accounts and facilitate ascertainment of staff position and drawal of
salary bills. The register should be closed monthly to ensure that no spell of leave
sanctioned and availed of by a member is left un-posted in the leave account and the
service book.
Sanction of Increments:-
4-8-1 The PAO/APAO i.e. drawing officer is competent authority to sanction / release increment
to the staff. In cases where the drawing officer and the officer who maintains service
records of the employees is different, a certificate of service particulars eligible for earning
increments shall be given by the authority who maintains service register to the drawing
officer of release the increment.
Register of Increments:
4-9-1 A register of increments in form P.A.O 6 should be maintained in the Section to watch the
due dates of increments and take action to obtain sanction to increments due in each
month. Separate pages should be allowed for the increments falling due in each month. In
the folio relating to a month, all increments falling due in that month should be recorded.
Enough space should be left between the names and also some blank pages left after the
entries of a particular month so that remarks affecting the date of increment or entries
relating to new names can be made. If for any reason the date of increment of a person is
changed to another month the name of the person should be scored through and a note
kept against it showing the folio to which it is transferred. Names of persons newly
appointed or promoted to higher grades should be entered immediately on appointment or
promotion in the relevant folios.
4-9-2. Before the preparation of the monthly bill, the increment register should be reviewed and
a consolidated list of cases of increments accruing in a month should be put up to Director
of Accounts for sanction. The increased Pay should be given effect to in the pay bill for
the month in which the increment accrues.
CHAPTER -4 25
4-9-3. The register should be closed monthly with an abstract showing the opening balance,
number of cases in which increments fell during the month, number of cases in which
increments were sanctioned and the closing balance. The closing balance should be
supported by details of cases and reasons for the delay in each case.
Departmental tests:-
4-10-1 Before sanctioning increments or ordering promotions it should be ensured that

conditions regarding the passing of departmental tests / Language test prescribed by
competent authority have been fulfilled.
Postings and Transfers:-
4-11-1. An important item of work in the Section is the postings and transfers of staff. The
section should maintain a register showing the position of vacancies in sections. The
transfers and postings should be approved by the Director of Accounts.
Drawal of Bills:-
4-12-1. The Pay and Accounts Officer (Administration) is the drawing and disbursing officer in
respect of the Pay and Accounts officers/Assistant Pay and Accounts Officers-in-charge
of the outstation offices.
Bills for pay and allowances:-
4-13-1. Bills for the Pay and Allowances of the Gazetted/Non-Gazetted Staff of the Office,
should be prepared by the Administration Section for the Head quarters Office/Branch
Office in accordance with the instructions contained in S. Rs. 7 to 10, 12 and 14 of T.R.
16 and the Financial rules of the Government and orders issued by Government from
time to time. For this purpose a staff position statement in Form PAO.No. 7 should be
obtained every month from each section indicating the names and periods of their duty
or leave during the month.
4-14-1. T.A. Bills, Medical Reimbursement Bills etc.
The T.A., Medical reimbursement bills etc., prepared in the prescribed forms and
presented by the members of the staff should be checked in accordance with the
instructions contained in Chapter VI and VII of this Manual.
4-15-1. Register of Bills: - A bills register should be maintained in form PAO.8 to watch the
disposal of bills received in the section. The bills after check should be sent to the pre-
check section. After receipt back of
26 PAO (WA) Manual
the bills duly pre-checked, bills requiring counter signature should be put up to the
controlling officer along with the register, The bills should then be sent to the concerned
pre-check section. The register should be closed monthly with an abstract showing the
opening balance, bills received and disposed of during the month and the closing balance
and submitted to the Pay & Accounts Officer / APAO
Drawal of Cash and Disbursement:-
4-16-1 The precautions enjoined in Para - 299 of A.P.W.D. Code should be strictly observed in
obtaining cash from the Bank. Section wise acquittance rolls should be prepared in
accordance with the instructions contained in S.R 4 (a) of TR. 32 and the actual amount
required for disbursement should be handed over along with the acquittance rolls to the
concerned sections after obtaining a simple receipt from each Superintendent for the
amount handed over. Before the close of the day the acquittance rolls along with
undisbursed cash should be returned to the Administration Section. Disbursement to the
last grade servants should be made in the Administration Section.
4-17-1. Register of Undisbursed Pay & Allowances
In order to watch that the amounts of all cheques received from the Cash section are
encashed and disbursed, a Register of undisbursed pay and allowances should be
maintained in the prescribed form, and posted in accordance with the instructions
contained in paragraph -21 of the Financial and Accounting Instructions, Part-I. The
instructions are reproduced below:
Para 21 of Accounting instruction part. I
The following instructions should be observed in writing up this Register:
i) As soon as a cheque is received from the Pay & Accounts Office, columns 1 to 3 should
be filled simultaneously with columns 9 to 11 of N.S.P form no. 71
ii) If, on encashment of the cheque, the amount is completely disbursed, a line may be
drawn through columns 5 to 9.
iii) Sufficient space should be left between one item and another to enable the particulars of
subsequent disbursements being noted in consecutive lines in columns 6 to 8.
CHAPTER -4 27
iv) At the end of every week and month, the details of closing balance (consisting of
uncashed cheques or undisbursed amounts) should be worked out, and submitted to the
head of the office, who should physically verify the balance on the last day of each month
and record a certificate to that effect in the Register.
v) The date of despatch of the cheques to the Treasury Bank should be noted in pencil in
column 4, pending the note ink of the date of actual encashment.
vi) Facts relating to remittance into Treasury/Bank short drawal from subsequent bills of any
amounts remain un-disbursed for 3 months should be noted in column 9.
4-18-1 Review of Acquittance Rolls:-
The Pay and Accounts Officer (Administration) /Assistant Pay and Accounts Officer
(Administration) should see:-
(1) that the amounts drawn on bills are completely accounted for by payments made and
balance held as undisbursed;
(2) that there is proper acquittance for each amount disbursed.
(3) that the amounts noted in the acquittance rolls agree with the claim for each person as
shown in the Office copy of the bills;
(4) that there is proper certificate by the person disbursing the amount to the effect that the
amount has been disbursed to the proper person; and
(5) that the total of the undisbursed balances as shown on the individual acquittance rolls
agree with that shown in the Register of undisturbed pay and allowances.
Office Expenses:-
4-19-1 A Register of office expenses should be maintained in the section to record all office
expenditure in accordance with the instructions contained in article 103 of A.P.F.C. Vol.-
I. The rules in chapter VI of A.P.F.C. Vol. I and orders issued by Government from time
to time should be observed in regard to the Office expenditure.
4-19-2 The Pay and Accounts Officer (Administration) /Assistant Pay and Accounts Officer
(Administration) is given a standing imprest to meet Office expenditure. The instruction
for dealing with the bills for Office expenditure is the same as for other kinds of bills
described in the previous paragraphs.
28 PAO (WA) Manual
Stationery:-
4-20-1 The Annual requirements of stationery, (including forms, registers etc.,) should be
obtained from the Director of Stationery and Printing by placing indents based on the
standards laid down in the Stationery Manual. In urgent cases, however, local purchases
may be resorted to within the powers delegated in this regard. A stock register, one for
stationery articles and another for forms and registers should be maintained in the section
to record the receipts, issues and balances of each item of stationery, forms or registers in
accordance with the instructions contained in the Stationery Manual.
4-20-2 Issues to sections and branch offices should be regulated in accordance with the standards
laid down in the Stationery Manual. The usual monthly indents for stationery may be
signed by the Superintendents of the sections. Other indents should be signed by the Pay
and Accounts Officers / Assistants Pay and Accounts Officers.
4-20-3 The Physical balances of stationery, forms and registers should be got verified annually
before placing the annual indent, by a Superintendent other than the Superintendent in-
charge of the Administration Section. Discrepancies should be settled promptly.
Furniture:-
4-21-1 A stock register of furniture should be maintained in the section showing the receipt and
distribution of furniture in the Office. Separate folios should be sent apart for each item
of furniture and receipts, issues and balances recorded as and when transactions take
place and attested by the Superintendent. The distribution of each item of furniture
among the sections and office should be shown in the last column of the register.
4-21-2 For every receipt of new item of furniture, reference to voucher or invoice number should
be furnished in the relevant column. Every issue should be supported by the
acknowledgments of the recipient. Separate lists showing the furniture supplied to each
section / office should be prepared in duplicate and one copy containing the
acknowledgement of the Superintendent of the receiving section should be filed in the
administration Section and the other copy handed over to the section concerned for being
hung in a prominent place in the section. The concerned section Superintendent is
responsible for the items of furniture so supplied to his section.”
CHAPTER -4 29
4-21-3 The physical balance of furniture should be verified annually by a Superintendent, other
than the Superintendent in charge of the Administration Section.
4-22-1 Receipt and Distribution of Dak:- The receipt of the dak by post and from the local
offices and its distribution should be attended to by the Inward Unit of the
Administration Section. The Receipt Asst. should sort out letters received by him
section wise. The Receipt Asst. will be able to sort out the letters correctly if the Section
number is indicated in the references (issued by this Office) which will be quoted by
other offices in their replies. The Section from which a letter originates should,
therefore, quote in all the correspondence the number of the section and also reference to
the seat in the section so that the reply received will contain this information. (The
despatch number in all communications addressed by this Office should be indicated as
PAO/Sec/II/A1/66-67….. dated…. 19….) PAO/Sec/XI/B2/66-67...dated .... 19...). These
numbers will be followed by the file number and the despatch number. Letters
containing no reference number of this Office should be got marked by Superintendent
(Administration).
4-22-2 The sorted out letters should be serially numbered for each day and sent to the
Superintendent concerned through a transit register indicating the total number of letters
sent on a particular day (e.g., Sl .No. 51 to 100=50 letters). Details of letters received
from Chief Engineer and Government/Accountant General should be given separately.
The letters received during the afternoon of the previous day and during the forenoon of
the day should be sent to the section concerned in the afternoon of the day concerned.
The letters sent should also be accompanied by a separate sheet of paper which is a
carbon copy of the entries in the transit register. A Separate transit register should be
kept for each section.
4-22-3 The Section Superintendents should arrange to acknowledge the letters received in the
transit register itself and retain the attached sheet with them. The transit register should
be returned to the Receipt Asst. Promptly. The letters received by the Superintendent
should be submitted to the Pay and Accounts Officer/Assistant Pay and Accounts
Officer for perusal and on receipt back, the Superintendents should mark the letters to
the concerned units and get them distributed promptly. The acknowledgements of the
concerned Assistant (auditor) for the total
PAO (WA) Manual 30
number of letters them should be obtained in the sheet referred to above and the same
kept in the safe custody.
4-22-4 All D.O. Letters as well as the letters from the Government will be sent to the concerned
Pay and Accounts Officers/Assistant Pay and Accounts Officers and they should ensure
that they are purported promptly in the urgent purport registers of the concerned
sections.
4-22-5 All the registered Dak should be entered by the Receipt Clerk in a separate register and
they should be sent to the concerned Superintendent who should acknowledge their
receipts against the relevant entries in the Register. These items should also be purported
in the sectional purport registers as the case may be.
Fair Copying:-
4-23-1 All Confident and demi-official letters and urgent letters should be got typed by the
stenographers attached to the Officer. All other fair copying work should be got done in
the typing branch which is centralized, in the Administration Section.
4-23-2 Each typist should maintain a diary showing the number of foolscap size pages typed by
him on each day and submit it to the Superintendent (Administration) every day.
Despatch:-
4-24-1 All correspondence to outside Offices other than cheques/drafts should be despatched
through the central despatch unit of the Administration Section. All fair copies of letters
with enclosures, if any, securely fastened should be sent by the concerned sections to the
despatch Clerk along with the despatch register. The letters and enclosures should be
acknowledged by the despatch clerk in the despatch register. The precautions and
procedure outlined in paragraphs 75 to 78 of District Office Manual should be followed
by the despatch clerk in despatching letters, etc.
Stamp Account:-
4-25-1 A Stamp account in proper form should be maintained by the despatch clerk showing the
Opening Balance the value of Stamps purchased the value of stamps used, and the
balance remaining in hand at the end of each day and submitted to the Superintendent
(Administration). The account should be submitted to the Pay and Accounts Officer
(Administration) /
CHAPTER -4 31
Assistant Pay and Accounts Officer (Administration) along with the bill for postage
stamps.
Filing and custody of Records and Vouchers:-
4-26-l The Vouchers and T.Es received Weekly from the compilation section and pre-check
sections should be got stitched into bundles separately for vouchers and T.E.Os in the
Records Branch within three days of their receipt. For each bundle of vouchers/T.Es., an
index should be attached showing the number of each voucher/T.E. and amount and
entered in the Register of Records. The voucher and T.E. bundles should then be made
over to Resident Audit Officer for concurrent audit on the prescribed due dates and
proper acknowledgments obtained in the transit register. On receipt back of the voucher
and T.E. bundles from the Resident Audit Officer, they should be carefully preserved in
suitable record racks.
(i) Where Resident Audit Office set up is not introduced, the vouchers etc., should be sent
to the Accountant - General along with Docket Sheets, schedule of works expenditure
etc., as laid down in Para 554, 567 to 569 of A.P.W.A. Code.
4-26-2 No voucher bundle or record should be supplied from the Records branch except on a
requisition signed by the Superintendent of the Section requiring the voucher bundle or
record and endorsed by the Superintendent (Administration).
Requisition for official documents:
a. The following instructions should be followed in dealing with requisitions for official
documents recorded in the Pay & Accounts Office.
b. Original documents like vouchers, service books, should not be sent out of office except
where a requisition for their production in the form of summons is received from a court
of Law or from a Tribunal for Disciplinary Proceedings. Where the documents are
required by the Investigation Officer they should be sent direct and in original to the
Government Examiner of questioned Documents, similarly for getting his opinion. In all
the cases, orders of Director of Accounts should be obtained. In the former cases, orders
of Director of Accounts should be obtained. In the former case it will be the duty of an
officer nominated by the Director of Accounts to produce them in the Court and to give
any evidence. If the Court chooses to employ powers of impounding under Section 104
of the Criminal Procedure Code the documents will
PAO (WA) Manual 32
be left by that officer in the Courts custody. As a matter of precaution and to provide for
all evetualities Photostat copies of the vouchers or other documents which are required
to be produced in a court should always be kept. Vouchers may be sent by insured post
to the personal address of the presiding officer of the court if such a course is considered
necessary and desirable by the Director of Accounts. The return of the Vouchers should
be watched carefully.
C. It has been decided that the Police may, where feasible utilize the services of a hand
writing or finger print expert who is under their own control or under the control of the
stated criminal investigation Department. In such cases, however, the Inspector General
of Police, will authorize the Director of Accounts, to hand over the documents, in
original, direct to the Investigating Officer who may use them for identification purpose
and also have them examined by the departmental hand-writing or Finger Print Expert.
d. All original vouchers and other documental relating to cases of alleged fraud and
embezzelments which may be required for investigation by the police including State
Examiner of Questioned documents or other Departmental Officer, etc., should be
impounded and kept in the safe custody of Pay & Accounts Officer as soon as fraud or
embezzelemet comes to the notice of the Director of Accounts. At the investigation
stage normally attested copies of such vouchers or documents with the approval of the
Director of Accounts should satisfy the needs of the investigating officers, but in case
where forgeries are suspected Photostat copies of the vouchers may be taken. The
investigation Officer may also be feely allowed to inspect the original documents in the
room of the Pay & Accounts Officer with prior approval of the Director of Accounts.
Such inspection includes perusal scrutiny and copying (including the taking of Photostat
copies) if Director of Accounts is out on tour on any day and the police want and
document for inspection the Pay & Accounts Officer may allow inspection of the
documents subject to report to the Director of Accounts on return.
e. In the majority of cases the facility of inspection of the original documents within the
Pay & Accounts Office and the taking of copies (including Photostat copies) will be
found to be adequate for the purpose of police investigation including identification of
hand-writing. Even where the original documents have to be shown to witness during
CHAPTER- 4 33
Investigation, it may be possible in many cases to have that carried out at the Pay &
Accounts Office.
f. In cases in which the investigation officer feels that the investigation cannot proceed on
copies of documents including Photostat copies, he will move the Inspector General of
Police or the Inspector General S.P.E. as the case may be, to address the Director of
Accounts personally to hand over the original documents to the investigation officer
indicating that Photostat copies will not serve his purpose. The Director of Accounts will
then handover the documents, keeping for his record Photostat copies of the documents,
which should be retained till such time as the originals, are returned to him.
Before handing over the original documents to the Investigating Officer, the Photostat
copies of the vouchers should be compared with the originals and certified to be correct
by the Pay & Accounts Officer concerned.
g. Extracts from vouchers may be made available to departmental officers to answer audit
objections when the office copies have been lost by them.
h. When document are sent for getting Photostat copies these documents should be sent
with a reliable and responsible Gazetted Officer accompanied by an “Orderly” travelling
by day. He should bring back the original vouchers with Photostat copies and negative
thereof, if any. It is expedient that adequate precautions should be taken to protect the
documents all along.
l. On receipt of the Photostat documents the Pay & Accounts Officer concerned will
checkup the documents, etc., with the list already in his possession.
Budget and control of expenditure
4-27-1 The Budget Estimates and Revised Estimates for the Pay and Accounts Organization
should be prepared in the Administration Section as laid down in the Budget Manual.
The Budget Estimates of the Pay and Accounts Organization forms part of the budget
estimates and Revised Estimates of the concerned units of the project. Budget Estimates
and Revised Estimates should be sent to the Chief Engineer concerned with a copy to
the Secretary (Works and Projects) indicating the allocation to the respective units in the
approved proportion.
34 PAO (WA) Manual
4-27-2 In order (i) to reconcile the expenditure with the booked figures and (ii) to correlate the
progress of expenditure with the budget provision, a Register in Form P.A.O. 60 should
be maintained as explained in the Chapter on “Reconciliation”. The Branch Offices at
outstations should forward the statements showing reconciled expenditure figures every
month in the prescribed proforma to the Administration Section where entire
expenditure figures should be consolidated and reviewed.
Duplicate Keys:-
4-28-1 Duplicate Keys of all almarahs and lockers allotted to Sections for safe custody of
documents and records shall be kept in the custody of the Pay & Accounts Officer
(Administration) /Assistant Pay & Accounts Officer (Administration) or the branch
officers as the case may be. The duplicate keys of the cash chests should be forwarded to
the Treasury for safe custody. A register of duplicate keys should be maintained in the
Section in the prescribed form. (APTC Form.26)
Control of Last Grade Government Servants and Contingent Staff: -
4-29-1 The control over the last grade Government Servants and contingent Staff of the Office
is centralized in the Administration Section. A common attendance register should be
maintained in the Administration.
4-29-2 Liveries should be supplied to the last grade Government Servants in accordance with
the scales laid down by the Government from time to time.
CHAPTER -5 35
PART-C
PRINCIPLES AND PROCEDURE OF CHECK CONDUCTED BY PAY

AND ACCOUNTS OFFICE
CHAPTER -5
CHECK AGAINST REGULARITY SANCTION AND
CLASSIFICATION CHECK OF EXPENDITURE
Introductory
5-1-1 It is the duty of the Pay & Accounts Officer/ APAO to see that the incurring of
expenditure from the consolidated fund of the State is governed by the following
essential conditions:
1. That there should exist a sanction, either special or general accorded by competent
authority,
2. That there should be provision of funds authorized by the competent authority fixing the
limits within which the expenditure can be incurred, and
3. That the expenditure should conform to the relevant provisions of the financial rules and
regulations framed by competent authority.
Check or sanctions to Expenditure:-
5-2-1 It follows from Article 166 of the Constitution that the power to sanction expenditure
from the Consolidated Fund of the State and (the Contingency Fund of the State)
including power to dispose of property and stores pertaining to the State Government, is
vested in the Governor whose sanction, given directly, or by persons to whom the
necessary powers have been delegated, is necessary to all expenditure from that Fund.
5-2-2 The extent and conditions of delegation of financial powers to different authorities are
described in the financial rules of the Government
5-2-3 One of the important functions of the Pay and Accounts Officer / Assistant Pay and
Accounts Officer in relation to the check of expenditure is to see that each item of
expenditure is covered by the sanction of the authority competent to sanction it. Here the
Pay and Accounts Officer / Assistant Pay and Accounts Officer has not only to see that
the expenditure is covered by a sanction either general or special, but he has also to
satisfy himself that the authority sanctioning it is competent to do so by virtue of the
powers vested in it by the provisions of the constitution
36 PAO (WA) Manual
and of the Laws, Rules or orders made there under or by rules of delegation of financial
authority made by a competent authority and (2) that the sanction is definite and thus
needs no reference either to the sanctioning authority itself or to any higher authority.
When a sanction to expenditure received by the Pay and Accounts Officer / Assistant Pay
and Accounts Officer has been examined and admitted as regular and correct the check of
expenditure against the sanction becomes a simple matter as the Pay and Accounts
Officer / Assistant Pay and Accounts Officer has merely to see that the expenditure
conforms to the provisions of the sanction.
5-2-4 In the check of sanctions to expenditure, the guiding principles enunciated below should
be observed:
If the sanctioning authority is vested with powers which may be exercised provided due
regard is paid to certain criteria which are expressed in a general form, sanctions
accorded under those powers can be objected to by the Pay and Accounts Officer /
Assistant Pay and Accounts Officer:-
(1) if the disregard of the criteria is considered to be so serious as to make the sanction
perverse, or
(2) if the facts of the case are such as to make the Pay and Accounts Officer/ Assistant Pay
and Accounts Officer confident that one or more of the criteria have been disregarded.
(ii) if it is vested with powers which are expressed in precise terms, the Pay and Accounts
Officer / Assistant Pay and Accounts Officer is bound to ascertain that the orders defining
its powers is obeyed exactly in every instance;
(iii) If any one item of a scheme requires sanction of a higher authority, the Pay and Accounts
Officer / Assistant Pay and Accounts Officer should held under objection any expenditure
on that item until sanction to it is obtained and in determining whether objection should
be raised to expenditure on any other portion of the scheme prior to the receipt of such
sanction it should be seen that the expenditure is not likely to exceed at a later date, the
limit upto which sanction can be accorded by the original sanctioning authority.
5-2-5 In addition to the question of competency of the authority sanctioning

CHAPTER -5 37
the expenditure the scrutiny of sanctions would include the following points:-
(i) whether the expenditure is a legitimate charge on the provision from which it is
proposed to meet it.
(ii) whether the expenditure conforms to the statutory provisions as well as the relevant
financial rules, regulations and orders.
5-2-6 The general position of the Pay & Accounts Officer in the matter of scrutiny of sanctions
and orders is as follows :-
i) In respect of sanctions accorded in consultation with the Finance & Planning

Department, the Pay & Accounts Officer has no direct responsibility for their Virus or
Propriety.
ii) A payment that is illegal can neither be ordered nor paid.
iii) In the case of sanctions accorded by Department Officers under delegated authority,
the Pay & Accounts Officer is responsible for their general scrutiny and should act on
sanctions only where they are from the competent authority.
5-2-7 It is imperative that utmost care and attention should be devoted to the work connected
with the check of sanctions to expenditure as once a sanction has been accepted,
expenditure may have to be passed against it for a length of time.
5-2-8 All sanctions to expenditure should be noted and properly attested in a prescribed register
or other record against which the check of the expenditure will be conducted, and if it is
known that the charge will entail a recovery from a third party, or such a recovery has
been ordered by the sanctioning authority, a note of the recovery due should also be made
and properly attested in a suitable register so that it may be watched.
5-2-9 Recurring charges which are payable on the fulfillment of certain conditions or until the
occurrence of certain event should be admitted on receipt of a certificate from the
drawing Officer to the effect that the necessary conditions have been duly fulfilled or the
event has occurred, as the case may be.
5-2-10 Sanctions with a long period of currency as well as sanctions of a permanent nature
require to be reviewed periodically so that if there is any reason to think that the
administrative authority concerned should be invited to review the sanction, such action
may be taken.
38 PAO (WA) Manual
5-2-11 The Pay and Accounts Officer /Assistant Pay and Accounts officer is entitled to receive a
copy of an order sanctioning expenditure or a sanction which is otherwise to be enforced
by the Pay and Accounts Officer / Assistant Pay and Accounts Officer, from the authority
competent to accord the sanction. It is necessary that all sanctions and orders
communicated to Pay and Accounts Officer / Assistant Pay and Accounts Officer should
be signed by an authorized gazetted Government servant. -.
Check against Provision of Funds:-
5-3-1 Articles 202 to 206 of the Constitution contained certain important provisions which
described the control which Legislature exercises over the expenditure from the
consolidated fund of the State.
5-3-2 No expenditure incurred from the consolidated and contingency funds of the state on or
after 1st April of a financial year under the provisions of Articles 204 to 206 and 267 i) of
the Constitution will be protected by law unless authorized by and appropriation Act
Passed in accordance with the provisions of article -204. All disbursements from the
consolidated fund during financial year, which are not authorized by the annual
Appropriation Act passed by the legislature before the close of the year will, therefore, be
challenged by the audit as un-authorized expenditure. This should be borne in mind by
the Pay & Accounts Officers / Assistant Pay & Accounts Officers.
5-3-3 The check against provision of funds should be directed primarily to ascertaining that the
money sought to be expended is to be applied to the purpose or purposes for which the
grants specified in the schedule to the Appropriation Act passed under Article 204, of the
Constitution were intended to provide and that the amount of expenditure against each
grant does not exceed the amount included in the Schedule.
5-3-4 Each grant specified in the schedule to an appropriation act is a single total sum
appropriated to the purposes set out in it the Particulars of a grant in that schedules are ,
however, based on the estimate drawn up for the information of the Legislature. The
distribution in these estimates between the various sub-heads and items may therefore be
taken as general evidence of the purposes for which the grant is made and the expenditure
should be recorded against the Grant and the sub-head of the grant under which provision
is made for the service.
CHAPTER -5 39
Note: While the initial responsibility, for the preparation of Budget estimates of „Voted”
expenditure rests with the departmental officers concerned, the Director of Accounts /
Pay & Accounts Officer has to see that the Classification indicated in the estimates
conforms to the provisions of the Constitution and it is also in accordance with the forms
of accounts of receipts and expenditure prescribed by the Comptroller and Auditor
General of India. He may also make suggestions which may serve to promote clearness
of accounts for the better information of the legislature.
5-3-5 A grant is intended to cover all charges, including the liabilities of past years, to be paid
during a financial year or to be adjusted in the accounts of that year. It is operative until
the close of that year. Any unspent balance lapse and is not available for utilization in the
following year.
Exchequer Control:-
5-4-1 The pre-check to be applied to all payments by the Pay and Accounts Officer / Assistant
Pay and Accounts Officer includes a check against provision of funds also: As a prelude
to the introduction of “Exchequer Control” which will require a law, the following
procedure which, without embodying legal or constitutional formalities of “Exchequer
control”, is intended to achieve in the main its substance, should be followed.
5-4-2 It is an important part of the functions of the Pay & Accounts Officer to see that no
payment is made in excess of the budget allotment.
i. The Pay & Accounts Officer / Asst. Pay & Accounts Officer has a direct responsibility
to refuse a payment from the Consolidate Fund which is not covered by appropriation
made by law or by an advance from the Contingency Fund.
5-4-3 In a project where primary emphasis is on the speedy execution and where the different
component parts of a work are executed by several divisions, a strict control over the
expenditure with reference to the distribution of grant as communicated by the chief
Controlling Authority for the grant may lead to practical difficulties to regulate the
payments. In such a case, it is open to the Chief controlling Authority to require the
Director of Accounts to control the expenditure with reference to the appropriations for
the unit as a whole, the responsibility for the control of expenditure among the various
sub-ordinate officers being left to the
40 PAO (WA) Manual
Chief Controlling Authority. In such a case necessary orders of the competent authority
for re-appropriation of funds among the units of appropriation will have to be obtained by
the chief controlling authority before the close of the financial year. For this purpose, it
will be necessary for the Chief Controlling Authority to submit final modification
proposals well in advance of the close of the financial year. These final modification
proposals will have to be prepared with reference to the actual expenditure incurred upto
the date on which final modification proposals are prepared and the further anticipated
expenditure during the rest of the financial year as well as adjustments to be made in the
supplemental accounts.
The Accounts staff of the Divisions shall collect the required particulars of bills /TEO‟s
and other adjustment which are pending payment /Adjustment in the Pay & Accounts
Office. Necessary control statement as prescribed by the Government in memo. No. 175 -
E /66-3 PWD dt. 29.03.66 should be sent by Pay & Accounts Officer /Assistant Pay &
Accounts Officers to the Divisions to enable them to exercise the necessary financial
control over expenditure.
5-5-1 Check against Rules and orders (Check against Regularity):-
Check against regularity consists in verifying that the expenditure conforms to the
relevant provisions of the Constitution and of the Laws and Rules made there under and
is also in accordance with the financial rules, regulations and orders issued by a
competent authority either in pursuance of any provisions of the constitution or of the
Laws and Rules made there under or by virtue of powers formally delegated to it by a
higher authority. The rules, regulations and orders against which check is conducted
mainly fall under the following categories:
(1) Rules and orders regulating the powers to incur and sanction expenditure from the
consolidated fund of the State (and the contingency Fund of the State).
(2) Rules and orders dealing with the mode of presentation of clams against Government,
withdrawing moneys from the consolidated fund, Contingency Fund and Public Account
of the State and in general the financial rules prescribing the detailed procedure to be
followed by Government servants in dealing with Government transactions; and
(3) Rules and orders regulating the conditions of service and Pay and allowances
CHAPTER -5 41
of Government servants.
5-5-2 The Pay and Accounts Officer / Assistant Pay and Accounts Officer, has not got the final
power of interpretation of the Constitution, Statutes, rules and orders; this resides in the
authority specified in the Constitution or the Authority which is the author of the rule or
order so long as the interpretation is not against the orders of a superior Authority or
contrary to any established financial principle or rule. Interpretation by Pay and Accounts
Office should be based on the plain meaning of the Article of the Constitution, Section of
statute, rule or order, except where this is inconsistent with another Article, Section rule
or order, and in such a case the inconsistency should be referred to the competent
authority for resolution or removal.
5-5-3 It is, however, the duty of the Pay and Accounts Officer I Assistant Pay and Accounts
Officer to bring to the notice of the competent authority any expenditure which does not
seem to be covered by the terms of the Article, Section, Rule or Order quoted as
justifying it, and which has been incurred by placing upon the Article, Section, Rule or
Order an interpretation which may seem to him to be not a natural, plain or reasonable
interpretation. In the Case of regulations framed by the Department the Pay and
Accounts Officer / Assistant Pay and Accounts Officer will accept what the department
considers to be the correct interpretation of its own regulations, provided that such
interpretation is not opposed to the ruling of any superior authority, or contrary to any
established financial principle or rule. Such discretionary power of interpretation does
not, however, give the department a free hand to interpret its rule to suit particular case in
other than a natural or reasonable manner. So long as a rule or regulation remains un-
amended the department is bound by it is found that some discretion is necessary in the
application of a rule, such discretion should be provided for in the rules.
5-5-4 The Pay and Accounts Office should also ensure as far as possible that rules and
regulations are observed not merely in the letter but also in the spirit.
Scrutiny of Rules and Orders:-
5-6-1 In relation to check of expenditure against regularity it is the duty of the Pay and
Accounts Officer / Assistant Pay and Accounts Officer to examine all financial rules and
orders issued by the executive authorities to
42 PAO (WA) Manual
see that the rules, etc., are themselves Intra Vires and that the check of transactions which
they govern may be effectively conducted against them.
5-6-2 In the scrutiny of these rules and orders it should be seen:-
1) that they are not inconsistent with any provisions of the Constitution or of any laws made
there under;
2) that they are consistent with the essential requirements of audit and accounts as
determined by the Comptroller and Auditor General of India.
3) that they do not conflict with the orders of, or rules made by any higher authority; and
4) that, in case they have not been separately approved by competent authority, the issuing
authority possesses the necessary rule making power.
5-6-3 In applying the second check prescribed in the preceding paragraph the Pay and Accounts
Officer / Assistant Pay and Accounts Officer should be guided by any subsidiary
instructions which may be issued by the Comptroller and Auditor General of India from
time to time. All doubtful points unless they are trivial should be referred to the Statutory
Audit Officer.
5-6-4 In applying the third check prescribed in the preceding paragraph if the Pay and Accounts
Officer / Assistant Pay and Accounts Officer have reasons to think that undue advantage
is taken of the provisions of any orders under which the rule is issued, he may bring the
case to the notice of the proper superior authority.
5-6-5 All orders of delegation of financial authority should be scrutinized carefully, as once
they have been accepted, check of sanctions as well as of expenditure or other
transactions may be conducted against them for any indefinite length of time. They
should accordingly receive the personal attention of the Pay and Accounts Officer /
Assistant of Pay and Accounts Officer and should be formally accepted by him before
they are admitted.
.
5-7-1 Check of Classification: - The first duty of the Pay and Accounts Officer / Assistant Pay
and Accounts Officer in examining a bill or account or T.E.O is to verify that the
classification adopted is correct. The check of classification should be applied to the head
of debit for the gross amount and to the head of credit which has to accommodate
recoveries /
CHAPTER -5 43
credits in a bill or account or T.E.O the expenditure on complete portions of a project

during, construction period is chargeable to the Capital Major Head of the concerned
project. The maintenance expenditure on completed portion of a project during
construction period is chargeable to the Capital Major Head of the concerned project. The
maintenance expenditure on completed portions of a project after they are opened for
operation is chargeable to the corresponds Major Head of expenditure in the Revenue
Account the Pay and Accounts Officer /Assistant Pay and Accounts Officer,
Superintendents, Senior Assistants and Junior Assistants should familiarize themselves
with the minor, sub detailed heads operated under the Major Heads of Accounts.
5-7-2 The Pay and Accounts Officer / Assistant Pay and Accounts Officer, Superintendents and
Assistants should also be familiar with heads operated for Deposits, Advances and
Remittances (vide the List of Major and Minor Heads issued by the Comptroller and
Auditor General of India).
44 PAO (WA) Manual
CHAPTER -6
CLAIMS OF THE NON-GAZETTED AND GAZETTED OFFICERS
INTRODUCTORY:
6-1-1 The Government have ordered to implement the scope of drawal and disbursement of
salaries to all Gazetted Officers except those specified in Para 1 of Annexure 1 to G.O.
Ms. No. 214, Fin. & P1g. (FW.SPF) Dept., dt.16.08.1979 as in the case of Non-Gazetted
officers. The issue of pay slips to all Gazetted officers is dispensed with. The general
principles governing the check of claims relating to both Gazetted and Non- Gazetted
officers are the same except where otherwise specified in this manual or by the orders of
Government issued from time to time.
Gazetted officers:
6-2-1 The scheme of dispensing with pay slips applies to all Gazetted Officers working in twin
cities, District Judges and Heads of Departments who are not All India Service Officers.
In regard to All India Service Officers, Andhra Pradesh Administrative Service Officers
and Select list Officers holding cadre posts, the Pay and Accounts Officer, Hyderabad
will continue to be the pay fixing authority.
2. The Pay & Allowances of all Gazetted officers will be drawn by the Heads of the Offices
and disbursed to the Officers as is being done at present in the case of non-gazetted
officers and will apply to the pay & allowances of Heads of the Offices etc., In the case
of All India Service Officers, Heads of Departments, Andhra Pradesh Administrative
Service Officers and Select officers holding cadre posts, their pay and allowances will be
drawn by the drawing officers/Heads of Offices. Whenever there is a change in their Pay
and allowances, these will be fixed by Pay & Accounts Officer Hyderabad and the
authorization issued in this regard. The authorization issued by the Pay & Accounts
Officer, Hyderabad to the individual Officers concerned should be surrendered by them
to the Head of the Offices /Drawing Officers who attach those authorizations to the pay
bill in which the allowances are drawn for these officers. The Pay & allowances of
Gazetted Officers including All India Service and Andhra Pradesh Administrative
Service Officers, Heads of Departments Select list Officers holding cadre posts need not
necessarily be drawn only by the Head of the Office / Head of Department.
CHAPTER -6 45
Head of the Office / Head of Department can authorize any Gazetted Officer in his office
to draw and disburse the pay and allowances to Gazetted Officers. The officer so
authorized should normally be the same officer authorized to draw the pay and allowance
of Gazetted Officers in the same office.
3. The amounts due to Gazetted Officers should be drawn in the pay bill forms used for
non-Gazetted Officers, but in separate bills by superscribing prominently the words
“Gazetted Officers bills” on the top of the front page of the bill for easy identification.
The Drawing Officer will maintain all records and Register of bills etc., in the same form
in which they are maintained for non-gazetted establishment.
4. All certificates required to be furnished in support of the claim should be furnished by the
Drawing Officer.
5a). In respect of All India Service Officers, Heads of Departments, Andhra Pradesh
Administrative Officers, and Select List officers holding cadre posts, their pay and
allowances will continue to be regulated by Pay & Accounts Officer, Hyderabad
whenever there is change in emoluments.
b) In the case of Pay and allowances of the Head of the Office himself the determination of
his pay and allowances will be done by the immediate superior officer / Head of the
Department as the case may be.
c) In the case of all other Gazetted Officers, the determination of the pay and allowances
will be done by the Heads of the Offices in the same manner as for the non-gazetted staff
working under them.
The authority determining the pay and allowances should scrupulously follow the
relevant rules on the subject. The determination of pay and allowances will be subject to
test -check of the next superior officer.
6. Under the new scheme, recovery of Income Tax, General Provident Fund and other
deductions from pay and allowances will be the responsibility of the Drawing Officer.
Certificates of deduction may be given by the Drawing Officers themselves for purposes
of Income Tax etc.,
7. The service books of all Gazetted Officers, including Head of Offices / Heads of
Departments are required to be maintained in the Offices of the Heads of the
Offices/Heads of Departments.
8. The service records, viz., leave account, pay and service particulars etc., which are
hitherto being maintained by the Pay & Accounts Officer.
46 PAO (WA) Manual
Hyderabad, will hereafter be maintained by the Head of Office/Head of the Department

under the new scheme. A service book is to be opened for a Gazetted Officer and entries
made there-in in the same manner as in the case of non-gazetted Officers and attested.
9. Certificates of transfer of charge of the Officers need not be sent to the Pay & Accounts
Officer hereafter excepting those of All India Service Officers, Heads of Departments,
Andhra Pradesh Administrative Service Officers and Select List Officers officiating in
cadre posts. When a Gazetted Officer including All India Service Officers, Andhra
Pradesh Administrative Service Officers, select list Officers holding cadre posts, is
transferred from one district to another, or from district to city or vice versa, the drawing
officer concerned should forward the service book and the Last Pay Certificate to the
concerned Head of the Office to enable the latter to draw the pay and allowances of the
Officer concerned. Among others, the last pay certificate should invariably show the
advances drawn by the Officer, the recoveries so far made and the balances still to be
recovered.
10. In order to see that the payments to Gazetted Officers covered by this scheme are
properly made and service records properly maintained, the Heads of Departments,
Departments of Secretariat, and General Administration (Special) should nominate an
Officer under their control to post-check systematically the payments made to the
Gazetted Officers and also verify whether service records are maintained up-to-date. In
respect of Offices regularly inspected, the Heads of the Departments should entrust this
job to the internal audit parties. If there are no internal audit organizations, the Heads of
the Department may entrust the above duty of post-checking the entitlements and
maintenance of service records to the inspecting Officers by evolving a suitable
questionnaire and should satisfy themselves that there has been no irregularity in drawals
or improper maintenance of service records.
All claims of Gazetted Officers coming under the scheme for arrears of pay & allowances
for the period prior to 01.01.1980 including All India Service and Andhra Pradesh
Administrative Service and Select List Officers holding cadre posts and Heads of
Departments should be sent by the Heads of Officers / Departments to the Pay &
Accounts Officer, Hyderabad / Accountant General, Hyderabad according as the Officers
CHAPTER -6 47
serving in twin cities or districts, as the case may be, for verification before the bills are
presented to the District Treasury Officers /Pay and Accounts Officer for payment.
12. Under this scheme the responsibility of watching recoveries of advances given to
Officers, whether long-term or short-term rests fully on the Head of the Office/
Department who is the drawing officer of the pay bills., Suitable registers as in the case
of non gazetted officers should be opened and watch kept over recoveries of Principal
and interest on the due dates. Recoveries of General Provident Fund Advances should
also be similarly watched.
Register of gazettes:
6-2-2 All gazettes received in the office will be received and entered in the Register of Gazettes
in “Form PAO 10” in pre-check section dealing with establishment claims. On receipt of
Gazettes the Superintendent should circulate to all assistants to note down any important
events relating to gazetted officers in the fly -leaves concerned.
Any general and important orders of Govt. should be brought to the notice of
coordination section for bringing to the notice of the Director of Accounts.
The gazettes should then be filed under orders of the PAO/APAO.
General:
6-3-1 No Pay should be passed for a Government servant beyond the date of attaining the age
of superannuation or on the expiry of a term of extension of service sanctioned by
competent authority.
6-3-2 The Pay & Accounts Officer /Assistant Pay & Accounts Officer is not required to watch
the observance of the provisions of the following nature:
a) Rules relating to the representation of any particular community or any backward class of
citizens However as per Section (4) of Act 24/1997, in respect of the first claim of a new
appointee the Pay and Accounts officer, Sub Treasury Officer or any other officer who is
charged with the responsibility of passing the salary bill shall not pass such bill unless a
certificate issued by the appointing authority to the effect that” the appointment has been
made in accordance with Section 3 of Act 24/
48 PAO (WA) Manual
1997” is attached to the first salary bill of the appointment concerned.

(vide Act 24/97 communicated in Memo No.2995/F9-A1/97-1 Finance and Planning
(PW) Department, dated 3.12.97)
b) rules relating to the proportion to be observed in recruitment to service between

personnel promoted from subordinate ranks and those recruited direct;
c) rules relating to educational or other qualifications.
SERVICE BOOKS AND LEAVE ACCOUNTS:
6-4-1. Service Books and Leave Accounts of all officers both Gazetted and Non -Gazetted will
be maintained by the concerned Head of Office / Drawing Officers.
Whenever the service books of any officers are called for by PAO/APAO and sent by the
Head of the Office they should be entered immediately on receipt in a Register of
movements of Service books in Form PAO-4. They should be returned to the concerned
office after done with and their despatch also should be entered in the Register. The
Superintendent will be held personally responsible for the safe custody of the service
books remained in Pay & Accounts Office and arrange to keep them under lock & key.
CHECK OF PAY BILLS:
6-5-1 The arithmetical accuracy of the pay bill should be checked with reference to the fly
leaves for the period to which the claim relates. If any further payment be made under
revised orders for the same month the new bill number and date would also be entered in
the fly leaf concerned.
6-5-2 After check, the pay order is enfaced on the pay bill and laid with the Audit Register
before the Superintendent and the Pay and Accounts Officer / Assistant Pay and
Accounts Officer who will sign the pay order and attest the entries in the register.
6-5-3 Procedure of checking:-
For the purpose of check, establishments on time - scales of pay fall under two groups. -
1. Those relating to last grade Government Servants whose names do not appear in the pay
bills.
CHAPTER -6 49
2. Those for other Gazetted and Non-Gazetted Government servants whose names appear in
pay bills.‟
For group (I) The check will be numbers only against the sanctioned strength of the
establishment.
For group (2) This check by number must be supplemented by a nominal check.
6-5-4 This nominal check consists in comparing the rates of pay & allowances for each
individual drawn in the bills with those recorded in the fly- leaf.
Audit Register (Form P.A.O ‘17’)
6-6-1 In the Audit Register a page should be set apart for each section of the establishment.
Different sections may be entered consecutively. Particulars regarding the number of
posts, period for which sanctioned and orders of the sanctioning authority will be noted in
the register in the space and column provided for the purpose. A line should be drawn
across the cases of the months previous and subsequent to the period of sanctions so as to
prevent admission by oversight of pay for the period in excess of the sanction.
6-6-2 The details of posts, incumbents, their pay, special pay and personal pay and allowances
should be maintained in a fly - leaf.
6-6-3 In March every year, details of each sanction as finally recorded in respect of the
previous year should be brought forward either on fresh pages or in a fresh horizontal
division of the old pages as may be convenient. If any fresh sanction, involving variation
in strength, scale etc., is received during the course of the year, it should be similarly
noted in the register and the details of each section suitably modified to incorporate the
changes. All such entries in the register should be attested by the Superintendent. The
details of establishment regarding incumbents, rate of pay, dates of increment etc., as
finally recorded in the fly-leaf of the previous year should similarly be taken in the fly-
leaf of the current year and the entries attested. When an increment certificate is received,
a note of the increase in pay should be made in the fly-leaf and attested by the
Superintendent after the increment has been checked. When a new name appears in any
section of an establishment bill, it should also be incorporated in the fly-leaf. Similarly all
cases of death, retirement resignation and permanent transfer out of the establishment as
also events
50 PAO (WA) Manual
occurring during the year which affect the increments (e.g. confirmation, suspension,
leave without pay, withholding of increments) should be noted under attestation of the
Superintendent.
Detailed instructions regarding check:-
6-7-1 To check establishments bills by number, calculate separately the number of persons in
each section of the establishment,
1. Drawing substantive pay.

2. on leave (including extra-ordinary leave) or under suspension
3. Drawing officiating pay.
Note them in the bills under letters “S” (Substantive) , “L”( Leave or Suspension) and
“O” Officiating and post the total under S, L and O in respect of each section of
establishment in the relevant sub-column or monthly column in register, broken periods
of less than a month being indicated by giving a number of days within brackets.
The posting in the register will include the number for whom the claims have been shown
as held over in the monthly bill. This is necessary to ascertain total number of persons for
a month.
b. When posting of all bills pertaining to an establishment in the register is completed, the
total should be struck against each sanction.
6-7-2 In the case of establishments where officiating arrangements in leave vacancies are
permissible, the check will consist in seeing that S plus L and S plus O are each within
the sanctioned strength. For example, the SLO posting in respect of a section containing
12 posts may be as follows.
S L O
Bill 118 6(25) 2(29) 1(21)

8/61
Bill 120 1(15) (15) 2

8/61
Total 8(9) 3(13) 3(21)
In that case both S plus L, i.e., 11(22) and S plus O i.e., 11(30) will be within the
sanctioned strength.
6-7-3. When the sanctioned cadre contains its own leave reserve and no officiating arrangement
is permissible, it has to be seen that S plus L plus O
CHAPTER-6 51
does not exceed the sanctioned strength.
Note: (i) Terminal leave or joining time taken from one post to another should be excluded in
posting “S”, ”L” “O” columns.
ii) The number of Government servants under suspension should be shown separately in
column “L”, the letter “S.P.” being noted against the entries and the amount of
subsistence allowance should be noted in the “Remarks‟ column as well as fly leaf
against which any supplementary claim on account of those men may be watched.
Provisional Payments
6-8-l i) In cases where action for continuance of temporary posts beyond the period upto which
they are sanctioned, has been taken and final orders have not been issued by the
competent authority, the holders of such temporary posts may be allowed to draw their
pay and allowances at the same rate as they were drawing in that post, for a maximum
period of 3 months after the expiry of the last extension on a declaration countersigned by
the controlling officer empowered to sanction the T.A. Bill as follows:
In the case of Heads of Departments however the declaration has to be countersigned by

the Government in the Administrative Department.
Declaration in the Case of Gazetted / Non-Gazetted Officers
“Certified that the sanction to the temporary establishment has expired on…….. Further
continuance has been applied for and is awaited. Pay & Allowances have been claimed in
this bill at the same rate as drawn previously.
Signed Countersigned”
(Ref. G.O.Ms.No.67, Fin. & Plg. (Fw-A&L) Dept., dt. 16.02.1976)
ii) Similarly in the case of non-receipt of Last Pay Certificate, the officer concerned should
furnish a certificate about the pay and allowances, advances, if any, drawn in the previous
post and deductions on account of G.P.F., Income-tax, super-tax, refund of advances etc.,
The Officer would be primarily responsible for the correctness of the information which
should be furnished by his in the form prescribed in the annexure to G.O.Ms.No.454,
Finance, dt.06.12.1961. The Officer concerned, should, however, in his own interest
obtain his copy of the Last Pay Certificate before proceeding on transfer, as enjoined
under the ru1es.
52 PAO (WA) Manual
iii) If the provisional pay, in the case of transfer of the new post is higher than that of the
previous post, the officer may be paid the minimum of the scale of the new post plus
special pay, if any, attached thereto or the pay last drawn in the previous post, whichever
is more favourable to the officer. No provisional payment of joining time pay and
allowances will be allowed. That is, the provisional payment order will take effect only
on joining the new post.
(G.O.Ms.No.454, Finance, dt. 06.12.1961 and G.O.Ms.No.110 Finance dt. 26.04.1965)
iv) A register of provisional payments should be maintained in form PAO 14 to watch the
receipt of final orders and that the provisional payments do not extend beyond the period
for which they were authorized.
Check and Posting of Supplementary Bills:-
6-9-1(i) The bills for claims which are omitted from the original bills for specified reasons and
which are drawn as supplementary bills will be treated as separate bills pertaining to the
same establishment and checked just like a original bill. Such claims should not be
admitted without full explanation of the circumstances in which they were omitted from
the original bills. The drawal in the supplementary bill should be noted in the original
monthly bill in which it was omitted or shown as held over in order to check against
double drawal. As regards the sums refunded in the monthly bill the details need not be
noted in the register, subsequent withdrawals being noted in the original bills against the
respective entries of refund. When however the refunds are due to transfer, promotion,
reversion or suspension of any incumbent, minus or plus entries in the “S” “L” „0‟
columns should be made in the relevant month for the particular section of establishment,
the minus entries being in red ink.
(ii) The arrears due to increments, and revision of pay etc., sanctioned retrospectively and
drawn in supplementary bills need not, however, be noted either in the Register Proper or
in the Original bills, Necessary details, including the period of claim, should be noted in
the flyleaf or flyleaves of the Register(s) for the year(s) to which the claim relates
(iii) A record of check of supplementary claim in respect of special pay, fixed travelling
allowance or conveyance allowance etc., should be made
CHAPTER -6 53
in the original monthly bill from which the item was omitted or in which it was shown as
held over. The supplementary bill should also be posted in the Register in the relevant
monthly case against the orders, sanctioning special pay etc.,
(iv) As regards supplementary bills in respect of arrears of allowances, a note should however
be kept in the register preferably in the remarks column. Noting of the supplementary
claim in the original bill is not required in such cases.
(v) In respect of arrear claims due to increments, revision of pay, revision of Dearness
Allowances of last Grade Government servants whose names are omitted from the
establishment bells it is not necessary to keep a note of supplementary claims in the
Original bills or in the register.
Payments of Leave Salary:-
6-10-1 In the case of Government Servants on leave preparatory to retirement or refused leave
under F.R. 86 or any other corresponding leave or terminal leave or such other leave on
the expiry of which he is not expected to return to duty, the drawing officer should record
a certificate on the leave salary bill that during the period for which leave salary is drawn
he was not re-employed under Government, Local Fund or a private employer after
obtaining declaration regarding non employment form them.
Other checks to be furnished while scrutinizing Bills:
6-11-1 a) It should be seen that the bill is in the prescribed form and is complete in all respects.
Arithmetical calculations should be checked.
(b) In the detailed scrutiny of a pay bill, the admissibility of the leave salary and officiating
pay of the men concerned will come under scrutiny. The Assistant (auditor) will check all
items in the bill corresponding to the names in the increment certificate and make the
necessary entries in the fly -leaf.
c) Increment certificates attached to Establishment bills (or submitted separately) for pre -
check should be examined to see that the increment certificate is according to rules and
supported by facts stated. The reasons why the increment is considered to be due, as
stated in the increment Certificate, should be examined with reference to fly leaf or the
54 PAO (WA) Manual
Register where one is required to be maintained. The entries in the explanatory

Memorandum should be checked with fly-leaf and when periods of past officiating
service are not susceptible of verification from the records of the Pay & Accounts Officer
/Assistant Pay & Accounts Officer; such service may be verified from the Service Books.
In the case of certificates submitted for pre -check, if the increments are found to be
admissible under the rules the certificate should be returned duly verified, and the fact
noted in the flyleaf.
d) The admissibility of Special Pay, Personal Pay and various allowances claimed in an
Establishment Bill should be scrutinized with reference to the rules and orders in force.
Orders sanctioning personal Pay, fixed travelling allowance, conveyance allowance, etc;
for a particular post together with the amounts drawn should be noted in separate
horizontal division of the page pertaining to the particular section of the establishment. A
note of Special pay admissible should also be kept in the fly-leaf against the name of the
incumbent concerned.
6-11-2. Senior Assistant’s (Auditor’s) Duties:-
The important points to be observed in the establishment bill besides those mentioned
above are to see.
That the arithmetical calculation of the bills is correct:-
2. that the enhanced pay of officiating Government servants is in accordance with the
rules.
3. That last pay certificate is furnished for a government servant transferred from another
establishment office.
4. That the dates of making over and receiving charge are stated and joining time is in
accordance with the rules 10
5. That in cases of government servants appointed for the first time, a health certificate is
furnished except where such health certificates are not required to be furnished,
6. That the increment drawn is supported by an increment certificate and if the increment
carries a government servant beyond an efficiency bar the declaration of fitness to
cross the bar is furnished by the competent authority;
7. That relevant note of the bill is made in the register as provided for in the earlier
paragraphs; and
CHAPTER -6 55
8. That the number of persons for whom pay or leave salary has been drawn does not
exceed the sanctioned strength of the establishment.
9. That the instructions contained in Appendix - VIII regarding specimen signatures of

officers drawing bills are followed.
Compensatory Allowances and Honoraria:-
6-12-1 Compensatory allowances should be determined with reference to rules and orders
relating to such allowances and the requisite certificates regarding the fulfillments of the
conditions attached to the allowances should be indicated in the authority so that payment
may be made only on the drawing officer furnishing the requisite certificate.
6-12-2 In checking sanctions to the grant of any compensatory allowances, fees or honoraria to
Government Servants the following general conditions should be kept in view.
(1) Unless in any case it be otherwise distinctly provided, the whole time of a Government
Servant is at the disposal of the Government which pays him, and he may be employed in
any manner required by proper authority, without claim for additional remuneration,
whether the services required of him are such as would ordinarily be remunerated from
the Consolidated Fund of the State.
(2) The authority granting or permitting a Government servant to receive any honorarium or
fee is required to pay due regard to the principle enunciated in (1) above and also to
record reasons justifying the grant of the extra remuneration to the Government servant
concerned.
(3) The amount of compensatory allowance is to be regulated that the allowance is not on the
whole a source of profit to the recipient.
Medical Reimbursement Claims:-
6-13-1 the expenditure incurred by and to be reimbursed to the employees on account of Medical
attendance and treatment can be claimed in salary bill forms under. The sub -head
“Allowances Honoraria etc.” It should be seen that the claims are in accordance with the
relevant medical attendance rules and „orders of Government and are duly countersigned
by the Controlling Officer and supported by receipts and vouchers in all cases. It should
be seen:
(i) that medicines which have been purchased and the cost to be reimbursed are not the
medicines included in the list of inadmissible medicines, and preparations, and
56 PAO (WA) Manual
(ii) That the hospital bills for treatment as inpatient show the allocation of charges under
medical attendance, bedding, diet, nursing and medicines and that reimbursement of only
admissible items has been allowed.
(iii) The detailed instructions contained in A.P. Integrated Medical Attendance Rules of 1972
as amended from time to time may be followed while scrutinizing the Medical
Reimbursement claims”.
Travelling Allowance:-
6-14-1 The requirements in travelling allowance bills are:
(i) that the journey was actually performed;
(ii) that it was necessary, and authorized by general or special orders;
(iii) that it was performed as expeditiously as possible by the shortest route;
(iv) that no bill has been submitted for it before; and
(v) that the amount drawn is correct with reference to rate and general conditions.
6-14-2 As some of the checks prescribed above cannot be exercised by the Pay and Accounts
Officer/Assistant Pay and Accounts officer independently the duty of scrutiny of
travelling allowance bills is divided between controlling officer and Pay and Accounts
Officer /Assistant pay and Accounts Officer.
6-14-3 In checking a bill, the scale of pay shown should be checked with reference to the fly
leaves or the pay bills if they are readily available, and the daily allowance should be
passed, according to the rate admissible, a steamer fare by the table of fares, the railway
fare by the time table and the air fare by the scheduled rates charged by the Air Transport
Company. In cases where counter signature is necessary, it should be ensured that the bill
is countersigned by the controlling officer.
6-14-4 Countersignature does not dispense with the necessity of formal check by the Pay and
Accounts Officer / Assistant Pay & Accounts Officer with reference to rates and general
conditions. Ordinarily, the countersignature by the proper authority, or the signature of
the Drawing Officer when a bill does not require countersignature, should be accepted as
CHAPTER -6 57
final evidence that the facts of the journey on which claim is based are correct and that
the controlling or the Drawing Officer, as the case may be, has exercised scrutiny
entrusted to him under the rules of the Government.
6-14-5 After the bills have been checked, they should be submitted with the Register of
expenditure on establishment to the Pay & Accounts Officer /Assistant Pay & Accounts
Officer.
Leave Travel Concession:-
6-15-1 The Government have extended the facility of leave travel concession to all the state
Government Servants including those appointed on temporary basis, who have put in a
continuous service of not less than five years, One for hometown, and the other for
anywhere in the state in a block period of four years, the first one in the first two years
and the second one in the next two years of the total block period. The block periods are
1989-92(1989-90 for home town and 1991-92 for anywhere in the state, 1993-96) and so
on. The home town should be declared by the Govt. Servant and approved by the
controlling authority.
For this, essentially the leave must be sanctioned and permission for availing the LTC
during the said leave period accorded by the leave sanctioning authority. Prior permission
should be obtained and no Post- fact. Approval can be accorded. The LTC can be availed
by the Government servant together with all family members or in two spells separately
for self and family within an interval of six months during the concerned block period. It
is however essential that the Government servant himself should avail the concession, as
otherwise the question of availment of LTC by his family members does not arise.
Only travelling charges to and fro are allowed and no D.A. or any other allowance is
permissible. The Government servant should travel by RTC Buses or Railway only and
claim actual charges but not by Private Buses etc.
The concession can be availed during regular casual/special C.L. or vacation but it cannot
be availed during the weekend or any other period of holidays alone.
(Govt. Memo. No.38731-D/415/A-1/TA/93, Fin. & Plg. (FW-TA) Dept., dt.29.10.93)
58 PAO (WA) Manual
The LTC to State Government employees should be limited to two dependent children
instead of to all dependent children (vide G.O.Ms.No.368, Fin. & Plg (FW. TA) Dept.,
dt.2-11-93). These orders have since been modified to the effect that “the Government
servants who are having more than two children who were born before 1.4.96 shall
continue to enjoy the concession in respect of all the children and restriction is applicable
to only the children who will be born after 1.4.96.
(G.O.Ms.No.140, Fin. & Plg. (FW.TA) Dept., dt.1.4.96)
(1) The following certificates have to be furnished by the claimant in the Travelling
Allowance Bill.
(1) Certified that for the block period of …….. I have not submitted any claim so far for
leave travel concession in respect of the persons for whom travelling allowance is
claimed in this bill.
(2) Certified that the advance of the travelling allowance for the leave travel concession
has been fully adjusted in this bill.
(3) Certified that the persons for whose journeys the claim is preferred in this bill
performed the journeys to and fro to from ……..
(4) Certified that my wife/husband is not a government employee/is an employee of…..

and that the concession has not been availed of by her/him separately for herself/himself
or for any of the family members covered by this claim for the block period ………
(5) Certified that the family members for whom claim has been made in this bill are
wholly dependent on me.
(2) The following certificates have to be furnished by the controlling officer / Drawing
officer
i) Certified that the claim was preferred in time by the claimant and that the delay in
presentation at the treasury is due to administrative reasons.
ii) Certified that the clam was not preferred and paid previously.
iii) Certified that necessary entries were made in the service register of the individual
regarding the availment of leave travel concession during the block period ….
iv) Certified that, apart from normal checks I have verified the claim after obtaining all
the required details, as to the actual travel correctness of number of family members,
distance traveled, fares and mileage claimed and I am satisfied that the claim is in order.
CHAPTER -6 59
3) A record of all the assistance granted under this rules shall be made in the service register
of the employee. The entries should indicate the dates of journeys of the government
employee and the family members together with the particulars of amount reimbursed as
traveling allowance.
The rules contained in Annexure. VII to the A.P. Traveling Allowance Rues published by
the Fin. & Plg. (FW. TA) Dept., and orders issued by Government from time to time may
be followed.
Encashment of Surrender leave:-
6-16-1 The Government have ordered the facility of encashment of surrender leave during
service for a period of 15 days once in a year or 30 days once in every two years without
actually going on leave. This scheme is being extended by Governm0ent every year. The
Government have been prescribing the months in a financial year during which only the
specified categories of employees can avail of this and not before. However, in respect of
employees whose leave at credit exceed the maximum permissible limit of accumulation
of 240 days they are eligible for encashment even before the prescribed periods subject
however to orders extending the facility by Government from time to time. Not More
than one encashment is permissible in a single financial year. In regard to encashment of
Surrender leave of 30 days a period of two years must have elapsed from previous
surrender.
Advances:-
6-17-1 The under mentioned advances may be drawn by the drawing Officer /Heads of Offices
from the Pay & Accounts Office on the authority of the sanction or duly certified copy
signed by the drawing Officer thereof appended to bill subject to Government Orders in
force.
1. Advances on Transfer.
2. Advances on tour.
3. Advances on account of travel concession during regular leave wherever admissible.
4. Advances in lieu of leave salary wherever admissible.
5. Advances for Medical attendance and treatment.
6. Honorarium of Non -recurring nature.

PAO (WA) Manual 60
(G.O.Ms.No.214, Fin. & Plg. (FW-SPF) Dept., dt.16.02.1979, G.O.Ms.No.124, Fin. &
Plg. (FW-A&L) Dept., dt.19.03.1976)
6-17-2 The loan applications for House Building, Car etc., Advances shall be scrutinized by the
concerned Head of the Department /Sanctioning authority and if they are found to be in
accordance with the rules, for the advance applied for, and after due verification of the
Pay particulars and the outstanding recoveries etc., pending against each individual,
orders sanctioning advances mar be issued by the Head of Departments‟ Sanctioning
authority. The Head of the Department / Sanctioning authority is responsible for proper
scrutiny of applications and sanction accorded.
(A) The Pay and Accounts Officer/Assistant Pay and Accounts Officer should see that the
orders issued by Government in G.O.MS.No.161, Finance and Planning (FW-Pen-I)
Department dated 15-4-1977 read with G.O.MS.No.326, Irrigation and Power (Projects
Wing) Department dated 23-8-1979 are followed in sanctioning the General Provident
Fund Advances, Refundable advance and part final withdrawal. The authorities
competent to sanction such advances are indicated in Appendix - XIII.
Preparation of Duplicate Bills in place of Original Bills Presumed Lost:
6-18-1 If a bill received in the section is reported as lost, an enquiry should be made and
responsibility fixed for the loss. To avoid delay in the payments the Drawing Officer
concerned should be addressed immediately reporting the loss of the bill and a duplicate
bill called for together with a certificate that the payment on the original bill was not
obtained by the Drawing Officer and that no payment will be claimed on the original,
even if it is traced later. An intimation should also be simultaneously sent to the cash
section reporting the loss of the bill with instructions that the payment on the original bill
should not be made at a later date when a duplicate bill has been honoured.
Payments to Government servants transferred to or from a project from or to a non-

project area:
6-19-1 For a Government Servant transferred to project the Payment due upto the date of relief
should be paid by the Office which relieves the Government Servant under the provisions
of Art. 72 of A.P.F.C. Vol. 1 and the fact noted in the last pay Certificate. For a
Government Servant transferred to the parent Department from a project the payments
due upto the date of relief will be paid by the Project under the provisions of the
CHAPTER -6 61
A.P.F.C Vol. I quoted above and the fact noted in the last pay Certificate. The date of
joining the parent department will be intimated by the parent department to the project
concerned, which will arrange to discharge its liability in respect of joining time pay etc.,
and issue a revised last Pay certificate. Any payment of arrears, due to increment,
fixation of pay etc., if it is to be paid by the parent department after the transfer of the
Government Servant to the project, should be paid by the parent department only and not
by the Project and the fact intimated to the Project invariably. Similarly, any payment of
arrears pertaining to the period of service of the government servant in a project should
be paid by the Project and not by the parent department even after the transfer of
Government servant from the project and the fact of payment should be intimated to the
department.
In respect of Government Servant (other than projects) transferred from one office to
another, the arrears claims due to them may be drawn and disbursed by the office in
which he is presently working duly debiting the expenditure to the same office.
6-19-2 (i) The transit pay of an officer, transferred to or from a Project from or to a non - project
Office is debitable to the concerned Project.
(ii) The transit pay of an Officer transferred from one projects to another is debitable to
the project to which he proceeds.
Retirement Benefits:-
6-20-1 All retirement benefits such as pension, gratuity and commutation of pension will be
authorized and released by the Accountant General and payments will be made by the
Treasuries IPAO pension payment offices. However, the encashment of leave at credit on
the date of retirement (limited to 240 days), release of G.I.S and F.B.F at the credit of
Govt. Servant will be drawn and disbursed by the head of the office presenting the bills to
PAO /APAO.
It should be seen that the claim is supported by a sanction of the competent authority, the
fact of drawal is entered in the service book of the individual and that rates are correct as
per the orders government issued from time to time.
Anticipatory Pension:
6-21-1 In a few cases where the sanction of pension gets delayed for any reasons
62 PAO (WA) Manual
Anticipatory pension will be granted by the pension sanctioning authority to the

Government Servants and will be claimed and presented to the PAO/APAO by the
Drawing Officer. The relevant rules in pension rules and the conditions attached to such
sanctions and the furnishing of required certificates to be furnished in the bills have to be
ensured of compliance before the payments by PAO/APAO.
Adjustment of objections:
6-22-1 The Assistant (auditor) is responsible for watching the adjustment of objections raised on
bills passed by him, and the reviewing officer when passing a new bill should see what
objections are still outstanding. Ordinarily, recoveries will be made by short payment in a
new bill, or by remittance through a challan by the drawing officers: outstanding
objections should be pursued regularly with the heads of offices.
63
CHAPTER 7
CHECK OF CLAIMS RELATING TO WORKS EXPENDITURE
Introductory:-
7-1-1 The Director of Accounts is the Chief Accounting Authority of the Projects and Principal
Disbursing Officer. The check drawing powers are vested with the Pay & Accounts
Officer / Assistant Pay & Accounts Officers by the Director of Accounts of the Project
concerned. In respect of other offices / schemes, the PAO / APAO nominated for
rendering the accounts is the Chief Accounting Authority. Limited cheque drawing
powers are, however, given to the Land Acquisition Officers and other Officers specially
entrusted with specific functions of a project / schemes for limited purposes to the extent
powers are delegated to them from time to time.
7-1-2. The work of checking claims relating to work expenditure is distributed among a number
of works pre-check sections. Each section is in-charge of one or more divisions / Offices
(It is desirable that section is given the charge of divisions / Offices engaged in similar
functions like mechanical divisions, construction divisions, Stores Divisions,
Maintenance Divisions, Land Acquisition Offices).
7-1-3. The Scrutiny of bills relating to work expenditure should be done (i) in accordance with
general rules, principal procedure laid down in chapter V and XI and (ii) with reference
to rules in codes and the financial rules in the Government.
7-1-4. The aim of pre-check is to ensure the financial regularity of all transactions.
Scrutiny of Sanctions:
7-2-1 The works pre-check sections will be responsible for the scrutiny of all sanctions
connected with the works expenditure (e.g. Administrative approval, sanctions to
estimates financial sanctions, sanction to contracts, sanctions to excess over estimates
etc.,) and check of expenditure against such sanctions.
7-2-2 An incorrect application of a rule or order shall be challenged but the rules themselves
must not be challenged in any communication to a lower Authority. In such cases the
inconsistencies should be brought to the
64 PAO (WA) Manual
notice of authority competent to amend the rules.
7-2-3 Nature of scrutiny
(1) All sanctions require scrutiny with reference to the following points,
(i) Legitimacy of charge against the state;
(ii) Correctness of Classification;
(iii) Competency of sanctioning authority;
(iv) Completeness of sanction.
(2) If the scrutiny is to be effective it should be prompt
Communications of sanctions:
7-2-4 All sanctions relating to works expenditure (other than sanctions relating to the
employment of work - charged establishment by the Divisional Officers shall be received
in the Pay & Accounts Office from the sanctioning authorities as soon as they sanctioned
No such sanction should be finally admitted, without the orders of the Pay & Accounts
Officers/ Assistant Pay & Accounts Officer, or the Director of the accounts as the case
may be, in respect of each sanction. All the sanctions should be recorded in the concerned
registers before they are filed.
Administrative Approval & Technical Sanction:-
7-2-5 For every work there should be administrative approval and technical sanction accorded
by the competent authorities. No administrative approval is, however, required for works,
which are the class either of ordinary or special repairs (Para 142 of APWD Code) and no
detailed estimate need be prepared for petty works and repairs the cost of which does not
exceed Rs. 2,500/- (Rupee two thousand five hundred only) (Para -99 of APWD Code)
(G.O.Ms.No.50, PWD, dt. 17-1-1966 Para 99 of APW D Code)
7-2-6 The powers of various officers of the Department to accord Administrative approval and
technical sanction are laid down in Chapter VI of the APWD Code as amended by orders
issued from time to time by the Government. The rules regarding work slips and revised
estimates are contained in Para 36, 187, 214 & 215 of APWD Code. Where the project
estimate as a whole is administratively approved by the Government and contains
sufficient details of the component pans of individual works included therein with their
estimated cost an overall technical sanction for the project as whole is not necessary the
Project Officers can accord
CHAPTER -7 65
technical sanction to the various component parts separately with reference to relevant
provisions made in the administratively approved estimate subject to the limits of their
powers or technical sanction.
7-2-7 All estimates received in the section should be entered in the register of estimates. The
register should be maintained in three parts to record separately the estimates sanctioned
by the Chief Engineers, Superintending Engineers and Executive Engineers. The estimate
should then be scrutinized and submitted to the Pay and Accounts Officer / Assistant Pay
and Accounts Officer along with the scrutiny slip in form “P.A.O. - 18” duly filled in.
The estimates sanctioned by Superintending Engineer and Executive Engineer should be
accepted by the Pay and Accounts Officer / Assistant Pay and Accounts Officer. Details
of the estimates indicating the name of work, estimate number and amount should then be
noted in the Works Audit Register under the concerned detailed head. Any peculiar or
objectionable features noticed in such estimates should be put up to the Director of
Accounts through the I.T.C., section. All the estimates sanctioned by Chief Engineers
should be put up to the Director of Accounts for acceptance with the remarks of the Pay
and Accounts Officer through the I.T.C., section
7-2-8. In order to ensure that all the estimates sanctioned are duly received a monthly list of
estimates sanctioned by each sanctioning authority should be obtained from him and
checked with the estimates already received. Wanting estimates should then be called for
from the sanctioning authorities (action in this regard should be taken by pre check
sections in respect of estimates sanctioned by Divisional Officer and by the 1TC section
in respect of other estimates.) A list of estimates sanctioned by the Departmental officers
during each month should be sent by each pre check section to the ITC Section.
Note: The term „ESTIMATES‟ includes revised estimates, supplementary estimates and work
slips.
Sanction to contractors:
7-2-9. Ordinarily no work (other than a work executed departmentally) should be started
without a formal agreement or contract sanctioned by competent Authority. No format
agreement is, however, necessary in regard to petty works and repairs, the estimated cost
of which is Rs.1000/- or less, but in these cases there should be some written
understanding
PAO (WA) Manual 66
(though not in any form) specifying prices and rates (Para -175 of A.P.W.D. Code)
7-2-10 All agreements received in the section should be entered in the register of agreements.
This register should be maintained in different parts to record separately the agreements
received from the Superintending Engineers and Executive Engineers. The agreements
should then be scrutinized and submitted to the Pay & Accounts Officer / Assistant Pay
and Accounts Officer along with the scrutiny slips in form PAO -19 duly filled in. All
agreements requiring Scrutiny in the I.T.C., section from higher audit point of view
should be sent to that section. All agreements referred to in Para 535 of this manual
(including supplementary agreements) should invariably be sent to I.T.C. Section for
scrutiny.
7-2-11 In order to enable the 1TC section to ensure that all agreements requiring scrutiny in that
section are received from the pre-check sections, a list of agreements received during
each month in the pre-check section of the out station offices should sent to the I.T.C.
Section in form P.A.O.‟ 20‟ . In respect of Head quarter section the Register of
Agreements should be sent to the I.T.C. Section instead of the List. Note; The term
“Agreement” includes “Supplement Agreement”
7-2-12 1) Sanction to excess -over estimates accorded by the competent authorities on the
completion reports for works should be recorded in the works - Abstracts -cum -Register
of works and also in the register of estimates and work Audit Register against the
concerned works and attested by the Pay & Accounts Officer pass (paras 377 & 373
APWA code.)
The procedure for the check of completion reports and statements is contained in paras 20
and 21 of the General Instructions (Accounts) issued by the Financial Adviser and Chief
Accounts Officer, NSP, which are re-produced below :-
Check of Completion Reports and statements:
ii) When a completion report or statement of works is received, the expenditure noted
therein should be verified with figures recorded in the works Audit Register and the
discrepancies, if any, got reconciled. The accounts of the works should then be closed on
the works Audit Register. If there is an excess over sanctioned estimate requiring
sanction, the
CHAPTER -7 67
amount should be entered in the objection book to watch the receipts of Sanctions.
iii) When a sanction to an estimate chargeable to the capital account of the project, of which
the construction „estimate is still under operation is received for the first item, steps
should be taken (1) to ascertain from the Government the date from which the accounts
of the construction estimate should be considered as closed and (2) to obtain for
verification, the completion Report of the Project. If there is a delay in the receipt of the
completion Report, a report should be made to Government and the Officer in charge of
the project and the matter should be pursued with till the report is received and
sanctioned by competent authority.
1) The Pay and Accounts Officer /APAO is responsible to ensure that no expenditure is
incurred after the date of the closure of the construction estimate without the approval of
competent authority.
2) In connection with the verification of the schedules and the financial statements
accompanying the completion Report it should be seen that:
i) The schedules should initially be signed by the Officer - in -Charge of the project and
countersigned as “Verified” by the Pay & Accounts Officer/APAO in token of this
verification of actual and classification, and
ii) The financial statements should similarly be signed and countersigned but in this case the
Pay & Accounts Officer /APAO should do so under the words “Actuals and Calculations
checked”.
Procedure in regard to performing and payment of bills
7-3-1 As soon as the claim is ripe for payment, the drawing officer will prepare the bill and
send it to the Pay and Account Officer duly passed by him for gross amount. The bills
will be received by the Superintendent concerned in the Pay and Accounts Office and
arrange fonts check after entering in the bill register. Necessary entries in relevant
registers are to be made while putting the pay order” on the bill if it is otherwise in order.
After check, the bills (and where necessary the measurement books) should be enfaced
with Pay order duly expressing the net amount payable by cheque both in words and
figures. The sub voucher should then
68 PAO (WA) Manual
be cancelled. The gross charge and the credits, if any, should be classified giving
reference to estimate number etc. The name or designation of the payee should be
indicated. The bills should be posted in the works abstracts and or Register of” Office
expenses” or other relevant accounting registers. A note of payment should be made on
the agreement /purchase order and the bills put up to the Pay and Accounts Officer /
Assistant Pay and Accounts Officer along with the registers and Memo for scrutiny of
bills in Form 70 where ever necessary. The Pay and Accounts Officer / Assistant Pay and
Accounts Officer while authenticating the Pay order should also initial the relevant
entries in the work abstract and other registers. The bills should then be sent to cash
section along with the cheque forwarding slips and disallowance memo, if any for
payment. As and when a bill is passed for payment or adjustment or T.E.O. is adjusted
entry should be made in one or other of the registers and for records mentioned in the
subsequent paragraphs. Entries in respect of payments should be attested by the Pay and
Accounts Officer /Assistant Pay and accounts Officer and adjusting entries by the
Superintendent.
7-3-2 Bills in respect of firms / contractors against whom there is an attachment should be
passed by credit to “P.A.O Deposits” and the fact intimated to the Divisions /Offices.
Before sending the passed bills to cash section the information after making necessary
entries in the Register P.A.O. 21” should be sent to coordination section for making
necessary notings in the register maintained in that section for the purpose in form P.A.O.
21; when the full amount due from the firm / Contractor is recovered, the fact should be
intimated by the Co-ordination section to the concerned Pay and Accounts Officer /
Officers concerned so that further claims can be passed for payment to the firms
/contractors concerned.
7-3-3 The amount credited to P.A.O Deposits” in respect of such recoveries should be cleared
in convenient intervals by making payments to the department concerned.
7-4-1 Check of bills:- Senior Assistants performing the original scrutiny must apply the rules
strictly. For his general guidance the various points that should be looked into in
conducting the scrutiny of claims are embodied in Appendix - IX. These should not be
considered exhaustive and any
CHAPTER -7 69
other points that may be necessary depending on the nature of each claims should also be
carefully seen. Once the detailed scrutiny is carried out strictly and every infraction of
rule brought to light, it will be for the officer to exercise discretion whether a particular
objection should be pressed or not. The Pay and Accounts Officer / Assistant Pay and
Accounts Officer should remember that exceptional cases may arise in which it is
desirable to relax formalities which should be followed strictly in ordinary cases, but the
circumstances must be really exceptional, before rules are relaxed, and even then the
relaxation must be of formalities rather than essentials.
7-4-2. If any point for simplification of procedure arisen in the course of scrutiny, it should be
brought to the notice of the Director of Accounts.
Uniformity of procedure:
7-4-3. Care should be taken to preserve uniformity of procedure in all the processes of work
carried out in the Works pre-check sections. For this purpose it is necessary that
Superintendents of pre-check sections should freely compare notes on all important
points. Superintendent are required to maintain a close watch over all the subordinates on
this point, and are required to enquire frequently into the practice of other sections so as
to ensure uniformity in the application of modes of check and documentation in all the
works pre-check sections. Wherever a general question common to all sections arises in
any section, that point should under the orders of the Pay and Accounts Officer /
Assistant Pay and Accounts Officer be referred to the coordination section. The
coordination section will take the orders of Director of Accounts and circulate them to all
pre-check sections.
7-4-4 The categories of bills received in the pay and accounts Office are given below:-
1. Impress accounts (Para -169 of A.P.WA. Code)
2. Bills for work done and miscellaneous payments and advances (Para 298 of A.P.W.A
Code).
3. Bills of suppliers (Para -308) and (b) 306 (5) of A.P.W.A. Code.)
4. Bills of P.A.O. Ministry of works, Housing and Supply,
5. Railway credit Note Bills.
6. Land Acquisition payments.

70 PAO (WA) Manual
7. Salary Bills of work-charged Establishment.
7-4-5 It is essential that every Assistant (Auditor), should acquaint himself with the nature and
scope of the work to which the claim relates, the agency of execution and the various
items and provisions of the work and the legitimacy of the charge on the work. For this
purpose a thorough and intelligent study (i) The estimate for the work and (ii) the
agreement is necessary.
Provisional payments in case of emergency
7-5-1 “It is a fundamental rule that no work should ordinarily be begun before a properly
detailed design and estimate are sanctioned and where necessary, a proper agreement is
concluded. Also, bills should not be presented to the Pay and Accounts Office before all
the prescribed formalities are fulfilled. In cases of real urgency, however, bills may be
presented and payments made on provisional basis pending completion of the formalities.
7-5-2 The circumstances in which and the conditions subject to which such payments in cases
of urgency are to be made on provisional basis (which are to be claimed in Form
“PAO.67” in respect of bill other than final bills are given below:
(i) where administrative approval of Government to the Estimate is required.
The Pay & Accounts Officer may make provisional payments to the extent of 25% of the
value of each contract based on the PAO Form 67 countersigned by the Chief Engineer.
(ii) where Administrative approval of the Government to the Revised Estimate is required
Where the Revised estimate is pending with Government, the Chief Engineer may ask for
any number of Provisional payments duly supported by PAO Form 67 countersigned by
him (except final bills). In these cases Payments should be in accordance with the
original or supplemental agreements entered into by the competent authority. Where the
Revised Estimate is pending with the Chief Engineer, the Pay & Accounts Officer may
make provisional payments upto 25% of the difference between the Revised Estimate
amount and the sanctioned estimate amount plus the tender excess if any, if supported by
the PAO form 67 countersigned by the Chief Engineer.
CHAPTER -7 71
(iii) Technical Sanction is wanting
If a technical sanction has not been accorded by the Officers as per the delegation of
powers vested with them, the Pay & Accounts Officers / APAO may make payments not
exceeding 25% of the value of work, based on the PAO Form 67 signed by the authority
competent to accord technical sanction.
(iv) Revised Technical Sanction is wanting
If revised technical sanction has not been accorded, the Pay and Accounts Officer /
APAO may make provisional payments on PAO Form 67 to the extent of 25% of the
difference between the value of the proposed Revised Technical sanction and the Original
Technical sanction plus tender excess, if any.
(v) where agreements and supplemental agreements have not been concluded by the
competent authority
The Pay & Accounts Officer /APAO may make Payment based on the PAO Form 67
countersigned by the authority competent to conclude the agreement/Supplemental
agreement upto 25% of the value of each contract [Value of each supplemental
agreement is provided the rates of the supplemental items of work are agreed to by the
Contactor and only formality of the signing the supplemental agreement is pending.
7-5-3 It has been clarified by government that the limit prescribed will apply separately for a
work and for a contract; that is to say, if the objection relates to the work as whole, as for
example, want of estimate for a work, the limits, such as the total of four payments or
25% cost, will apply to the work as a whole irrespective of the number of contracts
relating to the work. If however, the objection relates to want of agreement (s) in respect
of a sanctioned work, the limits will apply for each of the contract, i.e., payments in
respect of each contract, (Letter No. 1845 E/56-2, dated 17.9.1966) the Deputy Secretary
to Government, P.W.D (Projects Wing) the Deputy Accountant General (Project)
payments in respect of firms bills the debit of which is to “03. Suspense- Purchases” do
not come under the purview of these provisions.
7-5-4. In each section, a separate register for each division should be maintained for noting
serially every payment made on N.S.P. Form I and for further action till the item is
regularized. The notings in the register should be self-contained and each item should be
attested by the Pay
PAO (WA) Manual 72
and Account Officer/ Assistant Pay and Accounts Officer. The register should be closed
every month with an abstract showing the total number of N.S.P Form. I payments
outstanding at end of the previous closing, items added and items cleared during the
month and closing balance. In respect outstanding for more than one month; special
action should be initiated to get the items cleared by addressing the departmental offices
demi-officially. An abstract of the closing of the register should be submitted to the
Director of Accounts.
Work-charged Establishment
7-6-1 The sanctions to appointments and promotions of work-charged personnel should be

scrutinized to see that they are issued by competent authority. Payments should be
checked with re1rence to those sanctions.
Payments made by EES & other civil departmental officers under the limited cheque drawing
Powers scheme.
7-7-1 The system of centralized payment has been relaxed under the orders of Government in
the case of payments relating to certain specified nature of works. The Executive
Engineers, and other Civil Departmental Officers specially entrusted with specific
functions of the Project are vested with limited cheque drawing powers to be operated
against the account of the Director of Accounts or treasuries/ sub - treasuries/ Banks to be
specified and places in funds by means of letters of credit, as introduced in
G.O.Ms.No.198. Finance dt. 19.05.1962 and orders issued from time to time on the
subject by the Chief Engineer/Director of Accounts against the application for funds
made by the Chief Engineer / Director of Accounts against the application for funds made
by the respective Officers.
(G.O.Ms. No. 131, P.W.D. (PW) Dept. dt. 16-5-1974)
7-7-2 On receipt of specimen signatures of these Officers in triplicate (specimen signatures

duly countersigned) separately for each treasury /Sub-treasury/ Bank on which they are to
be authorized to draw the cheques, the Director of Accounts through the Pay and
Accounts Officer / Assistant Pay and Accounts Officers will authorize the treasury
Officer to admit payments by Cheques issued, against the letters of credit, by these
Officers.
(1. G.O.Ms.No. 131, PWD (PW) Dept. dt. 16-5-74.
2. G.O.Ms.No. 138, I & P (PW) Dept. dt. 7-4-1979).
CHAPTER -7 73
7-7-3 Cheque Books required will be obtained by the Officers to whom the limited Cheque
Drawing Powers are delegated, from the Pay and Accounts Officer/ Assistant Pay and
Accounts Officer for this purpose. Funds so placed at the disposal of these Officers will
be utilized by them in meeting the expenditure for the specified purposes only. These
funds should not be utilized by them under any circumstances for any other purpose.
These Officers will pay the bills of the specified category without pre-check by the Pay
and Accounts Officer / Assistant Pay and Accounts Officer and maintain Cash Books
wherein all payments made out of the letter of credit will be incorporated as and when the
transactions take place.
(1. G.O.Ms.No. 131, PWD (PW) Dept. dt 16-5-1974.
7-7-4 The Cash Book will be closed on 10th and 25th of every month (excepting February) by
the Officers to whom these powers have been delegated by the Government from time to
time for specified purpose. During the month of February the Cash Book will be closed
for the second time in that month at least six days before the close of the month. Copy of
the Cash Book together with the paid vouchers and other supporting documents will be
sent to the Pay and Accounts Office by these Officers.
Note:- Local Instructions in regard to receipt and adjustment of Cash Book extracts during the
2nd half of March of every financial year will be issued by the Director of Accounts in
accordance with the standing orders.
(1. G.O.Ms.No. 131, PWD (PW) Dept. dated 16-5-1974.
7-7-5 On receipt of copies of Cash Books, with paid vouchers in the Pay and Accounts Office
by 14th and 29th of every month (excepting February when it should reach the Pay and
Accounts Officer / Assistant Pay and Accounts Officer two days before the close of the
month as far as second closing is concerned), the payments made by these Officers
should be incorporated in the Cash Book of the Pay and Accounts Officer / Assistant Pay
and Accounts Officer after exercising the following preliminary checks by the pre check
sections of the concerned Division / Office:
(a) Checking the entries in Cash Book with a view to seeing that for
74 PAO (WA) Manual
each payment there is a voucher.
(b) Total of the debits and Credits agree with each other and Cash Book balance arrived
at is correct.
(c) Classification shown is in order.
(1.G.O.Ms.No. 131, PWD (PW) Dept. dt. 16-5-1974.

7-7-6 After the payments are incorporated in the cash book as well as in the accounts of the Pay
and Accounts Office the paid vouchers with the copy of the cash book should be sent to
the pre - check sections which will conduct 100% post check and post the works abstract
and other registers maintained.
7-7-7 The Pay and Accounts Officer / Assistant Pay and Accounts Officer should watch that
there is no delay in the receipt of Cash Book extracts from these officers. He should also
see that there is no delay in incorporating the Cash Book extracts in the Cash Book of
Pay and Accounts Officer / Assistant Pay and Accounts Officer. Wherever
reimbursements are to be claimed, the Pay and Accounts Officer / Assistant Pay and
Accounts Officer should ensure that they are claimed promptly.
7-7-8 Results of Post check should be communicated to these Officers in the form of Audit
notes and their settlement should be watched by the concerned pre check section. These
paid vouchers should be stitched in a separate bundle for each month and made over to
the statutory Audit Officer for post audit on the due dates.
(1. G.O.Ms.No. 131, PWD (PW) Dept., dt 16-5-1974

2. G.O.Ms.No. 138, I & P (PW) Dept., dt. 7-4-1979).
7-7-9 All pre-check sections should maintain a register in Form „P.A.O. 25‟ to record the
irregularities noticed during the post-check and communicate them to the co-ordination
section in Director of Account‟s Office. The Co-ordination section after scrutiny of these
reports, bring to the notice of the head of the Department / Government any recurring and
serious irregularities noticed.
(1. G.O.M).No. 131, PWD (PW) dated, 16-5-19/4.

CHAPTER -7 75
7-8-1 Payments Made by Special Deputy Collectors for Land Acquisition & Rehabilitation: -
As soon s an award is sanctioned under the Land Acquisition Act, the Officer,
sanctioning the award, .prepares a statement in Form “A” showing the amount payable to
each person under the Award, and forward a copy of the statements signed by himself to
Pay and Accounts Office as well as the Resident Audit Office. (Before signing the copy
the Officer should carefully satisfy himself that it correctly shows the amounts due under
the Award and should him-self enter the total of column No. 6 of the statement in words
both on original as well as on copies endorsed to Pay and Accounts Officer / Assistant
Pay and Accounts Officer and Resident Audit Officer).
7-8-2 In cases where an Award has been made by a Court under the Land Acquisition Act., a
second Award Statement should be prepared in form “B” by the Land Acquisition Officer
as the decision of the Court is ascertained.
Copies of statement “B” should also be forwarded to Pay and Accounts Officer/Assistant
Pay and Accounts Officer and Resident Audit Officer by him.
7-8-3 Any change in the apportionment of the Officer‟s Award made by a Court under the
relevant section of the Act should be communicated by the Land Acquisition Officer to
the Pay and Accounts Officer
7-8-4 If, under the Act, it has been arranged to grant compensation otherwise than in Cash the
nature of such compensation should be clearly specified in the “Remarks” column of the
Award statement.
7-8-5 On receipt of the statement “A” in the Pay and Accounts Office, it should be checked
arithmetically and it should be seen that there are no doubtful points requiring a reference
to the Land Acquisition Officer. Particulars of the Statement should then be entered in
columns 1 to 6 of the Register of Land Charges maintained, in the Pay and Accounts
Office. As and when statement “B” is received in Pay Accounts Office entries in columns
1 to 4 of the statement will be checked with statement “A” sent by the Officer and
necessary corrections carried out in statement “A” as well as in register of Land Charges
by the Pay and Accounts Office.
76 PAO (WA) Manual
7-8-6 Amount required actually for payment to the parties on the basis of Award statement “A”
and other necessary records, should be drawn by the Special Deputy Collectors in the
shape of Cheques in the name of individual awards.
The Special Deputy Collectors of all Major Projects are authorized to disburse the
amount of individual compensation upto Rs. 100/- in cash (G.O.Ms.No.249, Irrgn. PWD.
Dept., dt. 22.07.86).
7-8-7 The Special Deputy Collectors of all Projects in charge of Land Acquisition/
Rehabilitation will be vested with limited Cheque drawing powers in respect of payments
to be made by them towards land compensation and rehabilitation vide G.O.Ms.No.138,
Irrigation and Power (Projects Wing) Department, dt. 7-4-1979, the system of Letter of
Credit is made applicable for making such payments. The letter of credit will be issued by
the Pay and Accounts Officer /Assistant Pay and Accounts Officer concerned to the
Special Collector, who will, in turn distribute the amounts to va4ous Special Deputy
Collectors under his charge.
ii) The accounting procedure to be followed under this system is indicated below:-
i) The Pay and Accounts Officers / Assistant Pay and Accounts Officers should issue
quarterly Letter of Credit to the Special Collector, based on the requisition received from
them.
ii) The Special Collectors should distribute the amount of Letter of Credit received from the
Pay and Accounts Officers/Assistant Pay and Accounts Officers to all the Special Deputy
Collectors under their control as per the requirements under intimation to the Pay and
Accounts Officer /Assistant Pay and Accounts Officer.
iii) The cheque books required for this purpose shall be obtained by the Special Deputy
Collectors from the Pay and Accounts Officer /Assistant Pay and Accounts Officer
concerned, who should supply them from their own stock. For this purpose, the set of
cheque books being used by the Pay and Accounts Officers/ Assistant Pay and Accounts
Officers in the ordinary course shall be supplied. A maximum of five cheque pads may be
supplied to each Special Deputy Collector based on the requisition. As these cheque pads
do not contain any counterfoils, the Special Deputy Collectors shall maintain counterfoil
separately, as maintained by Pay and Accounts Officers / Assistant Pay and Accounts
Officers.
77 CHAPTER -7
iv) On receipt of specimen signature of the Special Deputy Collectors in triplicate duly
countersigned by the Special Collectors separately for each Treasury / sub-Treasury /
Bank on which they have to be authorized to draw the Cheques, the Director of Accounts
concerned through the Pay and Accounts Officers / Assistant Pay and Accounts Officers
will authorize the Treasury / Sub-Treasury / Bank to admit payments by Cheques, issued
by the Special Deputy Collectors against the Letter of Credit.
(v) The funds placed at the disposal of the Special Deputy Collectors should be utilized by
them solely in respect of Land Compensation / Rehabilitation payments and not for any
other purposes under any circumstances. They should not make payments in respect of
salaries, contingencies / Office expenses, imprest and miscellaneous charges, for which
they should submit the bills to the Pay and Accounts Officers / Assistant Pay and
Accounts Officers concerned in the usual manner.
(vi) Special Deputy Collectors should maintain a separate cashbook, in which all payments
made relating to Land Compensation, Rehabilitation, should be incorporated as and when
the transactions take place.
(vii) The Cash Books shall be closed on 10th and 25th of every month (except in the month of
February) by the Special Deputy Collectors. During the month of February the Cash
Book should be closed for the second time in that month at least (5) days before the close
of the month. Extract of Cash Book, together with the‟ paid vouchers should be sent to
the Pay and Accounts Officer / Assistant Pay and Accounts Officer so as to reach him on
12th and 27th of every month. The Special Collector should take suitable action against
those Special Deputy Collectors who fail to submit their cash books in time as this will
affect the closing and rendering of Accounts by the Pay and Accounts Officer / Assistant
Pay and Accounts Officer to the Accountant General.
(viii) In the case of month of March the Cash Book should also be closed on the 31st March. In
order to enable the Pay and Accounts Officer / Assistant Pay and Accounts Officer to
incorporate even the payments made upto end of 31st March in the accounts of March
itself the payments made by the Special Deputy Collectors after 25th of March, it is
necessary that the third batch of the Accounts of Special Deputy Collectors for the month
of March, are received in the Pay and Accounts Office on 31st March itself.
78 PAO (WA) Manual
(ix) Under any circumstances, the rendering of accounts of March by 31st should
notbe4elayed by the Special Deputy Collectors and they will be held personally
responsible for any lapse in this regard.
(x) The preparation of schedule of settlement with the Treasuries will be done by the Pay and
Accounts Officers / Assistant Pay and Accounts Officers. For this purpose, the Special
Deputy collectors should send monthly statements of Cheques drawn by them on various
treasuries (Treasury-wise) to the Pay and Accounts Officer / Assistant Pay and Accounts
Officer before the 5th of the succeeding month. The Special Deputy Collectors should
note that any delay in rendering these statements will make the reconciliation of schedule
of settlements with treasuries very difficult at a later stage. The normal codal provisions
will apply in respect of recording of counter - foils of cheque books and other points, not
mentioned specifically in the above accounting procedure.
(xi) The Special Deputy Collectors who have been vested with the limited Cheque drawing
powers can also make payments by issuing Cheques relating to declared amounts of land
compensation and rehabilitation to be booked under charged expenditure, subject to
release of Letter of Credit under charged head of account.
(xii) The Special Deputy Collector concerned shall depute his staff attending to this item of
work to the Pay and Accounts Office for undergoing requisite training.
1. G.O.Ms.No. 138, I & P (PW) Dept. dt. 7-4-79.
2. Govt.Memo.No.401/SLM.II(1)/79-3, dt. 7-4-79.
3. Govt.Memo.No.1028/LAR.II(2)/80-2, dt. 28-5-80.
4. Govt.Memo.No.1029/LAR.II(2)/80-2, dt. 27-6-1980.
7-8-8 (i) An award wise abstract should be prepared and enclosed to the Cash Book extracts to
be sent to the Pay and Accounts Office for adjustment.
(ii) The following preliminary checks are to be exercised by the pre- check section concerned
during the post check of the accounts relating to payments made by the Special Deputy
Collectors towards land compensation / rehabilitation under the limited Cheque drawing
powers, delegated to them, before incorporation in the Cash Book of the Pay and
Accounts Officer / Assistant Pay and Accounts Officer.
CHAPTER -7 79
(a) Checking the entries in the extract of Cash Book so as to see that for each payment,
there is a voucher.
(b) Total expenditure and receipts agree with each other, the cash balance arrived at is
correct:-
(c) Classification indicated is in order.
(iii) After the payments made by Special Deputy Collector are incorporated in the Cash Book
and also in the accounts of the Pay and Accounts Officer / Assistant Pay and Accounts
Officer the paid vouchers together with the copy of the Cash Book will be sent to the pre-
check sections who should conduct 100% check and post the concerned accounts records
maintained for this purpose.
(iv) Results of the cent percent check should be communicated to the Special Deputy
Collectors through Special Collectors in the form of audit notes and settlement of
objections watched, scrupulously.
(v) The vouchers will be stitched in separate bundles for each month and kept along with the
other voucher bundles of the Special Deputy Collectors concerned for the month, in the
record branch of the Pay and Accounts Office.
(1) G.O.Ms.No.138, I & P (PW) Dept., dt. 7-4-1979.

(2) Govt.Memo.No.401/SLM-II(i)/793, I & P (PW) Dept., dt. 7-4-1979).
7-8-9 On receipt of the requisition in Pay and Accounts Office, the amount claimed should be
checked with reference to statement “A”. It should be seen that the amount claimed in
respect of each individual is the same as the amount payable under award.
7-8-10 A separate Register should be maintained in Pay and Accounts Office in which a note
should be made whenever land compensation bills are paid. Separate pages should be
kept for recording the transactions in respect of each award. An entry should be made in
the register as soon as an award is received and the fact of having made the entry in the
register should be made in the Scrutiny slip. When all the land compensation bills
relating to an award are paid a note to this effect should be made in the register. In case
part payments are made the serial number of items of the land award statement should be
noted in the register to
80 PAO (WA) Manual
avoid double payments. This register should be closed monthly on 5th and put up to the
Pay and Accounts Officer / Assistant Pay and Accounts Officer.
7-8-11 Whenever a payment is made under the limited cheque drawing system to a party, the
Officer should obtain a receipt in a form “C” and when payments are made to a number
of persons under a single award, Acquittance Roll in form “CC” should be obtained.
Whenever a payment is made to a representative of the Award the fact of legal authority
for receiving compensation on behalf of the Principal award having been verified should
be noted in the “Remarks” column of the Acquittance under the Signature of the
Disbursing Officer. The amounts remaining undisbursed and which have to be credited to
Revenue Deposits under the Rules should be paid into the Treasury along with form “E”.
The form “E” will be sent along with Cash Book extracts to the Pay and Accounts
Officer/ Assistant Pay and Accounts Officer.
7-8-12 Whenever payments are made into the Court for deposit under the Act, a separate cheque
should be drawn duly supported by Receipts in triplicate in form “D” duly filled up as per
rules. The cheque so issued should be in favour of the presiding Officer of the Court
payable by the order of the Court to the credit of Civil Court Deposits. The cheques with
form “D” should be delivered to the Court and receipt obtained in form “D” in duplicate
from the court. Receipt in form “D” duly filled in should be sent to the Pay and Accounts
Office along with the Cash Book Extracts.
7-8-13 The Cash Book will be closed on 10th and 25th of every month excepting February by
these Officers. During the month of February the Cash Book will be closed for the second
time in that month at least five days before the close of the month. The Cash Book extract
duly supported by Forms “c”, „CC‟ and „F‟ long its subsidiary Form „AA‟ giving
particulars regarding the acceptance by the persons concerned of the amount entered in
Column -6 of the Statement A‟ will be rendered by the Special Deputy Collectors to the
Pay & Accounts Officer /APAO, When every payments are made into the Court the
Accounts Officer /APAO, whenever Payments are made into the Court the Pay and
Accounts should be rendered duly supported by Form „AA‟ and receipt granted by the
Court in Form „D‟. The cash book extract received should be checked so as to see that
every payment is supported by Form „C‟, „CC‟, „D‟, „E‟ and
CHAPTER -7 81
the amount paid on such receipt is the amount payable under the award. The account will
be adjusted only after completing this check. A note of such adjustment will be made in
the Register prescribed in Para -295 above in the pay & Accounts Office. While adjusting
the Cash book extract rendered by the Special Deputy Collectors the Voucher No. and
date will be filled in, the appropriate column of the statement „A‟ and “B”. When
payments in respect of an award are completed columns 7 to 11 of the Register of land
charges should be filled in and the fact of having paid all the bills in respect of an award
should be noted in the appropriate column of the statement „A‟ and “B” under the initials
of the Superintendent.
7-8-14 The register of awards and the register of Land Charges should be reviewed monthly and
the reasons for delay in completion of award statements should be investigated. If there is
delay on the part of the Special Deputy Collectors in paying compensation bills the
matter should be taken up with the Special Collector.
7-8-15 When all the payments to the awards/payments to the Court, relating to an award are
completed and reports of possession have been received, the Pay and Accounts
Officer/Assistant Pay and Accounts Officer should forward the statements „A‟ , „AA‟ and
„B‟ to the Chief Revenue Authority i.e., Commissioner, Land Revenue through the
Resident Audit Officer. (G.O.Ms.No.138, I & P (PW) Dept., dt. 7-4-1979).
Accounting:-
7-9-1 A register should be maintained for each division to record the estimates sanctioned by
Divisional Officers separate folios should be set apart for each detailed head each entry in
the register should be attested by the Superintendent.
7-9-2 The rules and procedure for the posting and maintenance of works abstracts are contained
in paragraph 344 to 364 of APWA Code. The monetary limit for major works in the
project is Rs. 1,00,000,00. (G.O.Ms.No.212, Fin (BG) Dept., dt. 03.09.1973, G.O.
Ms.No.304, PWD (PW) Dept., dt. 19.08,1966)
7-9-3 The Works Abstract should be posted as and when a bill is passed or a T.E.O. is adjusted
or an U.S.R. is received. The works abstract maintained in the Pay and Accounts Office
combines in itself both the works abstract and the register of works contemplated in
paragraphs 344 and 365 of A.P.W.A. Code respectively.
82 PAO (WA) Manual
7-9-4 The works abstract in respect of a work should exhibit the total expenditure upto date in
addition to the total during the month. For this purpose the expenditure to end of the
previous year in respect of all works not completed to the end of the previous year should
be carried over to the works abstract of the current year immediately after the accounts
for the year are closed.
7-9-5 This register should be maintained for each division to have collective record of all the
expenditure incurred on each work under each detailed head. The register should be
posted from the “works abstracts-cum-register of works”. The register should be
maintained and posted in accordance with the instructions contained in paragraphs 4, 5, 6,
8 and of the General instructions (Accounts) issued by the Financial Adviser and Chief
Accounts Officer, NSP which are reproduced below;
ii) In the works abstracts-cum-register of works maintained for each division the entries
relating to working estimates under each detail head of the project should be grouped
together and posted, and the total of each detailed head should be struck separately in the
register. The total expenditure by detailed heads should be abstracted each month in a
separate page in the register, and the progressive expenditure incurred by the division
under each detailed head, worked out month by month on this page. This progressive
expenditure by sub-head should be carried over to an abstract page, while opening a new
register. The entries relating to items of works which have been completed and in respect
of which completion repots have been received need not be brought forward to the new
register.
Note: In the case of projects for irrigation, navigation, embankment Flood Control and drainage
works for which capital accounts are kept, the expenditure against the open capital
accounts incurred between the date of closure of the construction estimate and that of
approval of the completion report should also be audited against the sanction to the
construction estimate of the project.
iii) The following points should receive special attention in maintaining the works abstract-
cum-Register of works
a) Entries under each detailed head of account should be numbered in a separate series. A
number should be assigned to a work, and an entry should be made in respect of it, as
soon as any sanction or order of
83 CHAPTER -7
allotment relating to it is received or expenditure on it is to be booked.
b) Technical sanctions to detailed estimates should be entered in the respective columns.

The amount of a Revised Estimate should be preceded by the letter “R” in red ink. Orders
of competent authorities passing excess over technical sanctions should be also noted in
these columns and the entry of the amount, preceded by the letter “E” should be put
within brackets, so that it may be distinguished from entries relating to sanctioned
detailed estimates.
c) In the case of works of Manufacture, the “Out turn” should also be recorded, the entries
being made in separate line below those relating to the” Operation”
d) Entry of Expenditure should be made only when there is any transaction during a month,
and whenever an entry is made, the expenditure of the month should be entered in blue or
black ink, and underneath it should be noted, in red and green ink, the expenditure to
date. The figures should be prefixed by a red ink minus sign when they represent minus
expenditure. When the expenditure on a work is incurred for the first time, the
progressive expenditure need not be entered. When it is entered for the last, item, i.e.,
When the work is reported as” Completed a line should be drawn through the space for
the remaining months of the year and the work” Completed” noted against it in the
column for “Remarks”.
iv) Currency of the Register:
The works Audit Register should be closed monthly and annually and sanctions and
orders which are still effective should be carried forward to the following year‟s register
(with all necessary particulars in respect of the expenditure already incurred against them,
the entries attested by the Supt.. as in the case of fresh entries. This action cannot,
however, be taken completely until the supplementary accounts of the year have been
closed. But it is permissible in anticipation of this event, to transfer to the New Year‟s
register such items of the old Register as appear in the divisional accounts of the New
Year. In such case the transactions appearing in the supplementary Accounts will of
course be recorded in due course in the old Register, and it will, therefore, be necessary
i) to effect all consequent correction in the entries transferred to the new Register, and
(ii) to review, where necessary, the postings previously made.
84 PAO (WA) Manual
Entries relating to works on which no expenditure has been recorded for six months
continuously need not be carried forward at once to the next year‟s works Audit Register,
unless the recorded expenditure is in excess of the estimate but an enquiry should be
made with the Divisional Officer whether accounts of the work should not be considered
as closed, The entries should be transferred ultimately if the account is reported to be
open still.
v) To ensure the accuracy of the posting in the works Audit Register, the entries in the
Register should be attested by the Superintendent.
7-9-6 To enable the Divisional Officer to know the progress of expenditure on individual
works, the Pay and Accounts Officer / Assistant Pay and Accounts Officer should send to
the Divisional Officer every month a “Schedule of works expenditure” in respect of
works affected during the month, in form “P.A.O. 22”. Along with the schedule of works
expenditure, a statement showing the progressive balances under “Purchases”,
“Miscellaneous P.W. Advances”, and „Deposits‟ should also be sent to the Division
concerned by pre-check sections, monthly showing (1) closing balance to end of previous
month, (2) credits/debits during the month, (3) Debits/credits during the month and (4)
closing balance to end of the month.
7-9-7 The rules and procedure for posting of contractor‟s ledger are contained in paragraphs
380 to 388 of APWA Code. If the Divisional Officer desires to have extracts from the
ledgers in any particular case, they should be furnished.
Register of special recoveries:-
7-9-8 The maintenance of this register is explained in Para 7 of General Instructions (Accounts)
issued by the Financial Adviser and Chief Accounts Officer , NSP, which is enumerated
below:-
“A register of special Recoveries (in the form PAO -69 should be maintained to facilitate
a watch over special recoveries of all kinds, which may be ordered by competent
authorities, or promised by the Divisional Officer, whether as the result of audit enquiries
and objections or otherwise. Leases and other similar agreements under which payments
are to be made to Government by parties concerned should also be entered in this
register.
CHAPTER -7 85
Note:
The term “recovery” as used by this provision included not only receipts and recoveries
creditable to revenue heads, but also receipts and recoveries taken in reduction of
expenditure. Thus anticipated credits on account of a sale proceeds of materials received
from dismantled buildings, and of surplus materials and plant of closed or abandoned
works, should be watched through this register. Similarly, credits to the sub-head “land
kilns etc.,” of the suspense head “stock” should also be watched through this registers the
orders passed by competent authority about the mode of clearance (vide art. 158 of
Account Code Vol. III) of expenditure debited to the sub-head being noted for the
purpose”
A register of Special Recoveries (in the form reproduced in annexure-I should be

maintained to facilitate a watch over special recoveries of all kinds, which may be
ordered by competent authorities, or promised by the Divisional Officer, whether as the
result of enquiries and objections or otherwise . Leases and other similar agreements
under which payments are to be made to Government by parties concerned should also be
entered in this register.
Notes:
The term “recovery” as used by this clause includes not only receipts and recoveries
creditable to revenue heads, but also receipt and recoveries taken in reduction of
expenditure. Thus anticipated credits on account of sale proceeds of materials received
from dismantled buildings and of surplus materials and plant of closed or abandoned
works should be watched through this register. Similarly, credits to the sub-head” Land,
Kilns etc.” of this suspense head “stock” should also be watched through this registers the
orders passed by competent authority about the mode of clearance ( vide Article 158 (b)
of Account Code Volume III) of expenditure debited to the sub-head being noted of the
purpose.
Such receipts are however not available for expenditure in excess of the authorized in the
estimate for the work.
7-9-9 The annual certificate of balances: - The annual certificate of balances should be
prepared by the Divisional Officers and forwarded to the Resident audit Officer/
Accountant General through the Pay & Accounts Officer / APAO. The Pay & Accounts
Officer /APAO has to check the
86 PAO (WA) Manual
correctness of the statement before transmitting to the Resident Audit Officer / Account
General
The instructions for the check of this return are contained in paragraph 22 of the General
instruction (accounts) issued by the Financial Adviser and Chief Account Officer , NSP,
which is reproduced below:-
The Divisional Officer‟s Annual certificates of Balances should, on receipt, be examined

with reference to compiled accounts and other records in the Pay & Accounts Office. To
the extent these certificates are based on the initial records of the division, correctness
should be broadly verified during local audit. Any point which is indicative of any
deviation from the financial rule should be taken-up with the divisional officer or higher
authorities as the case may require. The certificate No.1 relating to manufacture, land,
kilns etc., storage and other subheads of stock, should be checked and the closing balance
reconciled with the stock accounts., Cases in which sanctioned limits of stock reserves of
balances of stock appear to be unusually high or in excess of the normal requirements of
the divisions concerned, should be scrutinized critically and reported to the Director of
Accounts. Certificate No.2 relating to workshop Suspense and Certificate No.3 relating to
other suspense accounts (Viz., “Purchases “, MPWA”) and deposits are necessary for
completing the scrutiny of the transactions relating to these heads., Theses certificates
should be reconciled with the compiled accounts. Certificate No.4 relating to works
accounts should be examined to see that they are complete in all respects, that the closing
balance of the accounts for “Contractors under “Advance payments”, and Other
transactions” agrees with the total of the balances as per” contractors “ledger and that the
certificate does not indicate any deviation from rules requiring special action. Large
fluctuations in the balances may form the subject of special enquiry.
In respect of the Regional “workshop Suspense Balances” in which the operation of

workshop Suspense ordered to be discontinued vide G.O.Ms.No.176, Fin. & Plg.
(FW.BG.II ) dt.01 .07.1996 and G.O.Ms.No.310, Fin & Plg. (FW.BG. II), dt. 01.07.1996
and G.O.Ms.No.310, Fin. & Plg. (Fw.BG.II) Dept., dt. 4.11.1996 the balances under the
new heads of account are to be furnished by the Divisional Officer and should be checked
by the PAO/APAO. In respect of Personal Deposit accounts
CHAPTER -7 87
the balances should be furnished by the Divisional Officer and should be checked by the
PAO/APAO.
Suspense Heads
7-10-1 The rules for the operation of suspense heads are contained in paragraphs 408 and 440 of
A.P.W.A. Code. The following suspense heads are operated.
i) Purchases.
ii) Miscellaneous Public works Advances.
iii) Stock.
iv) Workshop Suspense.
Purchases: -
7-10-2 The circumstances in which the cost of materials received should be credited to the
Suspense Head “Purchases” by per contra debit to work or stock are given in paragraph -
409 of A.P.W.A. Code. In the case of stores division in which the “New Stores
Procedure” is followed, it is permissible to credit the cost of materials received for stock
as also the freight charges to “Purchases” by per contra debit to “Stock” irrespective of
the fact whether payment is made or not in the same month (Rule 9 of New Stores
Procedure). Materials received by one division from another division of the Project need
not be routed through “Purchases” (F.A.‟s Circular FA Est. 57, 58/3, dated 31st January,
1958).
Resister of Purchases: -
7-10-3 The register should be maintained in two parts, viz., (1) Purchases for stock, (2)
purchases for specific works. Credits should be posted in the register of “Purchases” with
full details, when an O.T.E.O. or S.R.B. or abstract of stock receipts is adjusted. When
bills for materials received are passed for payment, the debits should be posted in the
register against the relevant credits. No debit should be posted in the register except
against a corresponding credit already posted in the register. For every debit entry
reference to bill number and date or T.E.O number should be given in the remarks
column. Totals should be struck separately for credits, debits, and closing balance at the
end of each month and carried over to an abstract in a separate section of the register and
grand total struck. The totals should be agreed with the compiled figures and after
recording the reconciliation certificate, the register should be laid
88 PAO (WA) Manual
before the Pay and Accounts Officer / Assistant Pay and Accounts Officer.
7-10-4 To facilitate action in the division for the adjustment of the outstanding balances, a
statement of items outstanding under the head “Purchases” for over six months should be
sent to the Divisional Officer in January and July each year in the form P.A.O. „23‟.
7-10-5 Immediately after the closing of accounts for the month of March, the outstanding items
should be carried over to the new registers and each item attested by the Superintendent.
The total of such items should be tallied with the figures in the Broadsheet. A year-wise
analysis of the outstanding items should also be exhibited separately in the abstract.
Miscellaneous Public Works Advance: - -
7-10-6 The circumstances in which the suspense head “Miscellaneous Public Works Advances”
should be operated are contained in Paragraphs 420, to 425 of A.P.W.A.Code.
Register of Miscellaneous Public Works Advances:
7-10-7 Separate folios should be set apart in the register for each class of charge mentioned in
Paragraph 419 of A.P.W.A. Code. The debits should be posted in this register with full
details from the bills passed for payment or T.E.Os or stock accounts adjusted when the
charges are debited to this head pending recovery or adjustment. The credits should be
posted against the relevant debits when the adjustment to the final head is made or
recovery effected. No credit should be posted in the register without a corresponding
debit already existing. For every credit entry, reference to bill number and date or T.E.
Number and month should be furnished in the remarks column against the item in the
register. At the end of each month, totals should be struck separately for the debits,
credits and closing balance and carried over to an abstract in a separate section of the
register and grand totals struck. The totals should be agreed with the compiled figures
and after recording the reconciliation certificate, the register should be laid before the Pay
7-10-8 Details of each payment made should be furnished to the Divisional Officer concerned in
form P.A.O. „24‟ as soon as a bill/ T.E. is paid/ adjusted by debit to “Miscellaneous
Public Works Advances” (Columns 8 to 10 will be filled in by the Divisional Officer). In
the months of January and July each year a list of items outstanding under the head for
CHAPTER-7 89
more than six months should be sent to the Divisional Officer to enable him to review the
balances and take action for their clearance.
7-10-9 Immediately after the closing of accounts for the month of March, the outstanding items
should be carried over to the new register and each items attested by the Superintendent.
The total of such items should be tallied with the figures in the Broad sheet. A year wise
analysis of the outstanding items should also be exhibited separately in the abstract.
Stock:
7-10-10 Rules for the operation of the suspense head “Stock” are embodied in paragraphs 414 to
418 (A) of A.P.W.A. Code and paragraph 324 of A.P.W.D. Code. The procedure for the
adjustment of stock transactions is described in the chapter on “Transfer Entries”. Debit
is given to stock when a bill, the value of which is directly debitable to stock, is paid or
when S.R.B. or abstract of stock receipts is adjusted and credit is given to the head when
S.I.B. or abstract of stock issues or T.E.O. is adjusted.
Adjustment of Stock receipts and issues statements
7-10-11 In respect of the stock transactions operated under the orthodox procedure of stores
accounting the provisions of Chapter VII of APWA Code will apply and in respect of
those operated under the SRB SIB system as modified by the simplified procedure
approved by the Government the provisions in the New Stores Procedure as simplified in
G.O.Ms.No.304, PWD (PW), dt.19.08.1966, G.O.Ms.No.124, PWD (PW) Dept.,
dt.09.05.74, and G.O.Ms.No.9, PWD (PE), Dt.07.01.1965, G.O.Ms.No.997, PWD,
dt.17.06.1967 in respect to NSP, SLM and SRSP respectively and other orders issued on
the subject from time to time will apply.
According to simplification of accounting procedure a revised procedure is ordered as

follows for divisions also, and other than those mentioned above.
a. “Bin Card” substitutes the Register of Stock receipts/Issues

b. “Goods Receipts sheet” substitutes the abstract of stock Receipts.
c. “The monthly summary of indents” substitute the abstract or stock issues
d. “Priced stores Ledgers” substitutes half yearly balance return of stock and half yearly
Register of stock.
(Govt.Memo.No.1369/Y/67, PWD, dt. 25.11.69 IS.No.21 to 35 of

90 PAO (WA) Manual
Annexure to APPX. 7 executive instructions of APWA Code.)
7-10-12. The stock receipts and Issues statements should be checked to see that rules laid down
in chapters VII, XI and Paras 414 to 418 -A of A.RP.WA Code, Paras 307 to 339 of
A.P.P.W.D Code and Rules in the “New Stores Procedure” as modified by the simplified
procedure approved by the Government have been Correctly followed.
Register of Stock:-
7-10-13 Register of debits to stock and Register of credits to stock should be maintained for
Posting debits and credits respectively Each Payment or adjustment as it arises Should be
posted in these registers under the relevant authorized sub - heads giving brief particulars
of the transactions and bill or T.E. Numbers. Totals should be struck at the end of each
month under each sub-head and carried over to the abstract page where total debits, total
credits and Closing balances under each sub-head as well as grand totals should be struck
month by month. The monthly total debits and credits Should be agreed with the
complied figures and registers laid before the Pay and Accounts Officer / Assistant Pay
and Accounts Officer duly recording reconciliation certificate The debit balance under
each sub - head of stock at the close of the year should be carried over to the abstract of
the new year‟s register and attested by the Superintendent The debit balance at the close
of the year Should not normally, except as provided in paragraph -415 of A.P.W.A. Code,
exceed the reserve stock limit. Any excess over reserve stock limit requires the sanction
of Government and should therefore be noted in the objection book Pending regularisj0
7-10-14 The monthly debits and credits under this head as well as the progressive balances to
end of month shall be intimated to the Divisions through the division-wise classified
abstracts.
(Government P.W.D (Projects Wing), Memo.No.175-E/66-3, dated 29th March, 1966)
Workshop Suspense:-
7-l0-15 Rules for the operation of the suspense head “Workshop Suspense” are embodied in
paragraphs 437 to 440 and Chapter XIII of A.P.W.A. Code and Workshop rules of the
Project. The procedure for the adjustment of workshop suspense schedules is described in
the chapter on “Transfer Entries”. Suspense estimates (viz., labour suspense, material
CHAPTER -7 91
suspense, foundry suspense, general charges suspense) are sanctioned yearly under this
head to accommodate the debits on account of the charges incurred in the workshop
pending adjustment to the concerned jobs through the workshop suspense schedules.
Debits to this head is given under these estimates when a bill /T.E.O is paid/adjusted and
credit is given through the adjustment of workshop suspense schedules. Separate works
abstract should be kept for each of the suspense estimates and debits and credits posted
separately. At the end of each month the debits and credits should be totalled separately
and posted in the abstract page of the Works Audit Register.
Register of Workshop Suspense:-
7-10-16 A Register of Workshop suspense (in the same form as suspense register) should be
maintained and separate folios set apart for each class of suspense estimates. The total
debits and credits during each month as worked out in the works abstract should be
posted in the register in the columns for concerned month and closing balances struck.
The total debits, credits and closing balances should be carried over to the abstract in a
separate section of the register, grand total struck and attested by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer after the certificate of reconciliation with the
compiled figures is recorded.
7-10-17 The outstanding balance at the close of the year should be transferred to “Miscellaneous
Public Works Advances” pending clearance or write off. Thus there should be no balance
under the head at the close of the year.
7-10-18 The monthly debits and credits under this head as well as the progressive balances to
end of the month shall be intimated to the Divisions through the division-wise classified
abstracts.
7-10-19. A new accounting procedure was introduced for taking up works by R.M. Workshops
vide G.O.Ms.No.176, Fin. & P1g. (FW.BG.II) dated 1.6.96 and amendment issued vide
G.O.Ms. No. 310 Fin. & Plg. (FW.BG.II) Department, dated 4.11 .96.
Paras 4(1) to 4(7) of the said Government orders are reproduced hereunder.
1. A new separate sub-head for each Regional Mechanical workshop opened under MH
2701. Major and Medium Irrigation - 80 General
92 PAO (WA) Manual
MH 001 Direction and Administration under Non-Plan to provide salaries and

establishment cost of each P.W. Workshop as detailed in Annexure -I enclosed to this
order.
2. The Chief Engineer, Mechanical shall send necessary proposal for making provision in
the Budget towards salary component and establishment cost of workshops with
supporting number statement under the above head of account.
3. Whenever a vehicle or any other fabrication work like gates etc., are to be take-up, the
workshop concerned shall prepare estimates giving breakup for material cost and over -
head establishment component separately and send it to the concerned requisitioning
office, and shall ask for advance payment towards material component.
4. The workshop will take-up the repair of vehicles or other works by purchasing items
lobe bought from outside market from out of imprest amount of Rs. 2.00 lakhs now
sanctioned for each workshop meeting the initial expenditure take up repair works. The
above amount of Rs. 2.00 lakhs now sanctioned for each workshop meeting the initial
expenditure take up repair works. The above amount of Rs. 2.00 lakhs is to be provided
under” 340 Other Charges - 342 other Expenditure” under the relevant- head of account
of workshop.
5. It has been decided to open a personal Deposit Account for each workshop under
Public Account to operate the funds advanced by requisitioning Department under the
following head of account.
“MH 8443 Civil Deposits -
MH 800 Other Deposits
SH (08) Regional Mechanical Workshop Deposits

(to be opened).”
a detailed head for each workshop is adopted under above head of account as detailed in
the revised Annexure - II enclosed to this order. The amount for Rs. 2.00 lakhs made
available to each workshop as mentioned in instruction (4) above for meeting initial
expenditure shall be adjusted to above Personal Deposit Account of each workshop.
The General Superintendent/Executive Engineer of workshops shall maintain a detailed

account for every deposit received and job work under taken by them.
CHAPTER -7 93
Any adverse or negative balances under workshop deposit account will be viewed
seriously and liable for penal and disciplinary action against concerned General
Superintendent / Executive Engineer.
The Chief Engineer, Mechanical shall undertake the review of the balances under
workshop deposit account from all workshops at least once in the three months and
intimate the balances to the Secretary to Government, Finance and Planning (FW: Budget
) Department.
The General Superintendent / Executive Engineers of the workshops shall reconcile the
balances under workshop deposit account every year with the records of the officer of
Accountant General, Andhra Pradesh, Hyderabad who will maintain a separate deposit
account for each workshop.
6. All Departments in need of service of the workshop for repair of vehicles shall make
advance payments to the workshops by drawing funds on A.C. Bill towards materials
component from their respective budget heads of account. After the completion of work
and receipt of final bill which will indicate over -head charges of the workshop separately
the final adjustment bill will be prepared.
7. The requisitioning department while preparing the final adjustment bill shall prepare and
credit the expenditure towards the material component to the P.O. Account component to
the P.O. Account of concerned workshop and over - head charges as credit to the head of
account 2701 Major and Medium Irrigation - 80 General - M.H 001 Direction and
Administration - SH (99) Deduct -Recoveries - Over head / Establishment charges of
workshops recoverable from user departments.
P.W. Deposits:-
7-11-1 The rules for the operation of this head are contained in chapter XIV of A.P.W.A. Code.
Register of P. W Deposits:-
7-11-2. Separate folios should be set apart in the register for each class of deposits enumerated in
Paragraph 453 of A.P.W.A. Code. The credit should be posted in the register (as and
when a Bank draft or cheque is received and adjusted or recovery is effected from a bill
and the recovery is creditable to deposits) indicating full particulars of the name of
remitter, name of work, estimate, agreement number etc., and reference
PAO (WA) Manual 94
to voucher number in the respective columns. The debits should be posted in the register
against the relevant credits, when a bill/T.E.O. is paid/adjusted giving reference to
bill/T.E.O. Number in the remarks column. No debit should be posted in the register
except against a corresponding credit already appearing in the register. Separate totals
should be struck for the credits, debits and closing balances at the end of each month in
respect of each class of deposits and carried over to the abstract page in a separate section
of the register where grand totals of credits, debits and closing balances should be struck
for the head as a whole. The register should then be laid before the Pay and Accounts
Officer/Assistant Pay and Accounts Officer after recording a certificate of reconciliation
with the compiled accounts.
7-11-3 A list of items under “P.W. Deposits” outstanding for more than one year should be sent
to the Divisional Officer in the months of January and July each year to enable him to
conduct a review of the items. Items outstanding at the close of the year should be
brought forward to the next year‟s register and each item attested by the Superintendent.
The total of the items outstanding as brought forward to the new register should be tallied
with broadsheet figures. A year-wise analysis of the outstanding items should also be
exhibited separately on the abstract page for ready reference.
Refund of PW Deposits:-
7-11-4 Claims for refund of the amounts credited to Public Works Deposits” are prepared on
Hand receipts when such refunds are made independently. When Hand Receipt for refund
of deposit is received, the original credit entry should be traced in the Cash Book /T.E.
Register and deposit register and the fact of refund noted against them and attested by the
Pay and Accounts Officer. It should be ensured that the permanent receipts issued by the
Pay and Accounts Officer /Assistant Pay and Accounts Officer in respect of the credit, is
enclosed to the hand Receipt. The permanent receipt should be destroyed by the Pay and
Accounts Officer /Assistant Pay and Accounts Officer personally. An entry of the refund
should also be made in the duplicate copy of the relevant permanent receipt (Paragraph
275 of A.P.W.A. Code).
7-11-5 i) a) In cases of refund of deposit realized in cash and credited in departmental cash
accounts, a certificate in the following form should be
CHAPTER -7 95
recorded on the refund voucher by the Divisional Officer.
Certificate: “Certified that the permanent receipt originally issued to the party has been
received and checked with the counterfoil and the original entry in the cash book and
Accounts, that a reference to the repayment has been noted in red ink across the
counterfoil and that a note has been made in the cash book against the entry of receipt.
The original receipt has been destroyed by me”.
b) 1. In cases of refund of deposits realized by recovery from a payment made on a bill or

other voucher and no separate receipts are issued for such recoveries (vide paragraph
146) of A.P.W.A. Code a certificate in the following form should be recorded on the
refund voucher by Divisional Officer.
Certified that the original entry in the Cash Book and accounts have been duly verified
and that a reference to the repayment has been noted in red ink across the original receipt
entry in the cash book and deposit register
2. When the original receipts are not produced due to loss etc., a repayment can be ordered
by the Divisional Officer only on execution of an indemnity bond by the payee on
stamped paper.
3. In regard to deposits remitted into Treasuries directly by the parties and adjusted in the
departmental accounts through schedules for which no receipts are issued a certificate in
the following form should be recorded by the Divisional officer.
Certificate:
Certified that the original entry in the deposit Register and the original entry in the
transfer entry book have been duly verified and that a reference to the repayment has
been noted in red ink across the original receipt entry in the deposit Register and original
entry in the Transfer entry book. -
“Certified that the indemnity bond on stamped paper executed by the party in lieu of the
original permanent receipt has been enclosed to the Hand Receipt.”
7-11-6 The Earnest Money Deposited by Contractors along with the tender and further security
deposited by them at the time of entering into agreement has to be refunded, at the
instance of the executive by Pay &
96 PAO (WA) Manual
Accounts Officer / APAO, after the
i) Payment of final bill and
ii) Period of observation, responsibility is over on the basis of certificate to the effect that no
defects are observed during the observation period and that to observed if any, have been
made good.
Lapse and confiscated P. W. Deposits:-
7-11-7 Deposit outstanding for more than the prescribed period should lapse to Government in
accordance with the instructions contained in Paragraphs 463 and 464 of A.P.W.A. Code.
For this purpose, the Divisional Officers prepare the list of items outstanding under
deposits which can be treated as having become due for lapse from the lists of items
outstanding under “Deposits” for more than one year sent to them by the Pay and
Accounts Officer/Assistant Pay and Accounts Officer in January and July every year
according to the instructions contained in item (4) of the Annexure to the Government
Memo.No.175-E2/66-3, PWD (PW) Department, dated 29-3-1966 and furnish the same
to the Pay and Accounts Officer/Assistant Pay and Accounts Officer in April of every
year. On receipt of this list from the Divisional Officers, the items should be shown as
lapsed to Government by debit to “P.W. Deposits” and credit to the relevant Major Head
of receipts.
7-11-8 The schedule of lapsed P.W. Deposits should be preserved carefully division-wise in
separate guard files and in the personal custody of the Superintendent and handed over
separately to the successor at the time of handing over charge.
Refund of lapsed deposits:-
7-11-9 PW Deposits credited to Government under Para 463 of A.P.W.A. Code or confiscated
under provisions of an agreement or bond may be refunded without authorization from
the Accountant General. Before effecting the refund, the Pay and Accounts Officer /
Assistant Pay and Accounts Officer should ensure (i) that the item was recovered and
traceable in the Divisional records and in the records of Pay and Accounts Office, (ii) that
the amount was credited to Government as lapsed or confiscated deposit and it was not
paid previously and (iii) that the claimant‟s identify and title to the money are certified by
the Divisional Officer. The amount repaid should be treated as a refund of receipt under
the Major Head of Account to which it was credited, and the
CHAPTER -7 97
repayment should be noted in the deposit register and other records against the entry for
its credit to Government vide Para 276 of A.P.W.A. Code.
(Ref: G.O.Ms.No.228, TR & B (CI) Dept., dt. 28-6-1982).
Receipts and Recoveries on capital Accounts:-
7-11-10 All Receipts and recoveries on capital account in so far as they represent recoveries of
expenditure previously debited to the capital major head should be taken as reduction of
expenditure under the capital major head. For purposes of accounting, they should be
treated as revenue receipts in the first instance and booked as receipts and recovers on
Capital account. At the end of the month, they should be deducted from the account of
the major head in lumpsum.
(Para 3 of statement „E‟ in appx 4 to APWA code)
Register of Receipts and Recoveries on Capital Account
7-11-11 All receipts and recoveries on capital account should be classified and abstracted in the
Register of Receipts and recoveries on Capital Account, maintained in the Pay &
Accounts Office and each entry attested by the Superintendent. In this register a column
should be opened for each detailed head of receipt of recovery other than “Deduct..
refunds for which a single deduction should be made from the total revenue receipts of
the month, the details of the charges making up the figure to be deducted being recorded
in a separate section of the register. At the end of each month, monthly as well as
progressive totals during the year should be struck under each detailed head and at tested
by the PAO /APAO after recording a certificate of reconciliation with the compiled
accounts in respect of the total receipts credited to the head during the month. The
monthly figures shall be intimated to the division through the Division wise classified
abstract.
Note:
A new detailed head of account “ receipts on account of electricity charges : should be

opened under “deduct receipts and Recoveries on Capital Account” to accommodate
recoveries on account of sale of electric power to officials etc., (G.O.Ms.No.257,
PWD(W) Dt. 11-07-1966)
The recoveries towards current consumption charges should be credited to the

maintenance estimate of the Revenue Head of the account if the
98 PAO (WA) Manual
expenditure towards current consumption charges was paid to APSEB by debit to the
maintenance estimate under revenue account.
Stores
7-12-l All purchase orders received in the section should be entered in a separate purport
resister. Each purchase order after scrutiny should be submitted to the Pay & Accounts
Officer/ Assistant Pay & Accounts Officer for acceptance.
Note: Extension of time for supplies etc. should be granted by the officer who accepted the
tender (not lower in the rank than that of an Executive Engineer). (FA.s Endt. No.FA.
Genl 58-2594, dt. 22nd December, 1958)
7-12-2 Reports of losses received from the departmental officers, (in accordance with the
instruction and contained Chapter - XII of A.P.F.C Vol. I) should be entered in the
Register of defalcation losses and their write-off- recovery watched. Sanction to write off
losses when received should be noted in column 9 of the register. The register should be
closed every month with an abstract, showing the opening balance, cases registered and
cleared during the month and the closing balance, and sent to the I.T.C. Section for
review.
7-12-3 The sanctions should be scrutinized to see that (i) there is no defect in system or in rules
the amendment of which requires the orders of a higher authority and (2) there is serious
on negligence the part of any individual officer or officers which might possibly call for
disciplinary action requiring the orders of a higher authority. In cases of substantial
importance where the action taken by the authority who has sanctioned the write off is
considered inadequate, the matter should be referred to the next higher authority.
Payments in Respect of supplies through DGS & D
7-12-4 Bills in respect of supplies effected to the Direct Demanding Officers on “Director
General of Supplies and Disposals” rate contracts are initially paid by the Pay &
Accounts Officers, Ministry of Works, Housing and Supply and reimbursement are
subsequently claimed by them from this office through weekly accounts.
These reimbursements fall under the following three categories
7-12-5 (1) 98 Percent advance payments:
These advance payments are made on the bills presented by the Firms/
CHAPTER -7 99
Contractors supported by Invoices for the goods supplied. Reference is given to the
number and date of Railway Receipt. Payments so made are treated as advance payments.
(2) Connected balance 2 percent payments:-
These payments are made after the Firms /Contractors produce Inspection Certificates
from the representative of the Director of Inspection and the Receipt Certificate from the
consignees. The latter certificates indicate the acknowledgements of the consignees for
the stock received.
(3) 100 per cent full payments:
These are generally made where consignees‟ receipt certificates are presented with the
bills. In certain special cases 100 per cent advance payment is also made in respect of
certain materials. In such cases payment is made on proof of despatch. The Receipt
certificates of the consignees should be obtained and filed in this office in such cases.
7-12-6 Reimbursements to the Pay & Accounts Officers / Ministry of works, Housing and
Supply should be made after exercising “A-Check” and seeing that debit is chargeable to
the offices under the payment control of the PAO Organization. As reimbursements are to
be made within, a week from the date of receipt of the claim from the Pay & Accounts
Officers, Minister of Works, Housing and supply (vide Para- 10 (a) ii) of the collection of
letters issued by the Comptroller and Auditor General of India in connection with
separation of Accounts from audit part . II) and as detailed verification is not possible
before making payment, payment should be made by debiting the suspense head
Miscellaneous Public works Advances “of the concerned division. In the case of balance
10 % payments, the payments may be charged direct to the works concerned if the receipt
of the materials could be readily traced into the concerned measurement Books/
SRB/GRS Copies of the vouchers received should then be forwarded to the Executive
Engineers concerned who have received the stores for processing TEOs to clear the debit
under the suspense head Miscellaneous public works advances” The TEOs received from
them should be incorporated in the accounts on hand after scrutiny and the fact of
adjustment should be noted in the SRB/GRS/Measurement Book.
(Financial adviser‟s Orders on court Note. No. 8, dt. 21.5.1963)

100 PAO (WA) Manual
Railways Credit Notes
7-12-7 The claims with Railways are settled in cash through weekly account received from
Railway Accounts Officers. The weekly accounts are supported by the Railway Credit
Notes which are issued by the Offices under the payment control of the PAOs/APAOs in
flew of cash at the time of taking delivery of the goods.
7-12-8 The Railway Credit Notes are prepared in triplicate. The original is issued to the station
master of the Station from where the goods are taken delivery of for sending the same to
the Accounts Officer who in turn sends them to the Pay & Accounts Officer / APAO with
weekly accounts for reimbursement The duplicate copy of the credit note is sent to the
Divisional officer of the concerned Division. This duplicate copy will be sent by the
Divisional Officer, to whom it was sent to the Pay & Accounts Officer /APAO after
indicating the head of account for the expenditure. Normally the duplicate credit notes
issued during a week should be sent to the Pay & Accounts Officer /APAO and Accounts
Officer during the next week with a list of credit notes. While indicating the classification
reference to the SRB/GRS number or the stock receipt item number should be furnished
when the debit is to purchase or stock respectively; Estimate number and name of the
work should be furnished incase the expenditure is debitable to work. The triplicate copy
of the credit note is retained in the Division.
7-12-9 All the credit note bills received from the Railways in the co-ordination section
PAO/APAO should be entered in a separate register. They should then be scrutinized to
see whether all of them relate to the offices under the payment control of the
PAOs/APAOs such of those not relating should be immediately returned to the railways
giving reference to their letter number and bill concerned and a note to this affect made in
the remarks column of the register.
7-12-10. The credit notes should be sorted Division-wise. A statement in triplicate of the credit
notes (Divisions-wise) should be prepared and the commission charges debitable to each
division should be entered as the last item of the statement
7-12-11. Two copies of the division wise statement together with the credit notes should be sent
to Pay & Accounts Officer/APAO concerned after entering them in a transit register in
respect of bills received in Directors of Accounts Office.
CHAPTER -7 101
7-12-12. The clerk concerned in the pre-check section on receipt of these statements should enter
them in the bills register giving reference to the serial number in the transit Register of
credit notes as a denominator of the number in the Bill Register. The transit Register
should be returned expeditiously. The railway credit notes should be checked with the list
of credit notes already received from the division. The payment is made by debit to the
head of account indicated in the list of credit notes. In case the list is not received from
the division by the time the account is received, the payment should be made by debit to
MPWA since such bills should be paid within three days of their receipt. Demurrage
charges if any, included in the credit notes should also be charged to MPWA pending
clarification by the division regarding the need for incurring the demurrage charges. In
order to ensure that railway credit notes are issued only in respect of materials which are
in due course brought on the register of stock or the SRB/GRS as the case may be 2% of
the credit notes should be linked with the relevant SRBIGRS or stock register item as
noted in the list of credit notes.
7-12-13. One copy of the statement together with the cheque should be returned to the Co-
ordination section for transmission to railway authorities. The register of bills relating to
railway credit notes closed every week (on Monday) should be put up to the Director of
Accounts, pointing out all cases in which the credit notes are not returned within three
days. In respect of bills received by the PAO/APAO direct from Railways, payments may
be arranged by the concerned PAO/APAO and send cheques within 3 days of their
receipt. In respect of bills received by the PAO/APAO, direct from Railways payments
may be arranged by the concerned PAO/APAO and send cheques within 3 days of their
receipt.
Imprest and Office Expenses
7-13-1 Imprests are granted to the Project Officers/Other Officers as per Paragraph 5 (ii) of the
Accounting and Financial Instructions part -1 reproduced and Para 168 of A.P.W.A.
Code respectively to meet i) petty and ii) emergent claims. The imprests are recouped by
the Pay and Accounts Officers / Assistant Pay and Accounts Officers after cent percent
pre - check of the imprest vouchers.
It follows that sub-divisional and Divisional officers will no longer have

102 PAO (WA) Manual
a drawing account. The divisional officer will however be given imprest. The amount of
the permanent imprest will be calculated at the rate of Rs. 1000/- for the Divisional
officer and Rs. 500/- for each sub divisional officer. From out of this imprest, Divisional
offices may give sub imprests to the sub-divisional officers of an amount each and
section officer not exceeding Rs.100/- each.
7-13-2 One register should be maintained for each division / Office to indicate the total amount
of imprest opened with each Officer and subsequent recoupments from time to time. The
register should be posted every time when an imprest is opened, recouped or when the
imprest is enhanced or reduced. The register should be closed every month duly
recording a certificate under the dated initials of the Pay and Accounts Officer / Assistant
Pay and Accounts Officer to the effect that the amount of imprest outstanding at the end
of a month against each officer as shown in the register agrees with that shown in the
cash book.
7-13-3 On or after 31st March every year, an acknowledgement should be obtained from each
imprest holder in respect of each item of imprest shown in the cash book of the Pay and
Accounts Office as outstanding against such officer (paragraph 572 of A.P.W.A. Code).
Register of Office Expenses
7-13-4 Details of expenditure chargeable under the detailed head of account 050. Office
expenses should be recorded in the register maintained in respect of each divisions/office
duly classified under the relevant sub- detailed heads viz. 1) Service Postage, Telephone
and Telegram charges ii) Water and Electricity Charges iii) Purchase of Motor Vehicles
etc. iv) Other office expenses and v)Maintenance Motor Vehicles etc. and authorized sub
detailed heads. At the end of each month, the totals for the months and upto date totals
should be struck in respect of each sub-detailed head and total charges. The totals should
then be reconciled with the compiled figures and closings attested by the Pay and
Accounts Officer/Assistant Pay and Accounts Officer.
Some special instructions and orders relating to work:-
(1) Work done by the Department on behalf of contractors recovery of centage charges.
7-14-1 The percentage rates for Establishment and Tools and Plant prescribed in Appendix - 7 to
APWA Code have to be regarded as representing the
CHAPTER -7 103
indirect cost; i.e., over head charges to Government whenever a work is undertaken by it.
This amount must, therefore, be recovered from the contractors of the execution of work
if not contemplated in the contract. On the other hand, if the execution of such work by
Government on behalf of contractor is provided in the contract, the contract condition
would apply (A.Gs.Circular.No.WMI/A/15-209/61-62/29, dated 14-6-1962).
Claims for Workmen’s Compensation:
7-14-2 The authority competent to deal with compensation for cases involved in accidents is the
Executive Engineer who is the authority under A.P.D.S.S. to operate the agreement in
question. The Chief Engineer is the authority to sanction the compensation. In cases of
doubts as to the procedure or question of compensation or the liability of Government for
payment, the Commissioner for workmen‟s compensation should be consulted, (Item 23
of the record of discussions of Projects Working Committee held on dates 3-11-1958 and
12-11-1958).
The sanction of Chief Engineer is not necessary for payment of compensation to

Workmen employed by contractors in the cases where the contractor accepts the liability
and gives his willingness in writing for the recovery of compensation amount from the
amount due to him (Govt. P.W.D. (Projects Department) Memo.No.5733-E/59- 10, dated
12th November, 1960).
7-14-3 Calculation of Supervision Charges and Sales Tax on the issue of Materials not
contemplated in the Agreement- In cases where the issue of materials is not required for
bonafide use on works, the cost of the materials to be recovered is assessed at either -
(i) Issue rate plus storage charges plus supervision charges @ 10%
OR
(ii) Market rate, whichever is higher.
Sales tax will have to levied on the cost of the materials which represents higher of the
two amounts calculated as per item (i) and (ii) above.
(D.A.Gs. (Projects) Letter No. NSP /Coor /GL /9-2/638, dated 2nd September, 1964).
a) A Schedule of quantities of important materials like steel and cement etc., required for
execution in accordance with the requisite specification
104 PAO (WA) Manual
is appended to the conditions of the contract, for which recovery will be effected. If these
materials drawn according to schedule are short used, the excess quantity so drawn
should be returned to the Department in good condition and no payment will be made to
the Contractor there for. If they are not so returned to the Department their cost will be
recovered at the market rate prevailing at the time of supply or the issue rate whichever is
greater plus storage charges, plus supervision charges at 10%, plus sales tax is leviable.
If materials are either short drawn or short used (through drawn according to schedule)
the savings due to short drawal, use should be secured to Government by recovering the
cost thereof at issue rate from the Contractor. In the case of materials short use, though
drawn according to schedule, this recovery will be in addition to the recovery to be made
for the cost of materials not returned as stipulated above.
(b) If materials are drawn in excess of the theoretical requirements indicated in the appended
schedule, the excess quantity should be returned to the Department in good condition. If
they are not so returned to the Department, their cost will be recovered at issue rate plus
100% surcharge or market rate whichever is higher plus storage and Sales Tax if leviable.
(1. G.O.Ms.No. 2152, PW (Y) Dept. dt 30-12-70.
2. Govt. Memo. No. 481-Y/71-6, dated 24-3-1972).
Construction of Compound Walls to Government Buildings Sanction of Government:
7-14-4 The Provisions of Article 185 (b) of APFC Vol-I will apply equally to the construction of
compound walls or fencing around workshops, stores yard, etc., (Govt. Finance
(Accounts) Dept. U.O.Note No. 91715/2653/ Accounts/63-11, dated 4th Jan. 1966).
Note:- The Chief Engineers are empowered to sanction estimates for providing barbed wire
fencing for Stores Sheds/Workshops and Camp colonies etc., upto Rs. 1.00 lakh per
annum in relaxation of Article - 185 (b) of A.P.F.C. Volume - I.
Ref:- 1. G.O.Ms.No. 244, MPD, dt.3-6-1977.
2. G.O.Ms.No. 489, MPD, dt. 23-11-1977.

CHAPTER -7 105
7-14-5 Revised tender procedure
The revised tender procedure has been ordered in G.O.Ms.No.132, TR&B, dt.11.08.1998
(vide annexure). Relevant portions are however reproduced below.
If after the second tender call, the offers received are more than 20% the entrustment of
work will be done on nomination basis. For works upto one Crore, a committee
consisting of the Collector of the District in which the work is located and the
Superintending Engineer concerned with the work and two SES of two other works
Departments namely Panchayat Raj, Roads & Buildings and Irrigation will award the
work on nomination. For works costing above on crore, a Committee consisting of the
Chief Engineer concerned, the commissioner of tenders, a Chief Engineer or Engineer -in
Chief of another Departments with reputation for his integrity (serving or retired), the
Secretary of the concerned Department and the Finance secretary will give the works on
nomination. The Committees are empowered to give the works on selection basis upto
20% in excess of estimated rate in the case of works belonging to Irrigation & CAD
Department and Transport, Roads & Building Department. In the case of elevated service
reservoirs of MA&UD Department the ceiling of 20% may be exceeded, if it becomes
necessary in specific cases, considering that there is no response to these works in general
in the state. Necessary amendments to the provisions in the code shall be issued
separately. The committee can split the works into slices to give on nomination, if
considered necessary.
For giving works on Selection lists of contractors with good track record will be
prepared. In preparing these lists the volume of works done by them, the quality of works
done by them the infrastructure possessed by them and also works on hand and their
capability will also be considered. The list of contractors should be prepared and
published in advance regularly i.e., once in 6 months. From these lists contractors will be
called for negotiations in groups of 5 in rotation. The contractor offering to do the work
at the lowest rate will be given the work. Time allowed for selection by the Committee
will be 5 days.
5) The total value of works grounded in any year including works given through tenders or
through nominations shall not exceed the budget provided to each division.
PAO (WA) Manual 106
e) How to deal with Cases where the tender filed is less than the estimated cost.
Tenders upto 15% less than the estimate may be accepted but for tenders less than 15% of
the estimate a bank guarantee or demand Draft for the difference between the tendered
amount and 85% of the estimate value should be taken so that if the tenderer leaves the
works midway and the Department is forced to call for tenders for the work once again,
the bank guarantee or Demand Draft shall be used to finance the re-tendered work.
Maximum ceiling
The maximum permissible tender excess is reduced from 20% to 15% over the estimated
contract value in partial modification of G.O.Ms. No. 132 dt. 11.8.1998 and in case the
excess is more than 15 % the tenders shall be summarily rejected, At the same time, the
tenders received with the maximum permissible percentage excess are not necessarily to
be accepted, they may be accepted basing on the trend of tenders accepted either in the
project or in near vicinity for similar works. In case the trend of tender available relates to
considerable time gap, the accepted premium of the tenders be updated with reference to
the present price index and with justifiable reasons only the tenders shall be accepted
b) Discount Tenders (Percentage less than Estimated Cost)
The tenders received are found to have abnormally high percentage or within the
permissible ceiling limits prescribed but under collusion or due to unethical practices
adopted at the time of tendering process, shall be rejected.
When such situation arises that even for second‟ tender call, the reasonable percentage in
fair and free environment is not received, the works will be entrusted on selection basis
from out of the lists of contractors who are possessing the eligibility criteria as specified
in the tender document with proven track record prepared as per the procedure laid down
in the Annexure-II will be selected in turns of 5 contractors at each time and will be
asked to file their price bids at a specified place and time before the competent
committees to entrust work. The committee assessing the reasonableness of excess
percentage quoted will recommend to award the work to the lowest of all the contractors
participated. The
CHAPTER -7 107
contractor to whom the work is entrusted on selection basis will be provided necessary
security and protection if requested at his cost.
Committees to Entrust works on selection basis
For the purpose of above selection and entrustment of works to contractors the
composition of the committees at District and State level and powers delegated to them
are as under:
a) For the works costing upto Rs. 1 crore, a committee consisting of the Collector of the
District in which work is located, the SE concerned with the work and two SEs of two
other works Departments viz., Panchayat Raj, R&B and the Irrigation will recommend to
the competent authority to award the work.
b) For the works costing above Rs. 1 crore, the committee consisting of the C.O.T. and the
C.E. concerned and Engineer-in-Chief (Irrigation) will recommend and award the works
on the selection basis.
Committees to resolve Inter -Departmental Problems
In order to expedite execution of works and to remove any difficulty that contractors may
face in obtaining clearances and other infrastructure facilities from various departments
such as shifting of power lines, procurement of blasting materials, power supply
connection etc., at the District level, the Collector will formulate Committees and take
necessary steps. The Chief Secretary will have periodical review with the concerned
Secretaries and Chief Engineers in order to resolve the difficulties which could not be
sorted out at District‟ level. The Heads of the Departments are directed to constitute
suitable committees at different levels for speedy settlement of the different kinds of or
levels of disputes of technical nature by the C.Es concerned.
g) To improve the work culture and speed up the execution works, the Government issues
the following orders:
i) The powers of technical sanction are enhanced to Rs. 10 lakhs in respect of an Executive
Engineer and Rs. 50 lakhs in respect of a Superintending Engineer and these Engineers
are given the powers to approve the tender -notices, tender -schedule and finalize the
tenders at their level for the works for which they are technically empowered to sanction.
In Para 2.02 of annexure to the G.O.Ms.No.23, IFC A.P (PW Co), dt.5.3.99 the powers
for according technical sanction are detailed here under.
108 PAO (WA) Manual
Technical Sanction:
a) Not withstanding anything contained in the relevant codal provisions, APSS and
Government orders with regard to the procedure of according the technical sanction,
enhanced powers are delegated to the field officers as follows:
EEs upto : Rs.l0 lakhs

S.Es upto : Rs.50 lakhs
C.Es upto : Value of the administrative approval.
2. Tenders shall be received in 2 parts in 2 different sealed covers. The first cover shall
contain the qualification data viz., annual turnover and value of works under execution.
The second cover will contain the financial bid for the work in question. All engineers
opening tenders shall first open the first sealed cover containing the qualification data and
see whether the tenderer is qualified by using the formula;
AN - B>
Estimate value, where A is annual turnover on all civil contracts of the tender, N is period
of completion for the work for which tender is submitted and B is the value of works
under execution by the tenderer. The second cover containing the financial bid will be
opened only of those tenderers who are qualified according to this formula. The financial
bids of the tenderers who are not qualified shall not be opened and they shall be kept in
the sealed covers only.
Qualification Criteria
A. To qualify for award of the Contract, each bidder in its name should have, during the last
five years (specified financial years i.e. they should be immediately preceding the
financial year in which tenders are invited)
a) Satisfactorily completed (not less than 90 percent of Contract value) as a prime contractor
similar works of value not less than Rs. /- @ (usually not less than 50% of estimated
value of contract) in any one year.
b) Executed in any one year, the following minimum qualities of works:
-Cement concrete including RCC and PSC Cu.M.

-Earth work in both excavation and Embankment Cu.M.
- (relevant principal items be indicated
CHAPTER -7 109
(usually 50 percent of the expected peak quantities of construction per year)
B. Each Bidder should further demonstrate:
a) Availability (either owned or leased or to be procured against mobilization advances) of

the key and critical equipment for this work.
Note: (Based on the studies carried out by the Engineer, the minimum suggested major
equipment to obtain the completion of works in accordance with the prescribed
construction schedule /mile stones are shown in the above list)
b) Availability of the Key personnel with adequate experience as required should be

indicated based on the requirement for the work to be executed
c) Liquid assets /credit facilities of not less than Rs. lakhs (credit lines / letter of credit/
solvency certifications Banks etc. shall be equivalent of the estimated cash flow for three
months in peak construction period)
d) EMD in the shape of Bank Guarantee in the standard format enclosed, for Rs. ... (one per
cent of the estimated contract value) to be valid for the period as indicated at Para 1.03
(d) i.e., period of completion plus defect liability period.
e) Experience relating to the works executed in State/Central Government departments or

State / Central Government undertakings shall only be considered.
3.02.3 Bid Capacity
The sub Contractors‟/GPA holder‟s experience shall be taken into account in determining
the bidders compliances with the qualifying criteria. The tenderers who meet the
requirement qualification criteria will be qualified only if their available bid capacity is
more than the estimated contract value. The available bid capacity will be calculated as
under:
Assessed Available Bid Capacity : AxNx2-B

where
A= Maximum Value of civil engineering works executed in any one year during the last
five years (updated ....* price level) taking into account the completed as well as works in
progress.
N= Number of years prescribed for completion of the works for which

110 PAO (WA) Manual
tenders are invited.
B= Value of existing commitment and ongoing works to be completed during the period
of completion of works for which tenders are invited.
Note:- The statement showing the value of existing commitments and ongoing works to be
completed during the period of completion of works for which tenders are invited.
Note:- The statement showing the value of existing commitment and ongoing works as well as
the stipulated period of completion remaining for each of the works listed should be
issued by the Engineer-in-Charge government department I undertaking not below the
rank of Executive Engineer or equivalent and countersigned by the rank of SE or
equivalent. The statement to the above effect will be clearly enclosed to the Bidding
Document and the tenderer shall furnish the particulars invariably in the same format
failing which the tender shall be treated as incomplete and summarily rejected.
@= at……. * price level. Financial turnover and cost of completed works of previous
years shall be given weightage of 10% per year to bring them to …… price level*
The financial year in which bids are invited.
Even though the tenderer meets the above qualification criteria, he/ she is subject to be
disqualified if he /she is found to have misled or made false representation in the forms,
statements submitted in proof of the qualification requirements or record of poor
performance such as abandoning works not properly completed in the contract, inordinate
delays in completions, litigation history and or financial failures and for participated in
the previous tendering for the same works and had quoted unreasonably high bid prices.
In addition to the above, even while execution of the work, if found that the Contractor
had produced false / fake certificates of experience, he /she will be blacklisted and work
will be taken over invoking clause 60(a) of PS to APSS.
Tenders shall be valid for a period of 1/2/3 months as the case may be. Before the expiry
of the validity, the authority competent to call for tenders shall seek for further extension
of validity from the contractors and in case the validity is not extended his /her tender
will not be considered and the EMD shall be returned. During the period of validity if any
CHAPTER -7 111
tenderer withdraws his tender, his/her EMD shall be forfeited.
ANNEXURE -11
Annexure to G.O.Ms.No.23, Irr & CAD (PW Cod) Dept., dt. 5th March, 1999.
1. Government there by order to introduce an improved system f periodic monitoring and

evaluation of the performance and capabilities of contractors. The contractors who have
already registered with the competent authorities for the corresponding classes will
continue to have the registration valid till period indicated therein. I) lower their class of
registration is subject of evaluation of the performance as per the evaluation format
appended, based on which they shall be down grated or upgraded as per the credits
obtained in the evaluation.
2. The evaluation will be done based on the following criteria.
i) Technical Qualification
ii) Standing in Civil contract field relating to the specialization for which the contractor
submits the particulars either for registration or renewal or up gradation.
iii) Records of execution of works.
iv) Plant and machinery available with the contractor.
v) Financial status.
vi) Training in National Academy of Construction (NAC)
vii) Membership of BAI or any other professional bodies.
Viii) History of litigation.
The basis for the above criteria and procedure to furnish the details required there for are
discussed below
3. Basis for Evaluation Criteria
i) Technical Qualification: - role of technical agents in execution of civil Engineering

works is of quite significance more particularly in L.S. contracts. Keeping this in view
this criterion is introduced and the credits are indicated for self -qualification of the
contractor and qualification and experience of the employed Engineers by the contractors.
In addition suitable credits are also assigned for the man power possessed by the
contractor who are trained in N.A.C.
112 PAO (WA) Manual
Standing in Civil contract Field:-
The experience of the contractor in the civil contract field is considered as one of the
important criterion in as the experience contractor will have greater expose to the
working environment, procedure of execution of public works and also have quality
consciousness. Considering the above aspects the total length of experience as well as the
experience in execution of Civil Engineering works a contractor may possess experience
in certain specialized fields such as Irrigation works, R& B works, water supply and
sanitary works etc. In case a contractor files an „application for either registration or
renewal or up gradation in a particular field of specialization, his record of execution of
works should be assessed. Therefore in this criteria, credits have been assigned for
executing similar nature of works during the last 5 years from the year in which he files
application so as to evaluate his upto date knowledge of the work culture since the last
five years because the contractor‟s registration is valid for a period of 5 years. Similarly
credits are also assigned for having completed the similar nature of works within the
agreement period unless and otherwise it is extend for the reasons beyond the control of
the contractor. However if a contractor completes the works ahead of the agreement
period additional weight will be given by the suitable methodology indicated therein.
iv) Plant and machinery:-
It is expedient that a contractor should possess necessary plant and machinery of his
performance is evaluated, in order to assess his capability of executing the works within
the stipulated period. Hence suitable credits have been assigned to this criterion, however
the required plant and machinery will be indicated for the different works by the
concerned engineers, who evaluate the performance.
v) Financial Status:-
Since the Government have been implementing the Works in various public works
Department with huge outlays, it is necessary to assess the financial capability of a
contractor to commence the work and continue the work at least for a minimum period of
3 months without waiting of the bills to be paid by the concerned authorities. The
criterion has therefore been given importance and suitable credits are assigned for
different components viz. annual average turnover, availability of liquidated
CHAPTER -7 113
assets such as solvency / over draft facility and other credit lines etc.
Contractors trained in NAC :-
In case the contractor himself is trained in the National Academy of Construction it is

expected that he will be able to possess better skills in execution of works as well as
contract management, hence suitable credits are assigned to this criterion
Membership in Bai and Any other Professional Bodies:-
This criterion would reveal that the contractor, various items have been identified under
this criterion which are assigned suitable credits for each of them. The sum total of
credits under this criterion will be subtracted from the total credits achieved by a
contractor for all the above seven criteria. It is imperative to mention that in case the
concealment or misleading /false information is furnished, the contractor shall face very
severe action such as black listing or debarring from the contraction field.
The contractor shall submit an affidavit to the effect that the history of litigation
furnished by him is true and incase it is detected at any stage he will abide by the action
taken by the government without approaching to any Court whatsoever for redressal.
Before taking action against the contractor the engineers will, after through probe and
enquiry will give suitable opportunity to the contractor for offering his explanation and
then initiate action against him.
PROCEDURE TO FURNISH THE PARTICULARS FOR EACH OF THE ABOVE

EVALUATION CRITERIA.
The contractors shall furnish the information for each of the criterion (from i to vii)
mentioned above following the formats supplied to them by the concerned engineers who
evaluate their performance, however the formats will broadly contain the particulars to be
furnished as stated below:
i. With regard to qualification, the copies of certificate issued by the

University/College/polytechnic or any other competent authority shall be submitted.
ii. The copies of registration right from the inception, to date shall be furnished.
iii. With regard to execution of works during the last 5 years the contractor
114 PAO (WA) Manual
shall produce the copies of experience certificates issued by the competent authority not
below the rank of Executive Engineer and counter-signed by the Superintending Engineer
or equivalent indicating description of work, done of agreement, value/Revised
agreement value date of commencement, Agreed date of completion, actual date of
completion, total value of work done, reasons for delay if any, the physical quantities
executed each financial year etc.
iv The copies of relevant document in proof of possessing the equipment shall be produced.
v The audited balance sheet, income tax returns for the past 5 years shall be submitted
along with solvency, overdraft facility etc., in proof of the credit facility available to him.
vi The copies of certificate issued by the competent authority of NAC.
vii Copies of Membership of Builders Association or any professional body.
NOTE: The copies of all the certificates documents shall invariably be attested by a serving
Executive Engineer of any works department of Govt. of Andhra Pradesh. For
incorrectness of the copies of certificates/documents when compared with the originals,
action will be taken against EE who attested the copies and the Contractor.
EVALUATION PROCEDURE
TECHNICAL QUALIFICATION 10
a) contractor‟s qualification
BE ……… 3
b) Employed Engineers
i) B.E. with 4 years experience... 2 each

ii) Diploma with 4 years experience 1.5 each
c) Trained Manpower from NAC
Maximum of 10 credits
2 STANDING IN CIVIL CONTRACT FIELD 15
a) Experience from the lowest class upto the year of present class. Registration (for each
year 1 credit) subject to a maximum of 5
b) Experience in the present class from the year of registration to the present class to the
year of Evaluation (for each year 4 credits) subject to a maximum of 15
CHAPTER-7 115
3. RECORD OF EXECUTION OF WORKS 25

(during preceding five years)
a) Similar Nature of works as prime contractor for each Rs. 2.00 cr. (2) credit and additional
Rs. 1 Crore in that year will fetch (1) credit. Cumulative of all for 5 years
b) Works completed within agreement period-each work of Rs. 1 cr. will be given (1) credit
maximum of 25 credits
4. PLANTS AND MACHINERY

Requiring to the work of specialization 10.
FINANCIAL STATUS 25
Annual average-turn over during the preceding five years
a) For each Rs. 1 crore 2
b) For every additional Rs. 1 crore. 1

Subject to a maximum of 25 credits.
6. CONTRACTOR TRAINED IN NAC(CDI) 10
8. HISTORY OF LITIGATION (-) 35

during proceeding five years
a) Arbitration/lost 2
b) Court cases/stayed 10
c) determined work 10
d) Taken over under CI. 61 PS to APPS 13
4.0 evaluation of tenders
4.01 receipt of tenders:
The tender schedules shall be issued upto one day prior to the last day of submission of
Tenders. The tenders shall be received at the place and time as specified in the Tender
Notice. The contractor shall be allowed to submit the tender either personally or through
his agent or by post. In case of submission of tender by post the risk and responsibility for
either loss or delays in transit of the same is to be borne by the contractor. The tender
opening authority will not consider any tender received by him after the expiry of date
and time fixed for receipt of tenders.
4.01.1 Tenders will be received in two parts in 2 different sealed covers. Cover- A and Cover-B.
The Cover-‟A‟ shall contain the qualification data Viz.,
116 PAO (WA) Manual
Annual Turnover and value of works under execution etc., as at Para 3.02. The Cover „B‟
will contain the financial bid for the work in question. The Cover 'A‟ and Cover ‟B‟ will
be sealed and kept in another sealed envelope (Cover „C‟) supplied by the department
while issuing Tender Schedules.
4.01.2 The LBS and SES delegated with the power to invite the tenders will open and evaluate
the tenders as per the qualification criteria. While opening the tenders care should be
taken to first open Cover-C in the presence of the tenders or their authorized
representatives and other officials concerned on the specified date and time and also to
verify whether the Cover-A and Cover-B are properly sealed and minutes be recorded to
this effect then and there only. In case the Covers A&B or any one of them are
found/unsealed, such tenders will not be opened and summarily rejected.
4.01.3 First Cover (cover-A) with superscription as “TECHNICAL BID” which shall contain
the qualification data as described at Para 3.02 will be opened.
4.01.4. Second cover (cover-b) with the superscription of “price bid” shall contain the Schedule-
A i.e., the statement of description of work, quantity, estimate rate and amount. Price bid
(cover-b) of those tenderers who are determined as qualified as per eligibility criteria will
be opened on the date specified in the tender notice and the Cover-B of unqualified
tenderers will not be opened and kept in the safe custody till the tenders are finalized and
there after shall be returned to them along with E.M.D. The Schedule-A of price bid shall
contain the working items indicated as Part-I and LS provisions as Part-II. The premium
or discount quoted by the Contractor shall be applicable only for Part-I. However, the
provisions contained in the Part-II will be operable basing on the conditions provided in
the tender Schedules. The tenderers will have to state clearly their willingness to execute
the work at the percentage excess or less or at par over the ECV indicated at Part-I at the
space provided there in.
4.01.5 Before recommending/accepting the tender, the tender accepting authority shall verify the
correctness of certificates submitted to meet the eligibility criteria and specifically for
experience, the authenticated agreements of previous works executed by the lowest
tenderer, shall be called for.
/
CHAPTER -7 117
The EMD will be returned to the qualified but unsuccessful tenderer either after
finalization of tenders or expiry of validity of tenders whichever is earlier. -
4. 02. Finalization tenders
2.1 Tenders will be finalized by the EEs/SEs for the works costing upto their powers to accord
technical sanctions.
02.3 The Chief Engineer shall finalize the tenders for the works costing upto Rs. 1 crore. The
tenders for the works costing more than Rs. 1 crore will be referred to COT along with
Technical Bid evaluation and Price Bid evaluation for consideration. The COT shall
scrutinizes the tenders sub-mined by Engineer-in-chief/Chief Engineers/ Project
Administrations in accordance with the conditions stipulated in the Tender document and
in case of any discrepancy or non-adherence to the conditions, the same shall be
communicated which will be binding both on the tender concluding authority and the
contractor. In case of any ambiguity, the decision taken by the COT on tenders shall be
final.
02.3. Negotiations are not permitted to be conducted at any level.
02.4. The time allowed from the date of publication of tender notices to the date of receipt of
tenders is 14 days for the first call and 7 days for the second call. The tenders will be
received following three box system i.e., at SE‟s office, of the SP of the District where
the SE‟s office is located and one in the office of the ENC or by post to the SE
concerned.
7. MEMBER OF BAI AND OTHER PROFESSIONAL BODIES 5
8. HISTORY OF LITIGATION (-) 35

during preceeding five years
a) Arbitration/lost 2
b) Court cases/stayed 10
c) determined work 10
d) Taken over under CI. 61 PS to APPS 13
4.0 evaluation of tenders
4.01 receipt of tenders:
The tender schedules shall be issued upto one day prior to the last day of submission of
Tenders. The tenders shall be received at the place and time as specified in the Tender
Notice. The contractor shall be allowed
118 PAO (WA) Manual
to submit the tender either personally or through his agent or by post. In case of
submission of tender by post the risk and responsibility for either loss or delays in transit
of the same is to be borne by the contractor. The tender opening authority will not
consider any tender received by him after the expiry of date and time fixed for receipt of
tenders.
4.01.1 Tenders will be received in two parts in 2 different sealed covers. Cover- A and Cover-B.
The Cover-‟A‟ shall contain the qualification data Viz., Annual „Turnover and value of
works under execution etc., The Cover „B‟ will contain the financial bid for the work in
question. The Cover 'A' and Cover 'B' will be sealed and kept in another sealed envelope
(Cover „C‟) supplied by the department while issuing Tender Schedules.
4.01.2 The EES and SES delegated with the power to invite the tenders will open and evaluate
the tenders as per the qualification criteria. While opening the tenders care should be
taken to first open Cover-C in the presence of the tenders or their authorized
representatives and other officials concerned on the specified date and time aid also to
verify whether the Cover-A and Cover-B are properly sealed and minutes be recorded to
this effect then and there only. In case the Covers A&B or any one of them are
found/unsealed, such tenders will not be opened and summarily rejected.
4.01.3 First Cover (cover-A) with superscription as “TECHNICAL BID” which shall contain
the qualification data will be opened.
4.01.4. Second cover (cover-B) wit1 the superscription of “price bid” shall contain the Schedule-
A i.e., the statement of description of work, quantity, estimate rate and amount. Price bid
(cover-b) of those tenderers who are determined as qualified as per eligibility criteria will
be opened on the date specified in the tender notice and the Cover-B of unqualified
tenderers will not be opened and kept in the safe custody till the tenders are finalized and
there after shall be returned to them along with E.M.D. The Schedule-A of price bid shall
contain the working items indicated as Part-I and LS provisions as Part-II. The premium
or discount quoted by the Contractor shall be applicable only for Part-I. However, the
provisions contained in the Part-II will be operable basing on the conditions provided in
the tender Schedules. The tenderers will have to state clearly their willingness to execute
the work at the percentage excess or less or at par over the ECV indicated at Part-I at the
space provided there in.
CHAPTER-7 119
01.5 Before recommending/accepting the tender, the tender accepting authority shall verify the
correctness of certificates submitted to meet the eligibility criteria and specifically for
experience, the authenticated agreements of previous works executed by the lowest
tenderer, shall be called for.
The EMD will be returned to the qualified but unsuccessful tenderer either after
finalization of tenders or expiry of validity of tenders whichever is earlier.
4.02. Finalization of tenders
2.1 Tenders will be finalized by the EES/SES for the works costing upto their powers to
accord technical sanctions.
02.3 The Chief Engineer shall finalize the tenders for the works costing upto Rs. 1 crore. The
tenders for the works costing more than Rs. 1 crore will be referred to COT along with
Technical Bid evaluation and Price Bid evaluation for consideration. The COT shall
scrutinizes the tenders submitted by Engineer-in-chief/Chief Engineers/Project
Administrations in accordance with the conditions stipulated in the Tender document and
in case of any discrepancy or non-adherence to the conditions , the same shall be
communicated which will be binding both on the tender concluding authority and the
contractor. In case of any ambiguity, the decision taken by the COT on tenders shall be
final.
02.3. Negotiations are not permitted to be conducted at any level.
02.4. The time allowed from the date of publication of tender notices to the date of receipt of
tenders is 14 days for the first call and 7 days for the second call. The tenders will be
received following three box system i.e., at SE‟s office, of the SP of the District where
the SE‟s office is located and one in the office of the ENC or by post to the SE
concerned.
3) For the works upto Rs. 50 lakhs the tender notice shall be published in District editions of
two telugu dailies with the largest circulation. For works costing more than Rs. 50 lakhs,
the tender notices will be published in one Telugu daily and one English daily having
largest circulation at the State level. To reduce the cost of each publication, the format for
the tender notice in the newspaper shall be finalized by the
120 PAO (WA) Manual
Board of Chief Engineers so that the cost of the advertisement is kept to the minimum.
5) The tender schedules should contain not only the quantities but also the rates worked out
by the Department and the amount for each item and the total value of the contract. The
tenderer will not be required to quote item wise. He should indicate his willingness to do
the work either at the estimated value of the work or at a percentage in excess of the
estimated value of the work or at a percentage less than the estimated value of the work.
The work order should be issued to the successful tenderer on same day or next day of
opening of tenders subject to fulfillment of conditions prescribed. Once the work order is
issued to the successful tenderer, EMD of all the remaining contractors should be
refunded within 2 days by Regd. Post Acknowledgment due.
8) Payments or execution of quantities, in excess of agreement quantities, should be made

without delay and the EEs should take prompt action to obtain the approvals of the
competent authority to make the payment to the contractors. Failure in this regard shall
result in disciplinary action being taken against the concerned engineers. Similarly,
finally payments to contractors should not be delayed for want of a certificate form the
Quality Control staff. The Chief Engineers should ensure proper performance of the
Quality control wing and see that they give the certificates in time on pain of disciplinary
action to avoid delays in the payment of final bills to the contractors.
9) The site order book shall be maintained as provided for in the Codes and it should contain
the remarks and instructions of all engineers who visit the work viz., the EE, SE, CE and
ENC.
7-14-6 The Government have constituted, with the following personnel two stores purchase
Committees viz, (i) at Superintendent tending Engineer‟s level and ii) at Chief Engineers
level to deal with the purchase stores and Machinery spares Separately for each of the
construction and Mechanical Divisions.
CHAPTER -7 121
In respect of Construction Divisions In respect of Mechanical Divisions

(G.O.Ms.No.86, I&P (PW) Dept., dt.2-4-80, (G.O.Ms.No.450, Irrigation (PW) Dept., dt.12-11-
G.O.Ms.No.172, I&P (PW) Dept., dt.18-5-1982) 1982)
1 2
I. Superintending Engineers level, I. Superintending Engineers level,
Stores Purchase Committee for Stores Purchase Committee for
Construction Divisions. Mechanical Divisions.
(i) Local Superintending Engineer Chairman (i) Local Superintending Engineer Chairman
(to be specified by the Chief (to be specified by the Chief
Engineer concerned) Engineer (Mechanical))
(ii) Executive Engineer (to be Member (ii) Executive Engineer (to be Member
nominated by the Chief nominated by the Chief
Engineer concerned) Engineer (Mechanical))
(iii) Pay and Accounts Officer / Member (iii) Pay and Accounts Officer / Member
Assistant Pay & Accounts Assistant Pay & Accounts
Officer concerned Officer concerned
(iv) Executive Engineer (Stores) Member (iv) Executive Engineer (Stores) Member
concerned who makes the Convenor concerned who makes the Convenor
Purchases. Purchases.
(v) Nominee of the Commissioner Member (v) Nominee of the Commissioner Member
of Industries. of Industries.
(vi) Nominee of the A.P. Small Member (vi) Nominee of the A.P. Small Member
Scale Industrial Development Scale Industrial Development
Corporation Corporation
122 PAO (WA) Manual
Notes:- (1) the presence of either of the nominee of the A.P. Small Scale Industrial
Development Corporation or the nominee or the Commissioner of Industries is essential
for the approval of the purchases unless either of them have given clearance in writing.
(2) The agenda papers including the items proposed for approval by the Stores Purchase
Committee shall be made available to all Members ten days in advance of the date fixed
for the meeting to the Committee.
II. Chief Engineer‟s level Stores II. Chief Engineer‟s level Stores
Purchase Committee for Purchase Committee for
Construction Divisions Mechanical Divisions
1 2
(i) Chief Engineer Concerned. Chairman (i) Chief Engineer (Mechanical) Chairman
(ii) Superintending Engineer Member (ii) Superintending Engineer Member

(Nominated by the Chief (Nominated by the Chief
Engineer) Engineer (Mechanical))
(iii) Director of Accounts Member (iii) Director of Accounts Member

concerned. concerned.
(iv) Executive Engineer (Stores) Member (iv) Executive Engineer (Stores) Member
concerned who makes the Convenor concerned who makes the Convenor
Purchases. Purchases.
(v) Nominee of the Commissioner Member (v) Nominee of the Commissioner Member
of Industries. of Industries.
(vi) Nominee of the A.P. Small Member (vi) Nominee of the A.P. Small Member
Scale Industrial Development Scale Industrial Development
Corporation Corporation
CHAPTER-7 123
Notes:-(1) the presence of either of the nominee of the A.P. Small Scale Industrial Development
Corporation or the nominee of the Commissioner of Industries is essential for the
approval of the purchases unless either of them have given clearance in writing.
2) The agenda papers including the items proposed for approval by the Stores Purchase
Committee shall be made available to all Members ten days in advance of the date fixed
for the meeting to the Committee.
iii) The Departmental Officers will exercise the powers delegated in G.O.Ms. No. 86, Irrgn.
and Power (PW) Department, dated 2-4-1980 in respect of Construction Divisions and
will adopt the procedure prescribed in the following paragraphs.
(A) Stores covered by rate contract with D.G.S. and D. to purchase outside rate contract at
rate contract rates:-
Category
Notes:-(1) In regard to the monetary limits prescribed for Executive Engineers which pertain to
the value of job concerned, the Executive Engineers should not split the jobs with a view
to avoid reference to the Stores Purchase Committee and to bring the purchases within
their (Executive Engineers) powers. There should be only one job over a machine, at any
given time.
(2) The exercise of the powers delegated above is subject to the following conditions.
(i) Necessary budget provision exists in the budget in the respective financial year.
(ii) Necessary letter of Credit is available.
(iii) Provision exists in the respective sub - head under the reserve stock limit sanctioned by
the Government. The delegation of powers made under this order will not automatically
empower the Field Officers to exceed the limit of sanctioned Reserve Stock or the Budget
Provision.
(iv) The Executive other than Executive Engineers in charge of Stores Divisions are only
indenting Officers and can exercise powers specially delegated to them;
(v) When a machine breaks down it require only repairs of minor nature and
124 PAO (WA) Manual
the machine can be brought to working condition within 3 to 5 days after repairs if the
spares required are purchased. Such cases will fall under the category of emergency
referred to in Para (C) below. Purchases for machines which have been standing idle due
to repairs or any other reasons cannot be treated as cases of emergency; and
(vi) Emergency purchases of spares should be resorted to only for the specific purpose
mentioned above and spares should not be procured under emergency procedure for
anticipated break downs or stand-byes or for stock.
(C) Bidding procedure for items outside Rate Contract:
(i) Limited Tender System:-

Whether the spares stores
are required for Stock or Upto Rs. 25,000-
repairs directly charged on works.
(ii) Open Tender system above Rs. 25,000/- and less than Rs. 1 Lakh :-
By Publication in the Tender Digest‟ and by displaying the tender notices on Notice
Boards, and also, if considered necessary at the discretion of the purchasing Officers by
communication the tender notices directly to the leading manufacturers whether the
spares/Stores are required for stock or repairs directly charged to works.
(ii) Open Tender System :- Exceeding Rs. 1.00 lakh
By publication in the “Tender Digest” and by displaying the tender notices on Notice
Boards and also if considered necessary at the discretion of the Purchasing Officers by
communicating the tender notices directly to the leading manufacturers.
(iv) Purchase of Stores covered by Rate Contract:
Requirements of spares and other consumable should be planned in advance and

indents/supply orders should be placed on D.G.S & D. for supply of spares and other
stores materials required and the supplies obtained from the firms who are on Rate
Contract with D.G.S. & D. Purchases outside Rate Contract should be resorted to, only in
cases of real emergency and where spares/Stores are required for use on sick machinery
against specific jobs and the spares/Stores are not available with Stores Division.
CHAPTER -7 125
(v) Purchase of Stores not covered by Rate Contract:
For spares and other items of Stores which are not covered by Rate Contract either the
manufacturers or their authorized distributors should be contacted to supply the same on
their price list prices less discount admissible to Government Departments.
In case of emergency, tenders should be called for from reputed firms duly observing the
provisions under Article 125 of A.P.F.C. Vol.1. Even in these cases formal tender
enquiry should invariable be sent to the manufacturers and/or their authorized distributors
to have an idea about the rates of items intended to be purchases. All calls for tenders
should be sent by Registered Post to the firms concerned;
(vi) Review of Supplies for regulating purchases and withdrawal of powers of Officers in
case of injudicious purchases:
(a) the Executive Engineer, Stores should review the position of supplies from time to time.
If supplies on rate contract are received during the period between such reviews to meet
the requirements, emergency purchases should be stopped. If there has been a delay in
supplies not conducive to progress of works, emergency purchases may be restored to,
and the existing purchase orders on D.G.S. & D. may be reduced to the extent considered
necessary.
(b) The Stores Purchase Committee at Superintending Engineers level should scrutinize
periodically (say once in 3 months) all purchases of the Executive Engineers under the
control of the Superintending Engineers and report injudicious purchases if any, to the
Chief Eng meet. The Chief Engineer is vested with the authority to withdraw the powers
of the particular Executive Engineer concerned with the injudicious purchases, either for
a limited period or for an indefinite period. Similarly all purchases of the Superintending
Engineers should be scrutinized by the Stores purchase Committee at Chief Engineer‟s
level periodically (say once in 6 months). The Chief Engineer Mechanical is vested with
the authority to withdraw the powers of the particular Superintending Engineer concerned
with the injudicious purchases for a limited period or for an indefinite period.
(D) Terms of Payment:-
payments should ordinarily be made after receipt and acceptance of

126 PAO (WA) Manual
materials. In exceptional cases advance payment upto 100% of the cost may be made
subject to the following conditions:
(i) The terms of payment should have been mentioned clearly in the tender/quotation of the
firm concerned and should have been accepted by Stores Purchase Committee or other
authority competent to accept the tender /quotations.
(ii) Commitments on advance payments can be accepted only in the case of reputed firms. A
list of such firms should have been already approved by Chief Engineer, Mechanical.
(iii) Advance payment should ordinarily be against Railway Receipt through Bank. In
exceptional cases advance payment can be made on proforma invoice subject to the
condition that the representative of the Division delivers the cheque and takes delivery of
spares simultaneously. In the case of outstation firms, necessary Bank Guarantee should
be obtained before payment is made for the full cost being paid, in order to safe - guard
the interests of Government, and
(iv) In exceptional cases where the outstation firms insist upon 100% advance payment on
proforma invoice and do not agree to furnish Bank Guarantee, specific approval of the
Chief Engineer should be obtained before authorizing such advance payments.
(E) System of Accounting:
All emergency Purchases made by the Executive Engineer, Field Machinery Division for
specific jobs should be debited directly to the annual maintenance estimates of the
particular machine for which they have been purchased. In case of purchases by W & M
Division the cost of spares should be debited to the respective job estimates prepared in
the workshop for the purpose of carrying out repairs to a particular machine under
workshop suspense. Purchases costing more than Rs.5,000/- should not be charged either
direct to the job estimate or annual maintenance estimate of the machinery.
All other purchases made by the officers of other than Field Machinery Divisions and
Workshop and Machinery Divisions should invariably be routed through Stores Accounts
of Stores Division.
1. G.O.Ms.No.86, I&P (PW) Dept., dt. 2-4-1980.

2. G.O.Ms.No.172, I&P (PW) Dept. dt. 18-5-1982.
CHAPTER -7 127
3. G.O.Ms.No.450, I&P (PW) Dept., dt. 12-11-1982.
(7) Maintenance of Accounts of empty Cement Bags:-
7-14-7 When the work is executed departmentally the departmental Officers will have to
maintain and render numerical account for the empty cement bags.
7-14-8 Contractors Rates of Earnest Money, Security Deposits and Retention from Bills in
respect of Lumpsum and K2 contracts:-
i) The Contractors may be permitted to deposit a lumpsum amount of Rs.3.00 lakh with the
Chief Engineers concerned under whom they wish to tender for works and execute
necessary bonds in the form prescribed. The deposit of Rs. 3.00 lakh is necessary in the
case of each Chief Engineer‟s Organization to which the work may relate.
ii) The deposits etc. for works in the projects should be fixed as indicated below;
a) When standing security Deposit of Rs. 3.00 lakhs lodged with the Chief Engineer
concerned.
i) Earnest money Deposit 1% subject to a (LS. and K2 maximum of Rs. 75,000 Contracts).
Retention form bills value of work Rate of retention Money

i) For work done upto first 3½%
Rs. 50.00 lakhs
ii) For works done over a) First Rs.50.00 lakhs 3 and ½ %
Rs.50.00 lakh upto one Crore. b) Over Rs.50.00 lakhs 2%
iii) For works done over a) First Rs.50.00 lakhs 3 and ½ %
Rs.One Crore b) Over Rs.50.00 lakhs 2%
c) Over One Crore 1 and ½ %
b) When standing security deposit of Rs. 3, 00, 000 not lodged with the Chief Engineer
concerned Earnest Money Deposit:
(Both L.S. and K2 Contracts). 1 and ½ % subject to a max. of Rs. 1 lakhs.
Retention amount from bills
1) LS.Contract : 7 and ½ %
2) K2 Contract : 3 and ½ % till the value of work done is

128 PAO (WA) Manual
66 and 2/3 % times of value of earnest Money

Deposit on 5% thereafter.
Note:
1) Bank Guarantee should be obtained for the amount equal to the difference between the
amounts of security deposit at old rates and new rates to safeguard the interest of
Government against defective work.
2) Bank Guarantee can be accepted towards security deposit and in case of EMD in excess
of Rs.10,000/-.
iii) Earnest Money deposit and retention from bill should be at the rates specified in (ii)(b)
above even if the works are entrusted on nomination or on work order form.
iv) An amount of 2 ½ % of the value of work should be retained towards deposit from all the
final bills on lumpsum contracts irrespective of the fact whether or not standing lumpsum
deposit of Rs.3.00 lakhs exists.
((1). G.O.Ms.No.491, PWD, dt.14.05.1973, (2) G.O.Ms.No.306, TR&B, dt.14.10.71, (3)

G.O.Ms.No.179, I&CAD, dt.27.09.97)
v) The above clause in so far as it relates to retention of 7 ½ % security from the running
account bills is concerned will not apply to contracts entered into for designing,
manufacture, supply, erection, testing etc., (Mechanical contracts) where special
conditions are incorporated providing or retention of 10% of the contract value for twelve
months after the payment upto 90% on erection and testing.
(Ref: (1) G.O.Ms.No.416, TR&B (CI) Dept., dt.27.2.80, (2) Govt.Memo.No.662-

C1/9/81-1, TR&B (CI) Dept., dt.25.05.81, (3) G.O.Ms.No.179, I&CAD, dt.27.09.97)
vi) Steps to be taken to ensure that ultimately tender excess is not more than the prescribed
limit with a view to prevent collusion or the formation into a ring by contractors, the
following orders are issued:-
1) Tender schedules shall be issued till a date prior to the last date of submission of tenders.
2) Once a contractor buys a tender schedule, he shall not be permitted to return the schedule.
After buying a tender schedule, if a contractor does not tender for the work, his EMD
shall be forfeited (cash of bank guarantor both).
CHAPTER -7 129
If the EMD paid at the time of purchasing the tender -schedules is less because of the
contractor having a LSD. Concession then in forfeiting the EMD, the balance should be
forfeited from the LSD and the remaining amount of LSD refunded to the contractor so
that he can make a fresh deposit of LSD.
vii) If a contractor buys tender schedule, he shall not be permitted to return the schedule.
After buying a tender schedule if a contractor does not - tender for the work his EMD
shall be forfeited. If the EMD paid at the time of purchasing the tender schedule is less
because of the contractor having a LSD concession then in forfeiting the EMD the
balance shall be forfeited from the LSD of the remaining amount should be refunded to
the contractor so that he can make a fresh deposit of LSD.
(G.O.Ms.No.134, TR&B (RI) Dept., dt.11.08.98 Para d(2)
Vii) In Go.Ms.No.23, I&CAD (PW) Dept., dt. 5.3.99 which was made applicable only for the
tenders invited after issue of the GO. The payment of EMD has been modified vide
invited per modified vide 3.01-10 and 11 detailed here under
3.01.10 Earnest Money deposit:
In order to maintain the anonymity, Tender schedules will be supplied on payment of a

cost to any contractor of eligible class interested in bidding, without insisting for EMD.
This is introduced to enable prevention /reduction of extraneous forces interfering or
pressurizing the contactors to quote or under quote or not to quote at all in the tenders.
Hence the practice of collecting EMD in the shape of demand draft at the rate of 1 ½
percent subject to maximum of Rs. 1.00 lakhs or Rs. 75,000/ from the contractors who
have lump sum deposit with the concerned Chief Engineers will be dispensed with and in
lieu thereof Bank guarantee or DD obtained in favour of the officer as specified in the
tender, at the rate of 1% of the Estimate contract value will be collected without any
concession. The balance EMD will be collected at the present rates while concluding the
agreement and the Bank Guarantee will be unconditional and irrevocable as per the
standard format enclosed to the tender document The contractors who have L.S. Deposit
with concerned Chief Engineer will be permitted to take back their deposits, subject to
conditions that they are free from all liabilities.
Applicability of Qualification Criteria & EMD etc.,

130 PAO (WA) Manual
The qualification criteria at para.3.02 as well as modified procedure of collecting EMD in

the shape of Bank Guarantee will not be made applicable for the works costing Rs. 10
lakhs (ECV) and below, for above works single cover system shall be followed and the
EMD shall be submitted along with the completed Tender Schedule
7-14-9 Works let out on Nomination –Collection of Earned Money Deposit from the
Contractors:
1) The chief Engineer may collect Earned Money Deposit etc., in the case of works
entrusted on nomination according to the rates prescribed in G.O. Ms. No. 491, PWD,
dt.14.05.75.
i) In exceptional cases where Earned Money deposit is not collected in advance for reasons
to be recorded in writing, deductions may be made from each bill at the following rates
which are equal to the total of the rates of Earnest Money Deposit on retention from bills,
prescribed in G.O.Ms.No.491, PWD, dt.14.05.1975.
a) When L.S, Deposit of Rs. 3.00 Lakhs percentage deduction is made for L.S, and K2
contracts from bills 4 ½ %
b) When L.S. Deposit Rs.3.00 lakhs is not made LS contact: 10%
K2 contracts : 5 %
The existing orders regarding the collection of Earned Money Deposit, etc., from the
Labor Cooperative Societies, Job Workers, and unemployed and retrenched engineers
should continue to be followed:
iii) The EMD should be collected in respect of nomination contacts but where this was not
done i.e., where 2 ½ % is not collected in advances, deductions must be made from each
bill at 5%.
These orders do not apply to job works, for Rs. 500/- and less and for works entrusted to
special agencies execution like labour contact co-operative societies etc.,
1) G.O. Ms. No. 491, PWD, dt.14.05.1973.

2) G.O.Ms. No. 306, TR & B (Cl ) Dept., dt.14.10.81
3) G.O.Ms. No. 1398, PW (Y0 Dept., dt.07.10.1979.
7-14-10 All steel materials shall be procured from M/s. A.P.Steel Ltd. by making advance
payments. Any variation in cost of steel compared to other producers should be brought
to the notice of the Government. G.O.Ms.No.402, I & CAD, dt. 26.06.87
CHAPTER-7 131
The Chief Engineers should see that proper undertaking in this regard is obtained as per
note (3) under Sub-para (5) of para 306 of A.P.P.W. “A” code before advance payments
are made to these firms.
(I.G.O.Ms. No. 46, I&P (PW) dept., dt.6.2.81)
2. Memo. No. 358 -M&M (1) /81-2, dt. 09.04.1981)
The pay & Accounts Officer/APAO should maintain a single register for his office for
watch in the receipt of steel in respect of advance payments made to suppliers in the form
No. PAO. 66. Columns 1 to 7 should be filled up at the time of advance payments and
columns 8 to 10 after receipt of materials and of report regarding receipt of material from
the executive Engineer.
At the time of making advance payments the Pay & Accounts Officer /APAO may
address the concerned Executive Engineers for sending special reports immediately on
receipt of the material with details, description, quantity and value together with
particulars of GRS/SRB Number and date of M.B. No. and Page in which the receipt of
material is recorded. The Executive Engineer should maintain similar register for the
advance payments made in respect of his Division and send reports immediately on
receipt of material. If no report is received within (15) days, the Executive Engineer
should be reminded till the particulars of receipt of material are received.
(G.O.Ms. No. 53. I&P(PW) Dept.. dt. 14.03.1980)
7-14-11 Contractor-Withdrawal of Tenders before the closing date by Contractors-Time Table

for Acceptance of Tenders :-
(i) The time limit within which a tender should he decided may be incorporated in the tender
notice itself and this period may be according to the following time table within which a
tender should be finalised.
(a) One month for acceptance of lenders by Executive Engineers i.e., upto Rs. 1,00,000.
(b) Two months for acceptance of tenders by Superintending Engineer.
(c) Three months for acceptance of tenders which are beyond the powers of Superintending
Engineer.
(ii) For the purpose of the time-table, the date on which the tender-accepting
132 PAO (WA) Manual
authority communicates to a tenderer that his tender is under consideration and requires
him to appear at the office for discussion and comply with the formalities is the date for
time limit and failure to do so and consequent loss to Government, would render the
officer concerned liable to recovery of the resulting loss.
(G.O.Ms.No.1790, P.W.D., dt.17-8-1964 and Govt.Memo.No.2602, D/64-2, P.W.D.

(Projects wing) dt. 10-11-1964.
7-14-12 Contracts-Harijan Co-operative Societies and Labour Co-Operative Societies

Concessions :-
a) A deposit of 1% only should be obtained as Earnest Money Deposit from the Labour
Contact Co-operative Societies and Harijan Co-Operative Societies.
b) The labour Co-Operative Societies and Harijan Co-operative Societies should be

entrusted with unskilled work on nomination in preference to others.
c) Though the Executive Engineers are empowered to dispense with tenders upto Rs. 10,000
in general, the labour Co-operative Societies and Harijan Co-operative Societies should
be given preference in regard to nomination without calling for tenders.
d) Where the Executive Engineer deems it advisable to grant a work to any society above
Rs. 10,000 he may refer it to the Superintending Engineer and with his approval entrust
the work to the Society.
e) The Departmental Officers are permitted to let out the second work when the previous
work is completed by 75 % in favour of the Labour Contact Cooperative Societies and
Harijan Co-operative Societies.
(G.O.Ms.No.505, PW and T dt.27.02.1956, i.e. items (a) to (c) above till orders are issued
are modifying or altering them. (Govt.Memo.No.1980, D/61-8, Projects Department,
dt.18.12.1961)
Entrustments :-
Painting of work should be separated from the main estimate and also from Tenders and
entrusted to local cottage industrial paint manufacturers-cum-contracts subject to the
conditions.
1) Separate tenders should be called for to enable all the cottage industries of paint
manufacturers to take works.
CHAPTER -7 133
2) The quality of paint should be got checked
3) A special condition should be inserted in the agreements while awarding works that
paints should be to purchased only from local manufacturers. (G.O.Ms.No.432, P(IR-II-
2) dept., dt. 14.10.1980)
Government direct that painting work is to be entrusted to small scale industrial units
registered under small scale industries along with the cottage industries subject to the
above conditions.
(G.O.Ms.No. 464, Irrgn. (IR.II) Dept. , dt. 12.12.85)
Entrustment of works to unemployed Engineers

Unemployed engineers and retrenched engineers may be awarded works on nomination
as detailed below:
Works costing Rs. 25,000/- by Executive Engineer
Works Costing Rs. 50,000/- by Superintending Engineer,
Works Costing Rs. 1,00,000/- Chief Engineer
Conditions
a) Preference shall be shown to them over others in the matter of awarding contracts, other
things being equal.
ii) No EMD need be collected
iii) Retention money equivalent to 1 ½ % shall be retained from the bills in case of both K2
and L.S.Contracts.
iv) These concessions have been extended to partnership firms comprising solely
unemployed or retrenched Engineers for works costing upto to Rs. 5.00 lakhs.
v) These concessions should not be allowed to those who have already availed themselves
of the Concessions over a period of three years from the date of first availment.
vi) The total number of works to be awarded in a year should be limited to Rs. 2.00 lakhs in
value.
vii) They should neither sublet the contracts nor give power of attorney.
viii) If it is noticed that the works entrusted are executed by others, the unemployed Engineers
and retrenched Engineers shall be deleted from the list and debarred from taking up
works under State Government for a period of three years.
(ix) the above concessions will not apply to professional Contractors who
134 PAO (WA) Manual
are already in the field prior to the introduction of scheme i.e. 07.10.69.
(G.O.Ms.RT. 770, TR&B (BII) Dept., of 27.09.95 upto 2-98)
The following rules are framed vide G.O.Ms.No. 398, I & CAD (PW) Dept., dt. 05.09.90.
1. The members of the labour contract or Harijan and Girijan Co-operative Societies may be
treated as Class-III contractors. They shall be registered as Class-III contractors.
2. No solvency certificated need be insisted upon for the purpose of Registration.
3. Exemption from collecting EMD upto Rs. 2.00 lakhs in the case of individual and Rs.
10.00 lakhs in the case of societies may be allowed. This provision is amended raising the
EMD exemption limit to Rs. 20 lakhs in respect of both societies consisting of S.Cs. S.Ts.
and wadders and individuals of these communities.
(G.O.Ms.No. 275, I&CAD, dt. 26.09.94)
4. Works may be let out to societies on nomination upto a limit of Rs.25,000/- by E.Es. upto
a limit of Rs. 50,000/- by S.Es and up to a limit of Rs. 5.00 lakhs in the case of
individuals/societies by Chief Engineer. The power of CE to entrust works on nomination
to individuals is restricted to Rs. 2.00 lakhs only.
(G.O.Ms.No. 275, I & CAD dt. 26.09.94)
5. At least 15% of the works may be reserved for entrustment to the individuals or societies
of weaker sections, i.e. members belonging schedule Castes, Schedules Tribes and
Waddars.
6. The identification of the individuals, formation of societies etc., will be taken care of by
the Cooperative Department with the active guidance of the District Collectors.
7. The departmental officers will have discretionary powers to consider allotment of skilled
works also whenever possible.
8. These concessions are also applicable to Cooperative Societies of Schedules Castes,

Schedules Tribes and individuals belonging to SC/ST who happen to be unemployed or
retrenched engineers.
9. No second work should be given unless sufficient progress is shown in the first work and
no third is given unless first work is completed and sufficient progress is shown on
second work.
10. The concession holders are forbidden from subletting or giving power of attorney and
stipulation to that effect is to be made in the agreement. If such instances occur, they will
be debarred for 3 years. The professional
CHAPTER -7 135
contractors who got the work from the above concession holders shall have their names
deleted from approved list of contactors.
Entrustment of Works to Bharath Sevak Samaj:-
7-14-13 It was felt that while the current schedule of rates would be the standard, there was
scope for negotiation with the Bharath Sevak Samaj for bringing their rates to the level of
the average tendered rates for neighboring stretches, if the latter were lower. It was also
felt that in the matter of provision of water supply, sanitation and medical arrangements
the responsibility of the Government might be the same in respect of contractors under
the normal practice.
It was agreed that the agreement with the Bharath Sevak Samaj need not contain a penal
clause for non-completion of work. (Para 17 (a) at the minutes of the N.S. Project Control
Board Meeting held at Kurnool on 30-8-1958).
7-14-14 Financial and other arrangements in respect of the Program of work to be undertaken by
the Bharath Sevak Samaj as approved by the N.S. Project Control Board, vide No.
880/B156-12, dt. 9-7-1956
Advances would be made by the Project Authorities to the Bharath Sevak Samaj
upto25% of the seasons work, no security or earnest money being required. The advance
would be limited, within the above ceiling, to the actual requirements as determined by
the Project Authorities from time to time.
The bulk of the advances should be repaid at the end of the working season.
The Bharath Sevak Samaj would maintain internal accounts, and also indicate the
physical programs, from time to time, for fixing the quantum of advances.
The work should be split up into chain lengths and mark out given by the Project
Authorities who would also record the measurements in each chain length separately and
make payments to the Bharath Sevak Samaj. The payments to individual workers would
be made by the Bharath Sevak Samaj.
96% of the bills would be paid to the Bharath Vikas Samaj and 4% kept in deposit by the
project authorities for use on Community Development Programmed by the Bharath
Sevak Samaj.
136 PAO (WA) Manual
Water supply, sanitation and medical arrangements would be the responsibility of the
Project Authorities and all other amenities particularly provision of hutting and cultural
amenities would be provided by Bharath Sevak Samaj.
These arrangements would be subject to review from time to time by the Development
Committee or by one of its Sub-Committees.
Note:- For other conditions, see the work order form appended to G.O.Ms.No.264, P.W.
(Nagarjunasagar) Dept. dt.18-11-1960.
7-14-15 Half monthly payments due under section 4 (I) (d) of workmen‟s Compensation Act,
1923 to Departmental workmen involved in accidents:-
The Executive Engineers of all branches of public works Department including Projects
Wing may make half monthly payments to depart - mental workmen during the period of
their disablement under section 4 (1) (d) subject to the provisions of sections 6 and 7 of
workmen‟s Compensation Act, 1923. They shall however obtain post fact sanction of the
Chief Engineer in the case of half monthly payments and his prior sanction in the case of
(a) the commutation of half monthly payments under section 7 of the Act and (b)
Compensation payable for permanent disability suffered on the basis of medical report.
(Govt.Memo.No.14977/34/Accts/73-3, Fin & Plg. (Accts.) Department, dt.21-4-1975)
7-14-16 Petty Supervision charges are provided in the estimate at the following rates. The Petty
supervision charges should not be diverted for any other items of work.
a) Estimates upto Rs. 10,000: 5%
b) Estimates above Rs. 10,000 4 % sub. to mm. of Rs. 500 to one Iakh
c) Estimates above Rs. 1.00 lakh

and upto Rs.100 lakh: 3 % subject to mm. of Rs. 4000
d) Estimates above
Rs. 100 lakhs : 2 and ½ % sub. to min. of Rs. 3 lakhs
(Para 117 of „D‟ code)
The provision in P.S. charges in working estimates is to be made with

137 CHAPTER -7
reference to the cost of the big project of which the working estimate forms part of
(G.O.MS. No.987, PWD, dt. 18.7.72)
b) All incidental expenditure which can be foreseen such as compensation for cost of land,
sheds for workmen and stores should be separately provided for under relevant heads of
classification. The provisions for contingencies should not be diverted to any new work
or repair / which is not provided for in the estimate and of which the cost exceeds
Rs.2500/- without the sanction of Superintending Engineer vide also para -428 (e) of
APWD Code. The provision for petty supervision should in no case be diverted to meet
expenditure on other items of work. A provision of 1 % of the estimates cost should be
made towards handling charges in the estimates for purchase of machinery,
(G.O.Ms.No.385, I&P (PW) Dept., dt.25.10.1979)
Provision to be made in Estimates:
In order to prepare realistic estimates, the following provisions are permitted to be added
in the estimate.
a) Turnover tax at the rate of 1 percent for items relating to canal digging lining, repairing
road works etc., where the earth work excavation and embankment is involved and for
works other than the above, turnover tax at 3 percent tax at 3 percent shall be added in the
data.
b) A lumpsum provision shall be made in the abstract estimate towards Insurance

considering the agreement period and defect liability period of two year for the original
works and one year for maintenance works, by obtaining details of Insurance premium
from Insurance Organizations.
d) A Lumpsum provisions shall be made in the abstract estimate towards Banker‟s Changes
for obtaining Bank guarantees for payment of E.M.D., performance security and release
of retention amount as per prevailing procedure based on the period i.e. period of
completion plus defect liability period. The Chief Engineer concerned shall assess duly
obtaining the details there of from the Scheduled Banks and suitable provision shall be
made. Till then, no provision for this item need be provided.
e) A provision at 1 percent of the cost of Cement towards construction of temporary shed

shall be added on the data of relevant items. At the time of preparation of estimates,
proper care should be taken to provide the lumpsum provisions for the aforesaid items
and necessary
138 PAO (WA) Manual
conditions also should be incorporated in the tender document for suitable reimbursement
to the contractors from out of the above provisions, however not exceeding the amounts
indicated against each, on production of the Insurance policies, copies of appointment
orders with payments vouchers, Bank Guarantee etc. Failing to comply with the above
reimbursement shall not be allowed but suitable penalty shall be imposed for not
engaging technical personnel and the Engineer-in-Charge shall impose for not engaging
technical personnel and the Engineer-in-Charge shall take Insurance policy at the cost of
contractor duly deducting the premium from the contractor‟s bills. Contractor has to take
policy in favour of the employer i.e. Department.
7-14-17 Procedure for working out rates for Supplemental items:-
The Contractor is bound to execute all supplemental items that are found essential,
incidental and inevitable during the execution of main work at the rates to be worked out
as detailed below :-
i) Supplemental items directly deductable from similar items in the original agreements:-
the rates shall be either derived by adding to or subtracting from the agreement rates of
such similar item, the cost of difference in quantity of material or labour between the new
item and the similar item in the agreement worked out with reference to the schedule of
rates adopted in the sanctioned estimate with which the tenders were compared plus or
minus overall tender percentage.
ii) New items:-
a) Similar items the rates of which cannot be directly deduced from the original agreement.
b) Purely new items which do not correspond to any item on the agreement.
The rate shall be estimate rate plus or minus overall tender percentage:
Note:
1. The term “estimate rate” used in 1) and ii) above means the rate in the sanctioned
estimate with which the tenders were compared or if no such rate is available in the
estimate, the rate derived with reference to the schedule of rates adopted in the sanctioned
estimate with which tenders are compared.
139 CHAPTER -7
iii) Addition of provision towards importation of labour, amenities dewatering etc., in

working out supplemental items:
If the new item is in substitution of an old item which allowed for importation of labour,
labour amenities, dewatering etc., these factors may be taken into account in computing
the substituted items also, at the same rates at which they were originally provided.
In respect of new items, the case has to be considered on its merits and provision for
importation of labour, labour amenities, dewatering etc., has to be fully justified.
(G.O.Ms. No.1493, PW(Y) Dept., dt.25.10.197l as amended in Govt.Memo.No.544/codn
/72-22, PWD, dt.06.07.1973)
2) Authority to decide the similarity of items of the original agreement to derive the rate for
the supplement items :-
The authority who entered into the original contract will be the authority to decide with
items in the contract are similar to the items of work proposed under a supplemental
agreement. In cases of doubt or dispute, the decision of the authority next higher to the
contracting authority will be final and binding.
(Memo.No.12-cedd/80-30, dt.06.03.1980 of I & P (PW Dept.,)
3. Supplemental agreements based on mutually agreed rates and observed data
i) Where a contract provides for arriving at a rate” as mutually agreed to” for any item of
work not covered by the agreements it should be constructed, that the officers, while
agreeing to any rate under this provision should be guided by the directions issued by the
Govt. in G.O.Ms. No. 1493, PW(Y) Dept., dt. 25.10.1971 for working out supplemental
rates., So long as the said directions are followed the authority competent to execute the
supplemental agreement on this basis will be the authority competent to contracts as per
G.O.Ms.No.1007, TR&B Dept., dt.5.11.1976 for the value of the supplemental agreement
(net value in the case of substituted items and gross value in the case of new items). If
there is any difference of opinion between the departmental officers and the contractor
regarding rate payable, then such cases should be settled by reference to arbitration under
the provisions of agreement. In case of such dispute the rate offered by the Department
should be entered in a “Provisional agreement” which should be a supplemental to
140 PAO (WA) Manual
the main agreement and payments regulated accordingly, pending settlement of the
dispute through arbitration. After the award is passed payments are to be regulated in
terms of the award.
ii) Where rates for work to be done through supplemental agreement cannot be derived from
the item in the main agreement nor can they be derived from the SSR then rates for such
items should be worked out on the basis of data approved by the Chief Engineer. In case
of such data, however there will be no need for adding or subtraction from the tender
premium since such tender premium is related to the rates prevailing at the time of
original contract while the approved data rates are based on prices prevailing at the time
when the work was actually executed. Once the rates for such item are approved by the
Chief Engineer, the authority competent execute supplemental agreement should agree to
only such approved rate and execute agreements according to the powers delegated under
G.O.Ms.No.1007, TR & B Dept, dt.05.11.1976.
(Memo. No. 185, Cod/Bg -l/dt.05.3.80 of I&P(PW) Dept)
4. Authority for entrustment of Supplemental items to the original contractors and powers of
Officers of Irrigation Department and distinction between additional and supplemental
items:
i) such items of work which are found necessary after letting out a work and can be
executed independently without affecting or interfering with the execution of the work let
out, shall be considered as Additional Items “ of work not contingent on the original
contract.
ii) Such items of work which are found necessary after letting out a contract and cannot be
proceeded with independently without interfering with the work let out, but have
necessarily to be executed along with the original contract shall be considered as
“Supplemental items of work” contingent on the original contract.
iii) Additional items of work not contingent on the original contract are to be executed after a
separate estimate or a revised estimate or a work slip containing the additional items are
sanctioned / approved by the competent authority. Such works may be let out after call of
tenders or on nomination without call of tenders according to powers delegated to various
officers in G.O.Ms.No.1007, TR&B dept., dt.5.11.76.
iv) Supplemental items of work contingent of the main contract have to be

141 CIIAPTER -7
necessarily carried out through the original contractor as” authorized extra by entering
into a supplemental agreements (The powers for executing supplemental agreement will
be the same as the powers for executing original contacts according to delegations of
Powers. in force, regardless of who has executed the main contract in a given case,
subject however, to the condition that if the net effect of supplemental agreement to be
entered into is to enhance the total value of work under the main and supplemental
agreement to such an extent, that sancti0l to revised estimate is required by higher
authority” then sanction of the revised estimate from the higher authority shall be
obtained before entering into supplemental agreements.
(Memo.No.l64/Cod/79-4, dt.27.3.1980. of I&P (PW) Dept.)
When high rates are quoted : For the items, the quoted rates of which are high
intermediate payment will be made proviSi0)Y at the estimated rates plus or minus
overall tender percentage .Full accepted agreement rates will be paid only after all the
items of work are completed. The tender accepting authority will decide the exact items,
the rates of which are considered to be high for the purpose of the above clause and his
decision shall be final and binding on the contractor.
(G.O.Ms.No.1971, PWD, dt.17.12.1971)
b) 1) An item shall be considered as highly quoted if the premium for that item is 15 % or
overall tender percentage whichever is higher.
(Govt.Memo.No.43675-3, dt.25.6.87)
ii) In the case of canal works where trimming of the slopes is required an adhoc 10%
deduction of the part rates arrived at should also be added. This deduction may be
released only on completion of the works.
(G.O.Ms.No.355, PWD, dt.24.4.74)
c) The draft agreements concluded at Divisional level are verified by the Divisional
Accounts Officer (works) who should give a certificate to the effect that the agreement
conditions have been compared with the tender committee proceedings / Orders of tender
accepting authorities. For agreements at circle level, such verifiCati0 & recording of
certificates should be done by the P.A. to the periu1tefldhfi Engineer invariably.
(Govt.Memo.No.91 Cod r-8l-l dt.4.10.83 of Irrn. (PW) dept)

PAO (WA) Manual 142
d) Authorized deletions / omissions or additions (under clause 16 PS to APSS) may have to

be ordered by the E.E. Only with the approval of the Authority which approved
technically the original drawings & specification. In case the deletions/additions are of
such nature as to alter the very scope of the original sanctions requiring revision of
estimates by the Govt. Then such administrative approval shall be obtained to the revised
estimate first before taking action under clause 16(b) of PS to APSS.
e) Executive Engineer has got full powers to reject any portion of work which in his opinion
is defective, in case of failure of the contractor to rectify the defective work; E.E. may get
it rectified at contractor‟s risk. (In case of rejection of work, he may make such allowance
for the difference in the value as, in his opinion, is reasonable. (P.S.27)
f) Carriage, construction Plant, Scaffolding constructions, Temporary constructions, water

and lighting latrines for work people, sun protection, keeping dry and pumping , tolls and
signore age charges, settling out of works, clearing up during progress and delivery all
covered by the rates for work unless there are specific definite superseding instructions in
the specifications to the contrary.
No payment shall be made for the return trips with carts empty. Where there are loads
also for return trip, the agreement rates should allow for the reduced cost thereby on each
set of materials.
7-14-18 Sales tax has to be recovered from contractor‟s bills wherever required under provision
APGST Act. Extract Sub. 5(H) (1) of APGST Act is furnished below:
Extract of Section 5-H of the APGST ACT
Deduction of tax at Source:
5H (I) Not withstanding anything contained in this Act, the Central Government, or the State
Government, or an industrial, Central Government, or the State Government, or an
industrial, Commercial of trading underrating of the Central Government or of the State
Government or a local authority or a statutory body, shall deduct from out of the amounts
payable by them to a dealer in respect of work contracts of the works specified in section
5F and 50 executed for them, an amount calculated at the rate of four percent of the total
turnover .“
CHAPTER- 7 143
2) The tax deducted under sub-section 91) shall be remitted into the Government treasury
under the Sales Tax head of account within seven days from the date of such deduction
3) The authority making deduction under sub-section (1) shall furnish to the dealer from
whom such deduction is made, a certificate, containing such particular as may be
prescribed.
4) If any such authority defaults to deduct the tax specified under subsection (1) or defaults
to remit the amount so deducted or any portion thereof as required under sub-section
2) It shall be liable to pay, in addition to the amount so deducted , interest at the rates
specified in sub-section 3) of section 16 of the Act on the amount with respect to which
the default has taken place from the date of defaults to the date on which such amount is
remitted.
5) Payment by way of deduction in accordance with sub section (2) shall be without
prejudice to any other mode of recovery of tax due under this Act from the dealer
executing the works contract.
6) Where, tax in respect of work contract is remitted under sub-section (2) the tax payable
by the dealer in respect of such works contract shall be reduced by the amount of tax
already remitted under the said sub-section.
Provided that the burden of proving that the tax on such works contract has already been
remitted and of establishing the exact quoting of tax so remitted shall be on the dealer
claiming the reduction”.
The tax so deducted from the bills should be directly credited to the relevant final Head
of Account i.e. „040-Sales Tax “ and schedules of recovery at the end of every month sent
to concerned Commercial Tax authorities.
(C.C.T‟s reference A(2)/256/98, dated 5.5.1998 to all C.T.Os with copy upto DFA/Fin. &
Plg. (PW) Dept., dt.1.4.96).
The Pay and Accounts Officer /Assistant Pay and Accounts Officers have to furnish to
the contractor(s) a certificate of S.T. deduction in From No. as furnished below.
17-1 The authority making deduction of tax under sub-section (1) read with sub -section (3) of
Section (5H) shall furnish to the dealer from whom such deduction is made, a certificate,
in form XX
144 PAO (WA) Manual
FORM XX
(See Rule 17-1)
CERTIFICATE OF DEDUCTION OF SALES TAX
To
1. Name of the Supplier and address:
2. R.C.Number/Year:
3. Name of C.T. Office:
4. Total amount of tax deducted:
Sir,
I/We do hereby certify that a sum of Rs. (Rupees )…………… was deducted being the
amount payable by M/S. towards sales tax (Calculated @ 4% on the total turnover) on the
supply of goods quantity value …….. invoice No…… during the month /year in
pursuance of the Contract/Supply Order No….. Dated….. which are given in the
Schedule hereto. The above amount deducted at sources has been /will be paid to the
credit or State Government under Head of Account on vide challan No…… by…...,
Station: Signature of the Officer
Date: Responsible for deduction
Address: Commercial Taxes Departments with seal.
If the agreement does not specify the rates at which sales tax has to be paid by him then
the rates prevailing at the time of recovery should be applied. If the contracts specify the
rates then the recovery should be effected at the rates specified by Government from time
to time and any difference between the rates specified in the contact and those actually to
be paid to the C.T. Department should be charged to the estimate for the work. In such
cases the net amount payable to the contractor towards his bill (i) requires the same but
the gross amount debitable to work may be raised by the extent of the difference in the
S.T. and the S.T. recovery exhibited to the extent payable to C.T. department. In the S.T.
deduction certificate which the total amount so credited to C.T. department may be
shown and the amounts i) charge to contractor and ii) charged to work and paid by the
Government may be indicated in brackets clearly.
CHAPTER -7 145
i) The pure labour contract is not liable to tax.
ii) Materials supplied to contractor by the department for use in works and to the total
turnover for tax deduction at source.
iii) In respect of works contracts S.T. @ 4% should be deducted on the total value after
deducting 3% towards labour component.
iv) In cases of pure earth work excavation where no goods are involved, no deductions need
be made.
v) In all other cases deductions have to be made though the cases of embankment etc. where
the value of sand, bricks and stones may not exceed over 1 %. of the total value still a
deduction of 4% has to be made.
vi) provision towards S.T. may be added in estimates by the authorities. (Proceeding of
meeting in I & CAD, Secretary‟s chamber on 10.1.96 communicated in Govt.Memo.No.
49262/Cod/95-3, I& CAD (PW) Dept,
vii) In Go.Ms.No.23, I&CAD (PW.CoD) Dept., dt: 5-3-99, the provisions of which use made
applicable only of the tenders invited after issue of the G.O, the contractors were allowed
the facility of deduction of S.T. at the rate of 2 % at source and be exempted from
producing the clearance certificate from commercial department. The contractors were
also allowed option as became detailed be lane vide Para 3.01.4 of the G.O
For sales tax on works contract, contractors are given an option to opt for the composing
schemes under Section 5(g) of the APGST Act and those opting for it are subject to a tax
deduction of 2% at source on the total value of the contract. In such case, the departments
will not insist on production of clearance certificate and no assessment of tax will be
needed.
7-14-19 Transfer of work from one Division to another Procedure (i) Transfer of work from one
Division to another both of which are in account with the Pay and Accounts Officer/
Assistant pay and Accounts Officers of the unit, b) Transfer of work from one division in
account with PAO/ APAO one unit to another division in account with the another Pay
and Accounts Officer / Assistant Pay and Accounts Officer of a different unit. In both the
cases the transfer of accounts and records should be effected in the following manner.
146 PAO (WA) Manual
ii) Omitted
iii) If any sub-imprests have been given to the officers in charge of works for the transactions
on these works, the previous Divisional Office should get the full amount of the sub-
imprest reimburse in case from the new Divisional Officer and the sub-imprests should
be taken against the new Divisional Officer together with the expenditure incurred, if
any, in the old Division.
iv) If the Officer-in-charge of sub-imprest are not transferred to the new division along with
the transfer of the work, but the work is going to be entrusted to new officers in new
division, sub-imprests should be closed on the date of the transfer. In respect of account
should be rendered by the Divisional Officer to the Pay & Accounts Officer / APAO on
the date of the transfer, refunding to the Pay & Accounts Office /APAO the amount that
may remain undisbursed.
v) The old Divisional Officer should send the new divisional officer with copy of the Pay
and Accounts Officer /APAO, extracts in duplicate of (a) Materials at site accounts (b)
Transfers awaited from the Division, Departments or Governments.
vi) If any tools and plant are also transferred along with the works, the numerical account of
the Tools and Plant should also be sent to the new Divisional officer
vii) The old Divisional Officer should send to the Pay & Accounts Officer / APAO list of
unstamped receipts which have not already been entered in the Contractors; ledger.
Copies of the unstamped receipts should also be sent simultaneously to the new
Divisional Officer.
viii) A statement, in duplicate of any revenue receipts creditable to the head Receipts and
Recoveries on Capital to the heads “Receipts and Recoveries on Capital Account” such
as fines levied on contractor for delays etc., should be sent by the old Divisional Officer
to the new Division Officer to give the later an idea of the transactions for administrative
purposes.
ix) In respect of the Register of works, Suspense and Deposit transactions, and Contractor‟s
ledger, extracts should be sent to the new provisional officer by the old Pay & Accounts
Officer /APAO.
x) In respect of Suspense and Deposit transaction the transfer should be

CHAPTER -7 147
effected by deducting from the total of the month‟s transactions. In the Section dealing
with the new division they will be taken as fresh transactions in the month with a suitable
entry explaining the transfer.
xi) When the transfer is to a division under a Pay & Accounts Officer / APAO of the same
unit no monetary adjustment are necessary and it would suffice if the section dealing with
the old division sends to the section dealing with the new division extracts from the work
Register, suspense and Deposit registers. The n effect of the transaction should also be
intimated to the case section and compilation section in respect of other transactions for
effecting necessary changes in the cash book and broadsheet.
xii) When the new Division to which the work is transferred is under Pay & Accounts Officer
/APAO of a different unit, the old Pay & Accounts Officer /APAO should transfer the
upto date expenditure on the work, the total deposit and the Suspense ba1nces and
revenue receipts, to the accounts of the new Pay & Accounts Officer /APAO through the
head “Transfers within project”. It may be noted that the total expenditure on the work
including the expenditure incurred in the previous months and years is required to be
transferred through the head “transfers within Project”, as otherwise, the expenditure
booked in the accounts of the old Pay& Accounts Officer /APAO till the date of transfer
cannot figure in the account so the new Pay & Accounts Officer /APAO and there will be
a constant difference then forward between his booked account and schedules of the
works expenditure, as old Pay & Accounts Officer / Assistant Pay & Accounts Officer
will exclude the work from the later while the new Pay & Accounts Officer will have to
take the total expenditure into his schedule.
(N.S.C. Board‟s Proc.No. l3507/A/57/FA, dt.10.01.1957).
A note detailing the unsettled liabilities, pending bills, T.E.Os /S.R.Bs / S.I.Bs and
T.W.Ps etc. and the reasons for their pendency may be prepared and sent to the other
PAO/APAO. Also relevant portion of IR paras, audit notes, objections etc. together with
relevant correspondence files should be communicated The note should also indicate any
important points which the other PAO/APAO has to specially pay attention to. The
balance LOC of the concerned division duly certified has to be transferred
148 PAO (WA) Manual
List of returns due to/from outside offices should be communicated.
7-14-20 (N.S.C. Board‟s Proceedings No.13507/A/57/FA, dt.10-1-1957).
Accounting Procedure in respect of classification of expenditure on Jeeps and Cars etc.:-
(i) Adjustment at the use rate contemplated inPara-11 of the Accounting and Financial
Instructions, Para-I need not be made against concerned works in respect of jeeps and
staff cars and other personal vehicles.
(ii) The Expenditure incurred in connection with inspections within a radius of 8 kilometers
is debitable to “Other Office Expenses” and in respect of journeys beyond 8 kilometers
radius expenditure is debitable to “Travelling Allowances”. -
(iii) In order to simplify the accounting procedure stated in clause (ii) above, it is considered
that the maintenance charges of the vehicles may be adjusted monthly to the heads of
account “Other Office Expenses” and “Travelling Allowance” in a proportion to be fixed
by the Chief Engineers in respect of the vehicles of each division, and
(iv) The adjustment on account of depreciation may be made at the end of the year by raising
debits to “Other Office Expenses” and “Travelling Allowance” in the same proportion
and crediting the amount under the head “050 - Office Expenses”.
(G.O. Ms. No. 178, PW (N.S. Department) dt. 18-8-1960.
7-14-21 Claims of Work-charged establishment
The service conditions and Pay scale of all work-charged employees in the state have
been standardized in G.O. Ms. No. 107, PWD, dt.07.02.74.
Orders regarding provincilisation of work-charged employees subject to certain

conditions were also issued vide G.O.Ms.No.130, I & PDD, dt.18-03-81 the claims of all
work-charged establishment have to be regulated as per the orders of Govt. issued from
time to time. Extract of important provisions are furnished in the Appendix No. XIV.
7-14-22 In order to have information pertaining to a work in respect Rs.5.00 lakhs or more in
progress at a glance, viz., the programme of work, the date of handing over of site, the
stipu1aèd date of completion, the payments made to the contractor and the various
quantities for which payments have been made etc., a Docket Sheet in the Form PAO
No.68
CHAPTER -7 149
should be appended to the relevant work file.
(Ref. FA &CAO.NSP Memo.No.FA/F.V(2)/773-74/73, dt.11.01.74).
7-14-23 Employment of Technical agent by the Contractor:-
The contractors should employ technical personnel on the works costing above Rs.
50,000/- on the following scale:
Cost of Work Scale of Technical Staff Rate of recover p.m.

in case of failure
From Rs. 50,000 to One ITI Candidate Rs .1,500
Rs. 1.00 lakhs
Between Rs. 1.00 lakhs One Diploma Holder Rs. 1,700
and Rs. 5.00 lakhs
Between Rs. 5.00 lakhs One graduate Engineer or Rs2,500

and Rs. 15.00 lakhs. Two Diploma Holders
Above Rs. 15.00 lakhs One Graduate Engineer Rs. 4,200

and
One Diploma Holder
Employment of Technical personnel shall be with reference to the estimated cost of work
put to tender.
Appointment of staff should be on full time basis and the technical personnel should be
available at work site whenever required by the Engineer-in-Charge or take instructions.
In case the contractor himself is a Diploma Holder /Graduate no agent need be appointed
to supervise works costing upto Rs.5.00 lakhs/above Rs. 5.00 lakhs respectively. Even if
the contractors is himself a technically qualified person he shall employ technical staff on
the scale prescribed for supervising works, when more than one work is under taken and
if they are beyond a radius of 5 kms one or more works within a radius of, say 5 kms
shall be treated as a single work for purpose of employment of technical personnel.
150 PAO (WA) Manual
Necessary corresponding recovery for the period of non employment technical agent
should be effected in terms of agreement with reference to the Government orders issued
from time to time. For this purpose a prescribed certificate as in Government memo. No.
1580/Gen 1/77-9, dt.21.2.1978 should be obtained from the Departmental officers while
admitting the claims. (vide G.O.Ms.No.158, PWD, dt.21.2.1975) read with Govt.Memo.
No.1434/Cl 78-18, TR & B (C1), dt.20-12-80
b) The employment of technical personnel in respect of conveyance contracts will not be

applicable (vide Govt.Memo.No.994-Cl/76-13, TR & B (C1) Dept., dt.03.12.1977).
In Para (c) of Para 1.03 and Para 4 in Para 1.03(c) and 1.04 of annexure to the GO.
(reproduced below) provision has been made the reimbursement of the expenditure
incurred on engaging Technical personnel
c) A lumpsum provisions shall be made in abstract estimates to meet the expenditure to be

incurred by the Contractor on engaging Technical Personnel based on number of persons
indicated in the tender document and permissible wages as per SSRs.
In Para 1.04 of the G.O it is stated that failing to Comply with the above, reimbursement
shall not be allowed but suitable penalty shall be imposed for not personnel
7-14-24 Fixation of monetary limit for the expenditure towards repairs against inspection
vehicles and Heavy vehicles.
The Monetary limits fixed for incurring the expenditure towards repairs including
replacements of tyres and tubes in respect of light vehicle is Rs. 1 2,000j per annum and
for heavy vehicles is Rs 20,000/- per annum. Subject to the condition that the total
expenditure on each inspection vehicle should not exceed 75 % to the cost of the vehicles
purchased before 31.3 90 and that for incurring expenditure on vehicles purchased after
31.3.90 beyond 75% limit Government approval is necessary Government so prohibit
fixing luxury item like Fans, Foam Cushions Radios, Air-conditioners etc. except with
the prior approval of Government. (Vide G.O.Ms.No.22, Irrgn. (PW) Dept., dated
30.1.1985 and G.O.Ms.No.159, I&CAD (Projects Wing COD) Dept, dated 29-10-92.
7-14-25 i) All works costing more than 2,500/- should be check measured by the Deputy
Executive Engineer. See also paras 296 of APWD code and
151 CHAPTER -7
Para 297 of APWA code.
2) All individual costing and above should be check measured by the Executive Engineer
at least once. The check measurement of Executive Engineers should cover at least 30%
of the total expenditure incurred. (G.O.Ms.No.390, I & CAD (PW.Cod) Dept., dated
30.8.90) The Executive Engineer should check measure at least 36 works in a year i.e.
(Calendar or official year) in respect of construction I maintenance division, 24 in respect
of civil division and 12 in respect of investigation division.,
the components selected for check measurements should not be less than 50 % of the
value of work done specially include such of the item where there is scope for fraud. In
the case of embankments, L.S. of cutoffs should immediately be checked for leads as
well as for soil classification and also their suitable for foundations and impermeability
by the sanctioning authority or by the superintending Engineers in charge of the work. In
cutting, soil classification should be checked as per the existing instructions contained in
Govt.Memo.No.364/NSP.11(1) 80-21 Dated 20.10.1984.
(G.O.Ms.No.37, T R & B Dept, Dt.3.01.90)
Part bills should not be returned by Pay and Accounts Officer, if check measurement by
SE is not done.
1. Classification of soils and rock should be check measured by Executive Engineer in all
cases.
2. In respect of works costing less than Rs. 1.00 lakh, superintendit1g Engineer should
inspect and satisfy himself when the variation in classification is more than 10% but
check measurement should be done when variation exceeds 25 %
3. Variation in classification of soils and rock upto 10% can be approved by executive
Engineer and beyond 20% S.E. has to verify.
4. Bay of 110 is unit for this purpose when the variation in the classification in the pay is
likely to exceed 10%, a report to that effect should be furnished to the chief eng1eer.
(Govt. Memo.No.364/NSP.11(1)80-21, dated 29.10.84)
3) The Superintending Engineers should check measure all works costing Rs. 10 (ten) lakhs
and above once before final payment is made irrespective of
152 PAO (WA) Manual
of whether the work is of Major, Medium or Minor Irrigation Project. These orders are
also applicable to all regular circles in Irrigation Department besides projects circles.
(G.O.Ms. No.389, I & CAD (PW-Cod) Dept., dt.30.8.90)
4) Condonation for Non-Check-measurement of works.
Non-Check measurement can be condoned by the departmental officers; if the cost of the
work condoned is within his powers of write off and that there has been no loss on
account of lack of initial check-measurement.
5) Payment of final bills and F&F bills in the absence of check-measurement by

Superintending Engineers.
Final bills and F&F bills should not be paid by pay and accounts Officers in cases where
S.E. has to check-measure but actually not done. That should be returned.
Final bills can be Paid by Pay and Accounts Officer even though they were not check-
measured by S.E. Provided authorization is given by Chief Engineer Stating that he will
take necessary action to obtain ratification of no – check-measurement.
(Memo.No.44 /F8/87-1, dt.20.6.87 of FA & CAD
The Chief Engineers Assurance in the absence of S.E.‟ s check measurement for purposes
of Payment of final bills should be furnished based on his personal satisfaction that no
loss is sustained by the Government but not, based on S.E.s assurance (vide Govt. Memo.
NO. 16558/Cod /9 1-3, I & CAD (PW) Dept., dt.22.8.91
Certificate of measurement should be recorded in M. Book (1483/Plg.PMU/91-1, Fin &

Plg (Plg) Department, Dt. 1.10.91
Income Tax clearance certificate:
7-14-26 The Income Tax Clearance certificate by contractor-should be produced before payment
of the final bill in respect of the contracts whose value is over Rs. 10,000/- This Income
Tax Clearance certificate may be produced either along with the final bill or if the
contractor so chose, at any time before the cheque is issued. G.O.Ms.No.86, PWD,
dt.21.1.1969 read with
Check - Measurement of Works

CHAPTER -7 153
7-14-27 In addition, to the check-measurement, normally done by the Deputy Executive

Engineer and Executive Engineer as required under code provisions, the Superintending
Engineers should check measure all works costing over Rs. 5.00 lakhs during the
financial year.
In the case of works costing over Rs. 5.00 lakhs, prolonging of more than one financial
year the Superintending Engineers check-measure such works at least once in each
financial year. Check measurement should be done before the final bills are prepared as
any check -measurement by them after final bill is paid will be of no use. The orders are
applicable to all Major, Medium and Minor Irrigation.
(Vide G.O.Ms.No.270, dt.21.8.1974 read with Govt.Memo.No.225/B/ 75-2, P.W.D (PW)

Dept. dt.1.3.1975 vide G.O.Ms.No.405, Irrigation (PW) (COD) Dept., dt.14.8.1984)
Recording of levels for Bailing water:
7-14-28 pay payment at the rate inclusive of the element of bailing out water, When no bailing
water is actually required during execution is regulate whenever bailing out water is
found necessary during executive, the Water levels should be recorded in the
Measurement Books/LF Books and the rates for intermediate works worked-out making
deduction when bailing out water is not involved (vide Govt.Memo.No.991) 74-4 P.W.D,
dt.1.10.1974
Admission of the claims with the concurrence of Finance and Planning (PW) Department:-
7-14-29 Whenever any orders having financial implications are issued by the Government
without the concurrence of the Finance & Planning (PW) Department , payments in such
cases should be allowed, only after making reference to Government and after receiving
reply from the Govt. (Vide Govt.Memo.No.475/F.VIII(i)/82-2, Fin. & Plg. (PW)
Department, Dt.6.5.1982)
Delegation of powers
7-14-30 Pay and Accounts Officers /Assistant Pay and Accounts Officers of A.P. works
Accounts Service be treated as district Officers and the D.O.As who are having control
over 5 to 6 Districts may be treated as Regional Officers‟ for the purpose of exercising
financial powers delegated in G.O. Ms. No. 490 Genl (Art. T& desk) Department dated
28.9.94, vide Govt. Memo. No. 1395/F 111(2) 95-2, dated 6.11.95 and
154 PAO (WA) Manual
further orders of delegation issued from time to time.
Sl.No. Authorities to whom powers Jurisdiction of the authorities.

to sanction surrender leave
and Leave Travel concession
are delegated
1) Deputy Financial Adviser, In respect of all Chief Accounts Officers/

Finance and Planning Pay and Accounts (Proj. Wing) Officers
/Assistant Financial Advisors and Assistants
Pay and Accounts Officers/ Accounts
Officers Working under his control and also
the officers in the above cadres in the twin
cities working in Hyderabad Urban
development authority, Chief Engineer
(Irrgn) Chief Engineer (PH) Chief Engineer
(Mechl.) Chief Engineer (PP&M) CADA
Municipal Corporation of Hyderabad and
Project Director, Special Roads and
Buildings D.B. Circle, Secunderabad etc.,
2) Director of Accounts, SRSP In respect of all Pay & Accounts Officers
LMD Colony, Karimnagar and Asst.Pay & Accounts Officers /
Accounts Officer who are working under
his project.
3) Director of Accounts, NSP, In respect of all Pay and Accounts Officers

Nalgonda Dist. and Assistant Finance and Accounts
Officers / Accounts Officer who are
working under his Project.
4) Director of Accounts, SACB, In respect of all Pay and Accounts Officers

Dowlaiswaram. and Assistant Pay & Accounts Officers who
are working under his project. Beside the
officers working i.e., Visakhapatnam Urban
Development Authority Visakhapatnam and
Project
155 CHAPTER -7
Director Special Roads and Buildings, ADB

Circle, Visakhapatnam.
5) Director of Accounts, In respect of all Pay and Accounts Officers

Srisailam HE Project. and Assistant Pay and Accounts Officers /
Accounts Officers working under his
projects.
6) Director of Accounts, Telugu In respect of all Pay & Accounts Officers

Ganga Project Cuddapah. and Asst.Pay & Accounts Officers /
Accounts Officer work under his project.
7) Director of Accounts, CERP, In respect of all Pay and Accounts Officers

Vijayawada. and Assistant Finance and Accounts
Officers / Accounts Officer under his
Project.
3. All the Chief Accountants Officers / Pay & Accounts Officers / Assistant Financial
Advisers and Assistant Pay & Accounts Officers / Accounts Officers are requested to
apply for sanction of surrender leave and leave Travel concession to the concerned
authorities – above through their administrative officers.
1. Director of Accounts Telugu In respect of all Division all Accounts

Ganga Projects Cuddapah Officers Working in Nellore, Chittoor and
Cuddapah Districts.
2. Director of Accounts In respect of all Divisional Accounts

Srisailam Officers working in Anantapur, Kurnool
and Mahaboobnagar District.
3. Director of Accounts, In respect of all Divisional Accounts

Nagarjunasagar Project. Officers working in Khammam, Nalgonda
and Prakasam District.

Vijayawada. Officers working in Guntur, Krishna and
West Godavari Districts.
156 PAO (WA) Manual

Dowlaiswaram Officers working in Srikakulam,
Vijayanagaram, Visakhapatnam and East
Godavari Districts.
6. Director of Accounts, LMD, In respect of all Divisional Accounts

Karimnagar. Officers working in Medak, Karimnagar,
Nizamabad, Adilabad and Warangal
Districts.
7. Deputy Financial Adviser, In respect of all Divisional Accounts

Finance and Planning, Officers working in Hyderabad and
(Projects) Rangareddy Districts.
The Divisional Accounts Officers (Works) are requested to apply for sanction if
surrender leave and leave Travel concession of the authorities mentioned above through
their Divisional Officers (Executive Engineers) concerned.
S.No. Items of Expenditure fixed as per para 3 of G.O.Ms. Dept., dt.28.9.94
Regional Officers District (Other than

Collectors / Unit Officers)
(DAO‟s) PAOs / APAOs
1. Purchase of Bulbs and 1,000/- 500/-

Lamps (Per Annum)
2. Books, Maps and 1,000/- P.A 400/- P.A

Periodicals
3. Repairs to typewriters 600/- 400/- P.A

(P.A)
DELEGATION OF ----------- INCLUDING COLLECTORS

REGIONAL OFFICERS ---------
S.No. Items of Expenditure as per para 3 of G.O.Ms.490, (Desk) Dept., dt.28.9.94

CHAPTER -7 157
Regional Officers District (Other than

Collectors / Unit Officers)
1. Maintenance of Motor
Vehicles:
a) Light Vehicles 16,000/- 10,000/-
b) Heavy Vehicles
2. Purchase of Stationery 2,400/- 1,000/-
3. Purchase of Steel &

Wood
a) Purchase of Furniture 10,000/- 2,000/-
b) Repairs to Furniture 1,000/- 1,000/-
4. Rent for Offices Buildings Rs.16,000/- per month to all -- plinth area values and
rent – Department.
DELIGATION OF --- , TAHSILDARS/MANDAL OFFICERS
Sl.No. Item of Expenditure Ceiling limits now fixed as per para 3

G.O.Ms.No.490, G.A. (AR&T Desk) Dept.,
dt.28.9.1994
Collectors Divl. Officers
Per Annum Per Annum
1. Repairs to Typewriters DOAs PAOs / APAOs
& Duplicators
a) Typewriters: 1,000/-
b) Duplicators: 2,000/-
2. Organization of Sports
& Games
3. Electrical Installations: 10,000/-
a) For addl.
Improvements and
Alterations to the
Existing electrical
installation for each
Building Apartment in
the Compound
158 PAO (WA) Manual
b) Improvements and alterations & 10,000/-

New installation to new buildings
4. Printing locally without referring 20,000/- 5,000/-
to Govt.Press
5. Visits of High personnels 1,000/- on each
Occasion
6. Purchase of Non-Govt. 3,000/-
Publications relevant to Law &
Administrative Managements.
a) PAOs /APAOs
The Directors of Accounts are delegated of sanction surrender leave LTC to the PAOs/
APAOs etc as detailed here under vide G.O.Ms.No.174, Fin. & Plg. (FW.WA.I) Dept.,
Dt. 14.10.1992.
b) PAOs
The Directors of Accounts delegated to sanction of surrender leave and LTC to the
Divisional Accounts Officers as detailed here under vide G.O.Ms. No. 94, Fin. & Plg.
(FW.WA.II) Dept., dt.11.06.1992.
7-14-31 As per clause 73 of PS the Department and the contractor are free to go in for arbitration
in case of dispute or difference either during the progress or after completion of the
works or after the determination, abandonment or breach f the contract etc.
To engage lawyer to defend in arbitration cases, orders of Government are necessary.

Govt.Memo.No.664/Genl. 11/80-1, dated 18-6-80.
Princip1es:
Standing clause for incorporation in Agreements “Except as otherwise in the contract,

any disputes and differences arising out of or relating to the contract shall be referred to
adjudication as follows:
(1) Settlement of all claims upto Rs. 50, 000/- in value and below by way
of arbitration to be referred as follows:
(a) Claims upto Rs. 10, 000/- S.E. of another circ

in value in the same dept.
(b) Claims above Rs. 10, 000/- Another C.E. of the

CHAPTER -7 159
and upto Rs. 50, 000/- in value same department.
The arbitration proceeding will be conducted in accordance with the provisions of the
arbitration Act, l940 as amended from time to time.
The Arbitrator shall invariably give reasons in the award.
ii) Settlement of false claims above Rs. 50,000 in value shall be decided by the civil courts
of competent Jurisdiction by way of a regular suit and not by arbitrator.
A reference for adjudication under this clause shall be made by either party to the
contract within six months from the date of intimating the contractor of the preparation of
final bill or his having accepted payment.
(G.O.Ms.No.20, I & CAD (Project Wing ) Dept., Dt. 31.01.1989).
The Chief Engineer is authorized to accept an arbitration award below Rs.20,000/- in

value in case where the award is within the sanctioned estimate of the particular scheme
and does not involve any revision of estimate beyond the competence of the officers.
Other cases should be reported to Government.
7-14-32 Disposal of idle machinery:- Government have ordered a revised procedure for disposal
of surplus machinery which is not use for a long time in the Department. This procedure
is in supercession of all the earlier orders on the subject. The detailed procedure is
enumerated in G.O.Ms.No.132, I&CAD (Projects Wing) M & E2 Department dated
4.7.97. The terms and conditions and format of tender notice for adopting the above
procedure (Tender-Cum-Auction) are prescribed vide Govt.Memo,No.16/346/M&E2/97-
4, I&CAD Projects Wing Department, dated 15.7.97. Copies of the said G.Os are
furnished vide annexure.
7-14-33 Seinorage Charges:-
The following clause is ordered to be incorporated in all the tenders.
“The Contractor should produce documentary evidence for having paid the seinorage fee
to the Government as envisaged in G.O.Ms.No.243, Industries and Commerce, dated
6.5.86 amending the rule 26(2) of A.P. Minor Meneral Concession Rules, 1966. In the
absence of production of such evidence the normal seinorage fee together with 5 times
penalty provided in the said rule will be recovered from the contractors bill” If the
Contractor produces the transit form with seinorage fee paid stamp
160 PAO (WA) Manual
issued by the Assistant Director of Mine and Geology for the quantities extracted/
supplied/ purchased by him that should be treated as documentary evidence. However, if
the consumin agency gets a doubt about the genuineness of the transit form submitted by
the contractor, the same can be verified from the Assistant Director of Mines and
Geology, whether the same is genuine or not. If the Consumint agency is satisfied with
the transit form submitted by the contractor there is no need of further issue of MRCC
separately. Where seinorage fee is recovered from the contractor bills in the absence of
production of transit forms, the amounts so recovered may be directly credited to the final
Head of Account. “0853-Mining and Metallurgy Industries; M.H. 102 - Mineral
concessional Fee and Royalties; S.H.02 -Royalty on minor minerals” A consolidated
statement of recoveries so effected may be communicate to the concerned Assistant
Director of Mines and Geology every month.
(G.O.Ms.No.6, TR&B-BIII Dept., dt.12.1.96)
(Govt.Memo.No.1494/F.III-2/95-1, F&P (PW) Dept., dated 2.12.95)
In Para 6 (v) of G.O.Ms.No.23, I & CAD (PW-Cod), Dated 5-3-99 production of

documents for payment of Seignorage charges etc. has been dispensed with. The Para is
reproduced below; it shall applicable only for the tenders invited after issue of the G.O.
The Contractors will no longer be required from now onwards to produce clearance
certificate from the Mines Department and Seigniorage charges will be deducted by the
concerned Works Department from the bills of the Contractors for the materials used on
the work only.
The seigniorage charges will be recovered from contractor‟s bills as per the rates
prescribed in the contract documents for the materials used on the works only. The
present practice of insisting for production of documents evidence for having paid the
seignorage chares in respect of G.O.Ms.No.243, dt.8.5.86 and in the absence of such
production of the evidence, the imposition of five times penalty is dispensed with.
161 CHAPTER -8
CHAPTER – 8
TRANSFERS ENTRIES
General:-
8-1-1 The circumstances under which TEs are necessary and the rules for their preparation and
adjustment are contained in paragraphs 12 to 15 of Accounting and Financial
Instructions, part I (Reproduced below) and paragraphs 247 to 253 of APWA Code.
12. Transfer entries i.e. entries intended to transfer an item of receipt or charge from the
account of a work in progress or a head of account to the account of another work or
head, should be made in the following cases
a) In order to correct an error of classification in the accounts kept by the Pay & Accounts
Office.
b) In order to adjust by debit or credit to the final head of account (or work) and item
outstanding under a suspense account or a debit head,
c) In order to bring to account certain classes of transactions, which does not pass through
the cash or stock accounts, for example
i) for credit to public Works Deposits on account of balance due to contractor, who delay
receiving final payment for more than one month after the bill has been passed;
ii) for debit to Miscellaneous Public Works Advances of amounts found due from
contractors on the passing of final bills, if an immediate recovery is not practicable;
iii) for credit to the head Receipts and Recoveries on Capital Account “ of certain items of
revenue, not recovered in cash, for example , supervision charges on Sales on credit of
stores sold to private parties.
iv) In order to incorporate in the accounts of works, certain liabilities like unpaid balance of
partly running account bills etc.,
v) In order to relieve the account of a work in progress of (a) items which have ceased to be
debitable to estimate of the work, and (b) suspense charges which can no longer be kept
within the accounts of the work for example “Materials transferred to other works or
heads of account.
13. The Divisional Officers should prepare the Transfer Entry in Form. P.W.A.7 in respect of
classes (b) and (c) above. The Pay & Accounts Office should prepare the Transfer Entries
in the same form in respect of class (a) above.
162 PAO (WA) Manual
Transfer Entries should be prepared in duplicate by carbon process, as soon as they

become necessary or on the dates fixed for periodical adjustments (for example, those
based on log sheets of Special Tools & Plant). Both copies should be submitted to the
Pay & Accounts Office. After a brief entry of the particulars in a register of transfer
Entries in (PAO75 NSP Form No.17) After satisfying himself about the admissibility or
correctness of the Transfer Entry, the Pay & Accounts Office will include the Transfer
Entry in the accounts on hand and return one copy of the Transfer Entry to the Divisional
Office with the Transfer Entry number, etc., noted thereon.
A copy of the transfer entry will be furnished to the Divisional Officer by the Pay &
Accounts Officer. The Divisional Officer may, when necessary, seek further clarification
about the Transfer Entry. Brief particulars of such transfer entries should be entered in
the Register in (PAO -75 NSP Form No.17.)
The Register of Transfer Entries should be closed on every Wednesday, and an abstract
prepared showing the Transfer Entries, which have been pending inclusion in the
accounts and the reasons for delay.
Full details should be set forth in the Transfer Entries in the first instance and
clarificatory statements attached there to, if necessary, so that correspondence regarding
their correctness or admissibility may be reduced to the minimum.
Procedure for Adjustment
8-2-1 TEOs and OTEOs initiated by the Officers are received in duplicate. Ii order to have in
effective watch over the receipt and disposal of TEOs and OTEOs a separate purport
register should be maintained division wise in form PAO-26. All TEOs received in the
PAO‟s Office (except SRBs, SIBs workshop schedules and hire charges statements in
respect of which separate registers should be maintained as explained in subsequent
paragraphs ) and TEOs should be entered in this register and various columns filled in as
and when they are disposed off. The purport register should be closed weekly with
abstract showing full details of the pending TEOs and OTEOs. The Supdts. and Pay &
Accounts Officer / Assistant Pay & Accounts Officers should ensure that there is no
avoidable delay in the adjustment of the TEOs and OTEOs.
CHAPTER -8 163
8-2-2 The monthly closing done on 8th of the month should be submitted to the Director of
Accounts. No TEOs or OTEO should be pending for more than 3 days. The TEs after
scrutiny and orders of the Pay& Accounts Officer / Assistant Pay & Accounts Officer,
and TEOs initiated in the Pay & Accounts Office should be entered in the Register of
Transfer Entries (entry being made as and when a TEO or OTEO has been checked or a
TEO is initiated in the Pay & Accounts Officer. Each entry in the register should be
attested by the Superintendent and the closing abstract attested by the Pay & Accounts
Officer / APAO. After Adjustments the supplicate copy of the TEO or OTEO should be
returned to Officer who has initiated it or to the affected division /office /section in the
case of TEOs initiated in the pay & Accounts Office.
8-2-3 All transfer entry orders involving the rectification of arrears should be examined to see
that they do not indicate any defect in the system of accounting or any of the following
irregularities :-
(1) Expenditure is deliberately charged to wrong estimate because the correct estimate has
not been sanctioned.
(2) Materials are issued or transferred unnecessarily to works merely to utilize grants and are
retransferred to stock or work later on.
(3) To hide excess over estimate.
(4) To conceal that certain materials have been too long lying at the site of work without
being used.
Note:- Transfer entry orders received in March and those received for incorporation in March
supplementary accounts should be scrutinized with special care.
8-2-4 In the case of adjustment of stock issue statements, workshop schedules and hire charges
statements which are made based on the consolidated abstracts or schedules received,
they are to be dealt with close watch over the progress of their adjustments separate
registers in respect of each of these categories should be maintained as explained in the
subsequent paragraphs. An advice of adjustment should be sent to the affected divisions/
offices by the pre-check section, which adjusts such transactions finally, in form PAO 27.
Abstract of Stock receipt and issues:-
8-3-1 Abstracts of stock receipts and issues and extracts from the Registers of stock Receipts
and issues are receive4 monthly, from the divisions dealing with
PAO (WA) Manual 164
stores, in the pre-check sections of Pay and Accounts Office dealing with such divisions.
They should be purported in separate purport registers and disposal watched.
8-3-2. In the abstract of stock receipts, those items the value of which is not paid for or adjusted
in the accounts of the month in which the actual transactions take place should be
adjusted by debit to “ stock “ and credit to “ Purchase”
8-3-3. The abstracts of stock issues received should be separated unit -wise and these relating to
the unit in which the final adjustment is effected should be adjusted after scrutiny. In
respect of the issues relating to other units of the project, the procedure indicated under
“T.W.P.” should be followed. The general procedure indicated in respect of S.I.Bs may
be followed mutates mutandis.
Stores received Books:-
8-4-1. S.R.Bs. are received daily from the Stores Division in the pre-check section dealing with
Stores Division. On receipt they should be entered in the separate purport register and
adjusted at weekly intervals crediting the suspense head “Purchases” and debiting the
head “Stock”.
Receipts in pre-check Section dealing with Stores Division:-
8-5-1 All SIBs (original with abstracts received should be noted in a separate register in form
PAO-2B‟. The SIB abstracts are received weekly from the stores Division. They should
be distributed to the concerned pre-check sections through a separate transit register. All
SIBs received upto 21st should be distributed among the various pre check sections in two
batches one by 23rd and those received between 22nd and 25th should be distributed by
27th evening. In respect of issues relating to other units, the procedure indicated under
“TWP should be followed.
Adjustment in Pre-check section
8-6-1 All SIBS received should be entered in a separate register in form PAO 29. No SIB
should be sent to any division on any account. In respect of amounts debitable to the
maintenance estimates of previous years for which reference to current year‟s estimate
number is not furnished as also in the case of works (like those on provisional payments
form) for which estimate numbers are not furnished, the adjustment may be made under
the concerned detailed heads of account by opening separate works abstracts noting the
name of the work as given in the SIBs and the estimate numbers linked subsequently
when the sanctioned estimate for the
CHAPTER -8 165
work is received, in the Pay & Accounts Office. Till the sanctioned estimate are received
the amounts may be kept under objection for want of estimates in other cases where the
head objection for want of estimates. In other cases where the head of account cannot be
decided for want of correct name of work to which the debit pertains, the information
required should be collected by contacting concerned divisions. For this purpose all SIBs
received during the month for which particulars are required may be collected by sending
one clerk in respect of each Pay & Accounts Office deputed to the concerned divisions
at‟ headquarters of the Pay & Accounts Office on any day by 25th of a month. If the
particulars cannot be obtained even then, those SIB abstract, and total amount of the
abstract, and may be returned to the stores division giving full particulars of SIB and also
recording a note to the effect that the required Particulars could not be collected even
after contacting in the division. Such SIBs should be returned to the stores Division by
the stores section indicating the reasons for return. A list of SIBs received indicating the
reasons for return. A list of SIBs returned to the stores Division should be submitted to
Director of Accounts monthly duly indicating the reasons for their return.
Receipt in pre-check section dealing with Stores Division
8-6-2. All S.I.Bs received in pre-check sections upto 23rd should be returned to Stores Section
before 27th of the month and those received between 24th and 27th, action should be taken
to adjust all these abstracts where consultation with the concerned division is not
necessary and returned to the Stores Section on the penultim ate working day of the
month. (Abstracts for which consultation with division is necessary may be held over for
the next month).
8-6-3- Individual cases where it is not possible to dispose off an abstract within these time limits
should be brought to the notice of Director of Accounts on the 2nd of every month a
statement indicating the total amount of SIBs received previous month, amount adjusted,
balance to be adjusted with details for them with reference to the SIB abstracts received
should be sent to the pre-check section dealing with Stores Division. This pre-check
section should submit a fortnightly report to Director of Accounts regarding SIBs
pending in sections for more than 3days
166 PAO (WA) Manual
Final adjustment in the pre-check section dealing with Stores Division:-
8-7-1. On receipt back of the SIBs from the various sections, duly indicating the head of
account, the columns 7 to 9 of the register referred to above should be filled in and T.E.
proposed debiting the concerned works and crediting the concerned sub-head of stock
and incorporated in the T.E. register. The fact of such adjustments should be intimated to
the Stores Division. On the 5th of every month, an abstract should be prepared indicating
the total amount of SIBs received during the previous month, amount adjusted and the
balance outstanding and agreed with the balance shown in the statements sent by the
sections. This abstract indicating the action taken to adjust the balance amount should be
submitted to the Director of Accounts on the 8th each month.
8-7-2 The Executive Engineer will be furnishing a monthly abstract on 4th of every month to
the PAO /APAO indicating the total amount of SIBs sent by him during the previous
month, amount intimated to him as adjusted and balance and these figures should be
reconciled with the abstract referred to above and the fact of reconciliation indicated in
the report submitted to the Director of Accounts.
Adjustment of Hire charges Statements:-
8-8-1. Hire charges statements (with relevant abstracts) in respect of machinery used on works
in the divisions are received monthly, from the division maintaining the machinery, in the
pre-check section of Pay and Accounts Office dealing with division. Adjustment in the
accounts of hire charges could be carried out without the acceptance of the indenting
divisions, provided that the hire charges statements are supported by the trip sheets or log
sheets signed by the Deputy Executive Engineer or indenting divisions. In the absence of
these supporting documents the hire charges statements require the acceptance of
indenting divisions.
(Memo.No.212/M&E(5)/82-15, Irr. (PW) Dept., dt.8-1-85)
8-8-2 A separate register (division - wise) should be maintained in form “PAO 30” in the pre -
check section receiving the statements. Columns 1 to 5 of the register should be posted as
and when the statements are received. The statements should be checked to see (1) that
they are arithmetically correct, (2), that, in cases where trip or long sheets are enclosed,
the number of hours or number of “Kilo Meters” charged are in accordance with those
noted in the trip or log sheets and (3) that the rates of hire charges are in accordance with
the latest approved rates of hire charges.
CHAPTIR -8 167
The Statements should then be forwarded to the pre - check sections dealing with the
indenting division.
8-8-3 In the pre - check sections dealing with the indenting divisions, the charges included in
the Statements received should be analyzed and posted in the relevant Works abstracts
and other accounting registers and the statements returned without delay to the
Originating section duly indicating the Classification for the charges in the abstract under
the dated initials of the Superintendent.
8-8-4 On receipt back of the statements from the pre - check sections, the credits Should be
posted on the reverse of the works abstracts for the maintenance estimates of machines
for the relevant years, the Postings being made separately under the heads 193,
Recoveries towards depreciation and sales, and 195 - Deduct - Receipts and Recoveries
towards Maintenance in respect of credit on account of depreciation sales and
maintenance respectively, the remaining columns in the register under the dated initials
of the Superintendent in respect of each item. The final adjustment in respect of each
statement received should be carried out within 10 days of its receipt in the section.
8-8-5 The Register (form „PAO 30‟) should be closed fortnightly and put up to the Pay and
Accounts Officer /Asst. Pay and Accounts Officer. The closing due on 5th of every month
should be submit to the Director of Accounts indicating clearly the items outstanding for
more than 10 days together with reasons for the pendency
Adjustment of Work Shop Suspense Schedules:-
8-9-1 Workshop suspense schedules (in duplicate) prepared division - Wise indicating the name
of work, number date and amount of estimates to which the charges are debitable in
respect of each job undertaken in the workshop and supported by bills of cost are
received from the workshop division in the pre - check section of the Pay and Accounts
Office dealing with the division The schedules do not require the acceptance of the
indenting divisions
8-9-2 The Procedure indicated in the case of hire charges statements in respect of maintenance
posting and closing of the separate register, transmission to and receipt back from the
Pre-check sections dealing with the indenting divisions of the schedules and final
adjustment apply mutatis mutandis in the case of workshop suspense schedules
PAO (WA) Manual 168
8-9-3 The schedules should be checked to see (1) that they are arithmetically correct, and (2)
that the overhead charges levied are in accordance with the percentages fixed from time
to time by the competent authority.
8-9-4 The credits should be posted in the works abstracts of the various suspense estimates for
the work shop operations and in the workshop suspense register.
8-9-5 After adjustments one copy of the schedule should be forwarded to the affected division
and the duplicate copy retained as a voucher in support of the adjustment.
Note:- In the case of workshop where the workshop suspense schedules are received in
triplicate, the third copy should be returned to the workshop Division duly indicating the
fact of adjustment.
T.W.P Adjustments:-
8-10-1 The transactions arising in the accounts of one unit which are adjustable in the accounts
of another unit of the Project are passed on through the Major Head 8658 Suspense
Accounts (h) Suspense Accounts-I Transfers within the project. The Major Head 8658
suspense Accounts (h) Suspense Accounts -I TWP of the project has also to be operated
when the transactions arising in the accounts of one division of the project, on account of
expenditure incurred or supplies made and services rendered which are adjustable in the
accounts of another division of the project of same unit if they are under the payment
control of two different Pay & Accounts Offices. The head TWP should not be operated
in case, the two divisions are in the same unit and under the payment control of the same
Pay & Accounts Officer IAPAO. The amount outstanding under the Major Head -8658
Suspense Accounts (h) Suspense Accounts -l TWP represents Suspense Balances. It is
essential that originating and responding items are transacted in the accounts of the same
month on priority basis.
the accounts i.e. The ledgers and the Broad sheets in respect of this suspense head shall
be maintained in the central compilation section of the project in the same form as is for
“purchases” and put up to Pay & Accounts Officer IAPAO every month.
(G.O.Ms.No.469, I&P Dept., dt.20.11.1975)
8-10-2 No transaction should be incorporated in the accounts under this head without first
obtaining a counter T.E. However, in the case of transactions
CHAPTER -8 169
resulting from deductions from bills, i.e., house rent, electricity charges etc., the
transactions have to be accounted for without counter TEs.
8-10-3. In the pre-check section originating the transactions, a register of P.W. advances
originated should be maintained in Form P.A.O. 31 A&B. In the case of outstation Pay
and Accounts Offices one register for the entire office may be maintained in the
compilation section of the respective Offices. As and when a debit/credit is advised by a
Section/Unit/ P.A.O/ A.P.A.O to another section/unit/P.A.O./ A.P.A.O., the items should
be taken into T.W.P. register and columns 1 to 5 filled in forthwith, without waiting for
the receipt of responding T.E. Each advice should be supported by schedule, vouchers
etc., and should also contain full details of the transactions and indication of the total
amount of the advice, as a whole. A register in Form 31-A shall be maintained for the
advices received by them from other Pay and Accounts Offices.
(1. G.O.Ms.No.469, I&P (PW) Department, dt.20-11-1975

2. DOA/NSP Memo. No. DCAO/ITC/F-89-1/75-76/921, dt.6-2-1976)
8-10-4 All the sections should register the advices of T.W.P. received, in a separate purport
register of T.W.P. advices received, proposed necessary counter T.E.Os., incorporate
them in the account on hand and intimate the fact of adjustment along with copy of the
T.E.O. to the originating section/unit/PAO. Responding T.E.O. should contain full details
regarding the originating section/unit/PAO, advice number and date and total amount of
the advice. The purport register of T.W. advices received should be closed and put up to
the Director of Accounts every month.
8-10-5 On receipt of the fact adjustment in the originating section/unit/PAO, the remaining
columns in the register of P.W. advices should be filled in and the originating T.E.O.,
adjusted in the accounts on hand duly noting reference to the original advice on the
responding T.E.
8-10-6 The register of T.W. Advices should be closed every month in respect of the transactions
of the previous month and put up to the Director of Accounts. An item should not be
treated as closed until the columns 10 and 11 are filled in. Reasons for which the item
numbers in the T.W.P. Broad sheet (maintained in the compilation section at
Headquarters) could not be filled in (either because the original entry is not booked or it
is
170 PAO (WA) MANUAL
booked in a subsequent month) should be detailed out giving reference to the month of
the transaction, amount and action taken to clear the items.
8-10-7 In respect of TWP transactions originated by Establishment pre-check sections e.g.,

current consumption charges etc., the details to the contra- entry should also be available
and the establishment section itself should therefore propose both the TEOs (i.e.
originating and responding and transact both the TEOs in the same week‟s account. It
would be sufficient if a copy of the TEO adjusted is sent to the works pre-check section
concerned for posting in the work abstract register concerned.
8-10-8 In addition to the monthly review to be conducted by Pay and Accounts Officers/
Assistant Pay and Accounts Offices in respect of the Outstanding items, a special review
of every Outstanding item should be undertaken at the Pay and Accounts Officer‟s level
in December each year, and a report indicating the position as at the beginning of that
month, fresh items received during the month and clearance, should be submitted to the
Director of Accounts along with full details of the outstanding items. Similar review
should be conducted in the months of January, February and March as well and the report
submitted to Director of Accounts.
Weekly Closing of sectional T.E. Registers:-
8-11-1 The T.E. registers in respect of each division should be closed once in every week duly
striking, the total of debits and credits. An abstract of T.Es duly c1assifing the total debits
and credits under the prescribed detailed heads of account should be prepared after the
weekly closing and attested by the Pay and Accounts Officer/Assistant Pay and Accounts
Officer. The T.E. registers should then be forwarded to the compilation section for
posting.
171
CHAPTER -9
CASH SECTION
Introductory:-
9-1-1. The Director of Accounts is the Principal disbursing officer. The Divisional Officers are
not having cheque drawing powers except in certain specifically authorized cases like
limited cheque drawing powers for making payments for works specified by Government
All the payments are made by the Pay and Accounts Officers/Assistant Pay and Accounts
Officers under the control of Director of Accounts after cent per cent pre-check The
payments are made through Cheques on Banks/ Treasuries with which the Director Of
Accounts is placed in account. Certain classes of payments are made through Bank drafts
also.
(1. GO.Ms.No.131, PWD (PW) Dept., dt.16-5-1974

2. G.O.Ms.No.138, I&P (PW) Dept., dt.7-4-1979)
9-1-2 The divIsj0 is the unit of expenditure. The claims presented by the various Divisional
Officers will be Pre -checked by the pre-check section concerned under the control of
PAOs /APAOs. But schemes separately and not division wise. The work of drawal and
issue of Cheques and the maintenance of cash book is centralized in the cash Section.
9-1-3 (a) Drawing account on the treasuries in respect of Directors of Accounts / Pay Accounts
Officers will be communicated by the Accountant General, Andhra Pradesh every year
based on the sanction of Govt. for the Continuance of staff of PAO officer organization to
honour cheques issued by the Pay & Accounts Officers. Action should be taken to obtain
this authorization for drawing account sufficiently well in advance.
(b) The Specimen signature of the PAO/APAO authorized to sign cheques duly attested
by an officer whose specimen signature is already available in the Treasury /Bank shall
be communicated to the Treasury Officers and Banks with which the pay & Accounts
Officer is placed in account.
9-1-4 Whenever a Pay and Accounts Officer /Assistant Pay and Accounts Officer ceases to be
one by transfer, retirement or otherwise his Specimen signature shall be duly cancelled
under intimation to all the Treasuries / Banks.
9-1-5 In case where the Pay & Accounts Officer /Assistant Pay & Accounts
PAO (WA) Manual 172
Officer is placed in account with a number of Treasuries /Banks, Separate cheque pads
shall be used for each Treasury or Bank. Separate Cheque pads are to be used for Project/
Irrigation & Other Schemes with suitable superscription.
9-1-6 As soon as new cheque pad is brought into use, the Pay and Accounts Officer I Assistant
Pay and Accounts Officer shall notify the Treasury or Bank upon which he draws, the
number of the cheque pad brought into use and the number of cheques it contains. The
advice to a Sub-Treasury regarding a cheque book to be brought into use for drawing
cheques on it, should ordinarily be sent through the District Treasury. If it needs to be
sent urgently the Pay and Accounts Officer! Assistant Pay and Accounts Officer may
send it direct to the Sub-Treasury and forward a copy simultaneously to the District
Treasury Officer.
Functions of the Cash Section:-
9-2-1 The functions of the Cash Section in a Pay and Accounts Office are as follows:-
(i) Indenting receipt and safe custody of blank cheque pads.
(ii) Drawal, delivery and despatch of cheques and maintenance of Cash Books.
(iii) Receipt and disposal of valuables.
(iv) Receipt, custody and disposal of securities.
(v) Issue of permanent receipts for the sums credited to Government Accounts in the
Cash Book.
(vi) Maintenance of objection books for stamped receipts.
(vii) passing on of recoveries effected from bills.
(viii) Miscellaneous.
Organization of the Cash Section:-
9-3-1 The staff of the Cash Section consists of Superintendent, Cashier, Cheque-typists and
Assistants. The Cashiers draw and issue cheques and maintain the Cash Books. The
Cashiers work is supervised directly by the Pay and Accounts Officer in-charge of Cash
Section. The Superintendent of the Cash Section supervises the items of work other than
the drawal of cheques.
CHAPTER -9 173
Selection of Cashiers:
9-4-1 A Cashier is generally selected from among the Senior Assistants of the Office. The
conditions stated below should be kept in view in selecting a Cashier:
(i) He should be absolutely honest in money matters.
(ii) His integrity should be unquestionable.
(iii) His private financial position should be sound and he should be free from pecuniary
difficulties.
9-4-2 The post of a Cashier is not a promotion post and it is not, therefore necessary that the
senior most clerks should be appointed to it.
9-4-3 The cashiers shall be required to deposit security for a prescribed amount in one of the
forms prescribed by Government from time to time. The security shall be in the form of
cash, postal cash certificates, Government promissory Notes or FDRs and pledged in
favour of the PAO/ APAO concerned. In case the clerk concerned is unable to furnish
security in any of these three forms, a security in the shape of a fidelity bond executed
through any of the recognized Insurance companies may be accepted. The Government
servant furnishing security should also execute a security bond setting forth the
conditions under which the Government holds the security and may ultimately refund or
appropriate it. The security required should be deposited within one month of his
appointment.
9-4-4 A security deposit taken from a Government servant should be retained for at least six
months from the date he vacates the post, but a security bond should be retained
permanently or until it is certain that there is no further necessity of keeping it.
Duties & Responsibilities of the Staff of the Cash Section:-
9-5-1 The Pay & Accounts Officer/Assistant Pay & Accounts Officer in-charge of the Cash
section is responsible to see that the work in the cash section is carried out according to
the rules and procedures prescribed and that there is no delay in completing the
prescribed items of work on the due dates. He is personally responsible for the safe
custody of the blank cheque pads and the receipt books as well as the securities and other
valuables received in the office for safe custody. While signing the cheques, he should
see that the cheques are drawn in the proper form and that all
174 PAO (WA) Manual
mistakes are properly corrected and attested with his full signature. He should keep a
close watch on the utilization of the cheque pads issued to the Cashiers and ensure that
the cheques drawn on a particular day form part of the cheque pads that have been issued
for use to the cashiers. For this purpose, he should keep with him a list showing the
numbers of the cheque pads that are in use at a time, necessary corrections being made in
the list whenever any new cheuqe pad is issued from the stock to the Cashiers for use.
ii) The Pay & Accounts Officer (Cash) is personally responsible a) for the accuracy of the
amount mentioned in a cheque as compared with the Pay Order and b) for prompt drawal
and issue of cheques. It is his duty to bring to the notice of the Director of Accounts, any
act of omission or commission or lapses or failure in the correct working of the cash
section.
iii) The Cashiers are responsible for the accurate and proper maintenance of the Cash Book,
prompt and correct drawal, despatch/delivery of cheques, prompt Receipt, diarising
disposal of the valuables received by them and the watching of the receipt of the challans
in support of the remittances made by them into the Bank/Treasury. It should clear1y be
understood that the despatch and delivery of cheques to the persons entitled to receive by
an Assistant attached to the Cashier is to be done under the cashier‟s instructions and
close personal supervision. The Cashier is responsible to see that the messengers to
whom the cheques are delivered are properly indentified. Similarly, he should review the
bill transit registers received from the pre-check sections intelligently to ensure that
cheques have been drawn in respect of all the bills sent by the pre-check sections. A
careful review of the cheques despatch register maintained by the Assistant should also
be done at the end of each day to verify that there has been no delay in the issue of the
Pay & Accounts Officer I Assistant should also be done at the end of each day to verify
that there has been no delain1e issue of cheques drawn during the day. He should bring to
the notice of the Pay & Accounts Officer /Assistant Pay & Accounts Officer /all cases
where cheques have not been drawn during the day in respect of the bills received in the
cash section during the day and also the cases where the cheques drawn have not been
delivered.
CHAPTER -9 175
Indenting, Receipt and Safe custody of Cheque Pads:-
9-6-1 In order to avoid fraudulent interpolation or tampering with the contents of cheques, it is
necessary that the cheques are not hand written but typed in the special cheque typing
machine. For this purpose, the form of cheque books with counterfoils (used in regular
Public Works Divisions) will not be suitable. Cheque pads, each containing 100 cheques
in continuous length are got printed. Daily payment sheets prepared by carbon process
while typing out the cheques substitute the counterfoils of cheques.
9-6-2 The Pay & Accounts Officer (Cash) I Assistant pay & Accounts Officer (Cash) will
arrange for the Printing and keeping sufficient stock of the cheque pads for all the PAOs‟
APAOs under the control of the Director of Accounts. The expenditure in this regard is
debited to the office expenses of the Pay & Accounts Office. The requirement of cheque
pads for a year is assessed based on previous year‟s actuals and with reference to any
changes anticipated in the ensuing year and indents for the required number of cheque
pads are placed on control stamp stores Nasik. The Cheques paid are received they will
be counted an verified individually for the total number of cheques in pad and certificate
of count is recorded On the cover page in the space provided for its over the dated
signature of the Pay & Accounts Officer Assistant Pay & accounts Officer. The cheque
books are then taken to stock by filling in the relevant columns of the stock by filling in
the relevant columns of the stock register. The stock book of receipts and issues of
cheque books is maintained in form PAO.32. As and when the cheque pads are issued to
the Cashiers for use the relevant columns are filled in. After all the cheques in one pad
are completely used, the date of the last cheque is also noted in column 9 of the register
before a fresh cheque pad is brought into use. The cover pages of all the used cheque
pads are retained carefully with the Cashier. Whenever any cheque is cancelled the
details of such cheques are noted on the reverse of the cheque pads in the column
provided in addition to the prescribed entries Cash Book, daily payment sheet etc., and
the concerned cheque is retained in the cover of the concerned cheque pads. The Pay &
Accounts Officer/Assistant Pay Officer should invariably keep the unused cheque pads in
his personal custody under lock and key. Whenever there is a
PAO (WA) Manual 176
change in the Pay & Accounts Officer / Assistant Pay & Accounts Officer, a note should
be recorded over the signature of both the relieving Pay & Accounts Officer /Assistant
Pay & Accounts Officers showing the number of cheque pads and unused cheques
handed over. The note should be made in the cash book, stock book of cheques and other
permanent registers concerned.
9-6-3 If a cheque Pad or blank cheque form is lost, the Pay ands Accounts Officer / Assistant
Pay and Accounts Officer should at once inform the Treasury Officer /Bank concerned
furnishing the numbers of the lost cheque pads or cheques.
Forms of Cheques to be used by the separated Accounts Officer:-
9-7-1 The cheques for use in a separated Accounts Office will be of the following three kinds and
printed in different colours for easy recognition.
i) Negotiable :- to be used for personal payment only e.g. payment to contactors, Gazetted Officers
etc. if permissible. These will be in light blue colour
ii) Not Transferable :- Payable to payee only to be used for payment of pay and allowances of
Gazetted and Non-Gazetted staff and office expenditure when the amount is payable to the
drawing officer. These will be in light green colour.
iii) Creditable to Government Account only:
[Government Order to discontinue the operation of cheques of different colours. One

cheque will be used by the department with suitable endorsement for each category of
payment. Para deleted. (G.O.Ms.No.30, Fin. (W&P-F.3) Dept., dt.08.08.2007]
9-7-2 Cheques drawn in favour of individuals (other than Government Servants and pensioners
in respect of payment of salary, allowances, pension etc.,) Firms of Corporate bodies
shall always be crossed as (i) & Co., with the addition of the words “Not Negotiable
“between the crossing in respect of amounts no exceeding Rs.1,000/- (Rupees One
Thousand Only) in each case and ii) with the additions of the works” A/C payee only Not
Negotiable” between the crossing in respect of amount exceeding Rs.1,000/- (Rupees
One Thousand Only) in each case.
In case a request is made by the contractor “or Firm” to issue an Open Cheque, it may be
accepted to if the Executive Engineer / Drawing Officer recommends for such issue.
9-7-3 Cheques preferable at a Treasury for payment are not negotiable instruments and should
not therefore be crossed.
9-7-4 Cheques of the second category (vix) those to be issued for payment of pay & allowances
of Gazetted Officers and Non-Gazetted staff and
CHAPTER -9 177
Officer expenditure (when the amount is payable to the Drawing Officer) will bear the
superscription “Not transferable” on the top and the work” only” instead of the words “or order”
after the name of the payee with the addition of the worked “only” after the name of the payee,
the cheque cannot be endorsed by the payee, even for collection. The payee can however get it
collected through a messenger after duly discharging it by signing it on the back and sending it
through a messenger along with a letter requesting the bank/treasury to pay to the authorized
messenger name. [Cheque to be issued for payment of Pay & Allowances of Gazetted
Officers / Non-Gazetted Staff and office expenditure (when the amount is payable to the
drawing officer) will bear the subscription “Not Transferable” on the top. The cheque
cannot be endorsed by the payee even for Collector. The payee can, however, get it
collected through messenger after duly discharging it by signing on the back and send it
through a messenger along with a letter requesting the Bank / Treasury to pay the
authorized messenger named. (G.O.Ms.No.30, Finance (W&P-F.3) Dept., dt.8-8-2007)]
9-7-5 The third category of cheques to be issued in clearance of interdepartmental and inter-
Government transactions will neither bear the words “order” nor “only” after name of the payee.
Such cheques will be entered in the register of valuables by the receiving officer and sent to the
bank with a challan for credit to the relevant head of account.
[Deleted. G.O.Ms.No.30, Finance (W&P-F.3) Department, dated 08-08-2007]
9-7-6 Cheques issued by the Pay & Accounts Officers / Assistant Pay & Accounts Officers are valid for
three months only after the month of issue.
[One month only after the month of issue. G.O.Ms.No.30, Finance (W&P-F.3)
Department, dated 08-08-2007]
Drawal, Delivery and Despatch of Cheques Transmission of Bills to the Cash Section:-
9-8-1 With a view to regulating the work in the Cash Section, the passed bills will be received
in the Cash Section in convenient batches. The first batch of passed bills will be received
in the Cash Section as soon as the office starts working, the second batch by 1:00 P.M.
and the third batch by 3:30 P.M. Bills authorized by the Director of Accounts where
payment is to be made urgently or on a particular day should be received in the Cash
Section till the close of office hours. The first batch of passed bills to be received in the
Cash Section will be the bills passed by the pre-cheque sections after 3:30 P.M. on the
previous day, the second batch will consist of the bills passed by pre-cheque sections
upto 1:00 P.M. on the day the third batch will consists of bills passed between 1:00 P.M.
and 3:30 P.M. of that day. It is a matter of primary importance to ensure that cheques in
respect of the passed bills received on a day in the Cash Section are drawn and transacted
in the Cash Book before the close of business for the day and that all cheques in respect
of which window delivery is to be made through messengers are handed over on the same
day in case the messengers are there to receive the cheques.
9-8-2 The passed bills should be sent to the Cash Section through a bill transit register (form
PAO 33) columns 1 to 5 shall be filled in by the
178 PAO (WA) Manual
pre-check section while sending the passed bills to the Cash section. The passed bills are
received by the Cashier and acknowledged in column 6 of the transit register. The
Cashiers will hand over the bills with the cheques to the cheque typists. The cheque
typists will then proceed to type out the cheques along with the counterfoils on the daily
payment sheets. The blank cheque forms required for typing out the cheques will be
obtained from the Cashier to whom the cheque pads will be issued by the Pay and
Accounts Officer. The cheque typist should ensure that the cheque is made out in the
prescribed colour from the prescribed cheque pad which is in use at the time. In order to
enable the cheque typist to type out the cheques easily the pre-check sections while
passing the bills should clearly indicate the name of the party/firm on whose behalf the
cheque is to drawn as well as the bank/treasury on which the cheque is to be drawn. The
amount of the cheque will be typed with reference to the amount noted in the pay order
recorded on the bill by the pre-check section over the signature of the Pay and Accounts
Officer / Assistant Pay and Accounts Officer-in-charge of the pre-check section. Where
power of attorney is given by the contractor, the pre-check section should indicate near
the pay order on the bill and M.Book the name of the original contractor and not the
name of power of Attorney holder. When two or more bills are payable to one party,
they should be clubbed together and only one cheque drawn. While typing out the
amount of the cheque in figures, there should not only be a dot or decimal point between
the figures representing the whole rupees and the paise, but the latter should also be
followed by the abbreviation “P” whole rupees are concerned, shall be written in words
also. The amount of the paise may be written in figures after the words stating the
number of rupees (e.g., Rupees twenty five / 40P). If there are no paise, the word “only”
shall be written after the number, of whole rupees (eg. Rupees Twenty Six only). In
either case, great care should be taken to leave no space that could be used for making
any interpolation. No abbreviation such as, eleven hundred for one thousand and one
hundred should be used while typing the cheque.
Payments due to a contractor may be made direct to a financing bank provided that the
department concerned has obtained (1) a legally valid document, such as a power-of-
attorney or transfer deed signed by
CHAPTER- 9 179
the contractor and authorizing the bank to receive the payments due to him by the
Government, and (2) the contractor‟s written acceptance of the correctness of the account
prepared to show what is due to him by the Government on his signature on the bill or
other claim preferred against the Government on his behalf settlement of the account or
claim by payment to the bank. A receipt given by a bank in favour of which a contractor
has executed a power of attorney or transfer deed authorizing it to receive payments due
to him by the Government constitutes a valid discharge for the payment due to him, but
contractor should as far as possible, be induced to present their bills duly receipted and
discharged through their bankers.
A Common form of fraud in regard of cheques consists in altering the word “one” into
“four” by prefixing an „f and changing the „e‟ into an „r‟ as the figure can easily be
altered correspondingly to 4. The word “twenty” when written carelessly, has also
sometime been changed into “seventy”. A Government servant who draws a cheque in
which the word “one” or “twenty” occurs shall therefore write the word very carefully in
order to make such a fraud impossible. The Pay & Accounts Officer/ APAO shall
examine the words “four” and “seventy” and the corresponding figures in cheques with
special care.
9-8-3 Where the Pay and Accounts Officer /Assistant Pay and Accounts Officer is not
authorized to make any payment in cash, there will be no minimum limit for payment by
cheques.
9-8-4 The cheques as drawn above are attached to the respective passed bills and passed on to
the Cashier by the cheque - typists for transacting them in the Cash book. The Cashier
scrutinizes the cheques carefully to ensure that it is correct in all respects. The name of
the payee and the amount of the cheque should be carefully verified with that of noted by
the pre - check sections in the pay order. As every correction or alteration in the cheque
shall be separately attested with full signature of the Pay and Accounts Officer / Assistant
Pay and Accounts Officer who signs the cheque, the Cashier should mark out such
corrections or alterations on the cheque correctly. The cashier shall then provide the
protective crossing on the cheque by writing across it at right angles to the type the word
„under‟ followed by an amount higher by one rupee than that for which the cheque is
drawn e.g., under Rs. Twenty nine. In cases
180 PAO (WA) Manual
where the cheque should be crossed necessary endorsement to this effect should also be
recorded on the cheques by the Cashiers.
9-8-5 The cash book in the Pay and Accounts Office is maintained in the normal form of cash
book applicable to a Public Works Division. The Payments are recorded on the right hand
side of the cash book while receipts are recorded on the left hand side. The cheque
obtained from the cheque - typist is transacted in the cash book. The entry in the cash
book in respect of the previous cheque should first be verified before the next cheque is
transacted in the cash book to ensure that all the previous cheques have been drawn under
proper authority. The pay order in the Measurement Book is then cancelled and an
enfacement by means of a rubber stamp is made on relevant page of the Measurement
Book to indicate the fact of payment, cheque number and date and voucher number over
the initials of the Cashier. A similar enfacement is made on the bill also. The number
assigned to the-voucher should also be noted in the daily payment sheets.
9-8-6 The Cheques together with the Cash book, daily payment sheets and the connected
vouchers are then placed before the-Pay and Accounts Officer / Assistant Pay and
Accounts Officer. The Pay and Accounts Officer / Assistant Pay and Accounts Officer
after ensuring the correctness of the cheque drawn with reference to the colour of the
cheque, amount of the cheque, name of the payee, protective endorsement, crossing of
the cheque etc., will sign the cheque. The pay order on the bills will also be cancelled by
the Pay and Accounts Officer/Assistant Pay and Accounts Officer simultaneously to
ensure that a second cheque is not drawn in respect of the same pay order. All corrections
and alterations in the cheques will also be attested by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer with his full signature. The corresponding
entries in the Cash book and the daily payment sheets are also attested by the Pay and
9-8-7 The signed cheques together with the vouchers are then handed over by the Cashier to the
cheque delivery Assistant (Who is only an assistant to the Cashier) for delivery /
despatch.
Delivery of Despatch of Cheques:-
9-9-1 The delivery /despatch of the cheques drawn during a day is watched through a separate
register in form P.A.O. 34 called the cheque despatch register. All the cheques handed
over by the Cashiers are entered in the
CHAPTER -9 181
cheque despatch register filling in the details of the various columns provided therein. As
the set up of a division in a departmentalized system of accounts is the same as that of a
division in the Public Works Department in a state excepting for the payment functions,
the responsibility for delivery or despatch or cheques to the parties concerned rests with
the division. The cheques should therefore, as a rule, issued only to the Divisional
Officers concerned who presented claims either directly or through a messenger. In
individual cases, the cheques can be delivered to the parties concerned at the Pay and
Accounts Officer counter, if a specific request to this effect is made by the Divisional
Officer. In case cheques have to be sent through messengers the panel of names of
messengers authorized to receive cheques from the Pay and Accounts Office should be
sent by each drawing Officer to the Pay and Accounts Officer/ Assistant Pay and
Accounts Officer concerned in form P.A.O. 35. Any subsequent changes in the panel of
authorized messengers should be promptly intimated to the Pay and Accounts Officer /
Assistant Pay and Accounts Officer concerned and his acknowledgement obtained.
9-9-2 A separate acknowledgement in form P.A.O. 36 should be sent in respect of each bill
(whatever may be the category) in respect of which delivery of cheque is desired through
the authorized messenger. This acknowledgement should be delivered by the authorized
messenger to the Pay and Accounts Officer / Assistant Pay and Accounts Officer at the
time of collecting the cheque. It should be ensured that the messenger who brings the
acknowledgement is one whose name is already included in the panel of authorized
messengers (F.A. & CAO‟s D.O.No.FA/F.III(iii) 25-1/66-67/511, dated 4-8-1966). The
Divisional Officer and not the Pay and Accounts Officer / Assistant Pay and Accounts
Officer /will be responsible for cheques delivered to the messenger. The Cash4er should,
however, take all reasonable precautions to ensure that the cheque is delivered to the
correct party or messenger. In the case of cheque delivered to the Contractors/firms the
acknowledgements for such cheques so delivered may be obtained by the Divisional
Officer and sent to the Pay and Accounts Office in form PAO „37‟ within four days after
payment.
Delivery of Cheques at the counter of PAO (when authorized):-
9-10-1 In cases of contractors, job workers and suppliers in whose favour works or contracts are
let out as individuals, their specimen „signature duly
182 PAO (WA) Manual
attested by the concerned drawing officer should be forwarded to the Pay & Accounts
Officer /Assistant Pay & Accounts Officer for reference and record. Such persons, on
presenting themselves at the Pay & Accounts Office, may be given the cheques after
obtaining their acknowledgements in the cheque despatch register. Such cheques should
be crossed unless desired otherwise y the parties concerned. Such requests should be
routed through the drawing officer concerned. If the individuals in whose names the
cheques are made out send messengers to obtain the cheques, then all such cheques are
made out send messengers to obtain the cheques, then all such cheques should be crossed
without exception. The messengers should bring with them the acknowledgements duly
signed by the Payee. The contractor may be required to send identity cards along with the
messengers to serve as an additional precaution. The acknowledgement of the messengers
for having received the cheque will be obtained in the cheque despatch register while the
acknowledgement for the cheques by the payees will be filed separately. If the Parties
concerned do not turn up to receive the cheque, will be obtained in the cheque despatch
register while the acknowledgement for the cheques by the payees will be filed
separately. If the parties concerned do not turn up to receive the cheques then the cheques
duly crossed will be sent to them by Registered post after waiting for a period of three
days from the date of drawal of the cheques. The postal receipt number of the registered
cover will be noted in the cheque despatch register in the relevant columns to serve as an
acknowledgement for the cheque, the postal acknowledgements being filed separately. In
respect of out-station cheuqes on behalf of suppliers where delivery at the counter of the
Pay & Accounts Office is not possible they will be despatched direct to the firms by the
Pay & Accounts Officer/Assistant Pay & Accounts Officer under registered cover and the
postal receipt number with date noted in the relevant column of the cheques despatch
register, postal receipt being filed separately. The despatch of all such cheques drawn
during a day should be completed on the following day at the latest. In order to enable the
suppliers to link up the payments with their bills it is necessary that details of the
payments are furnished to them while sending the cheques. For this purpose, a
forwarding letter in the form PAO “38‟ shall be used. In order to facilitate the work of the
cheque despatcher in writing out the addresses of the firms in forwarding
CHAPTER -9 183
letter it is necessary for the pre-check sections to furnish the full address of the firms their
cheque forwarding slips.
9-10-2 The Cashiers are primarily responsible to ensure the correct and prompt delivery of
cheques. In order to ensure that cheque in respect of all the bills received in the Cash
Section have been drawn and that all the cheques drawn are delivered or despatched
without any avoidable delay, it will be necessary for the cashier to review the bill transit
registers of the pre- check sections as well as the cheque despatch register maintained by
his Assistant. Before returning the bill transit registers to the re check sections, the
Cashier should note against each bill the voucher number assigned to it in the Cash book
to ensure that all the passed bills are covered. Similarly at the end of each day, the cheque
despatch register should be carefully examined to ensure that all the cheques drawn and
transacted in the cash book during a day are included in the register and that there is no
avoidable delay in the delivery or despatch of cheques. The Cashier should prepare an
abstract of the cheques pending despatch and indicate briefly the reasons for the
pendency in respect of each cheque. A certificate to the effect that all the cheques drawn
for the day are included in the despatch register and that with the exceptions detailed all
the drawn cheques to the end of the day have been delivered / despatched should be
recorded by the Cashier in the cheque despatch register. The register should be submitted
to the Pay and Accounts Officer / Assistant Pay and Accounts Officer daily for review. It
is the responsibility of the Pay and Accounts Officer / Assistant Pay and Accounts
Officer (Cash) to bring to the notice of the Director of Accounts cases of delay in the
drawal I despatch of cheques.
9-10-3 The cheque forwarding slips for the cheques delivered at the counter as well as for those
sent by registered post directly by the Pay and Accounts Officer / Assistant Pay and
Accounts Officer should be sent at the close of each day to the concerned Divisional
Officer daily for his information. The cheque forwarding slips as furnished by the pre-
check sections should contain full details of the payment.
9-10-4 After action for the delivery/despatch of the cheques is completed the vouchers are
transmitted to the compilation section for compiling the accounts.
Despatch of Measurement Books:-
9-11-1 All payments re1ating to works other than those made out of imprest
184 PAO (WA) Manual
held by the Divisional Officers are made by the PAO /APAO after cent per cent pre -
check. For this purpose the Measurement Books where in detailed measurements are
recorded have also to be received in the pay & Accounts Office. The Measurement Books
re returned to the division after the bills received along with them are disposed off the
pied bill all the measurement books received from the division in respect of that bill are
also sent through the bill transit register duly indicating the measurement book numbers
in the columns provided in the bill transit register. While acknowledging receipt of the
passed bill in the bill transit register, the cashier should verify the measurement books
received along with the bill the entries noted in the transit register as well as the cheque
forwarding slip attached to the passed bill and indicate discrepancies in the bill transit
register deny. After the cheque is drawn the cheque is handed over to the Cahier by the
Cheque is drawn the cheque is handed over to the Cashier by the Cheque - typist. The
cashier should then verify the measurement books received with those noted in the
cheque forwarding slips to ensure that all the measurement books indicated in the cheque
forwarding slip are duly received by him. All the measurement books so received should
be handed over to the cheque despatches who will enter them in a separate despatch
register indicating the measurement book numbers clearly. When the cheque is received
from the cashier for deliver/despatch the cheque despatcher should verify the
Measurement Books received by him with those noted in the cheque forwarding slips to
ensure that all the measurement books are received intact, The measurement books are
then handed over to the messenger of the division concerned when he comes for taking
delivery of cheques and the acknowledgement of the messenger turn up for three days
after the receipt of the measurement books by the cheque despatcher, they should be
despatched to the division by registered post, the postal receipt number being noted in the
cheque despatch register against the relevant entry. Acknowledgment for the returned
measurement books should be insisted from persons not below the rank of a clerk. In
respect of bills which require post review by the DOA at 40% and 80% stage the pre-
check section should indicate in the bill transit register against the items (i.e.) bills passed
and sent to the cash section so that the cashier can return the MBs concerned after cheque
is drawn and
CHAPTER -9 185
entries made in the MBs. to the pre-check section for getting them post reviewed by the
DOA. It is the responsibility of the pre-check section to return the MBS to the divisions
concerned with remarks of DOA duly observing precautions of returning of MBs as laid
down in Para 23 and 419 of PAO Manual”.
9-11-2 The Cashier should scrutinize the despatch registers for the return of measurement books
daily to ensure that the measurement books are returned promptly. The despatch register
should be closed on every Monday indicating the details of measurement books pending
despatch for more than three days and submitted to the Pay and Accounts Officer / \
Assistant Pay and Accounts Officer for review and orders regarding the un-despatched
measurement books.
Statement of Bills Paid:-
9-12-1 The Pay and Accounts Officer / Assistant Pay and Accounts Officer shall send every
month to each division a statement of bills paid (in duplicate) in form „PAO 39‟ which
shall be verified by the divisional Officers to ensure that the bills paid by the Pay and
Accounts Officer/ Assistant Pay and Accounts Officer do not include any bills not either
presented or accepted by him. The Divisional Officer will return one copy of the said
statement to the Pay and Accounts Officer / Assistant Pay and Accounts Officer
concerned within a week from the date of receipt with a certificate to the effect that all
payments mentioned in the statement relate to his division and indicating items which do
not relate to his division.
(Govt. Projects Wing Memo. No. 175 –E/66-3, dt.29-3-1966)
9-12-2 The statement of bills paid should be got filled in at the time of signing each cheque (that
is each time this statement will get written up at the time of signing of the cheque
concerned). In the Remarks column the Pay and Accounts Officer / Assistant Pay and
Accounts Officer signing the cheque, put his initial. It should be watched that one copy of
the statement is received back promptly from the division by maintaining register in form
„PAO 40‟ by having one foil-for each division. Any delay in the return of the duplicate
copy of the statement should be pursued vigorously with the departmental Officers till the
statement is received back with the certificate.
186 PAO (WA) Manual
Receipt and Disposal of Valuables:-
9-13-1 The valuables that are received in the Pay and Accounts Office consist of the following
two categories:
(i) Those to be despatched to the parties or to be sent to Bank/ Treasury for collection
immediately on their receipt after action in the Pay and Accounts Office.
(ii) Those received for safe custody.
9-13-2 The first category consists of the following classes of valuables:
(a) Cheques
(b) Bank drafts.
(c) Interest warrants.
9-13-3 The second category consists of
(a) Securities and

(b) Bank Guarantees.
9-13-4 The valuables should be sent in sealed covers to the Pay and Accounts Office. They are
received by the Cashiers directly. If they are received in some other section along with
other documents, they should be sent to the Cashiers immediately on their receipt. All the
valuables received by the Cashiers are entered in the register of valuables in form PAO
„41‟ as and when received. The cheques and bank drafts are transacted in the cash book
and sent to the Bank along with the challan, for realization. In order to ascertain the head
of account to which such cheques /Bank drafts are to be credited the forwarding letter
received from the division is sent to the pre-check section concerned with a request to
indicate the classification. The pre-check section should return the forwarding letter
within three days duly indicating the classification. The Interest Warrants which are to be
sent to the parties concerned for realization are despatched to them and their
acknowledgements watched. Other documents like the Securities and Bank Guarantees
which are received for safe custody are entered in separate registers like register of
interest bearing securities and register of Bank guarantees. In all cases, the details of
disposal should be noted in the register of valuables.
9-13-5 In order to watch the realization and credit to Government of all the amounts covered by
the cheques and Bank drafts sent to the Bank a remittance register in form „PAO 42‟ is
maintained in the Cash Section.
CHAPTER -9 187
As and when the cheques are sent to the Bank for collection the columns in the register
are filled in. The receipt book of the challan from the bank in proof of realization of the
amount is watched and on receipt of challan, the remaining columns in the register are
filled in. The challan number is noted iii the cash book against the voucher already noted
therein while transacting the cheque. The challan is then sent to the compilation section.
The remittance register should be closed on every Monday indicating the number of
challans due from the Bank in respect of cheques/ Bank drafts despatched for realization
and submitted to the Pay and Accounts Officer I Assistant Pay and Accounts Officer for
review.
Register of Interest bearing Securities:-
9-14-1 Transactions connected with interest Bearing Securities do not pass through the cash
book and consequently the regular accounts of the Pay and Accounts Officer / Assistant
Pay and Accounts Officer. A register of receipt and disposal of these securities should be
kept in form PAO ‟43‟.
Periodical Verification of the securities:-
9-15-1 The Pay and Accounts Officer / Assistant Pay and Accounts Officer should verify
periodically and at least once in an year in May all securities which he has in his custody
and report the result to the Director of Accounts
Annual Valuation of G.P. Notes etc.,:-
9-16-1 In the case of security in the form of Government promissory notes, stock certificates of
Government, Municipal debentures or Port Trust bonds, the Pay and Accounts officer/
Assistant Pay and Accounts Officer should ascertain in May of each year whether their
value when valued at the Market price on 1st May of that year or the face value whichever
is less in each case is still sufficient to cover the amount of the security required. If the
total value of the securities deposited by the Government servants or contractors as
ascertained at this annual valuation falls short of the amount of the security required plus
5% by Rs. 100 or more, the Pay and Accounts Officer / Assistant Pay and Accounts
Officer should at once require the departmental authority concerned to obtain additional
security from the party concerned to the extent of shortage. No security should be
returned to any depositor on account of an
188 PAO (WA) Manual
increase in their valuation as ascertained at this annual valuation unless the securities
have appreciated so considerably that securities of the face value of Rs. 100 or more can
be withdrawn and the remaining securities (valued as described above) would still be
sufficient to cover the amount of security required plus 5% to provide against fluctuations
and the depositor submits a written request for the return of the securities that can be so
withdrawn.
Bank Guarantees:-
9-17-1 Bank Guarantees can be accepted from contractors in hew of cash deposits in respect of :-
1. Standing securities deposited with each Chief Engineer and (2) individual work towards
Earnest Money Deposit in excess of Rs. 10, 000 and 3) difference in security deposit at
the old and new rate. The Bank guarantees after accepting by the competent authorities
(Tender accepting authority) may be sent to the Pay & Accounts Officer /APAO for safe
custody.
G.O.Ms.No.167, Fin. (A/Cs) dept., dt.18.4.1961 and G.O.Ms.No.69, Fin. (A/Cs) Dept.,
dt.24.03.1965 valid up to 31-03-1963 and item 2 G.O.Ms.2706, PWD, dated 23.11.1961
and G.O.Ms.No.1455, PW(C) Dept., dt.31.05.1965 (valid until further orders)
G.O.Ms.No.491 , PWD, dt.14.05. 1973.
Note. 1
the tender receiving Officers should verify the wording, clauses of the Bank Guarantee to
ensure enforcement in case of default.
Note -3
The Tender accepting authorities should certify that he has scrutinized the guarantee and
has satisfied himself.
Note-4
The Bank Guarantee accepting authority should check and verify the Bank Guarantee
whether it is in the form prescribed and conform to the instructions issued by
Government.
(vide G.O.Ms.No.5, Fin. & Plg. (Proj. Wing) Dept., dt.25.1.96)
9-17-2 After receipt of the Bank Guarantees in Cash Section they have to be checked to see that
they are in the prescribed form and conform to instructions issued by the Government
from time to time and entered in
CHAPTER -9 189
the Register of interest bearing securities and put up to the Pay and Accounts Officer/
Assistant Pay and Accounts Officer. After approval by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer, they should be sent to the concerned pre -
check sections for noting in the relevant records of the Sections, they should be lodged in
safe custody with the Pay Accounts Officer/ Assistant Pay and Accounts Officer. The
cashier should verify the register weekly and intimate in sufficient time the concerned
authorities who have accepted the bank guarantees in regard to their renewal where
necessary.
Issue of Permanent Receipts:
9-18-1 Where the cash book is maintained by the Pay & Accounts Officer/ APAO, all amounts
realized by the departmental officers for credit to the project accounts are remitted in
favour of the Pay & Accounts Officer /APAO and accounted for as receipts in the Cash
Book of the Pay & Accounts Officer /APAO. The departmental officer will issue a
temporary receipt to the party as soon as the amounts are received by him. The permanent
receipt, in respect of such transactions, shall be issued by the Pay & Accounts
Officer/Assistant Pay & Accounts Officer only after the amounts are credited to the
project accounts and actually realized by the Treasury. The receipt books required for use
in the Pay & Accounts Office are obtained from the Director of Stationery and printing
the forms of permanent receipt should be arranged and bound in books in such a way that
the copy to be issued to the party as a receipt and a carbon copy to be retained as an
office copy can be prepared simultaneously with the use of carbon paper. The pages of
the receipt book should be machine numbered. Every receipt book should be carefully
examined by the Pay & Accounts Officer Immediately on receipt and the number of
forms in the book should be counted and a certificate of count should be recorded in the
following form which will be printed on the inner side of the outer cover of the book.
Certificate
The receipts in books No………………………………………………………………. complete

in number and in consecutive order.
Signature
Date:
Designations:
190 PAO (WA) Manual
9-18-2 The receipt books, on receipt should be taken over to the Stock register of Receipt books
and then issued individually for use. Unused receipt book should be held in the personal
custody of the Pay and Accounts Officer/ Assistant Pay and Accounts Officer under lock
and key and handed over to the successor as a specific item whenever there is a change in
the incumbency of the post.
The receipt accounted for in the cash book in respect of which permanent receipt are
normally issued are mainly of the categories mentioned below:-
9-18-3 (i) Remittances through challan or through cheques/drafts by contractors or suppliers

towards the cost of tender documents or towards earnest money or security deposits.
(ii) Recoveries from private parties and officials towards rent for the occupation of rest
houses and residential buildings under the control of the Project authorities.
(iii) Recoveries from private parties and employees towards the cost of electricity
consumed for water supplied.
(iv) Recoveries for service rendered in the hospitals, schools and other Public institutions
under the control of the Project Authorities.
(v) Recoveries due from contractors and employees of the project towards hire charges of
vehicles / machinery lent by the department.
(vi) Recoveries towards sale proceeds of stock materials, unserviceable material or

surplus materials.
(vii) Miscellaneous recoveries like private telephone calls, sale of papers, periodicals etc.
9-18-4 The nature of the transactions in most of the cases mentioned above is such that no useful
purpose is served in issuing individual receipt in respect of each transaction. The work of
issuing individual receipts in respect of electricity and water charges receipts from
schools etc. will be time consuming while in other cases like rents or rest houses, hire-
charges etc., the parties may not be easily available for taking delivery of the receipts.
Further in all cases temporary receipts-would have been issued by the concerned Officers
to the parties immediately on receipt of the amount. It will therefore be expedient to issue
individual receipt indicating the total amount accounted for as receipts for a specified
CHAPTER -9 191
period can be issued to the officer-in charge of collecting such-receipts to enable him to
ensure that all the amounts realized by him have been properly brought into account.
9-18-5 It is not permissible for a Government servant to issue a duplicate or copy of the receipt
granted by him on the allegation that the original has been lost or is not readily available.
A certificate may, when necessary, be given that on a specific day a certain sum was
received on a certain account from a certain person and a fee of Re. I should be levied for
every such certificate issued to a private party. This prohibition extends only to the issue
of a duplicate on the allegation that the original has been lost and does not apply in cases,
where under rules in force, duplicates may be prepared and tendered with the original.
Passing on of Deductions from Bills:-
9-19-1 The work relating to the passing on of deductions affected from the Pay bills and credited
to Miscellaneous Deposits of P.A.O is attended to in the cash section. While passing the
pay bills of the Gazetted Officer and the non-gazetted establishment the pre-check section
should ensure that all fund deductions in the bills are supported with necessary schedules
giving full details as to the name of the subscriber, account number, amount of the
monthly installment, number and amount of the installment of recovery in respect of
advances drawn from the fund etc.. If schedules are not attached to the bills, the pre-
check section concerned should prepare schedules and attach them to the vouchers.
Before the vouchers for the day are handed over to the compilers, the various deductions
in the bills are noted in a register of deductions which should be maintained in form PAO
„44‟ The schedules attached to the vouchers should also be removed and taken over by
the Assistant-in-charge of the Deposit register The deductions in a voucher are posted
against the individual or party concerned under the various categories of deduction and
the total deductions credited to PAO Deposits is also noted in the column provided. At
the end of each week, the total of the deduction under the various categories as well as
the total of the deductions from all the vouchers for a week is worked out and tallied with
the booked‟ figure under sits”.
9-19-2 The deduction on account of APSEI etc recovered from the employees of the Project /
Irrigation /other schemes from the salary bills will be
192 PAO (WA) Manual
passed on to the concerned authorities by 15th of succeeding month one batch comprising
all the transactions of the month after the monthly account is closed and sent to AG/other
Officers.
9-19-3 The credit on account of deductions shall be passed on to the respective Officers either
through cheques or through remittance in their favour in the bank or treasury. The fund
schedules detached from pay bills are grouped together category wise and an abstract of
the schedules is prepared on a separate sheet. The total as per the abstracts in respect of
each category of deductions should then be tallied with the totals under each category of
deductions a given in the register of deductions. If any of the amounts on account of the
fund deductions is not to be passed on, the concerned schedule should be retained and
such schedules should not be included in the abstract of the schedules. In the register of
deductions an abstract should be prepared showing the amount of the deductions category
wise for the period in question, the amount passed on and the balance. Full details for the
balance of the amount not passed on should also be abstracted in the register of
deductions. If all the fund recoveries for a period in question are passed on at the end of
the period, there will be no balance in the abstract referred to above. Otherwise the
balance would represent the amount of the fund deductions to be passed on and for this
the corresponding schedules should also be available.
9-19-4 Separate bills for each category of deductions for the amounts to be passed on will then
be drawn in the Cash Section and got passed by the Pay & Accounts Officer /APAO.
Cheques (in favour of the officer concerned) should then be drawn in cases where the
deductions are passed on through cheques. The schedules already prepared by Cash
Section should be attached to the concerned cheques and then forwarded to the Officer
concerned. In cases where the amounts are remitted through challan a self cheque for the
amount of the remittance should be drawn in favour of the Pay & Accounts
Officer/APAO and sent to the Bank/Treasury with a challan for credition it to the
concerned head of account. The relevant schedules prepared by the Cash. Section should
also be attached to the original challans for incorporation in the treasury accounts in
support of the remittance. The cheque number or the Challan number through which the
deduction are remitted should be noted in the register of deductions also against the
abstract for individual categories of deductions.
CHAPTER -9 193
In respect deduction viz. IT. ST, GPF, APGLTS which are directly credited in the
accounts of PAO, the relevant schedules of recoveries or payments should be collected
and a consolidated abstract prepared and sent to AG, AP/ ITO/Director of Insurance/
CTO etc.
9-19-5 Recoveries on account of funds adjustable in the book s of the local Accountant General
should normally be passed on by remittance into the bank, while other classes of
deductions adjustable outside the accounts are passed on through cheque/Bank Draft
drawn in favour of the departmental officers concerned.
Note:- As an exception to the theory of cash settlement indicated above, their recoveries towards
GPF, FBF, Insurance, ST, etc. can be transacted by the PAOs by adopting the procedure
of direct booking to the relevant heads of account subject to the condition of rendering
separate lists of OFF recoveries / payments duly supported by schedules /vouchers and
indicating the reference to the vouchers No. Gross amount, Net amount and recovery of
GPF etc., and also tallying the schedules/Vouchers with monthly accounts, the
instructions issued in this regard vide Govt.Memo.No.735/F III-2/89-13, dt.25.04.91
should be followed scrupulously.
(vide G.O.Ms.No.88, Fin. & Plg. (Proj. Wing) Dept., dt.16.8.1996)
Register of miscellaneous deposits of P. A. O.:-
9-20-1 The transactions under miscellaneous Deposits of PAO should be noted in a separate
Deposit register maintained in the Cash section so as to have a collective record of
transactions under this head during a month. As most of the deductions effected from
bills during a month will be passed on during the same month an account of such
deductions effected and passed on need not be maintained in detail in this deposit
register. The total of the deductions effected and passed on during the same month may
be noted in lump. In other cases where the deductions have not been passed on in the
month in which they were effected item-wise details of each recovery should be
furnished in the deposit register under the concerned month. The details to be copied in
this register will be the same as those given in the register of deductions against, the
balance amount shown as not passed on in the abstract in respect of each category of
deductions. To facilitate easy watch over clearance of the arrear items of a month such
items shall be passed on separately and shall not be clubbed with the items of a
subsequent month.
194 PAO (WA) Manual
separately and shall not be clubbed with the items of a subsequent month.
9-20-2 The register of PAO Deposits should be closed every month duly reconciling the debits
and credits for the month with the compiled account figures. The outstanding items
should be scrutinized intelligently to ensure that no items not creditable to miscellaneous
Deposits of PAO, has been credited erroneously under this head and that there is no delay
in passing on the items to the officers concerned. The Superintendent of the Cash Section
in personally is responsible for this work. The Pay and Accounts Officer/Assistant Pay
and Accounts Officer while reviewing the registers every month should ensure that no
item is kept outstanding without sufficient justification.
Miscellaneous procedure for Settlement through Bank Drafts:-
9-21-1 Certain classes of payments like payments to the Pay and Accounts Officer, Ministry of
Works, Housing and Supply, payments to another separated Pay and Accounts Officer/
Assistant Pay and Accounts Officer and certain fund deductions adjustable in the books
of the Account General of another State shall be passed on through bank drafts. These
bank drafts are obtained at par from the treasury or bank. A cheque is first drawn in
favour of the treasury officer or the agent of the bank with an application form to the
Treasury of Bank. Such cheques in respect of which bank drafts are to be obtained are
entered in a separate register inform PAO. „45‟ when the cheque together with the
application form is sent to the bank! treasury the columns in the register shall be filled in
and the receipt of the bank draft, they should be despatched to the party concerned
without delay after completing the remaining columns in the register The
acknowledgment in support of the receipt of the bank draft should be watched and
reference to the number and date of such acknowledgment should be noted in the register
in the column provided to complete the entry in respect of each item.
Time barred cheques: -
9-22-1 the currency of a cheque should expire owing to its not being presented at the Treasury /
Bank within three months from the month of its issue, it may be received back by the Pay
and Accounts Officer/ Assistant Pay and Accounts officer who should then destroy it and
draw a new cheque in lieu of it. The fact of the destruction and the number and date of
the new cheque should be recorded on the carbon copy of the
CHAPTER -9 195
daily payment sheet of the old cheque and the number and date of the old cheque that is
destroyed should be entered on the carbon copy of the Daily Payment Sheet of the new
one. The fact of the new cheque having been issued should be entered on the date of issue
in red ink in the cash book but not in the column for payment, a note being made at the
same time against the original entry in the cash book.
(Para 144 of A.P. P.W.A. Code)
Lost Cheques:-
9-23-1 When the Pay and Accounts Officer/Assistant Pay and Accounts Officer receive a report
that a cheque drawn by him has been lost; he should at once report the fact to the
Treasury/ Bank and request for stopping payment of the cheque. On receipt of a
certificate from the Treasury/Bank to the effect that the cheque has not been pain and that
it will not be paid, if presented thereafter, the Pay and Accounts Officer/ Assistant Pay
and Accounts Officer should cancel the original cheque and make necessary entries in the
accounts and then issue another cheque and make necessary entries in the accounts and
then issue another cheque in its place (S.R. 50 under T.R. 16).
Cancelled Cheques:-
9-24-1 The Pay & Accounts Officer /APAO Should cancel any cheque which has remained
unpaid for twelve months from the date of issue and write back the amounts in the
accounts. Before cancelling the same it is desirable to ascertain from the Bank/Treasury
concerned whether the cheque has been encashed or not. The cancellation should be
recorded on the carbon copy of the daily payment sheet and the cheque, if the cheque is
in the pay and Accounts Officer /APAO‟s possession should be destroyed. If the cheque
is not in possession, Promptly request the treasury/Bank to stop payment of the cheque
and after obtaining a certificate under Para -415 above, he should write back the entry in
the cash book by exhibiting the amount of the cheque as a minus figure on the payment
side in the Bank or Treasury column. A Counter reference should be given in the Cash
Book against the original to the second entry of the cheque (Para 145 of APPWA Code).
Cash Book extracts received from the Executive Engineers by Land Acquisition Officers and
Other Civil Departmental Officers having limited cheque drawing powers:-
9-25-1 The Executive Engineers/ Land Acquisition Officer and other Civil Department Officers
specially entrusted with Project Works can draw cheques for limited purposes to the
extent of powers delegated to them
196 PAO (WA) Manual
from time to time. The Cash Book extracts received from these Officers should, after
scrutiny, be incorporated in the Cash Book of Pay and Accounts Officer/ Assistant pay
and Accounts Officer.
Alternate Cash Books:-
9-26-1 The cash Book should be closed weekly. One Cash book will be in use for 1st week and
3rd week and another Cash Book for 2nd week and 4th week. This system of alternate
Cash Books is to facilitate concurrent audit by the statutory Audit Officer. The monthly
closing should be done on the last day of the month, giving the balance of imprests
outstanding against each officer.
(Para 37 (3) of Accounting & Financial instruction Part I)
Bills Returned with Objections:-
9-27-1 The bills returned un-passed with objections will not be routed through Cash Section, but
will be returned direct by the pre-check sections concerned. While returning the bills, all
precautions taken by Cash Section in the return of measurement books to Divisions
should be observed by the pre-check section concerned. The measurement books and
bills of out-station offices should be sent by Registered Post through the Central
Despatch unit of the Administration Section.
197
CHAPTER -10
RESULTS OF CHECK - RAISING AND PURSUANCE OF
OBJECTIONS
PART-I GENERAL PRINCIPLES AND RULES
Introductory: -
10-1-1 It is an important duty of the Accounts Organization to report results of its checking to
the proper authority so that appropriate action may be taken to rectify the irregularity,
where possible, or to prevent a recurrence of it.
10-1-2 An Assistant (auditor) must develop an instinct for assessing the importance of an
irregularity. He must keep before him his primary functions of securing the correctness of
accounts and the regularity of financial transactions. He must decide, therefore, when the
detailed check of accounts and transactions has been completed and all infractions, of
rules and orders noticed whether to demand regularization or correction in an individual
case, or whether to be satisfied with prevention of the error or regularity for the future. In
particular it will be remembered that, while financial rules or orders must be observed,
mere rigid and literal enforcement of such rules and orders may degenerate into a wholly
unintelligent check. As a general rule under insistence on trifling errors and technical
irregularities should be avoided, and more time and attention devoted to the investigation
of really important and substantial irregularities with the object not only of securing
ratification of the particular irregularity but also of ensuring regularity in similar cases for
the future. At the same time failure to appreciate the significance of what appears to be a
trifling irregularity may lead to failure to discover an important fraud or defalcation.
Again, notice may be taken of the cummulative effect of numerous petty errors or
irregularities as indicating carelessness and inefficiency in the maintenance of accounts
or in financial administration generally.
10-1-3 Ordinarily where a transaction requires the authorization of a higher authority the Pay and
Accounts Officer/Assistant Pay and Accounts Officer must insist that such authorization
be obtained; or where a sum of money is recoverable the Pay and Accounts Officer must
insist that such authorization be obtained; or where a sum of money is recoverable
198 PAO (WA) Manual
the Pay and accounts Officer/Assistant Pay and Accounts Officer must insist on recovery
save where the competent authority has directed that recovery should be forgone. But all
objections are not of equal importance and discretion should be exercised in pressing an
individual objection when the Pay and Accounts Officer/Assistant Pay and Accounts
Officer is satisfied that the aim to secure regularity is safeguarded for the future.
10-1-4 All observations and objections must be conveyed in courteous and impersonal term and
must be clear and intelligible.
10-1-5 Objections and observations in relation to any account or transactions subject to check by
the Pay and Accounts Officer / Assistant Pay and Accounts Officer or those of statutory
audit which need a reference to the authorities concerned should be communicated to the
drawing officer and, where necessary to the controlling authorities at the earliest
opportunity. It is important that before they are communicated, objections should, unless
otherwise provided in any case, be registered in detail in the prescribed records
maintained in the Pay and Accounts Office.
10-1-6 Reports of individual cases of serious financial irregularity should, in the first instance,
be addressed to the controlling authority concerned or to such authority as may be
specified by Government, though copies may be sent to higher authority simultaneously
for information in cases which are regarded to be so serious that they will eventually have
to be brought to the notice of that authority.
10-1-7 The pay and accounts Officer/ Assistant Pay and Accounts Officer should see that every
query or observation made by him in relation to any account r transactions is taken
promptly into consideration by the drawing officer or any other Government Servant or
authority to whom it may be addressed and returned with the necessary vouchers,
documents or explanation to the Pay and Accounts Officer/ Assistant Pay and Accounts
Officer as early as possible.
Pursuance and Clearance of Objections:-
10-2-1 The responsibility for the removal of objections and the settlement of other point raised
by the Pay and Accounts Officer/ Assistant Pay and Account Officer devolves primarily
upon the drawing officers, heads of offices and controlling authorities. To assist the
pn1ject authorities in
CHAPTER -10 199
the maintenance of financial regularity and of a proper system of accounts the Pay and
Accounts Officer / Assistant Pay and Accounts Officer is expected to maintain a constant
and careful watch over objections and to keep controlling authorities fully acquainted not
only with individual cases of serious disregard of financial rules, but also generally with
progress of the clearance of objections. For this purpose a statement of items held under
objection and pending for over six months should be sent to the heads of departments
concerned every half-year in the form P. A.O. „46‟.
(Financial Adviser‟s Endt.No.FA/F III (i)/26-I/59-64/347, dated 13-5-1963)
10-2-2 The pay and Accounts Officer / Assistant Pay and Accounts Officer should, as soon as
the facts come to his notice, direct the recovery of sums in respect of which there is no
doubt that they have been improperly disbursed. If in case an executive authority desires
to forego a recovery ordered by the Pay and Accounts Officer/ Assistant Pay and
Accounts Officer, it may be required to furnish the requisite sanction. Such sanctions,
when received should be scrutinized by the Pay and Accounts Officer and if he considers
them to be open to criticism he should raise and pursue the objections with them.
10-2-3 Where an amount is outstanding for recovery against a Government servant and money is
also due to him by Government, but has remained undrawn for a considerable period
owing to the death or resignation of the Government servant or any similar cause, the Pay
and Accounts Officer / Assistant Pay and Accounts Officer may adjust the amount due by
the Government servant against the amount due to him by Government, and thus clear the
objection. A bill from the Head of Office should be called for in the case of Government
servants who do not prepare their own bills and note of payment and adjustment should
be made in the relevant records.
10-2-4 The objection books should be written\with care, and watched closely both by the
Superintendent and by the Pay & Accounts Officer. An objection once raised can be
removed from the register only after it has been examined by the PAO/APAO/
Superintendent that due authority exists for the removal of the objection and put his
initials against the item concerned in token of his having done so.
200 PAO (WA) Manual
Reports on Defalcations and other losses:-
10-3-1 The Departmental Officers concerned are expected to report defalcations and losses to the
Pay and Accounts Officer / Assistant Pay and Accounts Officer and the statutory Audit
Officer simultaneously.
10-3-2 On receipt of a report of defalcation or loss of public money or property the Pay and
accounts Officer should call for such further information as he may require on the subject
and carefully examine the case and ascertain whether the defalcation or loss was rendered
possible by any defect in the rules, or whether it was due to neglect of rules or want or
supervision on the part of the authorities. The procedure in dealing with such cases is
contained in paragraph 294 to 322 of A.P.F.C. Volume - I.
10-3-3 A register of defalcations and losses should be maintained in each pre-check section for
each divisional drawing Officer and orders of write-off watched.
PART II- DETAILED PROCEDURE IN CONNECTION WITH THE COMMUNICATION OF

RESULTS OF CHECK TO EXECUTIVE AND CONTROLLING AUTHORITIES
Introductory:
10-4-1 Subject to the general principles and rules laid down in Part - I of this chapter the detailed
procedure in connection with communicating results of check to the proper executive and
controlling authorities is described in this part.
Objection Book:-
10-5-1 the objects of objection books are (1) to serve as a continuous record of the objections
raised and clearance of items placed under objection during and to end of each month, (2)
to afford ready means of reviewing the outstanding objections and (3) to facilitate the
compilation of such statistics of the objections as may be required from time to time.
10-5-2 The Objection Book should be maintained drawing officer-wise in form‟ P.A.O. 47‟ for
works transactions. In the case of the Objection Books for works transactions, a set of
pages should be reserved for each distinct class of objection of which a separate record
may be required for any purpose e.g., “Want of estimate”, “excess over estimate”, “want
of sanction”, “Over -payments”, “miscellaneous” etc.
CHAPTER -10 201
10-5-3 The instructions in this part of the chapter apply generally to all objections arising out of
check whether conducted centrally or locally. As an exception, objections which have
arisen out of local check but cannot be expressed in money values, need not be entered in
the objection books.
10-5-4 The money values of objections raised by the statutory audit should also be recorded
separately in the objection books.
10-5-5 For an efficient review of objections and of the progress of their clearance, it is desirable
to keep the objection books of each financial year separate, even though their clearance
may be effected in a subsequent year.
10-5-6 The objection books should be written with care, and watched closely both by the
Superintendent and by the Pay & Accounts Officer. An objection once raised can be
removed from the register only after it has been examined by the PAO/APAO
/Superintendent that due authority exists for the removal of the objection and put his
initials against the item concerned in token of his having done so.
10-5-7 As far as possible, the entry of an objection whether in the objection book or in the
document communicating the objection should be fully descriptive so that ordinarily
there should be no necessity of referring against the item concerned in to the voucher or
account concerned.
Registration of objection in form ‘P.A.O 47’
10-6-1 the objection falling under this category are „want of estimates”, excess over estimate”, “
want of administrative approval “and “Miscellaneous”, Under each head the objection
relation to each distinct transaction should be treated as a separate item, and a serial
number should be assigned to it.
10-6-2 The amount placed under objection during the month in respect of any item should be
noted against it in black ink in the appropriate column of the month concerned, and below
this entry should be noted in green ink (as the denominator of a fraction the numerator of
which is the entry of the amount placed under objection during the month), the
progressive total of the amount placed under objection to end of the month. In the case of
objections classed as “Miscellaneous” full particulars of the objection should be placed
on record. The postings of all items placed under objection should be verified by the
Superintendent at the time of
202 PAO (WA) Manual
his check of the bills and in token of this, he should attest the entries.
10-6-3 All objections should be communicated to the concerned officers giving full details as
and when they arise. A monthly list of objections raised during a month should be
furnished to the concerned officers as soon as the Objection Book is closed for the month.
In order to enable them to watch the progress in the clearance of objections a quarterly
report indicating category-wise the number of objections raised, number cleared arid
balance at the end of the quarter should also be prepared division / drawing officer - wise
and sent to the concerned officers and Superintending Engineers in the Form‟ P.A.O. 49‟.
(Financial Adviser‟s Endt. No. FA/F.III (i)/26-1/59-60/350, dated 13-5-1963)
Clearance of Objections:
10-7-1 An objection should be removed as soon as the necessary sanction or document is

received. The removal of an objection should be indicated in the Objection Book by an
entry of the amount adjusted in the column “Amount cleared” for the month concerned,
the progressive total of the adjustments being also noted, at the same time in the manner
prescribed for the posting of the amounts placed under objection. As a precaution against
error, a red ink line should be drawn across the page in all the remaining columns. The
reference to the order or other documents on the authority of which the objection has
been removed should also be noted in the column provided for the purpose. All entries
regarding the adjustment of objections should be attested by the Superintendent / Pay and
Monthly Closing:-
10-8-1 At the end of every month, all entries in the column “amount placed under objection” and
“amount cleared” for the month should be totalled separately for each class of objections
and a general abstract should be prepared in a. separate section of the Book. The Pay and
Accounts Officer / Assistant Pay and Accounts Officer should examine and initial the
abstract.
10-8-2 The progressive totals of each class of objections should be carried forward from month
to month and the unadjusted balance from year to year.
CHAPTER -10 203
Annual Closing:-
10-9-1 The Objection Book should be closed annually and the balances of outstanding objections
should be carried forward to the following year‟s Book, the entries being attested by the
Superintendent. If the outstanding balances thus brought forward relate to two or more
years, the balances of each year should be registered in a separate section. The
Superintendent is responsible to see that corrections due to supplementary accounts, if
any, are carried out neatly in the new objection book in due course by plus or minus
entries, as the case may be, made with suitable remarks.
Registration and Clearance of Objections:-
Objection Book:-
10-10-1 Objections relating to transactions other than works should be registered in this form
under the heads enumerated therein and the adjustments as and when they are made,
should be posted in columns 13 to 16 of the register. Every entry in the register should be
attested by the Superintendent.
10-10-2 At the end of every month, the money columns in the Objection Book should be totalled,
the balance of the past month should be added and the closing balance struck. The
Superintendent should sign the certificate at the foot of the page or last page of the
Objection Book for each month. The outstanding balance in each column of the
Objection Book should be carried forward from month to month. At the end of each
financial year the outstanding items should be carried forward with full details to the new
register and each item brought forward attested by the Superintendent.
10-10-3 If large or frequent advances are made under the operation of nay general rule of order
(e.g., LTC, Special Advances etc.,) it is desirable to open separate registers for keeping a
special watch over the recoveries. They are described in the subsequent paragraphs.
Objection Books of Stamped Receipts:-
10-11-1 The bills presented in the Pay and Accounts Office should only be claims and not
acknowledgements. In cases where bills are not pre-receipted a stamped
acknowledgement in support of final acquitance of the payee will have to be received in
the Pay and Accounts Office to
204 PAO (WA) Manual
complete the voucher. In cases where the cheques are sent to the divisions for delivery /
despatch to the parties concerned, the responsibility for obtaining the stamped receipts
from the parties and sending them to the Pay and Accounts Office rests with the
Divisional Officer. In other cases where the cheques are delivered or despatched to the
parties concerned directly from the Pay and Accounts Office the responsibility for
obtaining the stamped receipts rests with the Pay and Accounts Office. In either case, the
responsibility of watching the stamped receipts wherever due in order to complete the
vouchers rests with the Pay and Accounts Officer / Assistant Pay and Accounts Officer.
(Since the despatch / delivery of cheques is centralized in the cash section, the work of
watching the receipt of the stamped receipts is the responsibility of the Cash Section).
10-11-2 In cases where the cheques are delivered to the party or an authorized messenger at the
counter of the Pay Accounts Office, a simple receipt should be obtained before delivering
the cheque and the same pasted to the concerned voucher. In such a case, no further
action is called for in this regard. In cases, where the cheques are despatched by post, the
receipt of the stamped receipts (in cases where the bills are not pre-receipted) should be
watched. The cheque despatch register should be made use of for this purpose by
providing separate columns therein to indicate.
(i) Whether stamped receipt or simple receipt is necessary or not and
(ii) The date of receipt of the stamped receipts.
10-11-3 At the end of every month, this register should be reviewed critically by the Cashiers
and items for which stamped receipts are due would be listed out separately in the
register before the entries for despatch/ delivery of cheques for a subsequent month are
entered therein. In cases where stamped receipts are due the same should be called for
and pursued till they are received. This register would also serve as a subsidiary objection
book for the stamped receipts and only items outstanding for over three months should be
taken over to the Main Objection Book maintained in the Cash Section with the money
value. The stamped receipts as and when received are sent to the record section duly
indicating the name of the division, voucher number and date for being attached to the
respective vouchers.
CHAPTER -10 205
(i) The simple receipts should also be obtained in cases where advance stamped receipts are
appended to the bills paid for which cheques are drawn and delivered at Pay and
Accounts Counter / despatched. The simple receipts obtained at the time of delivery of
cheques at Pay and Accounts Office counter should immediately be pasted to the
concerned voucher by the cheque delivery assistant. The simple receipts for the cheque
delivered to the Divisions for onward transmission to the firms or despatched by post
should be called for and pursued till they are received. The simple receipts as and when
received are sent to record section duly noting the voucher Number and Date and name of
the Division for being attached to the respective vouchers. At the end of the every month,
this register should be reviewed critically by the cashiers and items for which simple
receipts are due should be listed out in the register before entries for the despatch/
delivery of cheques for a subsequent month are entered therein. This register should serve
as a subsidiary objection book for the simple receipts also and only items outstanding
over three months should be taken to Main Objection Book maintained in cash section
without money value for further pursuance and to watch the receipt of simple receipts.
(F.A. & C.A.O Memo. No. FA/F.V(i)/74-75/6, dated 22-4-1974)

206 PAO (WA) Manual
CHAPTER - 11
COMPILATION OF ACCOUNTS
11-1-1 In a separated system of accounts, the Director of Accounts is the principal disbursing
officer. The responsibility of compiling of accounts with reference to the payments and
adjustments rests with the Pay & Accounts Office. The compilation is done from the
classification noted on the vouchers and T.E.Os. Though the entire expenditure is under a
single Major Head, it is sub-divided into minor heads, sub -heads, and detailed heads to
facilitate administrative and accounting control. The Budget Estimates are prepared
separately for different units like, Dam, Right Canals and Left Canals in respect of certain
Project. The Pay and Accounts Office will maintain separate classified and consolidated
abstracts in respect of the expenditure on each unit of the Project. This expenditure is
consolidated and a monthly compiled account in respect of the project as a whole under
the various minor and sub -heads is rendered to the Accountant General on the 12th of the
following month. The month account is a statement of receipts and payments during the
month. The receipts are listed on the left hand side and the payments on the right hand
side.
In respect of all other major / medium minor projects or schemes where they are under
the payment control of a single P.A.O, the accounts will be compiled by the concerned
PAO/APAO only and render direct to the A.G., A.P. in a complete shape with copies to
the CE/ Head of the Department/Government in administrative Departments concerned/
Government in Fin. & Plg. (Pr.W) dept. under intimation to the D.O.A. The D.O.A.
although not the compiling authority should, however, ensures that these accounts are
rendered to the concerned authorities promptly and regularly.
In respect of the Irrigation Divisions in a District, the accounts for the month should be
compiled by the PAO/APAO in charge of those divisions for the entire district and render
the accounts to A.G., A.P. and the authorities. where there are more than one PAO/
APAO in any district having payment control of the Irrigation Divisions the PAO/APAO
nominated by Government for this purpose vide Govt.Memo.No.161(a)/Ser.2/94-1, Fin.
& Plg. (Pr.W) Dept., dt.21.4.94, should consolidate and render the accounts. The
procedure prescribed for compilation and
CHAPTER -11 207
rendering of Accounts enumerated in this chapter apply mutalis and mutandis to the
accounts to be rendered directly to the A.G.A by the PAO /APAO individually.
Organization and Scope of work:-
11-2-1 The bills presented by the Divisional Officers are attended to in different pre-check
sections The bills, duly passed by the respective Pay and Accounts Officers are sent to
Cash Section where the work relating to the issue of cheques is centralized Similarly the
work of compilation in respect of expenditure incurred by the Divisions/Office is
centralized in the Compilation Section. The items of work in this Section are listed
below;
(a) Compilation of Accounts
(i) Maintenance of Division-wise abstracts under the sub and detailed heads of account;
(ii) maintenance of weekly abstract registers to consolidate the expenditure Division-wise
under the sub and detailed heads of account;
(iii) maintenance of Consolidated Abstracts to indicate the weekly and progressive
expenditure division-wise under the various sub and detailed heads.
(b) Schedule of settlement with Treasuries.
(c) Account Current.
(d) Appropriation Accounts and Finance Accounts.
(e) Check against Appropriation
(f) Exchequer Control.
(g) Miscellaneous
Periodicity Compilation:-
11-3-1 The accounts are compiled and tallied weekly. (Though the accounts to be rendered to the
Accountant General and other offices are only in respect of the transactions for a
complete calendar month, it will not practicable to postpone the final Compilation to the
end of the month since this would result in re - verification of a large number of vouchers
and TEOs. in case the accounts do not tally).
11-3-2 The week for the Purpose of compilation covers the transactions (for vouchers as well as
T.E.Os) for the period from 1st to 7th (first week),
208 PAO (WA) Manual
8th to 15th (second week), 16th to 23rd (third week) and 24th to the last day of the month
(fourth week).
11-3-3 All Transfer Entry Orders on account of adjustment of S.R.Bs/SIB/ ATD statements, hire
charges statements, OTEOs and other TEOs etc., which are adjustable during the month
should be incorporated in the same month‟s account sent to the Accountant - General.
(FA & CAO Memo.No.FA/F.III (2)/74-75/658, dt.24-2-1975)
11-3-4 The detailed procedure for compilation is indicated in the succeeding paragraphs of this
Chapter.
Procedure for Compilation - Receipt of Vouchers:-
11-4-1 At the end of the each day, the vouchers transacted in the Cash Book during that day are
handed over to the Compilers by the Cashiers. The Vouchers should be sent through a
transit register indicating the total number of vouchers and the first number and the last
number of the voucher for the day. A certificate that all the vouchers as entered in the
Cash Book for the day are included in the first and last numbers noted should also be
recorded in the transit register by the Cashiers. The Compiler will receive the vouchers
and acknowledge them in the transit registers after duly verifying that all the vouchers as
indicated in the transit register are received.
Receipt of T.E.Os:-
11-5-1 T.E.O‟s for the adjustment of transactions from one head of account to another are first
received in the pre - check sections and entered in the T.E. registers. The T.E. registers
along with the abstracts are sent to the compilation section once a week well in time for
incorporating the transactions in the compiled account of the week concerned. In order to
facilitate work in compilation section, the pre-check sections should prepare an abstract
of the T.E.Os for the week sub and detailed head - wise separately for credits and debits
in the T.E. register. This work is in effect the preparation of a subsidiary classified
abstract in respect of the T.E.Os of one division received in a particular section. The T.E.
registers with the abstracts duly tallied should be sent to the compilation section which
will post only the sub and detailed head-wise totals in the concerned classified abstracts.
Posting the Division-wise Classified Abstract:-
11-6-1 The first stage of coiipi1ation of accounts is to post the vouchers and
CHAPTER -11 209
the T.E.O‟s in the Classified Abstracts. The classified Abstracts are maintained division-
wise. Based on the classification given on the vouchers the expenditure is posted under
the sub and detailed heads, separately for credits and debits, in the concerned division-
wise Classified Abstracts (To facilitate this posting the vouchers should first be sorted out
division-wise). The posting from the vouchers should be done daily and the postings from
the vouchers for a day should be completed on the next day. The sub and detailed-head-
wise totals as included in the T.E. abstracts for a week (sent by the pre-check sections)
should be posted in the division-wise Classified Abstracts after the voucher postings for
the week are completed. The totals under the various sub and detailed heads posted in the
Classified Abstracts are worked out at the end of each week. In order to ensure the
correctness of the postings from the vouchers it is necessary to check the voucher-wise
posting in the division-wise Classified Abstracts with the voucher-wise details in the cash
book. This checking should be done daily, immediately after the postings for the
vouchers are over. This checking should be done by the Superintendent personally.
Posting of the Weekly Abstract Registers:
11-7-1 The weekly totals as worked out in the division- wise Classified Abstracts are carried
over to the weekly abstract registers wherein the postings axe made separately for debits
and credits. The sub and detailed head-wise classification is noted vertically and the
divisions horizontally (or vice versa) so that both the division-wise expenditure for a
week under the concerned sub and detailed heads as well as the total expenditure for the
unit as a whole under the concerned sub and detailed heads are available at the same
time. The total debits and credits for the week for the unit as a whole are then worked out
in the weekly abstract registers.
Tallying with Cash Book:-
11-8-1 The posting in the weekly abstract registers will have to be agreed with the cash book and
T.E. Registers, which are the primary records for the payments and adjustments. The
Cash Book should be closed weekly to facilitate reconciliation with the compiled
accounts. The total charges will therefore be worked out as follows;
Total of the cash column plus total of the cheque column plus total of the T.E.Os, (debits
for the week minus total amount accounted for as cash from treasury).
210 PAO (WA) Manual
(b) Similarly the total receipts will be the total of the receipt column plus the total of the
T.E.Os (Credits) minus amounts accounted for as cash from treasury.
(c) The debits and credits in each T.E. abstract should be abstracted in a separate sheet of the
weekly abstract register. From this abstract, the total debits and the total credits in respect
of both the cash book and the T.E. abstract should be tallied with the totals worked out in
the weekly abstract register.
Preparation of Classified Abstract:-
11-9-1 The next stage of compilation is the preparation of Classified Abstracts for the week. The
weekly Classified Abstracts contained two columns, one during the week and the other
during the month. The monthly Classified Abstract will indicate the expenditure during
the month and during the year. From the weekly abstract register wherein the totals for a
sub or detailed head in respect of all the divisions of a unit are worked out and posted in
the Classified Abstract. (In respect of the detailed heads under the Minor Head “(o3)
Suspense” the debits and credits will be indicated separately). The totals under the head
during the month are worked out with reference to the totals in the previous Classified
Abstract in respect of the last week‟s accounts. At the end of the month, the totals during
the year are worked out in the Classified Abstract for the month.
Preparation of Monthly Accounts:-
11-10-1 The monthly account in form PAO 50 is in the form of a simple statement of receipts
and payments during the month. The Public Works Accounts are on the model of the
double entry system of accounts. So the monthly compiled account will be a balanced
one. The net total expenditure under the major head as worked out from the classified
abstracts of the different units of the Project is posted in the account. The receipts and
charges in respect of the other heads of accounts outside the major head like deposits,
TW. p loans and advances etc. are posted from the totals as worked out in the monthly
classified abstracts. The totals of cheques column as seen from the cash book is posted
against 8702 - P.W. Cheques while the total under 8782 -102 -PW. Remittances as seen
from the classified Abstract is posted against P.W. Remittances.
CHAPTER -11 211
The increase or decrease in Cash balance with reference to the opening and closing cash
balance is also posted and the account balanced. In respect of the Irrigation Divisions
consisting of several major heads, single accounts may be prepared separately. In respect
of externally aided projects/schemes, the accounts may be 4 kept very upto date so that
the compiled expenditure figures can be furnished at any point of time, even during the
course/middle of the month or week, for obtaining reimbursement or for any review, if
asked for by higher authorities.
Rendering of Monthly Accounts:-
11-11-1. The monthly compiled account should be sent to the Accountant General on or before
the 12th of the following month. The monthly account should be accompanied by
(i) Classified abstract of expenditure showing the details of the expenditure sub and detail
heá1wise during the month and during the year. The net expenditure under the major
head as incorporated in the accounts, should tally with the totals under the month” as
shown in the classified abstracts of the different units of the projects and other offices.
(ii) Abstract of progressive expenditure during the month and to end of the month in
respect of the different units of the Projects.
(iii) Schedules of recoveries towards I.T., S.T. etc. which are directly debited/credited to
the final heads of accounts concerned.
(iv) In respect of PAOs /APAOs who render the Accounts to the A.G., AP directly, they
should also send vouchers, schedule Dockets, schedules of Deposits and suspense
Balances etc., as prescribed in A.P.P.W Accounts Code besides the above documents.
11-11-2 A copy of the account together with the classified abstract is sent to Government
(administrative Department) as well as the Secretary to Government (Works and
Projects), Finance & Planning (Pr. W) Department. A copy of the classified abstract is
sent to the Superintending Engineers and to the Chief Engineers.
11-11-3 A the Accountant - General has to send advance figures of receipts and disbursements
for the Ce‟ha1 and State grants before the submission of the regular accounts, advance
figures should be sent to the Accountant General, by telegram indicating the code letters
by 4th of
212 PAO (WA) Manual
each month. (A.G.‟s letter No.10, W.M.II, dt.12-2-1957). Similarly the total expenditure
under the major Head of Account of the concerned Project during the month in respect of
each project account should also be communicated to the Government telegraphically so
as to reach Government not later than 4th of every month.
Division-wise Consolidated Abstracts:-
11-12-1 Since the Division is the unit of expenditure the monthly expenditure under the
concerned sub and detailed heads has to be abstracted division-wise so as to enable the
Divisional Officer to watch the progress of expenditure against the division-Wise
allotment of funds. For this purpose, division-wise Consolidated Abstracts are maintained
in the Compilation Section. The weekly totals under the concerned sub and detailed heads
division-Wise as exhibited in the weekly abstract registers is posted in a separate register
for all the weeks and the monthly expenditure is worked out. At the end of the month, a
copy of this Consolidated Abstract showing the monthly expenditure division-wise under
the various heads of account is sent to the Superintending Engineers and Chief Engineers
to enable them to verify the expenditure figures received by them from their subordinate
Offices. A copy of this abstract should also be sent to the Executive Engineers.
11-12-2 Divis10 - wise classified and Consolidated Abstracts will have to be arranged with inner
sheets to accommodate the transactions for a week and sufficient space at the end for
working out the totals. The materials required for the preparation of the monthly account
is easily available from the totals of the Consolidated Abstracts.
Transmission of Vouchers and T.E.Os to the Records Section:-
11-l3-1 After the compilation for a week IS completed the vouchers which are required for
transmission to other Offices (for purpose of Audit or for purpose of reimbursement)
should be retained in the Compilation Section and the remaining vouchers sent to the
Records Section through a separate transit register. The total number of vouchers as well
as the beginning and the ending serial number of the vouchers (except the vouchers
retained, which should be specified) should be noted clearly, in the transit register. The
Superintendent (compilation) should verify that all the vouchers received in his section
from the Cashiers are included in the details noted in the transit register before they are
sent to records section.
CHAPTER -11 213
The acknowledgement of the record-keeper for the vouchers handed over to him should
be obtained in the transit register which should be 4 preserved carefully in the
compilation Section.
11-13-2 As the-preparation of the subsidiary division-wise Classified Abstract for the T.E.Os is
done in the pre-check sections, the T.E.Os will not be sent to the Compilation Section and
the compilation will be done with reference to the sub head-wise details for debits and
credits separately given in the abstracts in the T.E. registers. The responsibility for
sending to the records section all the T.E.Os incorporated in the weekly accounts will,
therefore, rest with the pre-check sections. After the compilation for the week is
completed, the T.E. registers will be returned by the compilation for the section to the
pre-check sections. The abstracts in the T.E. registers will bear the endorsement over
signature of the Superintendent (Compilation) to the effect that the abstract has been
incorporated in the weekly accounts on hand. On receipt back of the T.E. registers the
pre-check section should verify the endorsement in the T.E. abstract and then arrange to
send the T.E.Os for the week (duly arranged) to records section through a transit register
indicating the details of the T.E.Os and the dated acknowledgement of the record-keeper
obtained in the transit register.
Schedule of Settlement with Treasuries:-
11-14-1. The cheques drawn by the Pay and Accounts Officer and transacted in the cash book
are accounted for as expenditure ,in the compiled accounts for the month irrespective of
whether the cheques are enchased during the same month or in a subsequent month.
Similarly, the remittances into Treasury are accounted for in the Project accounts as
receipts on the basis of the original challans received in the Pay and Accounts Offices. In
actual practice, however, it will be seen that all the cheques issued by the Pay and
Accounts Officer/Assistant Pay and Accounts Officer during a month are not encashed
during the same month. Similarly, all remittances brought to account by the treasury may
not be incorporated by the Pay and Accounts Officer/Assistant Pay and Accounts Officer
during the same month and all remittances incorporated by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer may not find a place in the treasury accounts
for the same month. This is due to the following reasons.
214 PAO (WA) Manual
(a) The account of the Pay and Accounts Officer/Assistant Pay and Accounts Officer
closes on the last working day of the month while the accounts of the sub-treasuries on
which the cheques are drawn or into which remittances are made, are closed four or five
days before the last working day of the month. Transactions recorded in the cash book of
the Pay and Accounts Office during the last date of a month will therefore find place in
the treasury accounts only in the subsequent month.
(b) Miss-classification in the treasury.
(c) Non-receipt of challans from the Divisional Officers.
11-14-2. In order to ensure proper and accurate accounting of payments made by the treasury in
respect of cheques drawn by the Pay and Accounts Officer/Assistant Pay and Accounts
Officer and to verify that all remittances made on behalf of the Project are brought to
account, a reconciliation of the discrepancies mentioned above has to be done. This
reconciliation is done through the Schedule of Settlement with Treasuries.
In respect of Projects where Consolidated accounts are rendered by the D.O.As to the
A.G A.P, the SST shall be got done for the entire Project in a centralized manner. In
respect of small Projects/Irrigation units etc., where the accounts are rendered by the
PAOs/APAOs themselves, the settlement with Treasuries shall be done by the
PAO/APAO concerned. The DOA should however ensure prompt settlement by the
PAO/APAOS and review the items awaiting clearance.
In addition to the centralized SST at DOA5 Headquarters office, the individual

PAOs/APAOs in whose cash books the cheques/challans have been transacted, shall also
devote personal attention to reconcile the discrepancies in the outstanding items specially
those of more than three months old and have consultations with the D.T.Os concerned
The assistance of the DAOs of divisions may also be taken by the PAO/APAOs at
frequent intervals on a regular basis. For this, PAO wise lists of out sanding items shall
be prepared and communicated to each PAO/APAO by the PAO in-charge of SST
headquarters
This settlement involves two aspects:-
11-l4-3 (i) reconciliation of Cheques issued by the Pay and Accounts Officer / Assistant Pay and
Accounts Officer, with the payments made in the treasuries.
CHAPTER -11 215
(ii) Reconciliation of remittances shown in the cash book with those included in the
C.T.Rs.
The following details are necessary for effecting the settlement:-
11-14-4 (i) List of Cheques drawn during a month by the Pay and Accounts Officer/ Assistant
Pay and Accounts Officer.
(ii) List of cheques encashed at the treasuries during the same month.
(iii) List of challans incorporated in the cash book by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer for the month.
(iv) List of challans incorporated in the treasury on behalf of the project during the same
month.
Separate lists should be prepared for Projects /Irrigation Divisions / any other special
schemes attached and where separate cash books and accounts are maintained in P.A.Os
Offices with special endorsement affixed on the cheques.
Reconciliation of Cheques:-
11-15-1. The Cash Section will furnish at the end of each week “Cheque drawn statements” to
the Compilation Section. The statement will be prepared treasury-wise/sub-treasury-
wise/bank-wise indicating the cheque number, date and amount. The totals in the “cheque
drawn statements” should be reconciled with the totals of the cheque columns in the cash
book.
11-15-2. At the end of each month the pass books are sent to the concerned treasuries. The
Treasury Officer will enter all the cheques paid by him during the month against the
project accounts indicating the cheque number, date and amount. The pass books are
returned with a Consolidated Certificate of Treasury Issues indicating the total amount
paid by the treasury during the month against the Project account. On receipt back of the
pass books in the Pay and Accounts Office the Consolidated Certificate of Treasury
Issues is verified with the totals of various cheques as given by the Treasury Officer in
the pass book. The cashed cheques as detailed‟ in the pass book are then verified
individually with those noted in the “Cheque drawn statements” received from the Cash
Section and items appearing in both the statements are paired off. The remaining items as
per the cheque drawn statements are abstracted and included in the Schedule of
Settlement. Any instance of payment included in the details of the C.T.I. given by the
Treasury/Bank but not included
216 PAO (WA) Manual
in brought immediately to the personal notice of the Director of Accounts. Such Items
require a close and in-depth investigation and should be reconciled immediately. Since
such items have to be prima fade suspected to be a result of fraud. The District Treasure,
officers have been instructed by the Director of Treasuries and accounts to furnish the
computer print outs to the DOAs/ PAOs/ APAOs concerned every month.
Reconciliation of Remittances:-
11-16-1. In order to ensure that all the challans received in the Pay and Accounts Office are
adjusted promptly so as to facilitate the reconciliation of such remittances with the
C.T.Rs received from the treasuries. The receipt and disposal of challans is centralized in
Compilation Section. All the challans received are diarised in a separate purport register
and sent to the concerned pre-check section for retransmission indicating the
classification. The adjustment should be proposed based on original challans only. The
challans when received back in the compilation section are sent to the cash section for
incorporation in the Cash Book by debit to P.W. Remittances - I. Remittances into
Treasuries‟ and credit to the concerned sub and detailed head of account. The final
adjustment of the challans should not be delayed for more than three days after their
receipt in the Pay and Accounts Office.
11-16-2 At the end of each month the remittance registers are written up treasury-wise with
reference to the challans incorporated in the pass-book. The Treasury Officer will enter
all the remittances into the treasury as per his books indicating the challan number, date,
amount, name of the remitter etc. and retransmit the Remittance register with the
consolidated certificate of Treasury Receipts On receipt of the Remittance Register the
total furnished by the treasury are verified with the Consolidated Certificate of Treasury
Receipts, the items are then paired off with those already noted by the Pay and Accounts
Officer /Assistant Pay and Accounts Officer in the Remittance Register as well as with
reference to the outstanding the of previous months, the items of remittances which have
been incorporated in the cash books of PAOs/APAOs but did not find place in the C.T.Rs
have to be closely and promptly investigated. Since such transactions may be due to
adjustment of fraudulent challans.
Preparation of Schedule of Settlement with treasuries:-
11-17-1 The Schedule of settlement with treasuries is prepared separately for

CHAPTER -11 217
cheques and remittances. The schedules are first prepared treasury wise. An abstract for
all the treasuries together is then prepared separately for Part-I--- Remittances and Part-
II-Cheques. The total under part-I--Remittances and II-Cheques as worked out in the
consolidated schedule is tallied with the corresponding figures shown in the monthly
account. The schedule is then sent to audit.
11-17-2. The schedule of settlement, with treasuries should be prepared in form PAO 51.
11-17-3 In cases where the outstanding in the schedule of settlement with Treasuries are large
their clearance by correspondence with Treasury officers will involve time and must
progress may not be achieve early. As the settlement with treasuries in respect of the
cheques and remittances on behalf of the projects and other divisions/offices in a very
important item of work, the question of immediate reconciliation should be tackled in as
best a way as possible.
To facilitate quick progress in this regard, it will be advantages to send a member of the
staff of Pay & Accounts Office to the various treasuries periodically, and also whenever
requisitions are received from Accountant-General s O.A.D parties inspecting treasuries.
The PAOs/APAOs should bestow personal attention for periodical review and take
immediate action for clearance of all outstanding items.
11-17-4. The Pay and Accounts Officer (Comp)/Assistant Pay and Accounts Officer
(Compilation) will be personally responsible for all the items of work connected with the
schedule of settlement with Treasuries. He should keep the Director of Accounts
informed of the position every month.
Account Current:-
11-18-1 One of the main features of a separated accounts system is that book adjustment for the
settlement of inter-departmental and inter-Government transactions are eliminated
altogether. The Pay and Accounts Officer /Assistant Pay and Accounts Officer will not
have any Exchange or Settlement account with any other Accounts Officer. All inter-
departmental and inter-Government transactions, where on one side a separated Accounts
Officer is involved, are settled in cash by cheques or bank drafts at weekly intervals as
explained below:-
218 PAO (WA) Manual
Transactions of the above nature fall broadly under the following categories:-
11-19-1(i) Deductions from Pay bills on account of funds (GPF, PLI, etc.)
(ii) Leave Salary, advance of Pay and T.A. on transfer when such debits are adjustable
outside the project accounts.
(iii) Temporary or part/final withdrawals from GPF Accounts, drawl of marriage

advances, HBA Advance etc.
(iv) Expenditure on schemes shareable in a prescribed ratio between two departments of

the same Government or different Governments.
(v) Recoveries from bills of contractors, suppliers towards Sales Tax, I.T; Seignorage
fees etc.
Note:- (i) Deductions towards Income Tax, Sales Tax, from Pay bills, contractors and suppliers‟
bill have to be directly credited in the Accounts of the relevant final Major/Minor heads
of the departments concerned.
ii) Subscriptions/temporary and part final withdrawals/recoveries of loans under G.P.F.

are directly credited / debited to the Final Head of Account.
(8005 GPF)
The relevant schedules of recoveries or vouchers in respect of payments should be

collected and consolidated abstracts prepared and sent to the Accountant General, A.P.,
I.T.O. and etc. as the case may be.
11-19-2 In cases where the minor head „PAO‟ Suspense is not operated in the books of any
Project Accounts Officer, the transactions which are adjustable in the books of another
Pay and Accounts Officer /Assistant Pay and Accounts Officer are initially classified
under Miscellaneous Deposits of PAO in respect of the credit and Miscellaneous
Advance of PAO in respect of debits. (FA‟s Memo. FA Genl.I-I 59-205, dated 1-5-1959
and 8-5-1959) The head Miscellaneous Deposits of PAO is kept outside the capital major
head in the section „Deposits and advances” while the sub-head “Miscellaneous advances
of PAO” is operated within the capital major head. Since the deductions from pay bills
represent mostly credits adjustable against the personal accounts of the employees, the
adjustments of these transactions are watched separately. The detailed procedure in this
regard is explained in the chapter dealing with Cash Section.
CHAPTER -11 219
11-19-3 The vouchers in respect of amounts debited to “Miscellaneous Advances of PAO” are
retained in the Compilation Section while sending the vouchers for a week to the records
section. A schedule of the transactions is prepared weekly in respect of the transactions
covering the periods from 1st to 8th, 9th to 16th, 17th to 23rd and 24th to the last day of the
month and the total worked out. The schedule with the supporting vouchers are sent to
the Accounts Officer concerned with a forwarding letter requesting for a bank
draft/cheque for the amount included in the weekly account and the receipt of the bank
draft / cheque watched.
11-9-4 When the bank draft/cheque is received, the same is entered in the Register of Valuables
and transacted in the cash book by credit to PAO Miscellaneous advances and debit to
PWD Remittances. The bank draft/cheque is then sent to the bank for realization and
credit to Government Account with a challan. As soon as the Challan is received the
Challan number is noted in the cash book against the entry already recorded while
transaction the bank draft cheque in the cash book.
11-19-5 A register in form „PAO‟52 should be maintained in Compilation Section to watch the
final settlement of the outward weekly accounts sent by the Office. The register should be
submitted to the Pay and Accounts Officer/Assistant Pay and Accounts Officer every
Monday.
Inward Accounts:-
11-20-1 The inward accounts received by the Pay and Accounts Officer/Assistant Pay and
Accounts Officer are entered in the register of inward claims maintained in form „P.A.O.
53‟ and the final disposal watched.
11-20-2 Immediately on receipt of the inward account, the vouchers accompanying the account
should be checked to see that the totals are correct and that no voucher is missing. In case
any voucher is found missing, the amount of that voucher should not be reimbursed and
the Accounts Officer requested to include the claim in his next weekly account duly
supported by the relevant voucher. When all the Vouchers in support of an account are
received intact, the account should be settled in full as claimed except cases where some
mistakes in calculation are detected in the course of the check of totals or where an item
clearly pertaining to another Accounts Officer has been erroneously included in the
account. In such cases the bank draft / cheque should be sent for the correct amount.
220 PAO (WA) Manual
the discrepancy being pointed out to the Pay and Accounts Officer /Assistant Pay and
Accounts Officer (who has sent the inward claims) simultaneously.
11-20-3 After exercising such a full preliminary scrutiny, the claim is paid by debit to
Miscellaneous Advances of P.A.O., and the cheque/draft is sent to the Accounts Officer
concerned. The acknowledgement for the receipt of the cheque/draft should be watched.
Separate schedules in respect of debits adjustable by different pre-check Sections are
prepared and these schedules with the supporting vouchers are sent to the concerned pre-
check sections for final adjustment by credit to Miscellaneous Advances of P.A.O. If, at
the time of adjusting the transactions under the final heads of account, it is seen that an
item has been passed on erroneously and the same cannot be adjusted, the amount should
be re-credited or re-debited to the Pay and Accounts Officer/Assistant Pay and Accounts
Officer concerned. Such transactions should be included in the next weekly intimation to
be sent to the other Accounts Officer along with the supporting vouchers and schedules.
The register of inward claims is closed and submitted to the Pay and Accounts Officer/
Assistant Pay and accounts Officer every Monday.
Payment in March:-
11-21-1 Normally the reimbursement in respect of transactions arising during the last week of a
month will be claimed in the first week of the following month. In order to claim
reimbursements for transactions arising in March within the same financial year, the Pay
and Accounts Officer/ Assistant Pay and Accounts Officer will not normally make any
payment on behalf of other departments after the 25th March so that the other Accounts
Officer could obtain and send the Government draft‟ cheque in complete reimbursement
of such transactions by the 29th March at the latest to facilitate utilization of the
Appropriations which lapse on 31st March each year, the Pay and Accounts Officer will
send hi-weekly intimations to the other party in respect of transactions arising during the
period from 17th to 25th March, the last intimation being sent on the 26th March
positively. In exceptional cases where such payments have got to be made even after the
25th March a telegraphic intimation should be sent to the other Accounts Officer
concerned and the latter will arrange to obtain Government draft immediately before 31st
March.
CHAPTER -11 221
Allocation of Expenditure in Respect of Schemes, the cost of which is initially Debited

to Project Funds:-
11-22-1 Certain schemes incidental to the construction of a project are required to be done by
departments other than the divisions of the project e.g., Revenue Department, Public
Health Department, Medical Department etc., According to the orders issued from time
to time by the Government, the expenditure on these schemes is to be shared between the
project and the State Government in a ratio approved by Government. Such expenditure
will be debited to the project in the first instance and the State‟s share got reimbursed
subsequently from the Accountant General. In order to watch reimbursements of
expenditure (initially incurred by the project) from other Departments, a register in form
P.A.O. ‟54 should be maintained in compilation section.
A bill of cost prepared in Form „P.A.O. 56‟ for each scheme separately together with the
outward accounts of the P.A.O. will be sent to the Accountant General for settlement in
cash. This bill need not bear the countersignature of the concerned Head of the
Department, provided he agrees to bear his share of expenditure. This procedure has been
approved by the Accountant General.
(Vide D.O. Lr. No. A.C.III/V, 8/9/64-65/177, dated 28-10-1965, addressed to the then
F.A and C.A.O, N.S. Project).
(The Director of medical Services, the Director of Agriculture, the Director of Public
Health and the Secretary, Board of revenue have given such concurrence in respect of
their shares of expenditure).
Appropriation Accounts and Finance Accounts:-
11-23-1 The Director of Accounts is responsible for the preparation of Appropriation Accounts
and furnishing the materials for Finance Accounts to the Accountant General on the due
dates prescribed by him. The following returns are due from Director of Accounts in this
regard.
(a) Appropriation Accounts:-
(i) Draft Appropriation Accounts indicating the original grant supplementary grant re-
appropriation, actual expenditure and excess or savings.
(ii) Statement of arrears in the divisions of the project.
(iii) Statement of arrears in collection of revenue.

222 PAO (WA) Manual
(iv) Statement of sub-head-wise details of stock.
(v) Statement of amounts held under objection to end of 31st March
(vi) Statement of amounts held under objection for want of relevant vouchers or
documents which are waived by competent authority
(vii) Statement of arrears under reconciliation of cash transactions with treasuries.
(Statement at item (I) is prepared from the Appropriation Audit Register maintained in
Compilation Section. The statement at item No. (vii) is prepared from the Schedule of
Settlement with Treasuries. The material for the other statements collected from the pre-
check sections and consolidated in the Compilation Section).
(b). Finance Accounts:-
(i) Statement showing the expenditure during the year and the progressive expenditure to
the end of the year for the different units of the project.
(ii) Statement of expenditure by minor head and sub-heads in the different units of the
project.
(iii) Material for review of balances for advances, deposits etc.
Check against Appropriation:-
11-24-1 The general principles and rules for the check against provision of funds are given in
Chapter-V of this Manual. Below are given some supplementary instructions to be
observed in this connection.
11-24-2 The Pay and Accounts Officer/ Assistant Pay and Accounts Officer is responsible for
watching firstly, that the total expenditure in a grant or appropriation does not exceed the
amount of the grant or appropriation, as specified in the schedule to an Appropriation Act
passed in accordance with the provisions of the Constitution, and secondly, that the total
expenditure on each of the sub heads fixed as units of appropriation under a grant or
appropriation does not exceed the allotment thereon as modified by orders of re-
appropriation passed by competent authority from time to time. Unless it is otherwise
decided by Government as a special case or where there is a division of Superintending
control between the departmental authorities in sub-head, appropriation check
CHAPTER -11 223
will not be exercised by the Pay and Accounts Officer/Assistant Pay and Accounts
Officer beyond sub heads of a grant or appropriation fixed as units of appropriation for
the purposes of appropriation accounts, the Pay and Accounts Officer/Assistant Pay and
Accounts Officer is also required to see that (a) if under the financial rules of the
Government, a particular object of expenditure requires a specific allotmental
expenditure on it is checked against such allotment, and (b) if a lumpsum allotment is
made for a group of items of expenditure of an office, the total expenditure thereon is
checked against the lumpsum placed at the disposal of the disbursing officer for the
purpose. Whenever several officers are authorized to incur charges relating to a unit of
appropriation against a lumpsum allotment placed for the purpose at the disposal of
single higher authority, it devolves upon this authority to watch the progress of
expenditure in all the Offices and to keep the aggregate charges within the allotment. If
the Pay and Accounts Officer/ Assistant Pay and Accounts Officer is requested by
Government to check these charges against the allotment, he will comply with the
request.
Certain categories or payments such as salaries, electricity charges (under 010. salaries)
Advocate General‟s fees etc. are kept outside the purview of “Treasury Control.” In such
case, the expenditure under such minor/ Sub-heads may be allowed to be continued even
in excess of budget provisions. Any abnormal excesses may be brought to the notice of
Chief Engineer concerned for obtaining re-appropriation etc. well in advance.
11-24-3 Appropriation check is conducted in two stages
(i) Check of sanction i.e., check of orders of allotment of funds and re-appropriation
which are to be enforced by the Pay and Accounts Officer / Assistant Pay and Accounts
Officer.
and
(ii) The check of expenditure against allotments.
11-24-4 The check of order of allotment and re-appropriation consists in seeing (a) that an
authority making allotments under a grant or appropriation does not allot amounts in
excess of those available under the grant or appropriation (b) that the amount
appropriated is available under the unit from which it is allotted and (c) that the order is
issued by the competent authority.
224 PAO (WA) Manual
11-24-5 For working out month by month, the progressive expenditure against the grant or
appropriation and each unit of appropriation, a register in form „PAO 57‟ should be
maintained. Each grant or appropriation should be assigned a page or set of pages. Under
each grant or appropriation the several sub-heads and units of appropriation should be
detailed showing against each, the authorized provision and progressive expenditure
month by month. The progressive expenditure for the month as well as the close of the
year should be agreed with the consolidated abstracts.
11-24-6 The booked expenditure should be scrutinized intelligently and warnings issued to
disbursing officers and if necessary to controlling authorities also when excesses appear
to be likely. Such warnings should not however be followed up in formal or routine
manner since the regularization of an appropriation irregularity rests with the executive
financial authority and the occasion and manner of the regularization within the law can
be chosen by that authority. Statement of Budget provision vis-a-vis Expenditure should
be sent to chief controlling authorities every month.
Closing of Accounts:
11-25-1 The grant at the disposal of a Chief Controlling Authority lapses on the last day of the
financial year and so no payment debitable to the accounts of the year is permissible after
the last day of the financial year Under a separated system of accounts all payments are
closely related to appropriations at the very point of authorizing payments and so the
chances of errors in classification requiring rectifying transfer entries in the accounts are
considerably reduced, if not totally eliminated. Similarly, as all inter-government or inter-
departmental transactions are settled in cash before 31st March each year, there are no
book adjustments in the accounts after the close of the March accounts. It should,
therefore, be possible to close the accounts for the year immediately after the close of
March. However one set of supplemental accounts should be compiled (by the 15th of
June or by the date fixed by the Accountant General) every year for all the units of the
Project in order to incorporate as many transactions of the year as possible in the
accounts of the same year. The Chief Engineers should be requested to obtain from their
subordinate officers the details required for adjustments in the supplemental
CHAPTER -11 225
accounts and send to the Pay and Accounts Office consolidated proposals by the 1st June
every year for incorporation in the said supplemental accounts. As far as possible, the
supplemental accounts should be confined to transactions involving large amounts only.
While proposing the adjustments in the supplemental accounts the grant position (as
finally modified by re-appropriation orders issued to the end of March), should be taken
into account so that the adjustments in March supplemental accounts may not lead to
large excesses or savings.
11-26-1 Pensionery Charges:- With a view to ensuring that the Projects accounts take
cognizance of the liability on account of the pensionery charges in respect of employees
of the projects, this liability has to be discharged annually in respect of project employees
by 31st July every year. The pensionery charges at such percentages as may be fixed by
the Government from time to time shall be calculated on the total salary and leave
allowances of the pensionable establishment employed on the Projects establishment and
adjusted by debit to the concerned project Major head and credit to the relevant Head of
account in the accounts of the State Government Head of account in the accounts of the
state Government (which is at present 2071 - pension and other retirement benefits.)
11-26-2 Calendar of Returns: - It is a matter of primary importance that the work in the
compilation section is kept up-to-date to enable the officers of the project to know the up-
to-date expenditure. The various returns like Classified Abstract, division-wise statement
of expenditure, challans pending incorporation in the Cash book, progress in the
realization of amounts due from other Departments/Governments etc., should be sent to
the Departmental Officers on the due dates prescribed. In order to watch the prompt
submission of the various returns due from the compilation section to the different
authorities a calendar of returns should be maintained the compilation section.
11-26-3 In order to have a collective record of the suspense, deposits etc., transactions in respect
of the different units of the Project, where they are in vogue, ledgers in respect of each of
the suspense heads, deposits etc. are maintained in the compilation section for purpose of
Appropriation account and Finance Account as well as review of balances. These
registers are also helpful for the reconciliation of the division-wise
226 PAO (WA) Manual
balances as worked out in the broad sheets maintained in the various pre -check sections.
The postings in these registers are made monthly division-wise/ Office-wise with
reference to the division-wise classified abstracts in respect of the suspense heads and
with reference to the schedules prepared by the compilers after the close of the monthly
account in respect of deposits etc., The progressive balances at the end of each month are
also worked out in the ledger.
In respect of Irrigation divisions/offices and other special schemes, where the accounts
are rendered by the PAOs/APAOs directly to the A.G., A.P, similar procedure as
explained above should be followed at P.A.Os level only and relevant schedules as are
required by the A.G. should be attached to the monthly accounts.
Adjustments between different Units/PAOs/APAOs of the Projects:-
11-26-4 In case where separate provision for expenditure exists for the different units of a project
even though the entire expenditure is debitable to a single major head, the accounts are
compiled separately for each of the different units and each such account will be balanced
one. When adjustments are to be made between two different units of the Project the
debit and credit and vice versa will have to be booked under separate accounts and for
purpose of balancing the counter entry under the same unit will have to be adjusted
through a separate head. The head “Transfers within the Project” is operated for this
purpose. The balance under this head represents suspense balances of the Project and so it
is a matter of utmost importance to ensure prompt adjustment of the items under
“Transfers within Projects.” a broadsheet is maintained in the compilation section to
watch the clearance of the items this head.
(G.O.Ms. No. 469, Irrigation and Power (PW) Dept. dt. 20.11.75).
This shall be operative between different PAOs /APAO‟s even to the transaction relate in
the same unit of Project
11-26-5 As soon as the accounts for the week are compiled, the compilers of each unit should
prepare a schedule of debits/credits in respect of the items under T.W.P. in form „
P.A.O.58‟ and hand over the same to the Assistant maintaining the broadsheet, after
necessary reconciliation with the compiled accounts. These items will be posted in the
broad -sheet and the original and responding items paired off. The section which
originates the items under T.W.P. is finally responsible to ensure that the item
CHAPTER -11 227
is responded to with least possible delay. In order to ensure that both the originating and
responding items are booked in the same month the section/PAO originating the
transaction should first obtain the responding T.E. from the Other Section/PAO
concerned and then only originate the entry. Adjustment through the media of T.W.P
should not as far as possible be effected in the last week‟s account if it is not possible to
obtain both the originating and responding entries for booking in that week‟s account.
Since the balances under T.W.P are treated as suspense balance, it will effect the budget
in view of the fact that the credit balance under T.W.P will get the expenditure while the
debit balance will have the effect of reducing the expenditure.
Note:- To ensure Prompt clearance of the T.W.P. items it is desirable that a monthly meeting be
held at the D.O.A5 Head quarters with the representation of all PA‟O5 office under his
control
11-26-6 The broad sheet duly closed should be submitted to the Pay and Accounts Officer /
Assistant Pay and Accounts Officer on the 25th of each month indicating the unadjusted
items under debits and credits separately.
Expenditure on Common Establishment:-
11-27-l The expenditure on common establishments Irrigation (P.W.) Department, Finance &
Planning ( Projects Wing) Department etc. initially debited for convenience to any one
unit of Nagarjunasagar Project against the head “25-Project Establishment” under the
Major Head of the Project should be allocated at the end of each financial year among the
different Projects in the proportion decided by the Government The amount so allocated
to the Project other than Nagarjunasagar Project should be got reimbursed from the
accounts Officers of the concerned projects before the end of each financial year.
(l. G.O.Ms.No.23, Irrigation (P.W) Department, dt.l9. 1.1983

2. G.O.Ms.No.166, I&P (PW) Dept., dt.2.5.1975
3. G.O.Ms.No.33, I&P (PW) Dept., dt.24.101975)
228 PAO (WA) Manual
CHAPTER 12
RECONCILIATION
Introductory:-
12-1-1 The payments made and the adjustments carried out in the Pay and Accounts Office are
analyzed and posted in different ways in different sets of books before the transactions
enter the final accounts for a month. The Bills and T.E.Os” are analyzed and posted in the
pre-check sections work-wise and detailed head-wise for each division in the subsidiary
account records e.g., works registers, suspense and deposit registers etc. Those relating to
cash transactions are analyzed in the cash book voucher- wise and detailed head wise for
each unit separately. Both the cash and adjustment transactions are finally analyzed
voucher-wise in the consolidated abstract of each division in the compilation section.
Though the process of analysis is different at different stages, the books are built upon the
same documents containing the basic information. It is necessary to reconcile the
combined effect of the posting in the various account records under each detailed head in
respect of each division with a view to detecting any miss-classifications and / or miss-
postings at any stage and rectifying them in order to ensure that the final accounts
prepared reflect the true facts.
Procedure for reconciliation:-
12-2-1 The procedure for reconciliation of figures between the cash book and the compiled
accounts has been explained in the chapter “Compilation of Accounts”. The procedure
for reconciliation of figures between the subsidiary account records maintained in the
pre-check sections and the compiled accounts is described in the chapter.
Note: In the case of misclassifications and/or miss-postings in the compilation section, no

corrections in the account registers of the pre-check sections is necessary, such
misclassifications and/or miss-postings being separately exhibited and rectified in the
subsequent months accounts by means of T.E.Os.
Reconciliation of Works Expenditure, Works Abstract and Works Audit Register:-
12-3-1 The Expenditure booked during a month as exhibited in the abstract of the work audit
register of a division under the various detailed heads of account should be tallied with
the figures shown in the division-wise
CHAPTER -12 229
consolidated abstract under respective detailed heads of account. If any discrepancy is

noticed, the voucher and T.E.-wise details in the work abstracts should be verified with
voucher and T.E-wise particulars available in the classified abstract of the division to
detect the mistakes. After the two sets of figures as exhibited in the words Audit Register
and the consolidated abstract have been agreed, a certificate of agreement should be got
recorded on the abstract page of the works audit register over the dated initials of the
Superintendent (Compilation). In case there are discrepancies, the certificate should be
amplified as follows:
(example).
Abstract for Financial Year Month
SH 31 R.B. Distributories ------------

160 Major Works ------------
161 Other Expenditure ------------
162 W.C. Estt. etc., ------------
Total ------------
Errors detected in Reconciliation.
(1) Errors in the current month (Details furnished below).

Details:
S.H. 31 R.B. Distributories

160 Major Works
161 Other Expenditure
162 W.C. Establishment
2. Errors of previous month corrected during the month/ Booked Figure for the month.
12-3-2 A note of the discrepancies under each of the detailed head may be separately made in the
folios of the Work Audit Registers under the respective detailed heads at the end to work
up to the total effect shown on the abstract page.
Suspense, Deposit, R&R and Contingent Registers:-
12-4-1 The total debits / credits as worked out in the abstract page of the suspense and deposit
registers and the total credit or debit in respect of other registers should be tallied with the
corresponding figures for the month in the division-wise consolidated abstract. In the
case of
230 PAO (WA) Manual
discrepancies, the voucher and T.E.-wise postings in the registers should be checked with
the details in the division-wise classified abstract. After the two sets of figures have been
agreed a certificate of agreement should be got recorded over the dated initials of the
Superintendent (Compilations) in the abstract page of the registers. In case there are
discrepancies, the certificate should be amplified as in the case of Works Audit Register.
Reconciliation of Establishment Expenditure:-
12-5-1 The payments made and adjustments carried out to the debit/credits of the minor head
“25-Project” Establishment”. etc., as included in the Approved Budget Estimates of the
concerned departments under the relevant Major Heads of Account may be posted in a
register in PAO Form 59 in respect of both Gazetted & Non-Gazetted establishments.
Separate registers should be maintained for each division/office. Every transaction as
soon as it takes place should be posted in the concerned registers individually and attested
by the Superintendent. After the month is over the totals under each sub-head/detailed
head should be struck. These totals should be verified with the corresponding totals in the
division- wise consolidated abstract prepared by the compilation section in respect of
each division. If any discrepancy is noticed, a verification of the voucher-wise particulars
in the registers should be made with the division-wise classified abstract. After the two
sets of figures have been agreed a certificate of agreement should be got recorded in the
register over the dated initials of the Superintendent (compilations). If there are
discrepancies the certificate should be suitably amplified as explained in the case of
works Audit Register.
12-5-2 Bills Register (in respect of Pay & Allowances of Gazetted Officers and Non-Gazetted
Officers of the Pay & Accounts Offices at head quarters) and register of office expenses
(contingencies) are maintained in the Administration Section. At the end of each month,
the totals under each sub head/detailed head of account should be struck in the registers.
12-5-3 A register of reconciliation in form „PAO.60‟ should be maintained in Administration

Section. In Col.4 relating to expenditure during the
CHAPTER -12 231
month) the monthly totals worked out in the bills registers and Office expenses register
etc., (maintained in Administration Section) should be posted in the register of
reconciliation against each sub-head of account. The postings in the register including the
postings in the relevant column should be completed by the 10th of every month in
respect of each proceeding month.
12-5-4 The register should then be sent to Compilation Section on 11th of every month for noting
the compiled figures in the columns prescribed. The register should be returned by
Compilation Section by the 12th to Administration Section. The bills Assistant in
administration section should check the compiled figure and note down the difference
(voucher-wise) between the compiled figure and Administration Sections‟s figure in
respective columns provided in the register. Explanations of difference between Col. 12
and 13 of the register should be mentioned in the last column for “Remarks” and
adjustments carried out then and there wherever necessary.
12-5-5 The entries for the month in the register of reconciliation will be countersigned by
Superintendent (Compilation) and approved by the Pay and Accounts Officer/Assistant
Pay and Accounts Officer (Compilation) in token of reconciliation by the 14th of the
month positively and the register returned to Administration Section.
12-5-6. The procedure of reconciliation prescribed above for the central office should be
followed by outstation Pay & Accounts Officers/Assistant Pay & Accounts Officers in
respect of their respective offices. Monthly statements of expenditure and receipts duly
reconciled with the compiled figure should be sent so as to reach Head Quarters Office
by 13th of every month positively for incorporation in the register maintained by the
Administration Section.
“The expenditure in respect of Pay & Allowances of staff including those of

PAOs/APAOs contingencies, office expenses etc., of both the head quarters and
outstation PAOs offices should be debited to the relevant units of Project/ Department as
included and approved in the budget estimates concerned.
232 PAO (WA) Manual
Rectification of miss-classification/ miss-postings:-
12-6-1 No reconciliation can be complete unless the discrepancies noticed are set right promptly.
It is therefore of prime importance that necessary T.E.Os are proposed in rectification of
the discrepancies immediately after the reconciliation is completed and before the
registers are laid before the Pay and Accounts Officer/Assistant Pay and Accounts
Officer T.E.Os in rectification of the miss-classifications/miss-postings in the
compilation section should be got countersigned by the Superintendent (Compilation)
before they are submitted to the Pay and Accounts Officer /Assistant Pay and Accounts
Officer.
CHAPTER -13 233
CHAPTER- 13
INTERNAL TEST CHECK
Introductory:-
13-1-1 A separate section of the Office, consisting of picked men who by aptitude, knowledge
and experience are competent to scrutinize intelligently the work in various sections in
order to exercise effective control on the quality of the work done in the sections, should
be entrusted with the responsibility for internal test check. The section should be under
the direct charge of the Director of Accounts. The reports of the section submitted to the
Director of Accounts should enable him to have an expert‟s appreciation about the
technical efficiency of the various units of his office. In addition, the section should
scrutinize cases referred to it with a critical eye from the higher audit point of view.
The section should compile all important orders issued by the Director of Accounts on
the points referred to by the PAOs/APAOs in respect of “works”. Copies of such orders
may be communicated to all the PAOs/Sections under the control of Director of Accounts
once in a month for their guidance.
Functions:
13-2-1 The following items of work are entrusted to the section:

1. Scrutiny of estimates and maintenance of project estimate registers
2. Scrutiny of agreements supplemental agreements and comparison of rates:
3. Post review of vouchers;
4. Review of Measurement Books;
5. Review of Organization and Methods;
6. Review of work done in the sections and review of registers;
7. Scrutiny of orders of general nature and cases marked by the Director of Accounts; and
8. Post-review of payments of bills of contractors at 40% and 80% stage in respect of

Agreements of Rs. 5.00 lakh and above.
9. Maintenance of the register indicating the important orders issued by Government /

Higher Authorities subject wise upto date.
234 PAO (WA) Manual
10. Any other items special work entrusted by the Director of Accounts.
Scrutiny of Estimates:
13-3-1 All estimate sanctioned by the Chief Engineers after necessary scrutiny by the Pay &
Accounts Officers / APAO should be sent to the internal test check section with the
remarks of the pay & Accounts Officers / APAO. The estimates should be scrutinized in
the ITC section from Higher Audit point of view. An important aspect of the scrutiny in
the section is regarding the procedure and basis adopted for sanctioning estimates as also
a comparative study of estimates for similar works. The estimates should then be
submitted to the Director of Accounts for acceptance. Estimates sanctioned by officers
upto the level of Superintending Engineers also (after scrutiny by the Pay & Accounts
Officers / APAO) should be sent to the Internal Test Check Section by the Pay &
Accounts Officer / APAO, if they contain any peculiar or objectionable features for
further scrutiny and submission to the Director of Accounts for orders.
Project Estimate Registers:
13-4-1 The instructions for the maintenance of the Project Estimate Registers are contained in
Paragraphs 12 to 17 of the General Instructions (Accounts) issued by the Financial
Adviser (Vide Appendix No.). To enable the section to post the Register, a detailed
statement (Form PAO 61) in duplicate showing the estimates sanctioned by the
Departmental Officers during every month should be sent by the pre-check Sections to
the Internal Test Check Section. From this statement, estimates sanctioned by the Chief
Engineers and Superintending Engineers should be posted individually in the register. In
respect of the estimates sanctioned by the Executive Engineers only the total under each
detailed head should be posted. The register should be closed and submitted to the
Director to Accounts very month. As the estimates sanctioned by the Executive
Engineers are posted individually in the Project estimates Registers maintained in the pre-
check sections, those project estimate Registers should be sent to the Internal Test Check
Section monthly for review. In respect of Branch Offices the ITC section should conduct
such review during monthly visits to the branch offices. The entries in the registers
should be checked by the internal Test Check section with the entries in the statements
received
CHAPTER -13 235
from the sections and put up to the Director of Accounts with review remarks.
13-4-2 The lists of estimates sanctioned / received from the Chief Engineers, Superintending
Engineers every month should be checked with the posting in the project Estimate
Register and wanting estimates, if any should be called for. “Similar register may also be
maintained in respect of irrigation Schemes etc.
13-4-3 A consolidated register of expenditure (in form P.A.O. 62) should also be maintained in
the section in addition to the Project estimates Register. The expenditruefigure5 may be
got posted monthly by the Compilation Section.
Scrutiny of Agreements:-
13-5-1 Agreements above Rs. 10.00 lakh where lowest tender is accepted and Rs.2.00 Lakhs in
other cases and all supplemental agreements in excess of Rs.5.00 Lakhs (Amendment
Orders were issued and the monetory limit enhanced in G.O.Rt.No.35, Fin.(W&P-F.3)
Dept., dt.03.09.2007) should, after necessary scrutiny in the pre-check sections, be sent to
the Internal Test Check Section with the remarks of the Pay & Accounts Officers /
APAO. The scrutiny in the Internal Test Check section should be conducted with
reference to the points mentioned below:
1. Whether the agreement is in standard form:
2. Whether any of the special conditions in the agreement is of an extra-ordinary or

unusual nature requiring the sanction of a higher authority or Government;
3. General scrutiny of rates;
4. Comparative study with reference to other agreements for similar works in other units,
Divisions etc.
(Amendment Orders were issued and the monetory limit enhanced in G.O.Rt.No.35,
Finance (W&P-F.3) Dept., dt.03.09.2007)
Scrutiny of Supplemental Agreements:
13-6-1 Supplemental agreements should be scrutinized very carefully to see whether there is any
attempt to favour the contractor by changing the specifications for the work for which the
contractor has quoted low rates in the original agreement. Where fresh classifications of
soil are introduced, in the case of canal excavation mainly, it should be examined whether
it is necessary and customary to do so.
236 PAO (WA) Manual
Comparison of Rates:-
13-7-1 A Rates Ledger should be maintained in the Section for important items of work. The
rates entered in several agreements should be posted in this register from the agreements
received for scrutiny in the section. Comparison of rates for items of similar nature
belonging to different units or different divisions etc. should be conducted.
Post Review of Vouchers:
13-8-1 a) The ITC Section should also ensure that payments are generally made by the Pay &
Accounts Officers in accordance with the Agreements and estimates and that the
prescribed rules have been observed while making payments. The Director of Accounts
will mark the divisions and month of vouchers for post review in a register maintained
for this purpose. While reviewing the vouchers the ITC section will test check in a few
cases whether necessary posting have been made by the pre-check sections in the
concerned registers before making the payment. The intention of the review is to have a
test check of payment and postings made by the pre-check Section.
(b) Post Check of bills with a value of Rs.50,000/- and above
All the bills whose value of Rs 5.00 Lakhs (Amendment Orders were issued and the
monetory limit enhanced in G.O.Rt.No.35, Fin.(W&P-F.3) Dept., dt.03.09.2007) and
above may be post checked by the section.
(Amendment Orders were issued and the monetory limit was enhanced in G.O.Rt.No.35,
Finance (W&P-F.3) Department, dated 03.09.2007)
For this purpose, the PAOs/ APAOs should send on 10th of every month to Director of
Accounts in the preform (PAO Form 70) indicating the bills paid during the previous
month. The director of Accounts should send round the ITC Superintendent to conduct a
check of these payments before the end of the month. The remarks if any on vouchers
will be communicated to the PAO/APAO by the Director of Accounts for rectification /
Regularization.
Review of Measurement Books:-
13-9-1 This review should be conducted periodically by taking random samples with the
following objective.
(1) To see that the procedure of recording measurements is in accordance with the rules
and the condin6ns of the agreement;
(2) To see that suitable general orders issued by competent authority exist for recording
measurements for various types of works wherever necessary‟ and
(3) to compare the methods of recording measurements in various divisions and units.
CHAPTER -13 237
Review of Organizations and Methods:
13-10-1 This work consists in scrutiny of the methods of work adopted, by various units in the
office and assessing whether they are scientific, efficient and so detailed into one another
that there is no duplication of work in the office. Suitable instructions will be given from
time to time by the Director of Accounts for conducting this work.
Review of work in sections and review of registers:
13-11-1 A test-check of the work in pre-check sections is necessary to see how far they are
following the prescribed rules and regulations, maintaining the various registers that have
been prescribed submitting the returns on the due dates and generally functioning as
efficient units of the Office. It should not only detect and desect the irregularities but also
suggest improvements in procedure wherever necessary.
13-11-2 A register should be maintained in the section for selection of units for detailed review
during a month, the selection being made by the Director of Accounts.
13-11-3 The general items of work to be reviewed are mentioned below:
(1) Scrutiny of the pre-check and accounting work of the pre-check sections by means of
test-check.
(2) Watching the implementation of important office orders and circulars issued from
time to time.
(3) Scrutiny of the adequacy or otherwise of the existing arrangements for check and
review.
(4) Investigation of important items of arrears.
(5) review of the upkeep and maintenance of Audit Registers suspense and deposit
Register, Broad sheets, Objection Books, purport and Des-patch Registers etc.,
13-11-4 The results of review should be reported to the Director of Accounts for orders. The
common defects noticed in a group of sections should be circularized periodically by
office order so that such defects may be guarded against in future. It is the duty of
Internal Test Check Section to see that the defects noticed are remedied by the pre-check
sections concerned and that there is no recurrence of such defects.
238 PAO (WA) Manual
[(A) “Payments of Bills at 40% and 80% stages in respect of agreements of Rs. 10 lakh
and above are to be post-checked by Director of Accounts. For this purpose after the bills
at 40% and 80% stage of agreements of more than of Rs. 5 lakh are paid, the Pay &
Accounts Officers/APAO should send the concerned M.Books, agreement and other
connected records to Director of accounts with the remarks of Pay & Accounts Officer/
APAO for post-check by Director of Accounts. It should be ensured by Director of
Accounts that M.Books received for post-check are returned back to the concerned Pay &
Accounts Officers / APAO within a week.
The Pay & Accounts Officer/ APAOs should see that the objections raised on the bills are
cleared before making payment of further bills on the agreements.
In case the bill at 40% or 80% stage happens to be a final bill or the final bill is received
in Pay & Accounts Officer office even before the value of work done under such
agreements reaches 40% or 80% stages, such final bills should be sent by Pay &
Accounts Officer / APAO to Director of Accounts, with their remarks for pre-check
before payment instead of post-check.]
Govt.Memo.No.417 FIII/85, dt.3.9.1985
[Amendment ordered by Govt. in G.O.Rt.No.35, Fin. (W&P-F.3)Dept., dt.03.09.2007.
“80% stage for all agreements between Rs.10.00 Lakhs & Rs.50.00 Lakhs payment of bills @
40% and 80% stages in respect of agreements of Rs.50.00 Lakhs and above are to be post-
checked by the Joint Director of Works Accounts this purpose after the bills @40% and 80%
stage of agreements of more than of Rs.5.00 Lakhs (Amendment is issued to the G.O.Ms.No.35,
Finance (W&P) Department, dt.03.09.2007 as followed:
For Read as
“Rs. 5.00 Lakhs the occurring in line 7 of Col.3” “Rs.50.00 Lakhs” of para 13-11-14-(A).
The word “Director of Accounts” mentioned at line “Joint Director of Works Accounts” 14 & 28
of Col.3 in para 13-11-14(A) G.O.Rt.No.245, Fin. (W&P-F.3) Dept., dt.17.02.2007) are paid, the
Pay & Accounts Officer / Assistant Pay & Accounts Officer should send the concerned records to
the Joint Director of Works Accounts with the remarks of the PAO/APAO for the post-check by
Joint Director of Works Accounts. It should be ensured by the Director of Accounts that
M.Books received for post-check are returned back to the concerned PAOs/APAOs within a
week.
The PAO/APAO should see that the objections raised on the bills are cleared before making
payment of further bills on the agreements.
In case the bill at 40% or 80% stage happens to be a final bill or the final bill is received in
PAO/APAO even before the value of work done under such agreements reaches 40% or 80%
stages, such final bills should be sent by PAO/APAO to Director of Accounts, with their remarks
for pre-check before payment instead of post-check”.]
CHAPTER -14 239
CHAPTER 14
INSPECTION AND LOCAL CHECK
Introductory
14-1-1 The check conducted in the Pay &Accounts Office is based on Claims supported by
certificates, where necessary and accounts etc., submitted to that office in the prescribed
form. The major portion of the original records namely the initial accounts and other
books and papers on which the claims etc., so submitted are based, is retained in the
Offices where they originate. To satisfy himself about the accuracy of the data on which
claims etc., are based, the Pay & Accounts Officer / Assistant Pay & Accounts Officer
(Inspections) acting on behalf of the Director of Accounts, will have to inspect the
Offices with a view to check the initial records.
Scope of Inspection and Local Check:-
14-2-1 The scope of inspection and local check by the Pay and Accounts Officer/ Assistant Pay
and Accounts Officer should generally be similar to that conducted by the officers of the
Audit Department (vide Government Memorandum No. 9884-A/59-1, dated 28.11.1959).
As, however, cent percent pre-check of all claims is conducted in the Pay and Accounts
Office, the scrutiny during inspection and local check should cover only such aspects as
are not required to or could not be seen during pre-check. In addition to the scrutiny of
the initial documentation in the division / office, the Pay and Accounts Officer/Assistant
Pay and Account Officer (Inspection) should keep in view important general topics. He
should make a thorough study of these topics in the division / Office inspected by him.
Periodically he should furnish a note on each such general topic of importance. Some
important topics of general interest are given below for the guidance of the ay and
Accounts Officer / Assistant Pay and Accounts Officer (Inspection).
(1) Various stages of sand, mortar and concrete from manufacture to utilization.
(2) Employment of N.M.R. Labour
(3) A critical study of (a) local purchases (b) purchases made through limited quotations
and (c) purchases made outside the rate contract.
240 PAO (WA) Manual
(4) Sufficiency of rules relating to assessment, collection and accounting of receipts.
(5) The work load of a division / Office and the justifiability of the existing strength.
(6) Transit evaporation and other losses in important materials.
(7) Improper maintenance / non-maintenance of important initial records which have a

direct bearing on the correctness of payments. (Material-at-sits account, stock accounts,
tools and Plant Register etc,)
(8) Variations in rates for departmental supply of materials to contractors in the

agreements.
(9) A critical review of supplemental agreements.
(10) Correctness of hire-charges for various types of machinery, maintenance of log

sheets, delay in recovery of hire-charges.
(11) Operational efficiency of the machines and vehicles / with special references to the
rates of hire charges.
(12) Special study of the works awarded on nomination.
(13) a critical study of tenders and agreements.
(14) A critical review of stock accounts with particular reference to the basis and manner
of procurement of materials and their utilization.
(15) A comparative study of the system of execution of similar works in the same
divisions or in different divisions with reference to the results.
(16) Special study of the frequency and magnitude of the maintenance expenditure on
canal banks to see if it is due to any imperfect construction of the banks.
(17) A critical study of the economics in the execution of the works by departmental
machinery vis-a-vis agency of contractors.
(18) A review of the idle machinery (including idle crew); review of the spares lying un-
utilized for a long time.
(19) A review of the working of special types of machinery in use.
(20) The U.S.Rs of a Sub-Division may be reviewed and verified to see whether all the
U.S.R. Amounts have been recovered from
CHAPTER -14 241
the contractors‟ bills, if not the reasons there of may be critically reviewed.
This list is only illustrative and based on his experience, the Pay and Accounts
Officer/Assistant Pay and Accounts Officer (Inspection) should make suitable additions
to this list of General topics.
(General Instructions) Objects of Inspection & Local Check
14-3-1 (i) To see that the initial accounts and records from which the claims presented and
accounts rendered by the project Officers are prepared or on which they are based are
properly maintained in the prescribed forms and that financial rules and orders are being
observed.
(ii) To test the degree of care exercised by the departmental authorities (responsible for
keeping the accounts) over the accuracy of original records.
(iii) To test check the accounts in sufficient details with a view t o verifying the accuracy
and completeness of accounts and,
(iv) To test-check such accounts, records etc., as cannot be checked adequately except in
local check.
(v) To see that the draft agreements concluded at divisional level are verified by the
Divisional Accounts Officer of the Division who should record a certificate to the effect
that the agreement conditions have been compared with the Tender Committee
Proceedings/ Orders of tender accepting authority, so as to ensure that any conditions as
may be required to be incorporated in the agreements in accordance with the tender
committee proceedings have been incorporated in the agreements. For agreements
concluded at circle office level such verification and recording of certificate should be
done by the personal assistant to the Superintending Engineer invariably.
(Ref. 91-Cod/81-11, Irrg. (PW) Dept., dt.04.10.1983)
14-3-2 An inspecting Officer is not expected merely to confine himself to the routine check and
inspection work. He should avail himself of the opportunity to assist the departmental
officers and accountants with his advice in matters affecting accounts, budget etc., or the
financial regularity of transactions. He may even offer suggestion bearing on the
242 PAO (WA) Manual
economy of public money and is expected to do so in all cases of superfluous clerical

work connected with accounts. There are various directions in which an intelligent
inspection officer can find scope for his enquiries. He may find that there are chronic
delays either in measuring the work done or preferring claims or in making payments and
it- may reasonably be presumed that such delays lead to enhancement of rates. He may
notice that no attempt is made to invite competition amongst contractors, or that the
arrangements for giving out contracts for work or supplies or otherwise, so defective as to
suggest that possibly Government does not receive full value for payment made. He may
observe peculiar features of revenue receipt or expenditure of the department or office
which may be suggestive of possible leakage of revenue realized, of untapped sources of
revenues, or of want of attention to economical considerations. An inspecting officer
must, however, remember that he is concerned primarily with the accuracy of accounts
and regularity of financial procedure and not with departmental administration.
Responsibility for inspection and Local Check:
14-4-1 The Pay and Accounts Officer/Assistant Pay and Accounts Officer (Inspection) is
responsible for the efficiency of the inspection and local check work as a whole, though
some items of work may be entrusted to the subordinate staff. The local inspection staff
should, before taking up the work, study the system of accounts and books prescribed to
see why they have been prescribed and how far they fulfill the desired end, so may obtain
a correct perspective and make their check both intelligent and useful instead of allowing
it to become merely a process of checking registers in a disconnected and mechanical
way. The Pay and Accounts Officer /Assistant Pay and Accounts officer (Inspection)
should himself undertake a substantial part of the general examination of the initial
accounts. A list of important items of work the examination of which should accordingly
be carried out by him is given in Appendix-X. It should, however, be deny understood
that the introduction of this list is not intended in any way to diminish his responsibility
for the supervision of the inspection as a whole as it is open to him to extend his personal
scrutiny to other points which in his opinion require it. The success of inspection depends
on the vision and
CHAPTER -14 243
imagination of the Pay and Accounts Officer /Assistant pay and Accounts Officer
(Inspection). It is difficult to indicate the specific points that should be looked into during
inspection and the use of any form of questionnaire is not desirable. For the guidance of
the local inspection staff, general instructions specifying the nature and extent of check to
be the conducted and documents to be reviewed are, however, indicated in Appendices
XI and XII.
Staff for the Inspection Party:
14-5-1 The pay and Accounts Officer /Assistant Pay and Accounts Officer (Inspection) should
be assisted, in the inspection of each office, by staff adequate to complete the inspection
of an office, within the period allotted for the purpose. The staff must include an
experienced accountant. Inspection work is important and requires special strategy and so
suitable staff should be selected.
Drafting Inspection Reports:-
14-6-1 The inspection reports should be prepared in three parts.
Part I (a) Introductory - (Brief description of the activities of the division/Office, the
.period covered by the Inspection, the month of test-check and names of officers in-
charge during the period covered by inspection).
(b) Outstanding objections from previous reports in brief (all the previous inspection
reports should be carefully seen and the latest position in respect of each paragraph
indicated. The object is that the latest report should be exhaustive covering all the
important objections raised so far).
(c) Schedule of persistent Irregularities:-
Important documents not produced for scrutiny at the time of inspection should also be
listed out as a last Para under this part.
Part II: All important irregularities should be included in this part under suitable
headings.
Part III: Test-Check Notes: - This part will deal with the minor irregularities. Instructions
of advisory nature for improvement in the maintenance of accounts records may also be
included, in this part.
14-6-2 The Inspection reports should be drafted by the Pay and Accounts
Officer/Assistant Pay and Accounts Officer (Inspection) himself with
244 PAO (WA) Manual
utmost care and precision. Particular care should be taken in regard to the language and
tone of the report. Every endeavour should be made to present a just and impartial picture
in clear and plain language. In framing objections, insinuations and offensive
generalizations should be avoided. The facts and conclusions should if properly stated,
speak for themselves. The use of words such as fraud or embezzlement which denote
crime should be avoided unless it has already been proved. The objections should be
stated clearly but concisely and nothing should find a place in the report which cannot be
supported by indisputable facts and figures. The report should be brief and consistent
(with full statement of all irregularities or defects the facts of which should be clearly set
forth in the statement, item by item, with all relevant circumstances and should be based
on clear documental evidence). They should be confined to points of importance falling
distinctly within the rules and orders which can be quoted and matters which call for the
orders of higher authority. Full details in support of irregularities should be given. It is
not sufficient to quote the rule or order violated; the Actual or possible effect of such
deviation on the financial interests of Government should be explained clearly. Particular
attention should be given to the logical sequence of events, their completeness in the
chain leading the final conclusions and the dates of occurrence. It is necessary to deal
with any correspondence; the subject matter should be summarized as briefly as is
compatible with clear exposition. All details necessary for a clear understanding of each
irregularity should be given including:
(i) an explanation of the transaction;
(ii) a description of the nature and magnitude of the irregularity;
(iii) any externuating circumstances which might have existed;
(iv) the defects, if any, in the system which led to the irregularity and
(v) The remedial or preventive measures adopted and adequacy or otherwise thereof
14-6-3 As a rule, trifling matters which can be and have been set right on the spot or are no
consequence to the finances of Government, need not be mentioned, but if a number of
similar points are noticed, it may be desirable to mention the type of error or irregularity,
with one or more
CHAPTER -14 245
instances, so that proper instructions may be issued for the guidance of the Government
servants concerned
14-6-4 The inspection report should be completed before the Pay and Accounts Officer/
Assistant Pay and Accounts Officer (inspection leaves the office inspected and it should
not be signed until the officer in-charge of the office (or any other officer acting on his
behalf) has been given the opportunity off reading and fully discussing it. The inspection
report should be forwarded to the Director of Accounts by name within a week from the
last date of the inspection
14-6-5 The Pay and Accounts Officer/Assist Pay and Accounts officer (Inspection) should also
submit to the Director of Accounts a confidential report (written in his own handwriting)
on the work and capacity of the Divisional accounts Officer as judged mainly by the
quality of work done by him during the entire period covered by the inspection, and also
by the results of the check applied by him (No opinion on the work of the D.A.O. should
be expressed in the inspection Report)
14-6-6 The Pay and Accounts Officer/Assistant Pay and Accounts Officer (Inspection) should
form an Opinion as to the Divisional Accounts Officer‟s knowledge of the rules and
procedure relating to check and accounts. It should be seen that the Divisional Accounts
Officer‟s personal copies of the codes and other books of reference supplied to him are
correctly posted up-to-date.
Framing programmes and Disposal of Inspection Reports:
14-7-1 To organize the work of the Inspection Party as also to frame the programme for
inspection and disposal of Inspection Reports, an Inspection Cell shall function in the
central office.
14-7-2 The Cell is responsible to arrange for the inspection of all the divisions once a year by
drawing up suitable programmes of inspection. The period of inspection of each office
should be so fixed that the party would be able to complete the work within the time
allotted. A suitable register should be maintained in the Cell indicating the office that
have to be inspected and the dates of last inspection by Pay and Accounts
Officer/Assistant Pay and Accounts Officer and statutory Audit Officer and the proposed
and actual dates of inspection by Pay and Accounts Officer/Assistant Pay and Accounts
office (Inspection) programme
246 PAO (WA) Manual
should be drawn up for each quarter in sufficient time and in such a way that as far as
possible there is an interval of three months between the inspection of a division/ Office
by statutory Audit Officer and the Pay and Accounts Officer/Assistant Pay and Accounts
Officer (Inspection and get approved by the Director of accounts The head of the office
should be given sufficient notice of the dates of inspection and requested to obtain from
his subordinate necessary accounts records, etc., (which should be specified) and to be
present at his headquarters to meet the Pay and Accounts Officer/Assistant Pay and
accounts Officer (Inspection) in time to discuss the results of inspection with him.
14-7-3 The inspection cell should arrange to obtain the particulars required for selecting the
month of test-check, the sub-division for test-check and the names of works for analysis,
etc., (the selection being made by the Director of Accounts) from the pre-check sections
and furnish the names of months, sub-divisions and works selected to the Pay and
Accounts Officer/ Assistant Pay and Accounts Officer (Inspection) and the head of the
office well in time. These details should also be intimated to the concerned section to
enable the section to forward the necessary accounts and vouchers to the Pay and
Accounts Officer/Assistant Pay and Accounts Officer (Inspection). Points requiring
special scrutiny should also be intimated with full details to the Pay and Accounts
Officer/Assistant Pay and Accounts Officer (Inspection) in time. For this purpose a
suitable register should be maintained in the Inspection Cell to record the points to be
seen during Inspection, as and when they are received from other sections. The lists of
Tools and Plant articles transferred to other divisions should be kept division-wise and
forward along with the inspection documents to the Pay and Accounts Officer /Assistant
Pay and Accounts Officer (Inspection) for scrutiny.
Disposal of Inspection Reports:
14-8-1 The Inspection reports received in the Cell after perusal by the Director of Accounts
should be entered in the register of receipts and disposal of Inspection Reports. The
Reports should be examined carefully and edited in the Cell. Remarks which are not in
order should be expunged or modified as may be necessary and those which are not
considered to be of sufficient importance should be transferred to Part -III. A separate
register should also be maintained in the Cell to serve as a collective record of important
irregularities in the various offices as shown in part II of the report, classified under broad
categories and
CHAPTER -14 247
suitable action taken. The report should be got approved by Director of accounts before
issue.
14-8-2 Parts -I and II should be forwarded to the Head of the Office in a tabular form providing
separately columns for the record of each item, of the replies and explanations of the
Head of the Office and final disposal in the Pay and Accounts Office. The Head of the
Office should be required to return the report with his replies within six weeks from the
date of receipt of the report and. compliance with the same should be watched through
the register of receipt and disposal of Inspection Reports. Long delays in the receipt back
of the report should be brought to the notice of higher authorities.
14-8-3 It has been ordered by Government that the first reply to an inspection report of a
Division need not to be routed through the Superintending Engineer.
14-8-4 Important objections should be taken up separately with the higher authorities in respect
of points which cannot be settled based on the replies of the Head of the Office. The
comments of the higher authorities should be invited before processing the cases further.
14-8-5 Part III of report viz., the Test Check notes should also be forwarded to the Head of the
Office with instructions to take necessary action on the remarks made therein. The Test
Check notes do not require a reply in detail, but it should be verified during subsequent
inspection that adequate notice was taken of it.
14-8-6 A separate register should be maintained in the Inspection Cell for watching disposal of
the Inspection Reports on the accounts of Pay and Accounts Office received from the
Audit Department and sending reports regarding the review of disposal of audit
objections to the Finance (Audit Objections) Department (G.O.Ms.No.144, Finance
(Audit Objections) Department, dated 31-5-1965)
248 PAO (WA) Manual
CHAPTER - 15
CHECK OF ACCOUNTS OF STORES AND STOCK
General:-
15-1-1 The check of claims for the purchase of stores is conducted according to the instructions
laid down in regard to the check of expenditure from the Consolidated Fund of the state.
15-l-2 Irregularity in the disposal of public stores is equivalent to an illegal appropriation of

public money, and check of the expenditure of money spent on the purchase of stores
cannot in itself be a complete check of the final application of the money, without a
check of the disposal of stores
Detailed Instructions for check of stores and stock:-
15-2-1 (i) the check of the accounts of Stores and stock kept in an office should be conducted in
accordance with the instructions laid down in the following paragraphs.
(ii) In respect of all divisions maintaining independent stores (i.e. both quantity and value
accounts.) Other than projects, the relevant provisions of G.O.Ms.No.997, PWD, Dt.
17.06.67 and Govt.Memo.No.1369-7/67-16, PW, Dt. 25.11.69 have to be observed.
(iii) the instructions contained in Govt.Memo.No.10970/228/TFR/90-1, Fin. & Plg. (FW-

TFR) Dept., dt.10-11-1992 should also be followed.
15-2-2 The check of stores accounts kept in any office shall be directed to ascertaining that the
departmental regulations governing purchase receipt and issued, custody, condemnation,
sale and stock taking of stores are well devised and properly carried into effect, and to
bring to the notice of the Government any important deficiencies in quantities of stores
held, or any grave defects in the system of control.
15-2-3 As regards purchase of stores the Pay & Accounts Office will see that:
(i) These are properly sanctioned, are made economically and in accordance with any
rules or orders made by competent authority for purchase of stores required for the public
service; in particular when stores are purchased from suppliers the system of open
competitive tender is adopted and the purchase is made from the lowest tenderer unless
there are recorded reasons to the contrary;
(ii) The rates paid agree with those shown in the purchase order for the supply of the
stores;
CHAPTER -15 249
(iii) Certificates of quality and quantity are furnished by the passing and receiving
Government servants before payment is made except where the contrary is allowed by
the rules of the Government regulating purchase of stores ; and
(iv) Purchase orders have not been split up so as to avoid the necessity, of obtaining the
sanction of higher authority required with reference to the total amount of the orders.
Note: - The Pay & Accounts Officer/Assistant Pay & Accounts Officer may call attention to
cases of uneconomical purchases of stores and any losses which may be clearly and
definitely attributed to the defective or inferior nature of stores which were accepted and
certified to be satisfactory in quality.
(v) Purchase of items (borne on rate contract) outside the rate contract should be carefully
scrutinized with reference to the instructions on the matter issued from time to time.
(vi) the purchase has been made with the approval of the S.P.C. at S.Es/C/Es level as the
case may be.
15-2-4 (a) As regards receipt and issue of stores, it should be seen:-
(i) that all stores received are promptly and properly taken to stock.
(ii) that there is a proper requisition for every article issued;
(iii) that entries of all stores issued are made in the stock books correctly;
(iv) that requisitions and indents are approved by the competent authority;
(v) that proper acknowledgments of the recipients exist;
(vi) that the valuation is correct and the allocation of debit to the various heads of
accounts for the cost of stores issued is correct; and
(vii) That the issue is regulated by the scales prescribed. If any
(b) The accounts of stores should be generally examined to see:
(i) that they are kept in the prescribed form;
(ii) That entries of receipts and issues are made in them as transactions actually occur,
that issues are supported by the proper authority and by proper acknowledgements and
that some official is entrusted with the responsibility of checking that this is done
properly and for seeing that
250 PAO (WA) Manual
balances are worked out correctly;
(iii) That the accounts of balances which were checked in the previous inspection have
been produced complete in all respects, that no entries in them have been tampered with,
that the closing balances as per previous accounts have been correctly carried forward to
the accounts under scrutiny, and that there exists a certificate of periodical check of
balances;
(iv) That stores axe periodically counted, weighed or otherwise examined by some
responsible official, other than the custodian of stores or his subordinates wherever
possible and verified with the balances in the stock books, and that necessary action has
been taken to adjust the surplus or shortages noticed;
(v) That the balance on hand does not exceed the maximum limit prescribed by the
competent authority and is not in excess of the requirements for reasonable period and
(iv) That adequate action has been taken for the disposal of surplus. Obsolete and
unserviceable stores.
15-2-5 The Pay and Accounts Officer /Assistant Pay and Accounts Officer should ascertain that
the accounts of receipts of stores whether purchased, or otherwise obtained, and of their
issues and balances are correctly maintained. Where a scale has been prescribed by
Government or other authority for issue of stores of any particular kind, it should be seen
that the scale is not exceeded.
15-2-6 Stores, in many cases, represent a locking up of capital, which is not justifiable unless
essential. In order to effect economy in this direction the Pay and Accounts
Officer/Assistant Pay and Accounts Officer will see that the balances in hand does not
exceed the maximum limit prescribed by competent authority and is not in excess of
requirements for a reasonable period.
15-2-7 The Pay and Accounts Officer / Assistant Pay and Accounts Officer should scrutinize
sanctions to write-off of stores accorded by competent authority and bring to the notice of
Director of Accounts any defects of system which appear to require attention.
15-2-8 The accounting for and maintenance of unserviceable stores which cannot be utilized by
the department in whose custody there are kept involve
CHAPTER -15 251
waste of labour and space. The retention of stores in excess of probable requirement of
the department in the near future may result in loss to Government through deterioration.
The Pay and Accounts Officer /Assistant Pay and Accounts Officer will, therefore, see
that measures are taken to survey, segregate and consider the disposal of unserviceable
surplus and obsolete stores in accordance with the procedure prescribed by Government
in this behalf.
15-2-9 It is an important function of the Pay and Accounts Officer/Assistant Pay and Accounts
Officer to ascertain that the articles are counted periodically and otherwise examined to
verify the accuracy of the quantity balances in the books. The Pay and Accounts
Officer/Assistant Pay and Accounts Officer shall not except when specially authorized to
do so, assume responsibility for the physical verification of stores, but he has the right to
investigate balances of stores if any discrepancies in the stores accounts suggest that such
action is necessary. Pay and Accounts Officer /Assistant Pay and Accounts Officer has
however, to see that a certificate of verification of stores is recorded periodically by a
responsible authority, that the system of verification adopted by the Executive is adequate
and proper, that discrepancies found on stock- taking are properly investigated and
adjusted.
15-2-10 Where a priced account is maintained. Pay & Accounts Officer / Asst. Pay & Accounts
Officer will see that:-
(i) An up-to-date priced “Vocabulary of sto.es” showing the correct description and
identifying code numbers of various items (completed in respect of issue rates by the
divisions concerned) is prepared and adopted.
(G.O.Ms.No.304, Public Works Dept., (Projects Wing), dt.19-08-66)
(ii) the stores are priced with reasonable accuracy and the issue rates fixed and revised by
the S.E. Concerned in accordance with the instructions issued in the matter from time to
time.
(iii) That periodical reconciliation is effected between the value accounts of the stores
and the booked figures
15-2-11 The procedure prescribed for raising and pursuing objections in relation to expenditure
shall generally apply in respect of objections on accounts of stores and stock.
Order of Government for reference on Stores Accounts procedure in

252 PAO (WA) Manual
various Major Projects
1. G.O.Ms.No.201, PW (NS) Dept., dt.13.07.61 (N.S.P)
2. G.O.Ms.No.9, PWD, dt.07.01.65 (N.S.P)
3. G.O.Ms.No.537, PWD (PW), dt.08.12.65
4. G.O.Ms.No.304, PWD (PW) dt.19.08.66 (N.S.P)
5. G.O.Ms.No.997, PWD, dt.17.01.67 (SRSP)
6. G.O.Ms.No.124, PWD (PW) Dept., dt.09.05.1974 (SRSP)

253
CHAPTER 16
CO-ORDINATION SECTION
Introduction:-
16-1-1 The Co-ordination section functions as a controlling and coordinating unit for the
different sections of all the Pay & Accounts Offices under the DOA‟s Control. This
section is under the charge of a Senior Superintendent who has all round knowledge of
the work in the various sections office. The section functions under the direct charge of
the Director of Accounts.
Functions:-
16-2-1 One important item of work in the co-ordination section is the disposal of all general
correspondence affecting payments, accounting and procedure when such matters relate
to more than one section / office. All correspondence of this nature addressed to the
Director of Accounts after perused by him in the dak stage is received in the co-
ordination section. Such correspondence includes orders of Government, and other
authorities as also questions requiring classifications or amendment to the existing
procedure. These are examined in the section with reference to the relevant rules and
orders and after obtaining the orders of the Director of Accounts, copies of the
correspondence are sent to the concerned sections with necessary instructions for their
implementation. Copies of such orders on general matters may be communicated to all
PAOs/ APAOs with spare copies to communicate to all sections for guidance and
implementation.
16-2-2 A second item of work in the co-ordination section is the preparation of periodical returns
and reports due to Government, and other Officers when the preparation of such returns
and reports requires the collection of material from different sections. Material for project
working Committee Meetings, periodical statements of items held under objection and
list of items pending under Miscellaneous Public Works Advances for over one year are
examples of such returns. The Pre-check sections have to send the particulars required for
the preparation of these statements on the due dates prescribed. On receipt of these
statements they should be checked, consolidated and forwarded to the concerned
authorities.
16-2-3 The Co-ordination section should examine important cases referred to

PAO (WA) Manual 254
it by the Director of Accounts with reference to the rules, orders precedents and previous
orders on the subject. The main object of such an examination in the Co-ordination
section is to give a full picture of the cases to the Director of Accounts giving reference
to the previous orders of the Director of Accounts on the subject as well as the
implications of the rules relevant to the issue. As different types of cases relating to
various sections pass through the co-ordination section, this section can also act as
reference section on all important matters. In order to enable the section to locate the
relevant papers and previous orders on a subject, a dictionary of references should be
maintained in the Coordination section to serve as a collective record of all important
orders issued from time to time. A file of office orders should also be maintained in the
section to facilitate ready‟ reference to the office orders issued from time to time.
16-2-4 As a controlling unit, Coordination section is responsible to report the state of work in the
various sections of the office to the Director of accounts monthly. For this purpose a
progress report indicating the state of work in respect of different items is furnished
monthly by the pre-check sections of all the PAOs Offices duly signed by the
PAOs/APAOs concerned to the Coordination section. The extent of arrears furnished by
the various sections in their monthly reports should be consolidated Pay & Accounts
Officer /Asst. Pay & Accounts Officer -wise and the position of arrears should be
reported to the Director of Accounts. Every month, the Coordination section should
conduct a detailed examination of the initial accounts/ registers etc., of a selected section
with a view to assessing the correctness of the monthly progress report. The Section
should be got selected by the Director of Accounts.
16-2-5 Different registers and returns are due to the Director of Accounts from the various
sections on prescribed due dates. Their prompt and correct submission should be watched
by the Coordination section. For this purpose a calendar of returns detailing the registers
and returns due from the different sections should be maintained in the Co-ordination
section. The concerned registers and returns should be sent by the pre-check sections
through the Co-ordination section to enable that section to make a note of the fact of
submission of the registers in the calendar of returns maintained in the section. The
calendar of returns should be closed every month and submitted to the Director of
Accounts detailing
/
CHAPTER -16 255
out the returns and registers not submitted by the sections. Necessary reminders should
also be issued to the concerned sections calling for the wanting registers and returns.
16-2-6 With a view to ensuring that the budget Estimates for the project as prepared by the chief
Engineers are correct with reference to the form of the budget and the principles of
budgeting, the budget estimates are sent to Government through the Director of
Accounts. The Scrutiny of the budget estimates is done in the Co-ordinations Section.
The primary responsibility for the provision of funds to meet the expenditure during a
year rests with the executive. The Budget Estimates and the Revised concerned in
accordance with the instructions in the Budget Manual and other orders of Government
issued from time to time. While scrutinizing the budget estimates and revised estimates
the following points should be borne in mind.
1. The form of the estimate is correct.
2. The nomenclature of heads of account is the same as that adopted in the approved
budget for the previous year. The opening of any new head of account or the change in
nomenclature of any existing head of account would require the orders of Government.
3. It should be seen that the principles of gross budgeting have been followed in respect
of heads accommodating recoveries and that the provision for recoveries is made on well
defined standards with reference to the actual of the previous year as well as the
anticipated recoveries during the current year. The instructions regarding the preparation
and submission of budgets are embodied in the Budget Manual. The actuals as noted in
the Budget estimates should be checked carefully with the compiled accounts. The
scrutiny of budget estimates / revised estimates should be prompt, quick and complete.
4. “The check-slip as approved by Government in Memo.No.2520/P&B.II/8l-1, I&P

(PW) Dept., dt.01.12.81 has to be followed by the Director of Accounts for purpose of
scrutiny of Budget Estimate.
256 PAO (WA) Manual
PART D - MISCELLANEOUS
CHAPTER 17
FINANCIAL STOCK TAKING
17-1-1 It is a matter of great financial importance that there should be a financial stock taking of
big engineering projects at suitable intervals so as to correlate the progress of expenditure
with the progress of work actually done, as compared with the estimate, in order to
ascertain the prospects of the Project being completed within the limits of sanctioned
estimates. This Financial Stock taking is primarily the duty of the Chief Engineer of the
Project.
(G.O.Ms.No.159, PWD, PW, dt.1.5.1968)
17-1-2 The investigation should be made in proper time by correlating as far as possible the
progress of expenditure with the progress of work as compared with the estimates. In
each case it should be ascertained as accurately as possible of the prospects for the work
remaining to be done being executed within the limits of the latest sanctioned estimate
which holds the field. The amount of the residual work to be done in the Project and the
amount of expenditure required to complete it should, wherever necessary, be furnished
in the return. In respect of items for which definite quantities corresponding to the
monetary provisions have not been given in the project estimate, the progress on volume
of work as an approximate percentage of the total volume of work should be furnished. If
the investigation indicates the probability of large excesses over the sanctioned estimates
or the probability of a project sanctioned as productive, proving unproductive, the matter
should be brought to the notice of the Government. The investigation of the financial
position of the project should be continued every year till the project reaches completion
and the results brought to the notice of the Government. In reviewing the financial
prospects of a productive project, the revenue aspects should also be mentioned.
17-1-3 The Financial Stock taking return of a Project/ Scheme should be

CHAPTER -17 257
prepared by the Chief Engineer concerned in consultation with the Director of Accounts
of the respective project and furnished to Deputy Account General (Works) by the first
week of June every year under intimation to Government (in the administrative
Department and Finance Department) in the proforma prescribed in G.O.Ms.No.159,
PWD, PW, dt.1.5.1968.
(1) G.O.Ms.No.159, PWD, PW, dt.1-5-1968.
(2) G.O.Ms.No.1098, PWD (Codn.), dt.9-10-1973.
(3) Govt.Memo.No.1552, P&B/76-2, dt.19-7-1976.
(3) Govt.Memo.No.223/P&B/II/79-2, dt.6-12-1979.

258 PAO (WA) Manual
CHAPTER-18
RELATIONS WITH AUDIT
18-1-1 The Director of Accounts is the internal checking authority for the claims arising in the
Project and other offices. The responsibility for statutory audit of the transactions rests
with the Accountant General. For the purpose of conducting concurrent audit of the
transactions of the Project, residential concurrent audit units function in close proximity
to the Pay & Accounts Offices. The Director of Accounts should afford every facility to
the statutory Audit Officer or his nominee to enable him to conduct residential concurrent
audit.
18-1-2 The Cash Books with the relevant vouchers and supporting documents should be handed
over to the concurrent audit section on the prescribed due dates. As audit of vouchers is
conducted with reference to various accounts records (viz. Works Abstracts, Works
Registers, Contractors: Ledgers, Suspense and Deposit Registers) and audit registers of
establishment, these Registers as also any other connected records required by audit
should be made available at convenient timings. As these registers would be required in
the Pay & Accounts Office constantly for day-to-day work for passing bills etc., a
working arrangement should be devised in consultation with the Concurrent Audit
Section for supplying the records and registers to audit. A spirit of mutual
accommodation and cooperation between the Accounts and Audit Offices should, at all
times, prevail.
18-1-3 The Cash Books, vouchers and other documents connected with the system of
decentralized payments should be made available to concurrent audit without delay. In
addition, any other records, vouchers or documents which may be requisitioned by the
Statutory Audit Officer should be freely made available to him. Further, he will be within
his rights to make use of the objections taken by the Pay & Accounts Officer for the
Audit Report.
Where Resident Audit Office set up is not introduced, the procedure prescribed in para4-
26-1 (i) may be followed.
18-1-4 The results of audit are communicated through monthly audit notes. The Audit Notes and
any other remarks of audit should receive the personal attention of the Pay & Accounts
Officers/ Asst. Pay & Accounts Officer and
CHAPTER -18 259
Superintendents. The audit notes on receipt should be entered in the register of audit
notes in form “PAO-63” and should be replied to as expeditiously as possible. The
Register should be closed once in a fortnight and put up to Pay & Accounts Officers/
Asst. Pay & Accounts Officer detailing the reasons for the pendency in respect of each
item.
Audit objections:-
18-2-1 Where the audit objections relate to the Accounts keeping, the Director of Accounts will
reply to the Audit as he will be responsible for the proper maintenance of initial accounts.
Even in the case of audit objections involving matters other than Accounts keeping the
Director of Accounts will act as the Coordinating Officer to help the Divisions and for
dealing with Audit objections.
18-3-1 Audit Committee: The Director of Accounts/ Pay& Accounts Officers/ Asst. Pay &
Accounts Officers will associate with Engineer-in-Chief (Member of Audit Committee)
for assisting him in providing material for discussions/ furnishing replies in the meetings
of Audit Committee formed under G.O.Ms.No.307, I & CAD, dt.27.09.98.
260 PAO (WA) Manual
CHAPTER -19
BUDGET-CLASSIFICATION AND LETTER OF CREDIT
General
19-1-1 No expenditure should be incurred without the approval for the Budget by the Legislature
for every financial year. Also every payment of whatever nature should be supported by
either a specified sanction of the competent authority or covered by general financial
rules.
19-2-1 Budget: A statement of the estimated receipts and expenditure of the state for each
financial year is known as Annual Financial Statement or Budget. It consists of
Consolidated Fund, Contingency fund and Public Account.
Consolidated Fund:-
19-3-1 Consolidated fund of the state is formed out of all revenues received by the government
of the state, all loans raised by Government by the issue of treasury bills, loans or ways
and means advances and all moneys received by the government in repayment of loans.
The transactions are accounted for in three different sections, namely (a). Revenue
account being the account of current income derived mainly from taxes and duties, fees,
fines and penalties, revenue from Government estates etc., and expenditure; (b). Capital
account being amount of expenditure of a capital nature met from loans, surplus revenues
and capital receipts; and (c). Loan Account being the account of public debt incurred and
discharged and of loans and advances made.
Contingency Fund:-
19-4-1 Contingency Fund of the State is in the nature of imprest created by a Non-recurring
nature contribution from the consolidated fund of the State. This fund is intended to
provide advances for meeting unforeseen expenditure pending authorization by law to be
passed by the legislature and will be kept at the disposal of the Governor.
19-4-2 For obtaining an advance from contingency fund, first, sanction of the Government in the
administrative department should be obtained based on which the Finance and Planning
Department will release the amount towards advance. Based on this LOC has to be
released against which only payments can be made.
Public Account of the State:-

19-5-1 Public Account of the State comprises of all moneys received by or on behalf of the State
Government which are not creditable to the consolidated fund of the state. It comprises of
provident fund etc., Reserve funds, Deposits and advances, suspense and miscellaneous,
remittances
CHAPTER -19 261
and cash balance.
Charged Expenditure:-
19-6-l Charged expenditure is not subject to vote by legislature though discussions can be made.
All decretal amounts and certain other categories of payments as enumerated in the
Constitution of India are debited to this portion of provision in the budget.
Classification:-
19-7-1 Classification: The classification structure in respect of accounts and plan is made up of
Sectors, Major Heads, Minor heads, sub-heads and detailed heads. The last one to
indicate the nature or form of expenditure such as salaries, travel expenses, loan etc.,
otherwise known as objects of expenditure. While scrutinizing the classification of
expenditure from the estimates stage itself and onwards it should be ensured that the
contemplated I incurred expenditure is close to the object of expenditure.
Letter of Credit:-
19-8-1 Letter of credit: After the budget is passed by the legislature and Appropriation Act
enacted, the C.Es/ Heads of Departments will place a requisition to the Government in
Finance Department through the administrative department for release of letter of credit
(LOC) periodically. On receipt of LOC the CE will distribute the same circle-wise under
intimation to the DOA concerned. The SEs in turn will distribute their portions divisions
- wise with copies to PAOs/APAOs. The PAOs and APAOs will then admit the payments
against these distributions.
19-8-2 In regard to treasury controlled items under establishment the Budget provisions will be
distributed quarterly by the C.Es, in respect of projects, and ENC in respect of Irrigation
Divisions/Offices. These will be scrutinized by the DOAs/DFA respectively and
communicated to PAOs/APAOs for admitting claims.
Guiding Principles:-
19-9-1 Guiding Principles: Principles and rules of classification are contained in A.P. Budget
Manual and Account Code Vol. I. The guidelines given in chapter No 5, of this manual
may also be followed.

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PAY & ACCOUNTS OFFICE

(WORKS ACCOUNTS) MANUAL

MINISTER FOR FINANCE &

2. Regrouping of paras in certain chapters specially those relating to works &

P.K. RASTOGI, IAS

2. The manual is divided into four parts.

3. PART - A explains the principles undelying scheme of separation of accounts

6. The Chief Accounts Officer will gratefully acknowledge suggestions for

Principles of Separation 2-1-1 to 2-1-3 1

PART B - GENERAL PROCEDURE AND ADMINISTRATION

Constitution of the Office 3-1-1 & 3-1-2 7

Sanction to leave (other than Casual leave) 4-7-1 & 4-7-2 23

Introductory 7-1-1 to 7-1-4 63

Collectors from land acquisition

General 8-1-1 161

Introductory 9-1-1 to 9-1-6 171

Delivery of Despatch of Cheques 9-9-1 to 9-9-2 180

Introductory 10-1-1 to 10-1-7 197

Introductory 10-4-1 200

Clearance of Objections 10-7-1 202

Introductory 11-1-1 206

Financial Stock Taking 17-1-1 to 17-1-3 256

Relation with Audit 18-1-1 to 18-3-3 258

General 19-1-1 260

projects) Finance and Planning (PW) Department, Secretariat for decisions at

i) Checking of Cash book and Compilation of monthly accounts.

Duties and Functions and powers of the Director of Accounts:-

(ii) He should ensure that expenditure is incurred on estimates sanctioned by competent

b) However, whenever there is a difference of opinion between the Director of

c) A periodical review of such list of payments should be made at Government level

(ix) He should be responsible for value accounting as regards stores.

(xi) He is responsible for the accounts documentation of all the transactions.

(xiv) As member of Negotiation) Tender and Stores Purchase Committees, he should

Powers Delegated to the director of Accounts:

8. To incur expenditure on repairs and maintenance of Type writers, Calculators,

10. To incur expenditure on repairs to office furniture (full powers).

GENERAL PROCEDURE AND ADMINISTRATION

Duties and Responsibilities of the staff: -

3-2-2. Superintendents: - A Superintendent is responsible for maintaining discipline in his

Signing of Communications and recording of letters: -

(1) Reminder cards and routine reminders.

(2) Acknowledgment of letters and documents received.

(4) Communication of adjustments made in the books in rectification of errors in

(5) True extracts from letter/vouchers.

(7) Cheque forwarding slips when no objection is conveyed.

Receipt and Distribution of Dak:-

System of Recording Correspondence:-

3-11-1 All correspondence will be filed in “files” or “cases”.

Section I: All returns of a permanent or recurring nature due to outside authorities.

Section IV : Unforeseen entries which a section is required to make in the Calendar in

A consolidated review report for all sections in respect of PAO/APAO should be

Responsibilities on taking or handing over charge:-

(v) Pending Court cases if any and

whenever there is change of incumbency should be sent to the Director of Accounts

Inspection of Sub-ordinate Offices under the control of the Director of Accounts:-

Conditions of Service and Problems of Staff:-

Maintenance of Personal Files, Service Books and Leave Accounts of Staff:

4-7-1 Sanction of Leave (Other than casual Leave)

4-10-1 Before sanctioning increments or ordering promotions it should be ensured that

Postings and Transfers:-

Bills for pay and allowances:-

4-14-1. T.A. Bills, Medical Reimbursement Bills etc.

Drawal of Cash and Disbursement:-