Question

(i) (ii) Explain the following concepts as commonly used in Government Accounting Procedure: General warrant Capital expenditure Recurrent expenditure Supplementary budget Payment voucher (iv)

Answer 1

(1) warrant:- This is the only authority through which money is expended in  government.Government officials cannot withdraw money without authority.

General Warrant:- This warrant authorizes the accountant general and the officer controlling expenditure to release funds for the payment of personal emolument and other services subject to the approval of budget. It will be in operaton for 4 months or until the budget had been approved which ever is earlier.

(2) Capital expenditure:- Capital expenditure is the money spent by the government on the development of machinery, equipment, building, health facilities, education, etc. It also includes the expenditure incurred on acquiring fixed assets like land and investment by the government that gives profits or dividend in future.

Capital spending is associated with investment or development spending, where expenditure has benefits extending years into the future. Capital expenditure includes money spent on the following:

• Acquiring fixed and intangible assets
• Upgrading an existing asset
• Repairing an existing asset
• Repayment of loan

3) Recurrent Expenditure:-

Recurrent expenditure on goods and services is expenditure, which does not result in the creation or acquisition of fixed assets (new or second-hand). It consists mainly of expenditure on wages, salaries and supplements, purchases of goods and services and consumption of fixed capital (depreciation).

When fees charged for goods and services are offset against recurrent expenditure, the result equates to final consumption expenditure in the Australian Bureau of Statistics' national accounts framework.

Includes:

• Operating expenses
• Tenancy manager revenue and expense components.

4) Supplementary Budget:- This budget forecasts the budget of the coming year with regards to revenue and expenditure. It is a system of budget in which all government expenditures must be justified for each new period.

5) Payment Voucher:- A document which can be used as proof that a monetary transaction has occurred between two parties. In business, a payment voucher can be used for a variety of purposes, sometimes taking the place of cash in a transaction, acting as a receipt, or indicating that an invoice has been approved for payment.