PUBLIC PRIVATE PARTNERSHIP IN RAILWAYS

Public-Private Partnership in Railways

Public-Private Partnership in Railways: A New Approach:
The existing literature on public private partnership (PPP) is largely project-centric and deals mainly with non-railway transport infrastructure. The railway is different from other modes of transport because of the strong interrelationship that exists between railway projects and the existing network/system in matters of operation, maintenance, etc and not much PPP literature exists in this area. The current approach to private participation in railways is a reform oriented policy approach that dwells on restructuring, privatizing, licensing, unbundling and deregulating the existing set up. This could be termed as a top-down approach. In contrast, the evolution of private partnership in the Indian Railways (IR) is a bottom-up phenomenon – incremental, multidimensional and without any change in the existing set up. A different framework is required to capture this evolution.
This paper is based on research carried out on the Indian Railways, in which seven railway companies were studied. These companies either came into being as part of private partnerships or used varied forms of private partnerships. The views of thirty key people associated with such partnerships were collected through interviews. PPP in IR has evolved over the last two decades in response to a strong need for increasing investment, prioritising projects, allocating dedicated funds, and reducing losses in peripheral services. An alternative two-dimensional three level framework for PPP in the railways has been developed, which not only captures private partnership in IR but also facilitates the development of strategies and vision for the future. The framework may help in laying down future goals for encouraging PPP at three levels – project level, organisation level and sector level – and shows interlinkages among the three for achieving the goals. It also represents an alternative approach to railway privatization with better social and political acceptance, which will encounter less resistance to change within the government organisation. (Volume 20, Number 1 Article by Anil Kumar Gupta & Shyamal Roy March, 2008) Courtesy: IIM Bangalore website.

The Railway Minister Lalu Prasad has given a hint to open Indian railway for Private companies in the name of Public Private Partnership (PPP). He was delivering his speech at the Conference on Public Private Partnership (PPP) I n Indian Railways. The FICCI had organized the conference. He disclosed the truth from the same podium that he did not ever want the post of Railway Ministry. He was asking for some other ministry. He encouraged the industry people to invest through PPP in Indian Railways. He said that Private sectors might help for modernization of railway stations to excellent standards. Indian Railway is planning to set up agricultural outlets on 7,000 railway stations across the country and the minister asked for private sector to join hands with Indian Railways.
The other areas where PPP might work are construction of sidings and logistic parks, wagon manufacturing, port-connectivity through railways, and constructing the Freight Corridor. It will help railway to stay with the need of modern India that is showing more hunger for development.
The Indian Railways are prima facie encouraging Public-Private Partnership in the capacity enhancing and modernizing exercise. Projects through the PPP model have been started in a few sectors and envisaged in few other areas. This paper is an attempt to assess the degree to which PPP has penetrated the Indian Railways.
The Indian Railways operates the world’s second largest rail network under a single management. It has an established route length of 62,759 km divided into three gauges – broad, metre and narrow.
The functions of the Indian Railways can be divided into core and non-core activities. The core activities comprise transportation of freight and passengers (running of trains and owning of assets) and non-core activities comprises catering, running schools and colleges for the children of the railway staff, medical healthcare facilities for the railway staff, production units and workshops, protection force for the safety of railway assets, maintenance of an exclusive telecommunications network etc.

PPP Project means a long term project based on a contract or concession agreement, between the Government or statutory entity on one side and a private sector company on the other side, for delivering an infrastructure service on payment of user charges. Typically, a private sector consortium forms a special company called a special purpose vehicle (SPV) to build and maintain the asset. The consortium is usually made up of a building contractor, a maintenance company and a bank lender.
Risk sharing is one of the most important features of a PPP. The PPPs most likely to succeed incorporate a risk mitigation framework that apportions risk in terms of capacity to bear.
The Railway Act:The Indian Railways Act stipulates that no private sector participation can be invited in the operations of the trains. Hence, the same is not open to the private sector.
Model Concession Agreement
The detailed modalities of the contract between the private player and the Government are specified in the document called Model Concession Agreement (MCA). This document plays a pivotal role in the implementation of the project. It clearly delineates the risks to be shared by the private player and the government and spells out the formula of sharing of the revenue among other important details. .
Types of PPP
PPP Model can be adopted through various ways. Maintenance Management Contract, Turnkey, Operate and management, ROT and BOT are few ways in which PPP can be adopted. BOT is the most preferred model for PPP in IR.
Viability Gap Funding
The money given by the government to the private player to make the project viable is called Viability Gap Funding. Support under this scheme would be available only for infrastructure projects where private sector sponsors are selected through a process of competitive bidding by offering grant assistance of up to 20% of the project costs, the Government will be able to use its scarce budgetary resources to leverage a much larger pool of private capital.
The Government of India has decided to put into effect the following scheme for providing financial support to bridge the viability gap of infrastructure projects undertaken through Public Private Partnerships.
Firstly, where the Government of India recognizes that there is significant deficit in the availability of physical infrastructure across different sectors and that this is hindering economic development
Secondly, where the development of infrastructure requires large investments that cannot be undertaken out of public financing alone, and that in order to attract private capital as well as the techno-managerial efficiencies associated with it, the Government 4 Guidelines Financial Support to Public Private Partnerships in Infrastructure 2006 published by the Secretariat for the Committee on Infrastructure Planning Commission. Further information on the same can be accessed from this report is committed to promoting Public Private Partnerships (PPPs) in infrastructure development
Thirdly, where the Government of India recognizes that infrastructure projects may not always be financially viable because of long gestation periods and limited financial returns, and that financial viability of such projects can be improved through Government support.
Projects through the PPP Model
In the past Indian Railways had made several attempts to rope in private participation in areas such as catering, wagon ownership and leasing and joint ventures for rail infrastructure projects. These efforts were, however, limited in scale and scope. The current strategy is to leverage private capital through PPPs to the maximum extent in areas which are amenable to PPPs to improve efficiencies and control costs.
1. Operation of container trains and Construction of Private sidings, ICDs and rail side warehouses IR has awarded licenses for container operations to 14 private sector companies, thus, ending the monopoly of Container Corporation of India (CCI) in this area. Most of the current parties are likely to use the operations for their internal use but dedicated third-party container operation providers might also emerge later to compete directly with CCI. These companies are involved in every step of the container business, from booking of traffic to aggregating the goods to distributing them at the destination by arranging transport. These companies would also pump in 2,000 crore to overhaul the terminals and purchase wagons.

740 crore was taken from these 14 players in license fees. In addition, Ministry of Railways intends to partner with State Governments, private logistics operators and infrastructure providers to establish multi modal logistic parks equipped with rail sidings with sheds, large inland container depots, warehouses for storage, office buildings for logistics operators, highway connectivity, and smaller assembly units for processing imported raw materials for export. Such Parks could either 11 be built independently at strategic locations or could be built in a Special Economic Zones (SEZs).
2. Construction of Dedicated Freight Corridor (Delhi-Mumbai and Delhi- Howrah) with a large component of PPP
It has been planned to construct a new Dedicated Freight Corridor (DFC), initially covering about 2700 route kms equivalent to around 5000 track kilometers at an approximate cost of Rs.28000 crores (US$6 billion) linking the ports of western India and the ports and mines of Eastern India to Delhi and Punjab. It will ensure multi-modal logistic connectivity and will also significantly enhance railway freight capacity to handle the large volumes anticipated from the ports on the eastern and western coasts. The construction of this corridor will be implemented through an SPV being created for the purpose through a mix of Engineering Procurement and Construction (EPC) and PPP methods.
The proposed corporate entity would provide the rail infrastructure, but would not engage in freight business itself, thus providing nondiscriminatory track access on payment of haulage charges by train operators. This approach would herald large-scale private investment and competition in freight operations. This underlying separation of rail from wheels would also mark a paradigm shift in the functioning of Indian Railways. Ministry of Railways is in the process of selecting a global consultant to advise on the concession agreement, principles of track access charges and other financing and bidding issues. The concessionaire could also tap additional ancillary revenue streams through commercial exploitation of land, construction of freight terminal/logistic park/ICDs etc. Further, after firming up wagon designs for DFC, private investment for its manufacture would be encouraged. Four more Dedicated Freight Corridors are being planned for which feasibility studies are being awarded.
3. High Speed Corridors
Plans are also afoot to study the feasibility of high speed passenger rail link between major metropolises to improve connectivity and slash travel time for distances of 600-1000 km to within 2 ½ to 4 hours..
4. World Class Railway Stations, Passenger amenities and Commercial utilization of land Metro City Railway Stations like Delhi, Mumbai need to be modernized to provide world – class passenger amenities and services to the large multitude of passengers using these stations. IR is planning to do so by attracting private investments in the area by allowing the areas around the stations and the air space above platform to be commercially developed while operational/passenger – handling areas are separated from such commercial areas as in case of airports. The concessionaire would be expected to construct and maintain the operational and passenger areas free of cost, share the revenue earned from the real-estate created and hand over the same after the concession period. The pilot project for New Delhi Station is on the anvil. Altogether 19 stations have been identified at the first stage. These are CST Mumbai (Carnac Bunder), Pune, Howrah (Kolkata), Lucknow, New Delhi, Anand Vihar and Bijwasan at Delhi, Amritsar, Chandigarh, Varanasi, Chennai, Thiruvananthapuram, Secunderabad, Ahmedabad, Patna, Bhubaneshwar, Mathura Bangalore and Bhopal. Development of other stations green field passenger terminals would also be taken up in a similar manner.
Indian Railways has approximately 43,000 hectares of vacant land. These are mostly alongside track in longitudinal strips, around railway stations, and in railway colonies especially in metro and other important cities/ towns with potential of being used commercially to generate revenue as well as capital for modernization and capacity addition. An authority, namely, Rail Land Development Authority (RLDA) has been set up under the Railway (Amendment) Act 2005 to pursue, inter alia, the main objectives of generating revenue, up grading railway assets and providing world-class state-of–the art passenger facilities/services at stations.
5. Pipavav Railway Corporation Limited
A Special Purpose Vehicle named PRCL (Pipavav Railway Corporation Limited) which was formed with equal equity participation from Ministry of Railways and GPPL (Gujarat Pipavav Port Limited) for construction, Operations and Maintenance of Surendranagar-Pipavav Broad Gauge line, has implemented Surendranagar - Pipavav Gauge conversion/New Line project. The construction of this line has been completed and thrown open for Goods Traffic since March 2003. Earlier, connectivity of Mundra Port on the West Coast to the Broad Gauge network of Indian Railways was completed. Gandhidham – Palanpur gauge conversion is being implemented through involvement of Kandla and Mundra ports. Kutch railway Company, SPV formed with Kandla and Mundra ports, Government of Gujarat and RVNL are equity holders.
6. K-RIDE
A Joint Venture named K-RIDE (Rail Infrastructure Development (Karnataka) Limited has been formed jointly with the State Government of Karnataka for early completion of four identified projects in the State of Karnataka. K-RIDE will execute these projects through Project Specific SPVs.
First such SPV named HMRDC (Hassan - Mangalore Rail Development Co.) has been formed with equity participation from Ministry of Railways, Government of Karnataka and K-RIDE. Strategic partners and other financial institutions will also take part in the equity contribution. Besides, Government of Karnataka has agreed for funding of three rail projects by contributing two-thirds of the cost.
7. The Wagon Investment Scheme (WIS) with provisions for freight rebate and supply of guaranteed number of rakes over periods ranging from 7-15 years for various categories of wagons has been well received. The scheme would be reviewed on the basis of feed back of the subscribers and continued further.
8. Setting up of SPV for manufacturing of locomotives/coaches/wagons with sustained economic growth and the resultant demand for rail transport, the requirement of rolling stock has increased manifold. The requirement of coaches/Electrical Multiple Units is projected at 22689-vehicle unit for the XI Five Year Plan. The gap between the requirement and the combined capacity of the two Production Units at Integral Coach Factory, Perambur and Rail Coach Factory, Kapurthala (around 2500 per annum) is planned to be bridged by augmenting the existing capacity of these Production Units and setting up a new manufacturing unit through a JV under PPP.
Similarly, the requirement of Electric and Diesel Locomotives has been projected at 1800 each during the XI Five Year Plan i.e. 360 locos per year. The existing in – house capacity for the manufacture of these locomotives is presently 150 per annum and can be augmented to 200 locos each per annum for Electric and for Diesel. The gap between the requirement and capacity is planned to be bridged by setting up two locomotive manufacturing units one each for diesel and electric locomotives through PPP. Possibility of PPP through long- term demand guarantee to prospective manufacturers of modern wagons is also being explored.
9. Parcel Services
Round-trip leasing of parcel vans in important mail/express trains is already being carried out on Indian Railways. 100 parcel vans have already been leased. A more comprehensive policy to run Express Parcel trains has been finalized. Two privately operated parcel trains are already in operation.
10. Catering Services, Budget Hotels and Food Plazas
Indian Railway Catering and Tourism Corporation (IRCTC) has already been mandated to develop catering services, budget hotels and food plazas at major stations through involvement of private entrepreneurs. IRCTC intends to take up around a hundred such budget hotel projects in the next five years with public Private partnership. 20 such concessions have already been awarded. The hotel will be set up under the name of Rail Ratna in five cities - Chandigarh, Sealdah (West Bengal), Madurai (Tamil Nadu), Vijayawada and Secunderabad (Andhra Pradesh) in the first phase. The IRCTC land will be leased out to the hospitality sector on behalf of the railways and finalize the bids for 30 years to construct, operate and maintain the hotel as per the terms and conditions specified in the bid document.
IRCTC is also commissioning new Food Plazas in Railway premises with private participation. The license period for food plazas is of nine years with a provision of extension of three years. Already 40 such Food Plazas have been commissioned. IR is also in the process of carrying out an examination of the scope of need- based ‘base kitchens’ and ‘launderettes’ with public private partnership to strengthen the infrastructure for on -board services.
Call centres are also being planned under PPP by IRCTC to cater to the need for information dissemination to the railway customers.
Government Policy on PPP in Indian Railways
India needs investment in infrastructure to the tune of $456 billion at current prices (more than $80 billion in Railways) during the Eleventh five year plan (2007-2012) to keep pace with the economic growth its experiencing. It must be noted that in spite of such dire need of funds in IR and the limited nature of its surplus, the IR has followed an over-cautious approach in inviting private sector participation in Indian Railways.
The reasons for the same have been identified as follows:
1. There exists no clear roadmap for implementation of PPP in IR On interaction with the senior railway officials it can be easily drawn that the IR are being forced to look outwards for finance and techno-managerial skills. What we have is a list of projects that have been selected on urgency basis but without any sound official articulation or planning.
2. Political Climate: It is evident that in our country politics dominate the decisions relating to economic policies. In the words of a senior railway official in-charge of PPP, “We live in a political economy and hence political sensitivities of the times will have a bearing on the economic policies of the time. We don’t want to hit bigger roadblocks later on in future. We must not only be transparent but also be seen transparent. No blind privatization will take place and hence private sector participation will only be invited in areas which require immediate attention and that too where the private sector is capable of reducing costs and improving the quality of service.”
3. Enforceability of the Contract: A PPP can only be successful if the government can ensure discipline on part of the private player to enforce the contract and thus result in achieving the desired objective. A senior railway official reveals the true reason, “We lack prior experience in dealing with such complex situations and hence are going very slow as we don’t want any thing to go wrong.” It is clear that the IR does not possess the requisite managerial skills that the current complex business environment calls for.
4. Threat of Private monopolies: Another reason for the slow approach is the fear of emergence of private monopolies (in the place of state monopoly) in case right policies are not adopted. In the words of a senior railway official “The characteristics of the railways are such that private monopolies will mushroom in place of state monopoly in case the right policy is not adopted.”
6. PSU Mindset: Another fact accepted by the railways is that a change in the mindset of the people from top to bottom (from the gang man to the customer) in the organization is required for mainstreaming of the PPP model. To achieve this, dedicated PPP cells have been established in every state to identify the projects that can be implemented through PPP.
The private sector participation is not a gift without a curse. It comes with its own set of problems. It has historically been proved that inviting of private sector participation in case of a government monopoly has not always led to the private sector efficiencies and modernization. On the contrary it has led to monopolization in the hands of the private sector. Therefore it is of pivotal interest that whenever private sector participation is being talked about it should always be assumed to be inviting competition as well.
Conclusion
Non-critical areas in the Indian Railways should be identified and private sector participation should be allowed in the same. The Indian Railways should focus on the core activities of running and operating the trains. The prospects remain bleak for any major policy change due to an extremely weak record of enforcement of contracts in the long run.
Corporatization of Indian Railways is the best way to take the restructuring of the Indian Railways forward. The IR should also adopt General Accepted Accounting Principles (GAAP), the role of the Indian Railways Regulatory Authority should be strengthened and it should be allowed to decide the fares to be charged from the passengers with a provision for adequate compensation from the Union Budget for keeping fares cheaper to fulfil its objective of social welfare. Manufacturing of locomotives and wagons should also be through the PPP Model.

SALUTES TO PEOPLE’S HEROES

SALUTES TO PEOPLE’S HEROES

SALUTES TO PEOPLE’S HEROES

The passing away of Mr. A Xavier of Dindigul and Mr. Paulraj of Madurai went unnoticed in the progressive circles of the Catholic Church of Tamil Nadu. As a friend and well wisher of the two people’s heroes, I stand to write a few lines in memory of them.
Paulraj was an old acquaintance to me. When I joined the St Joseph’s College, Trichy a Jesuit institution after my P U C in St Xavier’s College, Palaymkottai, Tirunelveli, Paulraj was one year senior to me both in the college and in the Sacred Heart Hostel. I should always remember Paulraj, as he was the inspiration for me to involve in AICUF. He encouraged me to join AICUF and take part in the activities. Another reason for us to come together was Rev Fr V Diaz, S J the Band Master of the St Joseph’s College Band , Trichy. While Paulraj played baritone I played trombone.
With his encouragement I joined AICUF and participated with full spirit. During the November 1976 some time after promulgation of emergency in the country, a seminar was organized on the foreign collaboration. As part of the seminar a poster exhibition was held in the Clive Hostel across the Teppa kulam, and a hall meeting in the community hall above the college canteen. I was asked to present a paper on the foreign collaboration in tooth pastes. I finally concluded in the paper that all such companies must be nationalized. That was my first appearance on the stage as a speaker. I owe a lot to Paulraj still I am confident in speaking in so many regional, national and international seminars and workshops. I vividly remember that he advised me on “cold feet”, do think that all the audience before you as less informed and then you would never feel nervous. It is true till date.

After my shifting to Loyola College Chennai in 1977, I lost direct contact with him. However, my destiny with AICUF continued and the National Secretariat of AICUF was just outside the campus of the college. With a little reluctance I entered the AICUF house. Rev A Xavier S J was there to invite me with such love and concern as the House Director. Thereafter, till 1983 when I was forced to break the official bond with AICUF house it continued as source of inspiration. The AICUF remains the first and last source of inspiration.

In 1978, once again Paul raj, Henry, Johnny were heroes in the AICUF as they were the pioneers to enter the Rural Education for Action and Development (REAL) Vedasendur near Dindigul. The name remains as the source of inspiration for so many generations of AICUFERs and non AICUFERs for involving with rural development. A word of Rev Fr Claude D Souza S J must be said at this juncture. He was instrumental in “brainwashing” the urban born urban English educated students to dabble with rural development. In fact he ushered in an era of rural development when the urban youth were dejected with national affairs and were attracted to naxalbari movement for armed struggle. He paved the way for silent revolution in the minds of the youth both within and outside the church. Thus, he saved a number of dejected and disgruntled youth from falling in to the clutches of extremist politics.

Paulraj after spending most of the years in REAL, left to Madurai to take part in politics. His contribution as a national executive member of the now defunct Indian People’s Front (IPF) is exemplary. After a decade or so he was not satisfied with the way the things went on within IPF. He retired thereafter to be local activist and visited many NGOs as adviser.

The untimely death of Paulraj is a perpetual vacuum among NGOs in rural areas. His name and fame has spread all over the country. Nevertheless, he was firm on the principle “think globally act locally”. At this juncture, I on behalf of thousands of ex-aciufers and NGO activists share the grief with his spouse Hephzibah and the children and re-dedicate ourselves for the cause of social change. Thank you Paulraj for every thing you gave us! Thank you Lord for giving such a wonderful person called Paulraj in our midst. We are proud to be his friends and contemporaries. .

The life and times of Rev A Xavier S J had touched many youngsters who took shelter under the huge banyan tree called AICUF. The warmth and convincing talk of Xavier is always remembered by generations of AICUFERs. The first thing that attracts the fresher in AICUF house is the house director who takes care of the boarding and lodging and the library.

Having got enlightenment, he left the Society of Jesus and married Lucy another kind hearted person. There were lots of controversies and criticisms on their marriage. However, a few of us believed that they have done the right thing in the interest of the church. The early church was indeed a lay church. They named his first son after Rev Fr Guerivere S J who was the think tank for AICUF for many years when he worked at the Indian social institute Bangalore and later New Delhi. The statistical man of AICUF was such a source of inspiration to generations of AICUFERs.

At this juncture, I on behalf of thousands of ex-AICUFERs and NGO activists share the grief with his spouse Lucy and the sons and daughters. We take this opportunity to re-dedicate ourselves for the cause of social transformation. Thank you Xavier for every thing you gave us! Thank you Lord for giving such a wonderful person called Xavier in our midst. We are proud to be his friends and contemporaries.

INTERNAL CHECK –PRE AND POST CHECK
1.1 INTERNAL CHECK
The check exercised By the Accounts office on the financial transactions of the Railways on half of Railway Administration is called internal check. This is called so to distinguish it from the audit conducted by the chief auditor of the railways receipts and expenditure on behalf of the controller and Auditor General of India. In fact the audit conducted by the Chief auditor should be rightly called “external audit” and the internal check carried out by the financial Adviser and his officers, on behalf of the Railway administration should be called “Internal audit” in modern parlance.

1. 1.1 The Scope and methods of internal check or internal audit have been brought out in detail in Chapter VIII of Accounts Code Volume I.

The Salient features of internal audit are as under.
(a) Check of Sanctions and orders,
(b) Check of delegation of financial authority,
(c) Check of all Establishment bills
(d) Pre-check and Post-check of expenditure
(e) Scrutiny of receipt - this includes inspection of original records at the stations as well as post audit of returns from the stations in the Traffic Accounts office;
(f) Internal check of debt and remittance transactions,
(g) Maintenance of Provident Fund Accounts,
(h) Check of pension payments,
(i) Prior check of all contractors bills etc., before passing the same for payment inspection of stations and other executive officers for checking the original records.

1.2 The Internal check is conducted with reference to -
(a) rules and orders issued by the President Railway Board, General Managers of Railways and various authorities,
(b) the instructions contained in the Codes and instruction issued from lime to time by the Railway Board,
(c) The recognized standards of financial propriety,

1. 3 While scrutinizing receipt. It should be seen
(i) That the amount due to the Railway for services rendered, supplies made, arc correctly and promptly assessed recovered as soon as they fall due,
(ii) that all receipt arc properly brought into account,
(iii» that all receipts are correctly classified, and if they represent an amount due to more than one railway, that they are correctly apportioned among the railways,

1.4 All claims against the railway are scrutinized with a view to see
(a) that the expenditure has been sanctioned by competent authority and that the expenditure is incurred by .an officer competent to incur it,
(b) that all prescribed preliminaries to expenditure are observed before disbursement of pay, etc.
(c) that it is covered by the grant at the disposal of the officer incurring it,
(d) that the expenditure does not contravene any rules and orders in force,
(e) that the expenditure does not involve a breach of the Standards of financial Propriety
(f) that the expenditure sanctioned for a limited period is not admitted beyond that period without further sanction,
(g) that in the case of recurring charges, which are, payable on the fulfillment of certain condition a certificate is forthcoming from the drawing office to the effect that necessary conditions have been fulfilled,
(h) that the charge is correctly classified,
As exceptions to this general rule the following payments may be; made before such check: - \
a} Payments from imprest
(h) Payment from station earnings when permitted under rules.
(e) Commission deducted by auctioneers from sale proceeds,
(d) Payment of certain classes of pay bills, muster sheets and labour pay sheets of open line staff specially permitted to be made by F.A. & C.A, 0.

1.5 INTERNAL CHECK OF SANCTIONS AND ORDERS
The Accounts Officer -should examine every rule. order or sanction whether issued by the president, the Railway Board, or any sub-ordinate authority in order to see
(a) that the authority framing the rule or according the sanction is competent to do so,
(b) that the sanction is definite.
(c) that the rule or order or sanction does not contravene any general or special orders of any higher authority and
(d) that the sanctions to expenditure of definite amounts, [he same arc always expressed both in words and figures.

1.6 TREATMENT OF ERRONEOUS PAYMENTS
When erroneous payments have been passed for considerable time. owing either to a wrong interpretation of financial rules or due lo oversight, the following procedure should he observed:
f) Wrong interpretation:
The new interpretation should be given effect from the date, which the competent authority may decide. If no date is specially fixed, the correct interpretation -should be given effect to from the date it is stated by the competent authority
Oversight
Payment made less than 12 months ago, should be recovered. Every overpayment of money to a railway servant is and must be regarded as a debt to public and all possible action should be taken for speedy recovery

1.7 POST CHECK OF PAID VOUCHERS
All bills, whether under the pre-check or the post check system in which payment has been made should be checked to see -
(a) that the acknowledgements of payments have been obtained (in English or Hindi).
(b) that the names of payees mentioned in the bills tally with the signatures obtained,
(c) that the payment has been witnessed, whereso required, by the official named in the bill and the acknowledgement is unqualified,
(d) that where a person other than payee himself has received the amount, the payment has been made under proper authority.
(c) that vouchers are stamped,
(f) that each voucher has been cancelled efficiently and promptly,

1.8 INTERNAL AUDIT AND INTERNAL CHECK :
Though Internal Check is part of Internal Audit as far as Railways are concerned yet there is a distinct difference between the two.
''International Audit is an independent appraisal function within an Organization for the review of activities as a service to all levels of Management. It is a review of the operations and accounts some-times continuously undertaken within a business by specially assigned staff".

The objectives of Internal Audit are
i) a Service to Management;
ii) ensures reliability and integrity of Accounts System.
iii) ensures compliances with rules and regulations;
Facilitate preventions and detection of frauds.
Internal Check is a part of the overall internal control system. The internal check is the check exercised on the day-to-day transactions which operate continuously as part of the routine system whereby the work of one person if proved independently of another.

SYSTEM OF INTERNAL AUDIT IN INDIAN RAILWAYS:
Internal Audit functions are performed in the form of Inspections of activity centres and offices by different agencies from Zonal and Divisional Railway offices:-
i) Inspection of Executive offices by Accounts Officers and Staffs as provided in Chapter-XVII of the Accounts Code Part-1,
ii) Inspection of stations by TIAs as per Chapter - XXXIII of Accounts Code - Part-II
Accounts Stores Verification of Stores as per Chapter-XXXIII of Stores Code
iv) Inspection of Subordinate Accounts offices by FA & CAO and his officers.
v) Inspection of Zonal Railway's Account Offices by the Board's Inspection Party,
All these Inspections are in the nature of Systems Audit ad Transaction Audit.
Further reading: Please refer Chapter-XVII of Accounts Code Part-1 to know more about the objectives of Inspections of executive offices and the records that are to be inspected.

STATUTORY AUDIT
2.1 Railways are part of the Government of India and not a corporation under any statute or Indian Companies Act. There is, therefore, no statutory audit of the type under Indian Companies Act. Statutory Audit is conducted by CAG which is much more comprehensive than company auditors and the audit report on performance is submitted lo the Par/lament by CAG, Public accountability is, therefore, maximum.

2.2 FUNCTIONS
The Comptroller and Audit General of India is the final audit authority in India and he is responsible for the audit of the accounts of the Indian Railways hut has no responsibility for the compilation of such accounts. The form in which account of the Indian Railway should he kept and changes in accounts classification affecting the recording of The expenditure in the Finance and Revenue Accounts are, however, subject to his approval (113-!).

2.3 OBJECT OF STATUTORY AUDIT (116 AI and 911 of Finance Code)
The Statutory audit has three fold purposes viz.
it is an accountancy audit - to check the accuracy and to see that all payments are supported by receipted vouchers,
it is an appropriate audit - to check to ensure that expenditure, receipts have been properly classified, and voted appropriations have not been exceeded
iii) it is also an administrative audit to check that expenditure has been incurred according to prescribed rules and regulations.
The main object of audit is to ensure -
a) that the system of accounts used by the internal check authority is correct,
b) that the method of check applied at every stage of the accounts is sufficient,
c) that the accounts are maintained and the checks applied with due accuracy and
d) that the arrangements exist in the accounts office to ensure attention to the financial interest of the railways on the part of all concerned.
2.4 RESPONSlBILITY
The responsibility of statutory audit is briefly as follows :-
a) it extends in respect of expenditure transactions lo all expenditure incurred in India.
(i) in respect of receipts, it includes receipt of Indian railways including receipts relating to accounts of manufacture,
c) it includes stores and stock accounts to do the extent prescribed by the Comptroller and Auditor General of India.
2.5 Audit is always conducted ex-post facto i.e. after the event-
Audit cannot prevent an overpayment through negligence or non-observance of rules and regulations. It is the duty of Audit to report results to the proper authority so that appropriate action is taken to rectify the irregularity wherever possible and atleast prevent its recurrence

COMMUNICATION FROM AUDIT -DRAFT PARAS AND AUDIT REPORTS (Chapter IX of Finance Code)
Ordinarily the results of statutory audit are communicated through -
a) Specific reports of the more important and serious irregularities discovered in the course of audit, of Accounts and departmental offices and station records,
b) Audit notes detailing minor irregularities discovered in the course of audit of accounts office records,
c) Inspection reports showing the results of audit of the initial records of executives offices (Para 916 of Financial Code).

An inspection report will consist of two parts, namely Part I dealing with the more important matters and Part II dealing with the rest, containing minor routine matters. Audit notes will also similarly consist of two parts. The final disposal of part II of audit notes and inspection reports rests with the Accounts officers and no formal reply to the Director of Audit is necessary. Replies to part I of inspection reports and audit notes and specific reports should be sent by the executive offices concerned to the accounts officer. In scrutinizing them, the Accounts officer should call for further information, if necessary, and consult the head of the division or department concerned, where desirable before giving a reply to the Director of Audit (918 and 919 of Financial Code). All audit objections and notes should be promptly attended to by the Accounts officer.

All important eases coming to the notice of Audit during inspections or regular audit which in the opinion of the Director of Audit merits inclusion in the Audit Report are brought to the notice of the Railway Administration through special letters, notes of objection etc., to the Heads of Departments/FA&CAOs by the Director of Audit. Since these special letters, factual statements form the basis of the material for the Audit Report, the Railway administration should deal with them at a sufficiently high level and bring out their point of view in a convincing manner before they proceed to prepare a draft paragraph for incorporation in the Audit report.

11.3 Draft paras
If it is decided by the Director of Audit that the statement of facts are required to be converted into a Draft Para for the Audit report, the draft Para prepared will be sent by the Director of Audit to the Personal address of the GM simultaneously sending advance copies of the draft Para with connected correspondence to the FA&CAO. HOD concerned, the additional Deputy, C&AG (Rlys) and the Director (Finance) Railway Board to facilitate prompt action and detailed examination. The railway administration is required to give a final reply lo the Director of Audit, after consultations with the Railway Board, within a period of eight weeks from the receipt of the draft Para. To allow some time for further enquiries and examination by the Railway Board, it will be necessary for the railway to forward the draft Para alone with a report from the Railway administration personally to the Director (Finance) Railway Board, as quickly as possible as but not later than five weeks of the receipt of the draft Para. The reply will be sent over the personal signature of the GM duly vetted by the FA&CAO.

Any modifications, which the Railway administration may desire to suggest, or any comments, which they wish Director of Audit to consider before giving their final reply should, as far as possible, be settled by personal discussions so that the final reply of the administration is sent within the overall time limit of 8 weeks. After the railway, administration has replied finally, any further enquiries by the Board or the Director of Audit will have to be dealt with based on highest priority,

11.4 Audit report of CAG
If the Audit is convinced of Railway administration replies that there are no irregularities, the draft paras will be dropped- If the audit considers the cases as irregular the draft paras will be included in the report of the CAG and the report is presented to the Parliament where it is taken up for consideration by the Public Accounts Committee. The Committee obtains personal evidence of senior officers of the Railway Board. The recommendations made by the Committee are considered by the Railway Board and notes on action taken by the Board are submitted to the Committee.

The Audit Report Covers Comments arising from audit of the Accounts of Railways and Appropriation Accounts on Railway Grants. Other points arising from the test audit of financial transactions of Railways are also included,

The Audit Report generally highlights :-
Financial Results of the year,
Leakage and Seepage of Railway Earnings,
Avoidable expenditure
Underutilization of assets:
Cost over runs due to Time overruns in the execution of projects
Inventory Control,

11.1 RECTIFICATION OF MISTAKES IN ACCOUNTS DISCLOSED BY AUDIT
(Para 922 of Finance Code)
if any mistake or inaccuracy is disclosed by Audit or detected in internal check, the following procedure should he adopted :
1) The mistakes should be rectified through the account of the month in hand if the accounts of the year have not been finally closed. (Any nature or mistakes)
2) Mistakes and misclassification noticed after, closing March Accounts but before the preparation _of Capital and Revenue and Finance Accounts should be rectified - The corrections should be intimated to the Railway Board by the first week of August either through a revised account or through corrections to accounts already submitted.
3) The following rules are lo he followed if the mistakes are noticed after the submission of Capital and Revenue and Finance Accounts :-
(a) If the item belongs to one revenue or service head but is wrongly classified under another - No correction need be made. A suitable note against the original entry is sufficient
The mistakes must, however, be corrected if the error affects (i) the revenue or expenditure of another Railway or a branch line company or another Government Department (ii) Capital Head (iii) Debt or remittance head.
(b) Capital - If the corrections affect capital major heads the same should be effected as without financial adjustment i.e. by altering the progressive figure of capital outlay.
(c)Debt or Remittance head : If the error affects a debt or remittance head the following procedure should be followed ;-
(i) Item taken to one debt or remittance head instead of another (either debit or credit) the correction should be made by transferring it from one to the other
(ii) Item credited or debited to a debt or remittance head instead of revenue or service head - same procedure as mentioned at (i) above,
(iii) Item credited or debited to a revenue head instead of to a debt or remittance head - correction should be made by minus crediting or minus debiting the revenue head and crediting or debiting the proper head,4, If the rectification of mistake would lead to an excess over grant or grants voted by Parliament or to a considerable change in the dividend payable in General Revenue, the orders of Financial Commissioner (Railways) must be obtained

GOVT ACCOUNTS AND BOOKS

GOVERNMENT ACCOUNTS,
1. Governed by the requirements of the constitution and instructions of parliament through its committees,
2. Purpose is to determine as to how as little money as possible may be taken from the tax payer to maintain the activities,
3. There must be a systematic record of all receipts and expenditure classified appropriately,
4. Generally kept on a single entry system,
5. Maintained on cash basis,,
6. Statement of receipts and expenditure is only prepared,

COMMERCIAL ACCOUNTS
1. Governed by standard accounting practices and conventions and the law of the land such as company law, income tax law etc
2. Purpose is to show how as much can be earned as possible consistent with the requirement of the business
3. There should be a record of the usage of capital, profit/loss source of profit/loss and indication about the solvency of the company
4. Maintained on double entry basis
5. Maintained in accrual basis
6. Trading accounts, manufacturing account, profit and loss account and balance sheet are prepared
STRUCTURE OF GOVT. ACCOUNTING
PART I
CONSOLIDATED FUND OF INDIA
It is governed by Article 266 of constitution of India All receipts and expenditure both h on capital and revenue accounts are accounted for. In addition, loans and advances to Govt employees are accounted
REVENUE
Deals with the proceeds of taxation and other receipts classified as revenue and expenditure there form Rlys: The traffic receipts form the main source of revenue and working expenses are the main revenue expenditure
CAPITAL
Deals with expenditure met with the object of increasing the assets. Rlys: Capital, DRF, DF, OLW-R & Capital Fund according to nature of assets and rules of allocation Block account prepared for all assets irrespective of the source of funds. Loan account reflects expenses charged to loan from General revenue - Capital
DEBT – PUBLIC DEBT, LOANS & ADVANCES
Rlys: HBA, Scooter advance, cycle advance, natural calamity etc both advances and repayment of loans and recoveries of advances

PART II
CONTINGENCY FUND OF INDIA
It is governed by Article 267 of constitution of India. It is operated to meet unforeseen expenditure pending authorization of parliament. It is under the disposal of the F C of Railway.
PART III
PUBLIC ACCOUNTS OF INDIA
It is governed by Article 268 of constitution of India. All receipts and expenditure both h on capital and revenue accounts are accounted for. In addition, loans and advances to Govt employees are accounted
DEBT (OTHER THAN IN PART I)
It consists of receipts and payments other than those under Debt heads pertaining to Part I. eg. PF, Reserve Fund,Security Deposits, EMD, Departmental advances
REMITTANCES
It merely embraces adjusting heads which appear transfer among different circles.
GENERAL and SUBSIDIARY BOOKS

GENERAL BOOKS
1. The General Cash Book or The Daily Abstract Of Cash Transactions (Form A 304)
2. The General Cash Abstract Book or The Monthly Classified Abstract Of Cash Transactions (Form A 306)
3. The Journal ( Form, A 307)
4. The Ledger (Form A 310)
SUBSIDIARY BOOKS
1. Register of Works
2. Registers of Capital, DRF, DF, Capital Fund and OLWR
3. Revenue Allocation Register
4. Register of Earnings
5. Suspense Registers
a. Demands Payable Register
b. Misc. Advance Register
c. “F” Loans And Advances Register
d. Deposit Misc. Register
e. Deposit Unpaid Wages Register
f. Demands Recoverable Register
Capital Suspense Registers(Stores & Workshop Suspense
DIFFERENCE BETWEEN GENERAL AND SUBSIDIARY BOOKS
GENERAL BOOKS
Monthly accounts are prepared from the postings made in the general books,
Only the voucher no and amount are posted in the general book,
Maintained to collect and bring into account the transactions of an accounts circle,
Are mainly meant t prepare accounts suiting the principles of Govt. accounting,

SUBSIDIARY BOOKS
Schedules accompanying account current are prepared from the ;postings made in the subsidiary registers ( e.g. details of earnings and working expenses and works expenditure)
Details of transactions are recorded in the subsidiary registers
Maintained to exercise control over expenditure of an accounts circle
Serves to keep accounts to suit the commercial principles of accounting

LDCE QUESTIONS 2008

LDCE QUESTION PAPERS YEAR WISE
SOUTHERN RAILWAY
11TH JUNE 2008
PAPER I

GENERAL KNOWLEDGE & ENGLISH, OFFICIAL LANGUAGE POLICY: GENERAL PRINCIPLES OF GOVERNMENT ACCOUNTING AND AUDITING WITH SPECIAL REFERENCE TO THE RAILWAYS. BOOKS AND BUDGET INCLUDING TRAFFIC BOOK

Important this paper contains two sections – A B & C both sections have to be answered section A carries 50 marks and section B carries 100 marks
SECTION A (MAX MARKS-50)
1. Write short notes on any two of the following (10 marks)
a) Narmada Bachao
b) VAT
c) Organ Transplant
d) Right to Information Act
2. Expand the following abbreviations ( 5 marks – ½ marks each)
a) LPG
b)CAT
c)PAC
d)SPV
e)ONGC
f) UPSC
g)SPCA
h) PERT
g) IMF
h) IRCTC
3. Explain the concept of Raj Bhasha how it is implemented in your office (Please restrict your note to 250 words) 5 marks
4. Name the authors of the following books ( 5 marks)
a) God of Small Things
b) Malgudi Days
c) As You Like It
D) My Experiments With Truth
E) Arthashastra
F) Who Moved My Cheese
G) Anand Math
H) The Monk Who Sold His Ferrari
I) Discovery of India
J) Harry Potter and Order Of Phoenix
5. Fill in the blanks (5 marks)
a) Veni ______ vicci
b) A Stitch in time _____________ ____________
c) Ignorance is _____________
d) Rise and Fall of _________ __________
e) Few and ________ between
f) I came, I saw and I __________
g) Jai Jawan Jai ____________
h) A thing of ________ is a joy forever
i) if they don’t have bread let them ear ____________
j) a ___________ measures earthquake

6. Briefly explain the difference between the following (10 marks)
a) Fundamental rights and directive principles
b) bonafide and malafide
c) BOLT & BOT
d) Limited tender an d open tender
e) Concurrence and sanction
7. The following personalities have been newsworthy. Briefly state the reason ( 10 marks)
a) E Sreedharan
b) INDIRA Nooyi
c) Barack Obama
d) J K Rowling
e) Sunita Williams
f) Kiran Mazumdar Shaw
g) Dalai Lama
h) Ratan Tata
i) Asif Ali Sardari
j) Hillary Clinton

SECTION B MAX MARKS 100
This section contains two parts A & B Attempt four questions taking any two from each
All questions carry equal marks of 25 each
1. What is the need for separate audit by representatives of comptroller and auditor general with effective internal auditing within the system, can c& AG Audit can be dispensed with discuss in detail giving pros and cons.
2. Write short notes on any five
a) Konkan Railway Corporation
b) Canons of Financial Propriety
c) Delegation of powers
d) reappropriations
e) Charged and voted expenditure
f) Railway Board
g) Dedicated freight corridor

3. In the present set up of Indian railways what are the different “FUNDS” In brief describe the nature of each fund and their operation. Briefly discuss “CAPITAL FUNDS”

4. How is the “operating ratio” calculated? What the limitations of this ratio in assessing the financial viability of the railway. What are your suggestions to bring down the operating ratio of Southern Railway?

5. “Railway finances were separated fro general finances primarily to secure stability for civil estimates by providing for an assured contribution from railway revenues and also to introduce flexibility in the administration of railway finances, is this concept still relevant today. Discuss relative advantages and disadvantages.

PART B

1. What is the purpose of “accounts office balance sheet. Briefly indicate the nature of debit and credit entries. What action would be taken for realisation of old outstanding?

2. Write short notes on any five
a) Zero based budgeting
b) Suspense heads
c) Apportionment of earnings
d) M & P Programme
e) Approximate account current
f) Railway Act
3. What is “appropriation accounts” annexure J is an index of the efficiency of the accounts department. Discuss how we can on southern railway minimise the number of instances brought under annexure J
4. In the existing systems, the closure of accounts take considerable time. Even then the booked expenditure do not reflect the actual and correct picture. Critically examine the procedure of monthly, quarterly and annual closing and give your suggestions for improving the existing system. Also indicates whether approximate account current should continue
5. “Traditional Budgeting is functionally oriented and accounting oriented but not result oriented. Zero based budgeting is an improvement over traditional budgeting” dicusss this statement in detail in the context Indian railways and also explain how zero based budget can be applied for revenue budget (i.e. working expenses).




















LDCE QUESTION PAPERS YEAR WISE
SOUTHERN RAILWAY
12TH JUNE 2008
PAPER II
TOTAL SIX QUESTIONS TO BE ANSWERED – TWO FROM PART I AND TWO FROM PART II AND TWO FROM EITHER PART III A OR III B ALL QUESTIONS CARRY EQUAL MARKS

PART I
FINANCIAL JUSTIFICATION FOR EXPENDITURE and TRAFFIC COSTING (MAX MARKS 50) ATTEMPT ANY TWO OUT OF QUESTIONS 1 TO 4

1 In the context of railway operations, explain the cost of joint costs. What is the basis on which such costs are apportioned among various services?
2. Write short notes on any five (maxi marks 5 each)
a.) Uneconomic Branch Lines
b.) Out of Turn Works
C) Special Limited Tenders
D) Throughput Enhanced Works
E) Terminal Charges
F) Orange Book and Pink Book
G) Specific Fuel Consumption

3. What is meant by productivity test and how it is applied to new projects? Do they serve the purpose as intended?
4. Highlight the importance of Sensitivity Analysis in evaluating investment proposals. How would you apply this to a proposal for a new line project?

PART II
MANAGEMENT ACCOUNTING (MAX MARKS 50) ANSWER ANY TWO QUESTIONS OUT OF QUESTIONS 5 TO 8

5. Define Break Even Analysis how it is calculated and what are the uses of Break-Even Analysis as a management tool
6. Write short notes on any five:
a) Management Audit
B) Profit Volume Ratio
C) Wagon Turn Around
D) Variance Analysis
E) Net Tonne Kilometres
F) Standard Costing
7. What is meant by financial ratios illustrate any two ratios can operating ratio be taken as a financial ratio give reasons
8. Discuss in detail the concept of performance of budgeting and its application in railway working

PART III MAX MARKS 50
Important answer any two out of questions 9 to 12 or any two out of questions 13 to 16

PART III A
9. What is meant by apportionment of earnings how is it done in respect of goods earnings of through traffic?
10. What is traffic suspense what are the items that constitute traffic suspense give your suggestions to reduce traffic suspense on Southern Railway?
11. Write short notes on any five
a) Leave Not Due
B) Staff Benefit Fund
C) Foreign Service Contribution
D) Supernumerary Post
E) Ex Gratia Payment
F) Special Casual Leave
12. (a) Briefly describe the organisational set up of the statistical department
And
(b) Define the following
i. Engine Hours
ii. Gross Tonne Kilometres
iii. Route Kilometres
iv. Occupation Ratio

PART III B
WORKSHOP STORES ACCOUNTS AND GENERAL EXPENDITURE
13. discuss how the POH of a Locomotive is worked out and explain how direct and indirect costs are taken into accounts
14. (a) what is stock adjustment accounts
(b) What are the various items adjusted through this account
C. Who is the competent authority to sanction the clearance of balance under this head
15. What are the essentials of a good inventory control system? Discuss ABC analysis and its advantages
16. Write short notes on any five
a) Completion Estimates and Completion Reports
B) Risk and Cost
C) Non-Schedule Items
D) Final Location Survey
E) Fall Clause
f) EFT and ECS

LDCE QUESTIONS 2007

LDCE QUESTION PAPERS YEAR WISE 2007
SOUTHERN RAILWAY
14TH FEBRUARY 2007
PAPER I
GENERAL KNOWLEDGE & ENGLISH, OFFICIAL LANGUAGE POLICY: GENERAL PRINCIPLES OF GOVERNMENT ACCOUNTING AND AUDITING WITH SPECIAL REFERENCE TO THE RAILWAYS. BOOKS AND BUDGET INCLUDING TRAFFIC BOOK

Important this paper contains two sections – A & B. Both sections have to be answered section A carries 50 marks and section B carries 100 marks
SECTION A (MAX MARKS-50)
1. write a short essay on any of the following (10 marks)
a. If there is poverty anywhere, it affects prosperity every where.
b. Effect of information technology on employment – is it positive or negative?
c. Raj Bhasha policy implementation on IR
2. Expand the following abbreviations ( 5 marks – 0.5 marks)
a. GDP b. CDROM c. RVNL d.GPS e. LIBOR f. PSLV g. GSLV h. SEBI i. BOLT j. ASEAN
3. Find the difference in meaning and usage of the following pairs of words( 5 marks)
a. effluent & affluent b. hallmark & bench mark c. jeans & genes d. affect & effect e. interpret & interrupt
4. why have these persons been in the news ( 5 marks)
a. Dr Raja J Cheeliah b. Nawjot Singh Siddhu c. Wangari Maathai d. Mohammed Ynus e. Shane Warne
5. give the name of the authors of these books (5 marks)
a. Search in Secret India b. Raja Tarangini c. The World is flat d. Ignited Minds e. Savitri
6. where are the following situated ( 3 marks 0.5 marks )
a. Buland Darwaza b. Hawa Mahal c. RDSO d. Petronas Towers e. Rolland Garros Ground f. Wax Museum of Madam Tussaud
7. Match the following ( 2 marks 0.5 marks)

Uber cup Cricket
China man Tennis
Check mate Badminton
Deuce chess
8. write a paragraph on any two of the following ( 4 marks each)
a. Dedicated Freight Corridor b. Ombudsman c. GM Crops d. Garib Rath
9. use the following in sentences of your own ( 6 marks 1 ½ marks each)
a. ultra wires b. de-novo c. suo-moto d. inter-alia
10. use the following idioms In your own sentences ( 5 marks)
a. bite the dust b. strike a balance c. in the same breath d. cast the first stone e. pay through the nose
SECTION B MAX MARKS 100
This section contains two parts A & B Attempt four questions taking any two from each
All questions carry equal marks
Part A
1. in a developing country like India on the threshold of the take-off, there is always competing demands between remunerative tariffs and societal needs. This calls of new ways of resource rising and innovative revenue measures. Describe the recent steps taken by IR in the regard. Do you have any suggestion?

2. the public accounts committee of parliament has repeatedly criticised the increasing trend of misclassifications ain accounts and mistakes in budgeting. Present an analysis of the causes for these problems. Suggest appropriate steps to eliminate their recurrence
3. railways are at once a Govt dept and commercial enterprise. Discuss how the twin-need of Govt and commercial accounting are satisfied in railway accounting process. Discuss the issue of dividend payment to the central revenue in this context.
4. write shot notes on any two of the following :
a. Integrated Budget b. Zero Based Budgeting c. Performance Budgeting d. Corporate Plans

Part B
5. Raiwlay Board (FC) have recently appointed a committee to explore the reasons for the delay in submission of monthly actual expenditure and also the variations between the approximates and the actuals. From your angle, analyze the causes for these delays and variations. Can the approximate be dispensed with the actuals submitted at an earlier date? Suggest steps for this.
6. There is a plethora of suspense heads in railway accounting. Discuss the need for continued operation of these suspense heads, specifically focussing on one suspense head each from Earnings, revenue expenditure and works expenditure
7. Write short notes on the following
a. demands payable b. exchequer control c. SRS F d. Annual Debt head Report
8. What is the accounting mechanism for recording the traffic earnings of a railway under various heads and their progressive realisation? Also describe the procedure for the apportionment of traffic earnings amongst railways

ANSWER ANY TWO out of questions 9 to 12 or ANY TWO out of questions 13 to 16 (25 each)
PART III A TRAFFIC ACCOUNTS STATISTICS AND ESTABLISHMENT ( 50 MARKS)
9. do you agree with the statement the magnitude of outstanding under traffic suspense reflects the efficiency of traffic accounts office? Discuss with your suggestions to bring it to the optimal levels.
10. a. what are the various types of statistical information generated from a goods invoice? Explain in detail how any three of them are calculated.
b. what is the reason for the continued difference between accounts office figures and statistical figures in monthly earnings?
11. Write short notes on
a. leave not due b. recent changes in the haulage charges of postal traffic c. scale check register d. combine train reports
12. Give significance of the following statistical results
a. wagon kilometres per wagon per day b. net tonne kilo meters c. occupation ratio d. net tonne kilo meters per engine hour
Part III B WORKSHOP AND STORES ACCOUNTS AND GENERAL EXPENDITURE
13. Elucidate
a. what are the constituent elements of workshop manufacturing suspense?
b. the objective and procedure for job costing in a railway workshop. How would you take make or buy decision based on cost data?
14. write short notes on
a. VED b.repeat order c. stores exception reports d. transfer pricing
15. a. describe the various techniques used for reducing the material cost through various stages in the purchase,storage, issue and disposal
b. how is inventory turn over ratio calculated? Can it be termed as a reliable index of inventory management

16. discuss the management information system with special reference to material management. Explain how the system helps the management in decision making.





LDCE QUESTION PAPERS YEAR WISE
SOUTHERN RAILWAY
15TH FEBRUARY 2007
PAPER II
TOTAL SIX QUESTIONS TO BE ANSWERED – TWO FROM PART I AND TWO FROM PART II AND TWO FROM EITHER PART III A OR III B ALL QUESTIONS CARRY EQUAL MARKS

PART I
FINANCIAL JUSTIFICATION FOR EXPENDITURE and TRAFFIC COSTING (MAX MARKS 50)

1. Describe the steps/stages involved in preparing a project report for new line project, predominantly for carrying iron ore. How is the project-appraisal and sensitivity analysis done for assessing the viability of the project? Assume your own data

2. Answer the following
a. there is a section of opinion which holds that cross-subsidisation in fares between passenger and goods in railways should be abandoned and the fare structure should align costs with tariff. Does the present traffic costing system provide adequate and reliable data to discuss the opinion?

b. discuss the methodologies of costing EMU services

3. Discuss any three of the following in brief
a. social cost benefit analysis b. specific fuel consumption c. apportionment of joint costs d. green book e. two packet system of tendering f. risk and cost tender

4. Railways need alternative sources for plan expenditure. Discuss the schemes like BOLT, BOT and projects under PPP in furthering this purpose.

PART II MANAGEMENT ACCOUNTING ( Max marks 50)
5. Explain the concept and utility of financial ratio analysis. Discuss the use of at least four ratios to assess the comparative performance of a railway in different periods as well as with other railways

6.
a. discuss cost volume-profit analysis . Describe the utility of break-even analysis for profit planning, continue or drop a product, make or buy decisions etc
b. zenith company manufactures a special cement which is sold in bags of 20 kgs its financial data is given below
Selling price per bag: Rs. 30.00
Variable cost per bag: Rs 16.00
Fixed cost : Rs 100000.00
Quantity : 3000 bags
Calculate the following
a. Break even quantity
b. Assume 10 % increase in fixed cost and calculate the new break even point
c. Assume 50 % increase in fixed cost and calculate the new break even point
d. Assume increase in variable cost to Rs 20 per bag and calculate the new break even point
7. write short notes on any three of the following
a. variance analysis b. fund flow analysis c. AFRES d. PERT
8. what is meant by Product Life Cycle Costing? Also explain the purpose of the same. What step you would recommend to reduce the life cycle cost in a railway production unit?

LDCE QUESTIONS 2003

LDCE QUESTION PAPERS YEAR WISE
MAY 2003
PAPER I
PART I GENERAL KNOWLEDGE & ENGLISH
1. Expand the following abbreviations ( 5 marks half marks each)
a) BCCI
b) KRCL
c) RITES
d) IRSSE
e) GNP
f) MFN
g) CCRS
h) FEMA
i) CD-ROM
j) IVRS
2. Name the following (5 marks each half marks each)
a) First Indian woman to win an Olympic medal
b) General manager, southern railway
c) Chairman railway board
d) Mixed doubles’ champions of Australian open 2003
e) Venue of Olympics 2004
f) Currency of Bangladesh
g) Firs president of India
h) Batsman to score the fastest century in cricket world cup
i) The author of the column “with malice towards one and all”
j) Secretary of state USA
3. In which cities would you find the following ( 5 marks half marks each)
a) Leaning Tower
b) Statue Of Liberty
c) Lotus Temple
d) Hutatma Chowk
e) Louvers Museum
f) ‘Petronas’ Towers
g) Gate Way Of India
h) Popes’ Residence
i) Vidhan Soudha
j) Wimbledon
4. Match the following ( 3 marks half mark each)
1. rugby a. castle
2. golf b. pole position
3. motor racing c. deuce
4. chess d. little slam
5. tennis e. eagle
6. contract bridge f. touch down
5. Name the authors of the following books ( 2 marks half mark each)
a) Interpreter Of Maladies
b) Discovery Of India
c) A Suitable Boy
d) Madhushala
6. What are the following ( 3 marks half mark each)
a) East coast railway head quarters
b) Rail coach factory
c) Diesel component works
d) Garden reach
e) Baroda house
f) IRIATT
ENGLISH LANGUAGE
8. USE THE FOLLOWING to bring out the difference in meaning ( 5 marks 1 mark each)
a) Bear and bare
b) Lose and loose
c) Break and brake
d) Severe and persevere
e) Genes and jeans
9. use the following in your own sentences ( 10 marks 1 mark each)
a) Suo moto
b) Fight shy of
c) De facto
d) Let sleeping dogs lie
e) Lingua franca
f) Take to heart
g) Ad infinitum
h) At the eleventh hour
i) Par excellence
j) Laughing stock
10. Write a para of not more than SIX sentences on ANY TWO of the following (10 marks 5 marks each)
a) Child is the father of the man
b) There is many a slip between the cup and the lip
c) Brevity is the soul of wit
PART II GENERAL PRINCIPLES OF GOVERNMENT ACCOUNTING (50 marks)
11. Write briefly about the various funds now in operation in Indian railways (10)
12. Answer ANY TWO of the following (20 each)
a) Trace briefly the various stages from survey to completion report of a new line
b) Write short notes on ANY TWO of the following
1. appropriation accounts
2. misc advance revenue
3. productivity test
c) Distinguish between ANY TWO of the following
1. Operating ratio and PEI
2. TC and JV
3. Sundry earnings and miscellaneous earnings
PART III BOOKS & BUDGET (INCLUDING TRAFFIC BOOK) (50 MARKS)
13. What steps would you suggest to reduce cash handling by railway (10)
14. Answer ANY TWO of the following
a) How are the earnings apportioned between zonal railways? Is apportionment necessary?
b) Distinguish between approximate and actual account current. Is it necessary to prepare both?
c) What are the various components of traffic suspense? How can we control each of them?
LDCE QUESTION PAPERS YEAR WISE 2003
PAPER II

SIX QUESTIONS ARE TO ANSWERED (TWO FROM PART I TWO FROM PART II AND TWO FROM EITHER PART III A OR PART III B) (each question carries 25 marks)
Part I FINANCIAL JUSTIFICATION AND TRAFFIC COSTING ( 50 MARKS)
1. How are Suburban cost worked out in the railway? Is the methodology adequate?
2. write short notes on ANY THREE of the following
a. urgency certificate
b. debits under demand no 9
c. material modification
d. wagon turn round
3. if the route between Madurai and Tutucorin is to electrified how will you work out the justification? What are the major data required?
PART II MANAGEMENT ACCOUNTING (50 MARKS)
4. What are the various sources of non-traditional earnings that have been and can be exploited by railways? Comment on the success or failure of the efforts to southern railway in this area in 2001-02 and 2002-03
5. What is ratio analysis? Discuss any two major ratios used in railways vis-à-vis companies
6. Discuss the use of computers in railway financial management. What are the areas that should be covered in computerised financial management information system?

ANSWER ANY TWO out of questions 7, 8 and 9 or ANY TWO out of questions 0,11 and 12 (25 each)
PART III A TRAFFIC ACCOUNTS STATISTICS AND ESTABLISHEMENT ( 50 MARKS)
7. Introduction of PRS, ARTS machines and other modernisations hve led to newer types of frauds. What steps can be taken by traffic accounts office and TIAs to detect these frauds? Illustrate your answer with at least two types of frauds
8. Write shot notes on ANT THREE of the following
a) LPC
b) Combined/joint train report
c) NTKM
d) Classification of commodities
e) Leave not due
9. How would you check the following proposals?
a. station to station rate for moving sponge iron
b. proposal under volume discount scheme
c. opening of a halt station

PART III B WORKSHOP &STORES AND GENERAL EXPENDITURE (50 marks)
10 a. explain the concept of part estimates
b. is there any need for accounts office to vet tender schedule in works tenders? Write in detail bringing out Board’s orders on the subject
11. Write short notes on ANY THREE of the following
a) Turnover ratio
b) Letter of credit
c) Basic schedule of rates
d) Material at site accounts
12 how are POH debits settled between two zonal railways? What are the reasons or wide variation in POH costs in different workshops and what can be done to bring about uniformity?

LDCE QUESTIONS 2001

LDCE QUESTION PAPERS YEAR WISE
14th June 2001
PAPER I
Important; this paper contains two sections A and B. both sections have to be answere. Sectin A carries 50 marks and Section B carries 100 marks
Section A (max marks 50)
GK I Expand the following abbreviations
(i) CBEC (ii) ICICI (iii) IRCON (iv) PAC (v) LIBOR (vi) SAIL (vii) TRAI (viii) BOLT
(ix) UNESCO (x) SEBI 5 marks
GK II write short notes onANY FIVE
I. BALCO disinvestment
II. Dabhol power project
III. External commercial borrowing
IV. Moody’s rating
V. Narmada river valley project
VI. Green house effect
VII. Public distribution system 10 marks
GK III. write short notes in not more than 200 words on ANY ONE of the following
i. Official language policy
ii. Renewable energy sources
iii. Information technology 10 marks
GK 4 name the authors of the following books
i. God of small things
ii. Discovery of India
iii. Malgudi days
iv. Das capital
v. War and peace 5 marks
GK 5 name the sports associated with the following
i. Ranji trophy
ii. Durand cup
iii. Rangaswamy cup
iv. Thomas cup
v. Wimbledon 5 marks

GK 6 Use the following pairs of words in sentences of your own
i. Poll – pole
ii. Adept – adapt
iii. Excepted – expected
iv. Opposite – apposite
v. Cite – site 10 marks

GK 7 Fill up the blanks with suitable preposition
The cabinet __________ Wednesday decided _________ form a sub-committee _____ draw ______ a white paper __________ the financial position _____ the state. The Government wanted ________ place the factual position _____ the people ______ the white paper 5 marks

SECTION B max marks 100

This section contains two parts A and B. attempt any four questions taking any two from each part. All questions carry equal marks

BA 1. Indian railways are required to fund not only commercially viable projects but also non-viable but socially relevant projects over the few decades. The massive investment requirements of the shelf of pending projects need innovative measures for funding. Outline some of the specific initiates taken by the railways in this direction and suggest further measures to over come the problem of resource crunch.

BA 2 how is parliamentary control over railway’s finances exercised? What is the role of various parliamentary committees in this process?

BA 3 writes short notes on ANY FOUR
i. Ways And Means Advances
ii. Rakesh Mohan Committee
iii. Railway Safety Fund
iv. Action Taken Note’
v. Commercial Exploitation Of Land
vi. Amortization

BA 4 what is zero based budgeting. What are the steps taken by the railways in the last five years to adopt this system?

BA 5 what is the role of statutory audit on the Indian railways? Is it possible to dispense with the organization if the internal auditing system is strengthened?

PART B
BB 1 what is appropriate accounts? Annexure J is the index of efficiency of accounts department. Discuss

BB2 there is urgent need to simplify the procedure and speed up the realization and accountal of traffic earnings. Discuss duly explaining the present system in detail

BB3 railways operate a large number of suspense heads. Discuss the need the context and the method of operation of any THREE of them selecting one each from earnings, revenue and expenditure and works expenditure

BB4 the delay in making available the acutals and the wide variation between the approximate and actual render the present system of closing of accounts ineffective and liable for criticism. Give concrete suggestions to make tangible improvements in this area

BB5 physical performance and financial results do not go in tandem so far as earnings are concerned. What are the factors responsible for such a divergence?
&/&/&/
WWW


LDCE QUESTION PAPERS YEAR WISE
15th June 2001
PAPER II
This paper contains two sections A and B. both sections have to be answered .Section A is compulsory for all candidates and carries maximum of 50 marks. Section B which carries maximum of 100 marks has two parts A and B. candidates should attempt either of the two parts depending on their optional subject

SECTION A (max marks 50)

A1 There is an overwhelming view that cross-subsidisation of passenger fare by freight rate should be given up and there should be alignment of tariff with the costs. How far our traffic costing system can be relied upon to take decisions in such important aspect? Do you have any suggestions to make?
A2. What are financial ratios? Enumerate any three of them and examine their applicability to railway working
A3. With the computerisation of accounts is should be possible to determine the cost activity wise. Do you agree? What further measures are required to have meaningful data?
A4. What is the meaning of life cycle costing? What are the areas where it can be employed? Is it an improvement over the normal costing system?

Or
What is marginal costing? Explain the scope for adopting this concept for maximising the intensity of use of railway assets
SECTION B
Important: This section contains two parts A and B. Either part A or part B should be attempted by candidates depending on their choice of optional

Part A (TRAFFIC ACCOUNTS AND STATISTICS; ESTABLISHMENT)
Answer any three questions. All questions carry equal marks

BA 1. How effective is the internal check mechanism of passenger reservations (PRS) and Advanced Railway Ticketing System (ARTS)? Is the system fool proof and free from frauds?

BA2. The magnitude of outstanding under Traffic Suspense reflects the efficiency of traffic accounts office. Discuss

BA3. (i) What are the important operating statistics relating to goods operations?
(ii) What is Specific Fuel Consumption? How it is computed for diesel and electric traction?
BA 4 writes short notes on:
I. Workmen’s compensation
II. Transport allowance
III. Annual statistical statement No 40
IV. Operating ratio
V. Pension fund
BA 5. ‘Recommendation of V pay commission has thrown railway finances out of gear do you agree?
Or
Elaborate the procedures of internal check of establishment claims in a computerised environment as distinct from manual bills

PART B (GENERAL EXPENDITURE ACCOUNTS, WORKSHOP, AND STORES ACCOUNTS)

Answer any THREE questions. All questions carry equal marks
BB1. What are the latest instructions from Railway Board regarding (1) award of contracts n single tender basis for execution of works and (2) post tender negotiation?

BB2. Write short notes on:
(i) risk purchase
(ii) profroma on cost
(iii) “make” or “buy” decision
(iv) completion reports
(v) variation in quantities in a works contract

BB3. “The workshop out-turn statements truly and effectively reflect shop activities and efficiency of workshops accounts office”. Discuss with particular reference to checks to be exercised in the preparation of statement

BB4. How far stock verification can contribute to better material management? What improvement, if any, would you suggest to make it more effective?

BB5. Explain the linkage between stores, WMS and Revenue Budget

BB6. There has been a spurt in the cases referred to for arbitration on this railway. How far is this attributable to the recent changes in the arbitration act? Are there deficiencies in contract formulation and management? Suggest remedies.

LDCE QUESTIONS 1996

LDCE QUESTION PAPERS YEAR WISE
6th September 1996
PAPER I
GENERAL KNOWLEDGE AND ENGLISH; GENERAL PRINCIPLES OF GOVERNMENT ACCOUNTING AND AUDITING WITH SPECIAL REFERENCE TO RAILWAYS; BOOKS AND BUDGET INCLUDING TRAFFIC BOOK
Important: this paper contains two sections A and B. both the sections have to be answered. Section A carries 50 maximum, and section B carries 100 marks
SECTION A
GK1. Expand the abbreviations in any five 5 marks
a) CTBT
b) ICRISAT
c) NABARD
d) ECAFE
e) PSLV
f) WTO
g) SEBI
h) MAT
i) ILO
j) BIFR
GK2. (I) Write short notes on any five 10 marks
a) Alamatti Dam
b) CHIPKO Movement
c) Medha Patkar
d) Damodhar Valley Corporation
e) Vote On Account
f) Atlanta
g) Solar Energy
Or
(ii) Write the main features of the official language Act 1963 (Act 19 of 1963)

GK3. Write a note in not more than 200 words on any one of the following 15 marks
a) Public sector disinvestment programme
b) Amarnath yatra
c) SAARC
GK 4. Fill up the blanks with suitable preposition 5 marks
Coming back _______ the Eastern Railway, operations were _____ its peak efficiency and ____ February and March 1969, _____ loading figures ____ coal and general goods set new records. ___ far ____ general goods loading is concerned the figures obtained _____ those months have never been reached subsequently.
GK 5. Name the authors of the following books 5 marks
a) Discovery of India
b) My experiments with truth
c) Passage to India
d) As you like it
e) Ivanhoe
GK 6. What is common to the following railway stations from the point of view of fast travel 5 marks
Lucknow, Kalka, Amritsar, Dehardun, Bhopal, Bokaro, Ahmedabad, and Bangalore
GK 7. Name the four highest civilian awards given in our country naming atleast two recipients of the highest award 5 marks

SECTION B (MAXIMUM MARKS 100)
This section contains two parts A and B. attempt any four questions taking any two from each part. All questions carry equal marks of 25
PART A
BA 1. What are the various instruments through which the Indian railway finance corporation raises funds? How are these deposited to meet the capital requirement of railways ? how does the Indian railways discharge its liability to the corporation?
BA 2. write short notes on any four
a) Amortisation
b) Capital Fund
c) Railway Fare And Freight Enquiry Committee
d) Activity Based Costing
e) BOLT Schemes
f) Budgetary Reports

BA3. What are the various committees of parliament relating to railway financial performance? Explain in detail the working of any one of the committees

BA4. “In the wake of economic reforms and liberalisation policies Indian railway’s system and procedures require fundamental change” discuss

BA 5. (a) What is the purpose of different funds in the set up of the existing railway’s financial system?
(b) What are the implications in financial terms and nature of justification between charging of works to capital fund and capital-at-charge?

PART B
BB 1. What do you understand by zero based budget? How is this improvement over the conventional system of budgeting in railways?
BB2. Explain the present system of remittance of earnings into government account. What are your suggestions for improving the promptness of accountal?
BB3. How is the earnings budget of a railway formulated? What is the usefulness of various statistical data in this exercise?
BB4. Within the appropriations voted by parliament, relays should be free to prioritise their investments on works, rolling stock and machinery and plant. Do you agree? Give reasons for your answer.
BB5. The present system of closing of accounts and transfer adjustments delay the availability of accounting information for decision making. What are the areas in which this can be improved upon?


LDCE QUESTION PAPERS YEAR WISE
7th September 1996
PAPER II
FINANCIAL JUSTIFICATION FOR EXPENDITURE AND TRAFFIC COSTING: MANAGEMENT ACCOUNTING, TRAFFIC ACCOUNTS AND STATISTICS: ESTABLISHMENT (OR) GENERAL EXPENDITURE ACCOUNTS WORKSHOP AND STORES ACCOUNTS
Important: this paper contains two sections A and B. both the sections have to be answered. Section A is compulsory for all candidates and carries 50 marks maximum

Section B which carries 100 marks maximum has two parts A and B. candidates should attempt either of the two papers depending on their optional subjects.

Section A maximum marks 50
A – 1. what do you understand by “life-cycle” costing? What are the important areas where it can be employed? How is it an improvement over the normally known costing system?
A – 2. what is meant by financial ratios? Enumerate any three of them. Can the operating ratio be considered as a financial ratio? Give reasons for your answer
A – 3. a work costing Rs 75 Lakhs and not included in the sanctioned budget is required to be executed urgently. What is the procedure to be followed in the zonal railway before the work can be commenced?
A- 4. in regard to goods traffic what is the traffic costing information available? How are they helpful in investment formulation?
Section B
Important: this section contains two part A & B. either part A or Part B should be attempted by candidates depending on their choice of optional. Each part contains a maximum of 100 marks.
Part A Traffic accounts and statistics establishment
Answer any three questions
All questions carry equal marks
BA 1. What is the impact and consequential changes on the traffic accounts office due to introduction of passenger reservation system (PRS) and advanced railway ticketing system (ARTS)? Has this contributed to the efficiency of internal check?
BA 2. Write short notes on
a) Cash in transit
b) Leave not due
c) Ex- Gratia bonus
d) Demands recoverable
e) Charges for haulage of postal traffic
BA 3. What are the types of statistical information generated from a goods invoice? Explain in detail how any three of them are calculated.
BA 4. How far can the procedure relating to internal check in the accounts code be dispensed with in respect of computer prepared pay bills?
BA 5. The performance of the accounts dept in recovering dues to the administration from the employees requires improvement. Can you suggest any system improvement?
Part B General Expenditure accounts workshop and stores accounts
BB1. Higher inventory levels are preferable to “out of stock” situations. What are the economic and financial implications?
BB2 what are the existing safe guards for effective control over expenditure? Can you suggest any improvement?
BB 3. What do you understand by the “two envelope system” in a works tender? How is this an improvement over the existing open tender system?
BB4. The existing system of incentive payment encourages inefficiency and dilutes quality. Can you suggest any alternative system to improve productivity in the workshops?
BB 5. an item was simultaneously ordered on two sources after an open tender – A at Rs 2.00 per unit and B at Rs 2.05 per unit. B completes his supply within the delivery period of 90 days and A fails to even commence supply. In this back ground a proposal is received from the COS for enhancing the quantity on B, arguing that the item is regularly required and stocks will last only 15 days. B is agreeable for the enhancement. What will be your recommendations on the proposal? Give reasons for your answer.

LDCE QUESTIONS 1994

LDCE QUESTION PAPERS YEAR WISE
MAY 1994
PAPER I
GENERAL KNOWLDEDGE AND ENGLISH; GENERAL PRICIPLES OF GOVERNEMNT ACCOUNTING AND AUDITING WITH SPECIAL REFERENCE TO RAILWAYS; BOOKS AND BUDGET INCLUDING TRAFFIC BOOK
Important: this paper contains two sections A and B. both the sections have to be answered. Section A carries 50 maximutm, and section B carries 100 marks
SECTION A (Max marks 50)
GK1. Expand the abbreviations in any five 5 marks
i. GATT
ii. IMF
iii. ANC
iv. ASEAN
v. SLV
vi. NPT
vii. CAT
viii. RBI
ix. ADB
x. UPSC
GK 2. Write short note on any five 10 marks
i. Isobar
ii. Dunkel
iii. Territorial waters
iv. Wind farms
v. Bosania
vi. Telugu ganga
vii. Nelson Mandela
viii. Yasser Arafat
ix. Narmada project
x. Hazarat bal mosque
GK 3. Match the following 5 marks
i. Lara a. Jhansi
ii. Rabindranath Tagore b. Atomic Energy
iii. Lakshmi Bai c. Cricket
iv. Homi Baba d. Chess
v. Anand e. Geethanjali
GK 4. Use any five of the following pairs of words in sentences of your own 10 marks
i. coarse – course vi. Prey - pray
ii. wise - vice vii. Brake - break
iii. call – cavail viii. Tall – toll
iv. rain – rein ix. Foil - fail
v. sell - cell x. Naval – Novel

GK 5. Fill up the blank with suitable prepositions 5 marks
The absence _____ census data is taken advantage of ____ various persons ____ each state ____boost the estimates _______ persons speaking their language.

GK 6. Write a note in not more than 250 words one of the following 10 marks
a. national literacy programme
b. rail road coordination
c. public sector undertaking
GK 7. Give one word for any five of the following 5 marks
i. one who sells flowers
ii. doctor treating children
iii. specialist in heart disease
iv. documents issued by authority to its citizens who wants to travel abroad
v. the presiding authority over Lok Sabha who generally conducts its proceedings
vi. one who writes dramas
vii. the highest point of a mountain
viii. a person who knows a number of languages
ix. science dealing with study of animals and birds

SECTION B
This section contains two parts A and B. Attempt any four questions taking any two from each part. All questions carry equal marks
PART A
BA 1. Discuss the committee system introduced for ________ of the budget and examine whether this in any way rendered any of other already existing instrument/procedure for financial control of railway by parliament redundant.
BA 2. What is the purpose of different “funds” in the set up of existing financial system of railways? Has there been any change in the last two years? Discuss the pros and cons of the change if any
BA 3. In what way the present set up and systems and procedures in railway help or hinder the railway in coping with the recent liberalisation policy initiated by the Government? Discuss
BA 4. Write short notes on any four
a. Railway Convention Committee
b. Plan Heads
c. Indian Railway Finance Corporation
d. Konkan Railway Corporation
e. Canons Of Financial Propriety
BA 5. What is the need for separate audit by representatives of the Comptroller and Auditor General? With more effective organisation or internal auditing system can it be dispensed with? Discuss
PART B
BB 1. Do you consider the present procedure method of assessing earnings effective and realistic? Suggest any improvements / innovations you feel necessary
BB 2. How far the principles of zero based budgeting and management accounting been adopted I n railway in assessing the requirement as also reasonableness and need of inputs and analysis and presentation? Discuss
BB 3. “The present system of monitoring and accountal of remittance of earnings is not effective In preventing frauds”. Discuss. Do you suggest any procedural changes?
BB 4. “The present procedure of apportionment of earnings and expenditure is not fair to the southern railway with limited lead”. Discuss
BB 5. Discuss whether it is necessary to have Annual Works Programme, and M&P as at present? What are the alternatives/improvements you would suggest and why?





LDCE QUESTION PAPERS YEAR WISE
May 1994
PAPER II
FINANCIAL JUSTIFICATION FOR EXPENDITURE AND TRAFFIC COSTING: MANAGEMENT ACCOUNTING, TRAFFIC ACCOUNTS AND STATISTICS: ESTABLISHMENT (OR) GENERAL EXPENDITURE ACCOUNTS WORKSHOP AND STORES ACCOUNTS
Important: this paper contains two sections A and B. both the sections have to be answered. Section A is compulsory for all candidates and carries 50 marks maximum
Section B which carries 100 marks maximum has two parts A and B. candidates should attempt either of the two papers depending on their optional subjects.

Section A maximum marks 50
Attempt any two questions. Each questing carries 25 marks
A – 1. How far the present traffic costing been effective in determining realistically the financial viability of introduction of new trains/augmentation of service?
A – 2. “Traffic costing like statistics is often used not for enlightenment in taking correct decision but for supporting decisions one wants to take”. How far is this statement well founded or unfounded. Discuss with specific cases if any illustrating your stand.
A – 3. How often the principle of marginal costing used in capturing / retaining the customer while protecting and furthering the financial interest of railways? Illustrate
A – 4. How far the principle of zero based assessment of inputs and innovation in management accounting principles utilised to further the objective of change over to unigauge system? Discuss.

SECTION B
Important: This section contains two parts A and B. Either part A or part B should be attempted by candidates depending on their choice of optional Each part contains a maximum of 100 marks

Part A (TRAFFIC ACCOUNTS AND STATISTICS; ESTABLISHMENT)
Answer any three questions. All questions carry equal marks
BA – 1. How far the present method of compilation and presentation of statistical data helped in effective management decision and control on railway?
BA – 2. Division as profit center knows its expenditure and not its earnings. How far divisionalisation of traffic accounts help in ensuring effective informed participation nad mobilisation in bettering the financial performance of the division?
BA – 3. Has the computerisation of reservation system helped in improving the earnings, effecting analysis of passenger profile to maximise the earnings/utilisation of seats, plug loopholes? Discuss the effectiveness of passenger reservation system (PRS) and advance railway ticketing system(ARTS) introduced in current booking.
BA – 4. Write Short Notes On
a. Firms Credit Notes (FCNs)
b. Special Casual Leave
c. National Holiday
d. Wage Period
e. Productivity Linked Bonus (PLB)
BA – 5. Discuss the present method of accountal and recovery of advances and dues like festival advances, diet charges, electricity charges from the staff. Discuss whether the system for recovery is effective and suggest any improvement felt necessary
BA – 6. What are the steps you would suggest to control the expenditure on establishment – which has almost doubled over the last few years – for improving the competitiveness of the railways and its viability?
PART B (GENERAL EXPENDITURE ACCOUNTS AND WORKSHOP AND STORES ACCOUNTS)

Answer any THREE questions. All questions carry equal marks
BB – 1. Is risk purchase effective in our system? If not why not and what is the procedural/policy correctives you would suggest?
BB -2. With the cost of finance the inventory carriage is increasingly becoming costly. How can railways reduce inventory without compromising on effectiveness of its service and also ensure economy?
BB - 3. Discuss the effectiveness of prevailing system of incentive payment in railway workshop. How is it an instrument for improving productivity with quality commensurate with investment for modernisation of the workshop?
BB – 4. How far the system of purchase through open tenders ensured quality with economy and reliability? Should railway change over to a system of identifying reliable suppliers with long term commitment in the interest of ensuring quality and reliability?
BB – 5. is the present procedure/method of planning , procuring and inducting machines as replacement or for modernisation cost effective? What are the improvements you suggest to ensure the investments slim, strictly need based and improvement is productivity commensurate with investment is ensured?
BB – 6. There is growing feeling that “we should better privatise, better buy than make”. Why is this so? What role can stores and workshop accounts play to rationalise and ensure “makes”, more attractive than “buys” and reverse the trend?