GAR 1990

1. “Chief Accounting Authority” of Ministry means:

a. Principal Accounts Officer of the Ministry
b. Comptroller & Auditor General
c. Head of the Department
d. Secretary
2. Contingency Fund of India is established in pursuance of clause (1) of Article……of
Constitution
a. 150
b. 157
c. 267
d. 283
3. The form in which the accounts of Union & States is kept shall be prescribed by President on
the advice of:
a. Ministry of Finance (Department of Expenditure)
b. C & AG
c. CGA
d. None of the above
4. Annual Account of Government of India, duly certified by………. shall be submitted to
President, who shall cause to be laid before the Houses of Parliament
a. CGA
b. Finance Minister
c. C&AG
d. Secretary, Lok Sabha
5. Accounts of the Central Government is kept with
a. Reserve Bank of India
b. Ministry of Finance
c. State Bank of India
d. Non of the above
6. A statement of the closing balance of Central Government, including Railways, Defence,
Posts etc. shall be sent each month by RBI, CAS, Nagpur to:
a. CGA
b. RBI, HQrs. Mumbai
c. Finance Ministry
d. PAO
7. Accounts of Jammu & Kashmir and Sikkim are kept with RBI
a. True
b. False
8. Complete accounts of the Central Government and each of the State Government shall be
maintained by RBI, CAS, Nagpur, which act as a general clearing house
a. True
b. False
c.

9. Transactions of State Government arising in the Central Treasuries are classified under:
a. 8550 – Civil Advance
 b. 8671 – Departmental Balance
c. 8786 – Adjusting Account Between Central and State Government
d. 8658- Suspense Accounts- Suspense A/c (Civil)-Accounts with Accountant General
10. Transactions in a State Treasury on behalf of other State Governments & Central
Government shall be taken, in the first instance, against the cash balance of State concerned
a. True
b. False
11. In case of transactions pertaining to other State Governments, the AG shall make
a) Adjustments through CAS, RBI, Nagpur
b) Cash settlement by issuing Cheque/Demand Drafts
12. Transactions of the Central Government including Railways, Defence, etc in State Treasuries
will be classified under:
a. 8675 – Deposit with RBI
b. 8782 – Cash Remittances
c. 8658 – Suspense – PAO Suspense
d. 8680 – Misc. Govt. Account
13. The bank should prepare the Credit Scroll duly supported by…..and Debit scroll duly
supported by….and send daily to the Accounts Officer of the Ministry
a) Cheque / Challans
b) Challans/Cheques
14. Classified Abstract is prepared by Pay & Accounts Officer from the:
I. Accounts received from CDDO
II. Bank Statement of Transactions (Date wise Monthly Statement-DMS)
III. Books of Adjustments initiated in Accounts Office (Transfer Entry Register)
IV. Compilation Register maintained by Pay Accounts Officer to compile his own
transactions
a. I, ii & iii are right
b. I, iii & iv are right
c. Ii, iii & iv are right
d. I, ii, iii & iv are right
15. The Pay and Accounts Officer submit his monthly account compiled under Major, Minor and
up to Objective Heads to:
a. Line Ministry
b. CGA
c. Pr. Accounts Office
d. Ministry of Finance
16. In respect of transactions taking place at Central Treasuries in Union Territories, whose
account is at present maintained by State Accountant General will be submitted by him to:
a. Ministry of Finance
b. C & AG
c. Pr. Accounts Office
d. CGA
17. The Cash Balance of the Central Government will be reconciled by the CGA at the close of
every month with:
a. Closing Balance Statement available with Principle Accounts Officers
b. Closing Balance Statement available with RBI, CAS, Nagpur
c. Closing Balance Statement available with PAOs
d. Closing Balance Statement available with RBI, Hqrs. Mumbai
18. Statement of Central Transaction(SCT) prepared by CGA consisting the progressive figures
up to March (Supplementary) of:
a. Civil Ministries
b. Civil Ministries & Railways
c. Civil Ministries, Railways, Defence ,Post, Telecommunication
d. None of the above
19. State Government Accounts are compiled by the respective AsG on the basis of monthly
accounts received from Treasuries/ Bank/Civil Department Offices (PWD, Forest
etc.)/Adjustment account kept by AsG
a. True
b. False
20. Detail Book maintained by AG contains
a) All Revenue & Capital Accounts
b) Only Capital Accounts
c) Capital and Debt Deposit, Suspense & Remittance (DDSR) Accounts
d) Only Debt Deposit, Suspense & Remittance (DDSR) heads
21. Details of central transactions ( other than pension) in State Treasuries will be submitted by
AG to
a. Central Pension Accounting Officer
b. Principal Accounts Officer
c. CGA
d. C&AG
22. Normally, transactions appearing in the books of Accounts Officer of Ministry which are
adjustable by other Accounts Officer(including Railway, Defence, Post, Telecommunication)
are settled through RBI, CAS, Nagpur
a. True
b. False
23. From the following transactions, indicate the ones which are adjusted through RBI, CAS,
Nagpur
i) GPF recovery of an IAS Officer (Maharashtra Cadre) deputation to Ministry of
Shipping
ii) Settlement of payments against Supplies arranged by Directorate General of Supplies &
Disposal (DGS&D), Ministry of Commerce
iii) Debts on account of supplies arising in the books of High Commission of India, London
and Indian Embassy, Washington with Defence, Railways and Posts etc.
iv) Dividend payable in lieu of tax on Railway Passenger Fares by Railways to Central
Revenues
a. I, iii & iv
b. Ii, iii & iv
c. Iii & iv
d. All the above
24. Transaction initially taken against the balance of a State which eventually adjustable against
the balances of another State shall be passed on
a. Cash Settlement
b. Settlement Account
25. Transaction in a State Treasury in respect of payments of pension to High Court Judge will
be booked under:
a. 2071 Pension-Civil Pension-Other Retirement Benefits
 b. 8658- Suspense Account-PAO Suspense
c. 2014 – Administration of Justice-102-High Courts
d. 2053 –District Administration
26. Appropriation Account (Civil) shall be prepared by ………and submitted to Government
a. C&AG
b. CGA
27. Annual Accounts of the whole of Government of India (including Railways, Defence, Posts
etc.) will be prepared by CGA and got certified by C&AG
a. True
b. False
28. Proforma Accounts means:
a. Accounts kept on temporary basis by CGA
b. Monthly account prepared on Commercial basis by PSU
c. Accounts kept outside the general accounts by Public Undertakings
d. Suspense account kept by the Pay and Accounts Offices
29. Government account are maintained mainly on “Double Entry” System
a) Right
b) Wrong
30. The Government Account of a year is kept open for certain period beyond 31st March for
I. Completion for various accounting process
II. Closing the Account of various Suspense items & GPF interest
III. Adjustment of misclassification
IV. Adjusting actual cash transaction taking place after 31st March
a. All are right
b. I, iii & iv are right
c. Ii, iii & iv are right
d. I, ii & iii are right
31. Government Account are not based on Cash basis
a. True
b. False
32. Government Account is kept in ……parts
a. Two
b. Four
c. Three
d. One
33. Public Debt is the part of
a. Consolidated Fund of India
b. Public Account
34. Contingency Fund set up by the Government under Article….of Constitution
a. 264
b. 265
c. 270
d. 267
35. Government act as a banker in respect of amount kept in this part of the account
a. Consolidated Fund of India
b. Contingency Fund of India
c. Public Account of India
d. Consolidated Fund of Union Territory
36. Transactions relating to “Remittance” and “Suspense” are embraced in
a. Consolidated Fund of India
b. Public Account of India
37. If the Major Head of Account denotes account code “0” or “1”; it pertains to
a. Revenue Receipts
b. Revenue Payments
c. Capital Section
d. Public Account
38. The main unit of Classification in accounts shall be
a) Object Head
b) Minor Head
c) Major Head
d) Detail Head
39. “Functions” of the Government denote in
a. Minor Head
b. Sub-Major Head
c. Sub-Minor Head
d. Major Head
40. “Charged” and “Voted” Expenditure should be classified separately in accounts and should
be appended to the heads to distinguish the two categories of expenditure
a. True
b. False
41. Expenditure on a temporary asset or expenditure on Grant-in-aid to local bodies or
institutions (for purpose of creating assets belonging to them) is classified under Capital
Account
a. True
b. False
42. Capital Expenditure meant for
i) Increasing the concrete assets
ii) Creating asset of permanent nature
iii) Reparation of enormous damage caused by natural calamities
iv) For the purpose of creating temporary assets
a. I, ii & iv are right
b. Ii, iii & iv are right
c. I,ii, iii & iv are right
d. I, ii & iii are right
43. The cost of intermediate maintenance of the work while the project is not yet opened
should be met form
a. Capital
b. Revenue
c. Both proportionately
d. From the Fund created for this purpose
44. Depreciation of plant should be charged to
a. Capital
b. Revenue
45. Capital receipts in so far as they relate to expenditure previously debited to Capital Head
accruing during the process of construction of a project should be classified as
a. Revenue
 b. Reduction of Capital Expenditure
46. Receipts on charges pertaining to more than one head of account is booked in the first
instance under one of the heads concerned; but the portion creditable or debitable of the
other head should be transferred before close of the year
a. True
b. False
47. Amount outstanding against Government due to book-keeping errors under the heads
which “Close to Balance” shall be written off to:
a. 2075 Misc. General Services
b. 2070 – Other Administrative Service
c. 8658 – Suspense account
d. 8680 – Misc. Government Account
48. The service charges for service rendered by one State Government to another shall be
charged and settled by cash basis. Do you agree?
a. Disagree
b. Agree
49. Recoveries of expenditure for service or supplies made to non-Government parties (local
bodies, municipalities etc.) shall be classified as
a. Reduction of Expenditure
b. Receipts
50. In case of projects jointly executed by several Governments, where expenditure is to be
shared proportionately as agreed, but the entire expenditure of project initially spent by
one Government and later on recovered from others, then such recovery shall be classified
as
a. Reduction of expenditure
b. Receipts
51. Service Charges levied by the Directorate General of Supplies & Disposal for “purchase” and
“inspection” of goods supplied to other Departments should be classified as
a. Receipts
b. Reduction of Expenditure

52. If a claim is relinquished (abandoned), the value of the claim shall be recorded on the
expenditure side of accounts as a specific loss
a. True
b. Untrue
53. If money due to Government has actually reached the Government servant but embezzled
or stolen or lost before remitted into treasury/bank, such money should be
a. Entered into Government account under Consolidated Fund of India or Public Account
under relevant head
b. Amount should be kept under suspense
c. Amount should not be entered in accounts
d. Amount should be kept outside Government Account
54. Acceptance of counterfeit coin or notes shall not be regarded as a loss of cash as it is not
treated as legal currency
a. Right
b. Wrong
55. The transit pay and allowances when a Government Servant proceeds on transfer on
deputation should be borne by
 a.
b. Lending Department
c. Borrowing Department
56. Transfer Pay and allowances & TA both ways of a G/S transferred on foreign service payable
by
a. Lending Department
b. Borrowing Department
57. Advances of Pay and Allowances and TA on transfer should be debited to the final head of
account wherefrom he proceeds and not to “8550-Civil Advance”
a. True
b. False
58. An item kept under “Suspense Account” because
i) Lack of details of claim
ii) Lack of information of the final head of account
iii) Insufficient budget provision under final head of account
iv) Consultation with others is required before debiting to final head
a. All are correct
b. I, ii & iii are correct
c. I, ii & iv are correct
d. Ii, iii & iv are correct
59. When the Municipal Tax of a building (non-residential) is paid by the PWD it should be
debited to
a. Rent, Rates & Taxes
b. Maintenance & Repairs
60. Taxes both residential and non-residential building owned by Army should be debited to
a. 2059 – Repairs and Maintenance
b. 2076 – Defence Services - Army

1. D ((GAR 2(d)
2. C (GAR 2(h)
3. B (Note under GAR 3)
4. C (GAR 4)
5. A (GAR 8(1)
6. A (Note under GAR 8(3)
7. B (Note under GAR 9)
8. A (GAR 11)
9. D (GAR 12)
10. A (GAR 13)
11. A ( GAR 13 (a)
12. C (GAR 13(b)
13. A (GAR 14 (a)
14. D (GAR 14 d)
15. C (GAR 14 e)
16. D GAR (14 f)
17. B (GAR 14 (f)
18. C (GAR 14 j)
19. A (GAR 15 a)
20. D (GAR 15 f)
21. C (GAR 15 h)
22. B (GAR 16(1), normally settled through Cheque. But there are exceptions like DGS&D
23. B (GAR 16 & Note there under. GPF should settle by Cheque)
24. B( GAR 16(2)-by settlement account through RBI, CAS, Nagpur.
25. B (Note 2 under GAR 14(b)
26. B (GAR 17(3)
27. A (17(4) & (5)
28. C (GAR 18)
29. B (GAR 19) (mainly in Single Entry System. Double entry system is applied only in regard to the
maintenance of a set of technical accounts called the journal, ledger and Balance Sheet)
30. D (Note under GAR 20) (Normally accounts period is up to 31st March. Cash transactions after
31st March cannot be adjusted in the accounts of previous year)
31. B (GAR 21-Based on Cash Basis and not on “accrual basis”. Accounts are kept in Indian Rupees-
GAR 22)
32. C (GAR 23 – Consolidated Fund of India, Contingency Fund of Indi & Public Account)
33. A (GAR 23 – Consolidated Fund of India is divided in three parts – Tax Revenue, Non-Tax
Revenue & Public Debt/Loans and Advances)
34. D (GAR 23 – Article 267/Section 48 of Union Territories Act 1963)
35. C ( GAR-23 - Money kept in Public Account does not belong to Government but to Public)
36. B (GAR 23)
37. A (GAR 25 – Revenue Receipts; 2 or 3 Revenue Payments; 4 or 5 Capital Expenditure; 6 or 7
Loans and Advances 8 Public Account (8000 is Contingency Fund)
38. C (GAR 26 a)
39. D (GAR 269B) (1. Major Head =Functions of the Ministry;2. Sub-Major Heads=Sub functions; 3.
Minor Head=Programmes 4. Sub-Minor Heads=Schemes & Activities 5. Detail Head=Sub
Schemes 6. Object Head= Primary Unit of Appropriation.
40. A (GAR 27)
41. B (Cannot classify under Capital-GAR 30 and note there under)
42. D (GAR 30& 31)
43. A (GAR 31 a)
44. B (GAR 31 c)
45. B (GAR 31 e)
46. A (GAR 33)
47. D (GAR 38)
48. B (GAR 49(i)
49. B (GAR 53)
50. A (Note under GAR 53)
51. A (GAR 54)
52. B (should not be recorded GAR 58(1)
53. A (GAR 58(2)
54. B (regarded as cash)
55. B (GAR 66 (2)
56. B (GAR 66 Note 1)
57. A (68(2) It should be adjusted to final head account by the Department who pays the advance)
58. C (GAR 70)
59. B (GAR 72)(2059-Public Works-Maintenance & Repair)
60. B (GAR 72(iv)
 GAR 1990

1. Government accounts are maintained in ……………………………………………….parts

a. Four b. six c. 3 d. 2 (ans. c)

2. Government accounts are in to divisions consists of :

a. Contingency fund & Public account

b. Consolidated fund & Contingency fund
c. Contingency fund, Proforma accounts, consolidated fund
d. Consolidated fund, Contingency fund and Public Accounts. ( ans. d)

3. Consolidated fund of India envisaged in the constitution of India under Article No….

a. Article 266 (2) and (4)

b. Article 266 (1) and (3)
c. Article 266 (3) and (4)
d. Article 266 (1) and (2) (ans. b)

4. Contingency fund of India created under Article No………….. Of Constitution of India.

a. Article 266 (2)

b. Article 267 (2)
c. Article 267 (1)
d. Article 266 (3) (ans. c)

5. Public account envisaged under Article no-------------------of Constitution of India.

a. Article 266 (1) and (2)
b. Article 266 (1) only
c. Article 266 (2) only (ans. c)
d. Article 267 (1)

6. Consolidated Fund of India divided into ---------------------------------------parts

a. Three b. Four c. Two d. Five (ans. c)

7. Consolidated Fund of India consists of divisions namely;

a. Revenue Expenditure, Revenue receipts and Capital expenditure

b. Revenue and Capital
c. Capital expenditure, receipts and public debt.
d. Revenue Receipts, Capital Receipts and Loans. (ans. b)

8. Revenue division of Consolidated Fund of India Consists of :

a. Revenue receipts
b. Revenue expenditure
c. Revenue Receipts and expenditure thereof
d. Revenue expenditure and loans receipts (ans. c)
9. Capital division of Consolidated Fund of India Consists of :

a. Capital Receipts and Expenditure

b. Capital Receipts, Revenue Receipts
c. Capital Receipts, Capital Expenditure and Public Debt.
d. Capital Receipts, Capital Expenditure and Public Debt, Loans and Advances. (ans. d)

10. Classification of expenditure under government accounts based on :

a. Sectors
b. Divisions
c. Groups
d. Units (ans. a)

11. Sectoral classification consists __________________main divisions

a. Five b. Four C. three d. two (ans. b)

12. Sectoral classification is based on following divisions, namely:

a. General Services, Social and Community Services

b. General Services, Social and Community Services, Economic Services.
c. General Services, Social and Community Services, Economic Services and grants-in-aid.
d. Social Services, Community services and Economic Services. (ans. c)

13. Classification of government accounts is based on

a. Ministry
b. Department
c. Functions
d. Activities (ans. c)

14. Classification of Government accounts consists of -------------tier

a. 6 tier b. 7 tier c. 3 tier d. 5 tier (ans. d)

15. Main divisions of classification consists of :

a. Major head, Minor head, Sub head;

b. Minor head, Sub head, Detailed head;
c. Major head, Minor head, Sub head, Detailed head, Object head
d. Major head, detailed head, object head. (ans. c)

16. Major head of classification denotes:

a. Programme of government
b. Functions of government
c. Projects of government
d. Ministries of government (ans. b)
17. Minor head of classification denotes :

a. Ministries of government
b. Functions of government
c. Programmes of government
d. Projects of the government (ans. c)

18. Sub head of classification denotes :

a. Programe under a function

b. Function of government
c. Scheme under a programme
d. Projects under a programme. (ans. c)

19. Detailed head of classification denotes :

a. Scheme under a programme

b. Scheme under a function
c. Organization or a sub scheme under a scheme
d. Organization alone.
(ans. c)

20. Math the following:

a. Revenue Receipts … 1. Major head starts with 4 or 5 (d)

b. Revenue expenditure … 2. Major head starts with 6 or 7 (e)
c. Capital receipts … 6. Major head starts with 2 or 3 (b)
d. Capital expenditure … 3. Major head 8000 (f)
e. Public Debt, Loans & Advances ... 4. Major head 4000 (c)
f. Contingency fund of India … 5. Major head starts with 0 or 1 (a)
g. Public Account .. 7. Major head starts with 8 (g)

21. Revenue expenditure is broadly defined as expenditure incurred on creation of assets-

TRUE/FALSE.
( FALSE )

22. Expenditure incurred for replacement and improvement for existing assets is treated as
Revenue expenditure …. TRUE/FALSE

(FALSE)

23. Expenditure incurred on acquisition of assets of permanent nature is treated as Capital

expenditure ……… TRUE/FALSE
(TRUE)

24. Construction of a school or hospital is treated as Capital expenditure. … TRUE/FALSE

(TRUE)
25. Income generated during the construction of project shall be treated as Revenue. TRUE/FALSE

(FALSE)

26. In respect of Project under construction expenditure towards interim maintenance shall be
treated revenue expenditure. TRUE/FALSE
(FALSE)

27. Additions, renewals and replacement to a capital project should be treated as Capital
expenditure. TRUE/FALSE.
(TRUE)

28. All sums received by Government are treated as “Credit” and all sums paid are treated as
“Debit”. Therefore, refund of excess receipt should be debited to concerned expenditure head
of account. TRUE/FALSE
(FALSE)

29. Misclassification in the account towards debit(expenditure head) should be rectified by passing
contra Credit to the respective head of account. TRUE/FALSE
(FALSE)

30. Misclassification noticed in the accounts should be rectified immediately as and when noticed, if
during the currency of the financial year. TRUE/FALSE
(TRUE)

31. Misclassification noticed under Revenue expenditure/receipt should be corrected immediately

even after closure of the accounts. TRUE/FALSE (FALSE)

32. Misclassification noticed under Capital expenditure heads need not be rectified if the accounts
for the year are closed. TRUE/FALSE (FLASE)

33. Misclassification noticed under DDR heads need not be rectified if the accounts for the year are
closed, only a note of error will suffice. TRUE/FALSE (FALSE)

34. Appropriation accounts are contains details of expenditure up to detailed head level.
TRUE/FALSE (TRUE)

35. Appropriation accounts are to be prepared in ________________stages.

a. Four b. three c. two d. one (ANS. a)

36. Appropriation accounts are prepared in _________________of rupees

a. In crore b. in lakh c. in hundred d. in thousand (ans. d)

37. State 1 of appropriation accounts explains variation between :

a. Budget estimates and supplementary grants
b. Budget estimates and Final grants
c. Budget estimates and Re appropriations
d. Supplementary grant and Final grants. (ans. b)
38. Stage 2 of appropriation accounts are prepared with comparison of :

a. Budget estimates and actual expenditure

b. Actual expenditure and supplementary grants
c. Final grants and budget estimates
d. Final grant and actual expenditure (ans. d)

39. Final stage of appropriation accounts are to be submitted to CGA under the signature of :

a. Chief Controller of Accounts of the department

b. Internal Financial advisor
c. Pay & Accounts officer
d. Secretary of the Department (ans. d)

40. Finance accounts of the departments consists of :

a. Actual expenditure and budget estimates

b. Expenditure under various head
c. All transactions including receipts, expenditure, Loans
d. Expenditure under Capital, Loans, Debt, Deposits and remittance with opening balances.

(ans. d)

41. Receipts from an organization having commercial activity were misclassified as receipts under
non commercial activities of the department. The error came to light after closure of the
accounts.
a. Misclassification should be rectified as and when noticed
b. Misclassification should be rectified by proposing TEO
c. No TEO is required
d. No TEO needs to passed only a note of error needs to be recorded. (ans. d)

42. A Govt. loan for a specific scheme has been misclassified under General purpose loans, the
error came to light after closure of the accounts.
a. A note a error needs to kept on record
b. No TEO needs to be incorporated in the accounts.
c. TEO should be proposed to rectify the misclassification
d. No TEO is required as the accounts are closed. (ans. c)

43. Recovery towards subscription to GPF was misclassified as recovery of House building advance,
the error was noticed after closure of the accounts.

a. Misclassification should be rectified immediately.

b. No TEO needs to be made as the accounts for the year are closed.
c. A note of error will suffice the action
 d. Misclassification under these head should be rectified immediately even if accounts are
closed. (ans. d)

44. Recovery towards CGEGIS from the pay bill for the month of July 2009 was misclassified as
recovery towards PLI. The error was noticed in April 2010.

a. As the accounts for 2009-10 closed no TEo required

b. As the accounts for 2009-10 are closed a note of error needs to be placed.
c. Misclassification needs to be rectified immediately even though accounts are closed.
d. After closer of the accounts no corrections are permissible under these heads (ans. c)

45. Recoveries on account of Licence Fee for Government quarters were wrongly credited to
account of CGEGIS.
a. Misclassification should be rectified by TEO
b. A note of error will be sufficient
c. No corrections are permissible under these heads (ans. a)

46. A sum of Rs.500 being the recovery of advance of pay on transfer was booked under General
Provident fund and error came to notice after the close of the year.
a. A note of error will be sufficient
b. As expenditure involved is revenue which close every year no TEO is required
c. As the transaction involves revenue expenditure head and Public account TEO to be
incorporated in the accounts.
d. As transaction involves public account no TEO is required. (ans. c)

47. Government of India decided to convert a loan of Rs.54 Crores given to a corporation as its
share capital.
a. TEO is required to be proposed in the monthly accounts
b. No TEO is required as the accounts of the year are closed.
c. To be incorporated in the annual accounts as a Prior Period adjustment
d. Only a note of conversion is sufficient to convert loan into equity. (ans. c)

48. GPF recovery of Rs.20, 000/- was misclassified as recoveries of House building advance in the
month of Sept.2009, the error came to light in March 2010.
a. Since the heads affected are under public account no correction is required.
b. Error noticed in Public account should be rectified immediately, however old it may be.
c. Since the accounts are open TEO needs to be proposed through Monthly accounts
d. Only a note of error is sufficient to rectify the error. (ans. c)

49. Supplementary Demands for Rs.500 Cr is passed by Parliament to cover the unforeseen
expenses incurred from the contingency fund on account of mid-term elections to Lok sabha.
a. Expenditure should be debited to Contingency Fund of India.
b. TEO needs to be proposed to transfer the expenditure from functional head to Con.fund.
c. As funds are obtained through Supplementary Demand no TEO is required in the accounts.
d. No expenditure should be incurred without budget provision. (ans. b)
50. Expenditure on construction of office building was classified as revenue expenditure and error
noticed after closure of the accounts.
a. As expenditure involved is capital in nature, same should be transferred to appropriate head
of account.
b. Expenditure erroneously booked to revenue should be transferred to Capital through
accounts, however old it may be.
c. Since the error occurred between revenue and capital, no TEO needs to be proposed only a
note of error in the concerned monthly account and progressive capital expenditure figure
in Finance accounts needs to be corrected. (ans. c)