1

TYPES OF BUDGET

A – SALARY COMPONANT
B – NON SALARY BUDGET
C – CONTENGENCY GRANT

&
ITS UTILIZATION

Inayat Ullah Khan Jatoi

(R) Addl. Director Public Instruction(EE)Punjab
Cell # 0333-4241574
inayatjatoi1@gmail.com
 Learning Objectives
 Enable the Managers…..
 To understand the Concepts & Purpose of……. ..
 Sources of Funds
 Budget /Expenditure
 Current & Development Expenditure
 SNE
 Salary & Non Salary Budget

&
 Proper preparing & utilization of Budget
 Prepare for external Audit

3
PART – A

BUDGET
 Sources of Funds
 At present, school receives funds from two
sources.

 1. Non-Governmental/Private Fund Source

(F.T.F is a Non Government Fund)

 2. Governmental Source.( Budget )

The government source include funding
by Provincial and local Govt.
NSB (Non Salary
Budget) is a part of Government Fund/Budget.
 BUDGET
 It is a statement of receipts and expenditure during
a financial year of the Government. it reflects
government policies, priorities, financial strategy
and operational plans in financial terms.

Budget as Management Tool

 Allocates resources among different services and

functions to obtain inputs required to achieve
outputs.
 BUDGET/EXPENDITURE

CURRENT EXPENDITURE
It is the expenditure incurred on performance of
state functions i.e. provision of social, economic and
community services, maintenance of law and order,
general administration and payment of interest on
debts raised for public purposes
DEVELOPMENT EXPENDITURE
Development Expenditure means any expenditure
on development projects which are undertaken
through development budget. It is expenditure
financed on a project for the purpose of acquiring,
constructing or enhancing physical assets or on
schemes of capital outlay which add to the
economic potential of the country.
 “Statement of new expenditure (SNE)”

 The expenditure relating to new current activities

during the next financial year.
 The expenditure is mainly on personnel and
purchase of durable goods.
 The proposal of new expenditure shall be prepared
by the DDO on the same forms which are used for
regular budget.

Submission of SNE
 The new expenditure shall be submitted with the
budget documents separately as a “Statement of new
expenditure (SNE)”
Non Development Budget (Current
Expenditure)

 Salary Related Budget

 Non Salary Budget

 SALARY COMPONANT
(Employees related Expenditure.)

Normally these expenditure operated

automatically through
computerized pay roll in AG/DAO.
 PART- B

NON SALARY BUDGET

(NSB)
NON SALARY BUDGET SCHEME
FOR
HIGH & HIGHER SECONDARY
SCHOOLS

Inayat Ullah Khan Jatoi

(R) Addl. Director Public Instruction(EE)Punjab
Cell # 0333-4241574
inayatjatoi1@gmail.com
 Contents
 Objectives of Scheme
 NSB fund’s outcomes
 Estimate of school budget
 Usage of funds
 Stages of Long Term School’s Planning
 Approval of NSB
 Implementation of NSB Budget
 Accounting of NSB
 Monitoring
 Re-appropriation
 Audit of NSB
 List of NSB Budget Codes
 Objectives of NSB Scheme
 To reduce the budgetary constraints of school
 To reduce drop out
 To improve & ensure retention of students in
school
 To empower school management and school
council
 To improve the school’s environment
(physical & learning)
 NSB fund’s outcomes
(NSB Policy Section 2.3)

 100% cleanliness of Building

 100% cleanliness of Classrooms
 100% cleanliness of Playground
 100% cleanliness of Washrooms
 90% teacher’s attendance
 100% Functionalize available facilities i.e.
electricity, drinking water, washrooms, boundary wall
Cont……
NSB fund’s outcomes

 100% repair of furniture

 Purchase of new furniture (25% out of required
furniture)
 100% functionalize available classrooms
 Students retention enhanced by 20% in 3 years
(baseline 78%)
 Estimate of school budget
 PMIU will allocate the funds for schools according to the
NSB formula
 PMIU will inform to EDO(E) and EDO (F&P) for school’s
fund
 Each school will be informed about decided funds.
 Funds will be directly deposited from province to
District Government Account –IV as Conditional Grant.
 These funds will be utilized strictly only for the purpose
decided through DAO under relevant rules laid down by
the Finance Department.
 FTF and other funds will be deposited in another account
(These amounts will not be mixed in SC account)
 Usage of funds (cont.)

 Head teacher will use these funds as Drawing

and Disbursing Officer (DDO) observing the
Delegation of Financial Power Rules, Austerity
Measures with maintaining expenditure record .
 School has liberty to use funds under NSB policy
section 2.3
 SC will work according to SC Policy 2007/13
 Any construction work can be done after
fulfilling the important need as per NSB policy
 SBAP (School Based Action Plan) will be prepared
Usage of funds
 Funds will not be used on non listed items in NSB Policy
which are;
 Purchase of Land
 Any work/ activity which is not in school’s premises
 Purchase of vehicles etc.
 Those items which will not be used in school
 Those items which are not mentioned in SBAP/NSB/ non
listed items can be fulfilled after the written approval of
the authority.
 All Non salary/ recurrent expenditures will be covered
from NSB Fund
 No extra funds will be allocated for non salary
expenditures
Stages of Long Term School’s Planning
1 2 Current 3
Identification Situation Identification of
of Analysis of School’s
School’s Vision School Objectives/ Aims

4
7 Stages Identification of
of School’s Need
Long Term School Planning

6 5 Classification/
7
Cost Estimation Categorization
Preparation of
of School Needs of school’s
Budget
need
 Stage-1
Identification of School Vision

 Vision will help to set the school’s objectives

 SC and Head Teacher will prepare School’s
vision
 Parents and students will also be the part of
this activity
 Vision can be:
“Provide comfortable and encouraging
educational environment to achieve the
better results”
 Stage-2
Current Situation Analysis of School

 School baseline will be conducted

 Information of teachers attendance, results,
cleanliness and basic facilities will be collected
 Use school’s data, govt. reports and MEAs
record
 Stage-3

Identification of School’s Objectives/ Aims

 3 to 6 comprehensive objective are sufficient for proper

implementation of SBAP and results
 Objective will be prepared by SC, staff and Head
Teacher
 Objectives set by govt. will be considered as per NSB
Policy section 2.3
Example:
 Improvement in educational environment
 Improvement in physical environment
 Ensure the retention of students
 Stage-4
Identification of School’s Need

 School needs will be identified according to the NSB

policy
 Daily school’s need i.e. teaching, learning and
educational material will be addressed
 Taken steps to reduce Drop out and improve the
attendance
 Any kind of Changes/ situations which can makes
future requirements
Example
White wash, cleanliness of classrooms and wash rooms ,utility
bills, repair of boundary wall, stationary, new furniture and repair
of existing furniture, sanitary work etc.
 Stage-5
Classification/ Categorization of school’s need

 All school needs will be Classified/ categorize in 2 groups

for better results
 Compulsory Needs:
Repair & white wash of classrooms, material for gardening, utility bill,
accessories for cleanliness, cleanliness of school, repair of electric wiring,
repair of furniture, purchase of furniture, sanitary work and drinking
water, learning material, learning material for children, security measures,
 Important Needs:
White wash of building, repair of boundary wall, plantation, stationary for
learning & office, temporary teachers, water tank, first aid box/ material,
study tours.
 Schools needs can be categorized according to the local
situation
 Stage-6
Cost Estimation of School Needs

 Cost estimation of all needs will be done by SC, staff

and Head Teacher
 Consider all type of expenses like:
 Cost of material/ items
 Packing cost of items
 Transportation, loading/ unloading cost of items
 Installation cost
 Maintenance cost
 Stage-7
Preparation of Budget

 NSB Budget will be prepared for High &

Higher Secondary schools according to NSB
policy .
 SBAP/ SDP will be prepared, quantity &
quality will be mentioned in plan
 Reclassification may be considered after
discussion and school needs.
 All item’s cost will be mentioned in plan
separately
 Approval of NSB

 SC and school staff will prepare the NSB

 NSB will be approved in staff and SC meeting.
 Approved NSB will be sent to District Administration
through district collector /EDO(F&P) for review.
 EDO (F&P) can point out/ objection on any item(s) and
inform to School Administration.
 Primary and Elementary share is included in the
budget of High School. Head teacher is expected to
give due attention on the needs of primary and
elementary portion.
 Implementation of NSB Budget
 School head teacher will be responsible to implement
 Detailed implementation plan will be prepared
 Purchase items in bulk to reduce the cost
 Major work/ construction (which can be disturbed the daily school
routine/ functions )will be started in summer vacation
 Procurement will be made according to PPRA (Punjab
Procurement Regulatory Authority).
 Purchase through quotations at local level. 3 tendering at
local level.
 Funds will be transferred to DAO quarterly in equal
installments and will be utilized like other government
budget.
 Accounting of NSB (cont.)

 Cash Book (Record for cash transaction)

 Cash amount/ transaction will be recorded
 Head teacher will maintain vouched account of the
Receipts of purchased items.
 School bank transactions detail (cheque #, date of issuance
and name of person) will be entered in cash book
 Expenditure statement should be obtained and
maintained on monthly basis.
 Stock entries be made properly.
 In case of Rs. 10,000/- or above amounts for any item(s)
will be paid through cross cheque.
 Deduction of income and sales tax be ensured.
 Accounting of NSB (cont.)

 Inventory Register (Record for material detail)

 Schools will prepare the inventory register
 All items available in school will be entered in
school’s inventory register
 New purchased material will be entered in inventory
register
 Accounting of NSB

 Budget Register
 School will maintain the budget register
 All purchases detail will be entered in register
 Ledger (income, expenses and balance sheet) must
be updated
 Schedule of Payments be obtained from DAO and
Expenditure statement be maintained properly.
 Monthly Reconciliation statements be prepared.
 Monitoring
 Head teacher should monitor all financial
activities according to the vision and targets
already framed and below mentioned actions will
be checked
 Are the expenses according to the budget?
 Are the division of resources considered?
 Are the work progress is according to the timeline
 Are the rules of PPRA are being observed
 Are the results of NSB according to the govt. target
 Is the MEAs record cover the govt. targets
 Performance of contractor will be observed
 School Administration can review the project and take decision
regarding continuation of project, change in plan, change in timeline
and also terminate the project
 Re-appropriation

 Due to miss calculation, delay or any other

reason, re-appropriation may be made during
the financial year.
 In these circumstances, school will submit
revised budget to EDO(E), EDO (F&P) under
rules and procedure.
 Audit of NSB

 Auditor General, Government of Pakistan can

audit the incomes and expenditures
 Govt. have liberty to nominate any 3rd party for
audit
 Audit will be made in selected schools every
year
Discussion
Q/A
 PART – C

OPERATIONAL EXPENDITURE
(CONTENGENT BUDGET)
 Major components of
Public Financial Management(PFM)

 Budgeting
(Preparation of Budget – Budget Cycle)

 Expenditure
(Utilization of Funds according to the Financial Rules)

 Auditing
(Maintenance of expenditure record accordingly)
 How to operate Private Fund
 Decision regarding to utilize the F.T Fund will be taken
by School Council under rules.
 Every cash transaction will be operated through official
bank account.
 Strictly observe codal formalities.
 Maintain F.T Fund Cash book separately and close
monthly regularly.
 Enter every purchase item into Stock Register.
 If item is consumable in nature enter into consumable
Stock register.
 If item is in permanent in nature, enter into
paramagnet stock register.
 How to operate Budget/Govt. Fund
 The following steps are taken to operate the budget.
 Feed the budget into AG/DAO.
 Prepare Budget Register/Contingent Register for concerned
Financial year.
 Make expenditure according to the rules/procedure laid
down by the Finance Department.
 Prepare & enter bill into Budget register duly signed by the
DDO.
 Submit the Bill into AG/DAO office while entering in token
register.
 After auditing the bill AG/DAO will issue the cheque to
concerned DDO.
 Enter Cheque into Cash book on receipts side.
 Pay to concerned and enter into Cash book on Payment side.
 Purchase Process
 Allocation of amount relevant Head
 Justified Demand/ Requisition
 Stock position
 Approval from authority
 Purchase committee
 Specification
 Market survey/Report/Estimate
 Quotation call letters
 Tendering process/if required

 Contd…
 Sealed quotations
 Comparative statement
 Supply order
 Inspection report
 Stock entry
 Submission of bill to AG/DAO
 Ensure Income tax and GST deduction
 Cash book entries (Receipt and Disbursement)
 Payment
 Proper acknowledgement
 EXERCISE

 Activity – 1
 Activity – 2
 Activity - 3
Discussion
Q/A
Thank you !