POWER GRID COMPANY OF BANGLADESH LTD.

ACCOUNTS MANUAL

DESIGNATION SIGNATURE

PREPARED BY Manager Accounts

REVIEWED BY Deputy General Manager, FIN

APPROVED BY Director Finance

Document No: QD-FIN-02 Revision No.: 00 Effective Date: 01/01/06

 PREFACE

This Accounts Manual of the Power Grid Company of Bangladesh (PGCB) has been
prepared on the assumption that PGCB will shortly take over the transmission assets
and liabilities of Bangladesh Power Development Board (BPDB) and Dhaka Electric
Supply Authority (DESA). The Company at the initial stage will be engaged in
wheeling energy from the generators to the distributors but ultimately is expected to
engage in buying energy as a "Single Buyer" from the generators (both public sector
and independent power producers) and selling to distributors in the public and private
sector organizations.

In preparing the Accounts Manual due consideration has been given to the provisions
of the Companies Act 1994 and the requirements of the external auditors. The Manual
incorporating the Chart of Accounts and the various forms as Input Documents have
been designed for a Computerized Accounting System.

The Manual addresses the General Ledger Accounting System and the preparation of
Financial Reports under a Computerized Accounting System. Three other separate
sections deal with Computerized
− Fixed Asset System
− Inventory Control System
− Monthly Salary System
Recruitment of all the necessary personnel required to run the organization as
envisaged above has not yet been completed and accordingly job description and
functional responsibilities have not yet been determined. Once these are in place it may
be necessary to make appropriate amendments to this Manual.

The Chart of Accounts may also require to be modified depending on the type of
software to be used.

PGCB's ability to effectively manage and accurately account for its assets, liabilities,
income and expenditure will depend to a very large extent as to how strictly and
efficiently the guidelines and procedures laid down in the Accounts Manual are
followed.
 POWER GRID COMPANY OF BANGLADESH LTD (PGCB)
ACCOUNTING MANUAL
Table of Contents
Section - I General
Page No.
1. Introduction 1
2. Corporate planning, budgeting and budgetary control 1
3. Internal control and internal auditing 2
4. Major Accounting Policies 3
5. Computerization of the Accounting System 3
6. Transaction Recording Levels 3
7. Accounting for Depreciation 4
8. Books of Accounts and Supporting Documents 4
9. General Ledger 5
10. Financial Statements And Periodical Reports 11
11. Control of Accounts Personnel 11
Section - II Accounting Procedure
12. Accounting Responsibility 12
13. Safe Custody 12
14. Bank Account and Cheque Books 12
15. Money Receipts 12
16. Accounting for Receipts 13
16.1. General 13
16.2. Receipt of Cash 13
16.3. Receipt of Cheques/P0/Drafts etc., 13
16.4. Dishonoured Cheque 13
16.5. Bank Credit Advice 13
16.6. Recording of Money Receipts, 13
16.7. Deposit of Money in to Bank 14
16.8. Data Entry of Statement of Receipts & Banking 14
17. 17. Accounting for Payments: 14
17.1. General 14
17.2. Payment Voucher 14
17.3. Cash Payment/Petty Cash 15
17.4. Bank Payment/ Cheque Payment 15
17.5. Cheque Writing Procedure 16
17.6. Loss and cancellation of cheque 17
18. Bank Direct Debits 17
19. Bank Reconciliation Statement 17
20. Collection Control Account 17
21. Advance Payments 18
22. Journal Voucher 18
23. Postings to General Ledger 19
24. Trial Balance 19
25. Financial Reports 19
26. End of Period Processing 20
Section - III Accounts Codes
27. General 21
28. Account Code Structure 21
28.1. Type of Account 21
28.2. Account Code 21
28.3. Master Account Code 21
28.4. Subsidiary Account Code 21
28.5. Examples of typical code numbers 21
28.6. Opening of Account Codes 22
29. Cost Center Codes 22
30. Input/Document Source Code 22
31. Preparation and verification of Input Data 23
32. Chart of Accounts 23

ANNEXURE-A (Chart of Accounts) 24~31

Section - IV Accounting Forms and Books

33. General 32
34. Books and Forms to be maintained 32
34.1. At Head Office 32
34.2. At Area Office 32
34.3. At Sub-Office 32
35. Forms to be used 33
Section - V Fixed Assets System
36. Introduction 34
37. Computerized System 34
38. Fixed Assets Group 34
39. Fixed Assets Code Structure 34
40. Movement Records 34
41. Reports 35
42. Reconciliation 35
Section - VI Inventory Control System
43. Introduction 36
44. Computerized Inventory Control System 36
45. Inventory Record Maintenance 36
46. Inventory Group 36
47. Inventory Item Code 36
48. Receipt of Inventory items 36
49. Issue of Inventory items 37
50. Issue Price 37
51. Reports 37
52. Reconciliation 38
Section - VII Monthly Salary System
53. Introduction 39
54. Computerized Salary System 39
55. Employee History Maintenance, 39
56. Employee Identification Code 39
57. Cost Center Allocation Code 40
58. Monthly Salary Variation Report 40
59. Income Tax Deduction 40
60. Reports 40
61. Salary Payment 40
 POWER GRID COMPANY OF BANGLADESH LTD (PGCB)
ACCOUNTING MANUAL
Section - I General
1.0 Introduction:
Power Grid Company of Bangladesh Limited (PGCB) has been incorporated as a
private limited company registered with the Registrar of Joint Stock Companies
under the Companies Act 1994. The Company has been established to
a. take over BPDB's / DESA's transmission assets,
b. act as the wheeler of electricity from generators to distributors, and
eventually take over commercial trading of electricity from generators to
distributors, and
c. sell on to distribution companies and major consumers through a bulk
supply tariff.
The accounting system of PGCB has been designed to conform with the
requirements of the Companies Act 1994 and the objectives of PGCB.
This Accounting Manual provides guidance and instruction to assist PGCB and its
various offices for managing accounting issues. The Accounts Department of
PGCB shall be responsible for promptly and accurately collecting, recording and
classifying financial transactions and reporting to the management of PGCB .
The Accounting Manual describes in detail the procedure to be followed for a
computerized accounting system which should enable the timely preparation of
accurate Financial Reports to enable the PGCB management to take effective and
necessary action for efficient management of the organization.
PGCB's ability to effectively manage and accurately account for its assets and
liabilities will depend to a very large extent as to how strictly and efficiently the
guidelines and procedures are followed.
2.0 Corporate Planning, Budgeting and Budgetary Control:
Long, Medium and short term planning shall be primary elements in financial
management of PGCB. Long and Medium term plans referred as Corporate Plans
shall be drawn up by the management as indicative plans based on corporate
vision , Whereas the short term or annual plans should be drawn up with emphasis
on what can realistically be achieved within the coming year with a view to
maximizing profits and controlling of revenue expenditure.
PGCB shall draw up Capital Expenditure Budget and Revenue Income and
Expenditure Budget by 3 1 " March each year in-respect of the following financial
year. A Cash Flow Budget should also be prepared. These Budgets should be
placed before the Board of Directors for approval. The approved Budgets shall
form the basis for activities of the Company. Any item of expenditure not included
in the budgets shall be placed before the Board of Directors with full particulars
and explanations for their approval before incurring expenditure. To meet
emergency situations the Managing Director may be authorized by the Board of
Directors to incur expenditure, not included in the budgets, up to a certain amount
(to be determined) but such expenditure must be placed before the next Board
meeting for its approval.
Actual expenditure should be closely monitored against budget provisions at
regular intervals and deviations should be reported to the management for taking
appropriate actions promptly.
Page # 6
3.0 INTERNAL CONTROL AND INTERNAL AUDITING:
Internal Control
Internal control means the entire system of control that is administrative,
operational and financial at each level of activity of the PGCB and its
Area/sub-offices. The system covers the controls to be exercised by PGCB with
respect to separation of duties and responsibilities, safeguarding assets and funds
and preventing frauds and errors.
In order to achieve accountability at all levels it is essential for PGCB to include the
following elements of internal control:
ƒ by-laws, standing orders, and executive orders
ƒ policies , objectives
ƒ systems and procedures
ƒ organization structures providing for segregation of duties
ƒ job descriptions
ƒ planning and budgeting
ƒ financial and physical performance reports
ƒ internal auditing
For the internal control system to be effective there should be organizational
independence of the operating, custodial and accounting departments. Operating
departments should not have any principal accounting or custodial functions, even
though they may be responsible for producing and recording initial or basic data.
Initiation and authorization of a transaction, its recording and custody of the
resulting asset should be separated. Thus , receipts and disbursement of funds
should be divorced from accounting. The Inventory department should not have
access to the principal accounting records used for checking store-keeping
integrity. Duties and responsibilities should be so segregated that no one person
will handle a transaction from beginning to end. If that division is not possible,
other protective practices must be devised. These internal checks shall help in
establishing the reliability and integrity of the accounting records and information.
Internal Financial Audit
PGCB shall have a system of continuous internal financial audit as part of the
overall Internal Control System. The Internal Financial Audit unit should consist of
a group of persons, headed by a qualified professional as the Internal Auditor
reporting directly to the Managing Director. The Internal Auditor should have as
much ' freedom as possible to decide on his role and operations, otherwise, hi s
position may become untenable and be of little use for assuring accountability.
Typical matters which the Internal Financial Auditor should appraise and report to
the management include:-
ƒ the effectiveness of ' the accounting, financial and operational
controls, and any need-s for revision;
ƒ the extent of compliance with prescribed policies, plans and
procedures;
ƒ the reliability of accounting systems, data and financial reports;
ƒ methods of remedying weak controls or recommending introduction of
controls where there are none;
ƒ verification of assets and liabilities.
The Internal Financial Auditor should work within a well-defined framework of

Page # 7
 programs and reporting requirements. The Internal Financial Auditor shall also be
authorized to ensure that computer programme changes and amendments are
consistently monitored to prevent irregularities.
4.0 Major Accounting Policies:
a. PGCB is assumed to be a going concern and will continue to operate.
b. PGCB shall employ consistent methods in maintaining records and
preparing financial statements.
c. The accounts shall be maintained and statements prepared in
conformity with the provisions of the Companies Act 1994.
d. The accrual concept will be used in recognizing revenue and
expenses.
e. Fixed assets owned by the PGCB shall be depreciated using straight
line method at equal rates over the physical life of the assets.
f. The accounting period of the PGCB will be one year ending June 30
every year.
g. Financial transactions shall be recognized as and when they occ ur.
These transactions shall then be recorded in the books of accounts for
the period to which they relate.
5.0 Computerization of the Accounting System:
The accounting system of PGCB shall be computerized and maintained centrally
at the Head Office. The system will assist PGCB to record financial information
promptly and thus enable various financial statements and reports to be produced
accurately and timely.
The system shall be based on the Double Entry accounting principle which is
applied by commercial and industrial organizations. The features of the
computerized system shall be as follows
ƒ It shall be user friendly and menu driven. As a result, operators not
familiar with double entry accounting transactions may easily operate
the system,
ƒ It shall be capable of maintaining secrecy
ƒ The system shall provide for necessary audit trail to be maintained,
ƒ The system shall be capable of generating hard copy reports for
internal and external audits.
ƒ The system shall have the facility to maintain data relating to the
current year, the budget and the cumulative historical balances.
Separate Computerized System shall be maintained as subsidiary system for:-
a. Fixed Assets (quantity and value)
b. Inventory Control' (quantity and value)
c. Monthly Salary preparation-
For further details about these systems please refer to Paragraphs 10 , I I and 12 of
Section 1 of this Manual.
6.0 Transaction Recording Levels
The activities of PGCB are carried out at the Head Office and its various Area
Offices/sub offices throughout Bangladesh.
Assets and liabilities shall be recorded and grouped according to their nature. Sub-
division under each group shall be maintained for easy identification and

Page # 8
 reference.
Similarly, Income and Expenses shall be recorded according to the nature and
types of activities. Expenses shall be further classified under different Cost
Centers to enable Financial Reports to be prepared for each Cost Center for
effective management purposes.
Area Offices shall maintain Bank and Cash Accounts and shall be required to
submit monthly reconciled and balanced returns ( summari zed Head-wise Cash
and Bank Accounts) to Head Office Accounts Department for incorporation of the
transactions in to the central Computerized Accounting System.
Sub-Offices shall maintain only cash account (Imprest Petty Cash) to meet day to
day petty expenses and they shall submit monthly reconciled and balanced returns
summarized Head-wise Cash Accounts) to their respective Area Offices for
incorporation of the transactions in the Area Offices Cash Account.
The Accounts Coding system of PGCB has been designed not only to take care of
the present need but adequate provision has also been made to allow for future
expansion.
7.0 Accounting for Depreciation
Most fixed assets depreciate, that is wear out or otherwise suffer a reduction in
their useful life through use or obsolescence with the passing of time . Therefore,
fixed assets which have a definite useful life shall be depreciated. Fixed assets
which have indefinite useful life, such as freehold land, will not be depreciated.
Fixed Assets shall be shown on Financial Statements as follows:-
a. fixed assets with definite useful lives shall be included in the financial.
statements at cost (or, if re-valued, at the re-valued amount) less the
appropriate amount provided for depreciation; and
b. fixed assets with an indefinite useful life shall be included in financial
statements at cost (or, if re-valued, at a re-valued amount).
8.0 Books of Accounts and Supporting Documents:
Section 181 (1) of the Companies Act 1994 states that books of accounts shall be
kept for:
a. all sums of money received and-expended by the Company and the
matters in respect of which the receipts and expenditure take place;
b. all sales and purchases of goods/services by the Company;
c. the assets and liabilities of the Company; and
d. in the case of a company engaged in production, distribution,
marketing, transportation, processing, manufacturing, milling,
extraction and mining activities, such particulars relating to utilization
of material, labour and other items of overhead cost.
Section 181 (5) states that the books of accounts relating to a period of not less
than twelve years immediately preceding the current year together with vouchers
relevant to any entry in such books of account shall be preserved in good order.
In order to comply with the provisions of the Companies Act 1994 PGCB shall be
required to maintain the following books of accounts:
ƒ Cash/Bank Book (which may be incorporated in the General Ledger)
ƒ General Ledger
ƒ Subsidiary Ledgers for Debtors and Creditors
ƒ Fixed Asset Register
ƒ Stock/Inventory Register

Page # 9
9.0 GENERAL LEDGER
The General Ledger is the book of final entry for all the transactions of the
Company and shall incorporate the control accounts of all subsidiary books. A
complete trial balance shall be capable of being drawn-up from the General
Ledger.
ƒ The general ledger system shall be computerized. Each and every Data
relating to financial transaction shall be entered with appropriate details in the
i. Money Receipt,
ii. Cash Payment Voucher,
iii. Bank/Cheque Payment Voucher,
iv. Journal Voucher
v. Statement of Receipts
vi. Statement of Banking -
vii. Statement of Cheques Issued
viii. Petty Cash Statement
These documents will be used as Source Input Documents to enter relevant
data into the computer for processing. -
ƒ Initially, Cash and Bank Books should also be maintained manually, as
parallel system, but these may be discontinued as soon as the accounting
staff are fully familiar with the Computerized Accounting System.
The accounting documents and data which form the basis for recording transactions
are:

Sl. Input Documents Descriptions

no.
1 Money Receipt MR is prepared on the basis of receipt of cheques and cash.
(MR) The Statement of Receipts is written up from these MRs.

2 Cash Payment Voucher Cash payment vouchers are prepared for recording
(CP) payments made in cash. Cash Book/Petty Cash Statements
are prepared from these vouchers.

3 Bank/Cheque Payment Cheque Payment Vouchers are prepared for recording

Voucher payments made by Cheque/P.O/ D.D/ Bank Transfer
(BP) Advices. Bank Book/Statement of Cheques Issued are
written up from these vouchers.
4 Journal Voucher Journal Vouchers are prepared for recording non-cash
(JV) transactions and other adjustments.
5 Statement of Receipts Money Receipts issued are recorded in this statement.
(SR)
6 Statement of Banking Cash/Cheques/Bank Transfer Advices/POs/DDs etc.
(SB) received and paid into Bank are recorded in this statement.
7 Statement of Cheques Issued Cheques issued by the Area Offices shall be recorded in this
(SC) statement.
8 Petty Cash Statement Petty Cash transactions shall be summarised on this
(PC) statement.

Page # 10
10.0 Financial Statements And Periodical Reports
PGCB shall prepare monthly/quarterly/half yearly and annual Financial Accounts
and such other reports as required by the management of PGCB.
10.01 Major Financial Statements:
The following major financial statements shall be prepared by PGCB
ƒ Income and Expenditure Account:
ƒ Separate Income and Expenditure Account shall be prepared for each
Cost Center including the Head Office (Corporate Office) -and a
Consolidated Income and Expenditure for all the activities of the
PGCB. Each of these report shall show the appropriate Budget
figures.
ƒ Balance Sheet
ƒ A Balance Sheet reflecting the financial position of PGCB shall be
prepared at the end of each month showing the Capital, Liabilities and
Assets of the Company.
11.0 Control of Accounts Personnel
ƒ All Accounts personnel shall form part of Finance Department and
shall be under the overall control of the Finance Director.
ƒ The confidential reports of the accounts personnel shall be initiated
and shall be signed by the Finance Director and those of others by the
Managing Director.
ƒ Transfer, posting and initiation of disciplinary measures, if any, in
respect of all accounts personnel shall be in consultation with the
Finance Director.

Page # 11
 Section - II Accounting Procedure
12.0 Accounting Responsibility
Every officer whose duty is to prepare and render any receipt, voucher, account or
return in respect of the Company's financial transactions is personally responsible
for their completeness and strict accuracy and, their dispatch within the prescribed
date. An officer who signs or countersigns a statement, accounting return or
certificate is personally responsible for the facts stated therein so far as it is his
duty to know or to the extent to which he may reasonably be expected to be aware
of them. If in the pre-printed form, statement, return or certificate does not
represent the facts, it is his duty to make any necessary amendment which will call
attention to the deviation and so to give the authority concerned the opportunity of
deciding whether the amendments cover requirements.

13.0 Safe Custody

All the money of the Company not deposited in the bank and retained in hand shall
be kept in strong fire- proof safe secured by two locks of different patterns. All the
keys of the same lock must be kept in the same persons custody and as a general
rule, the keys of one lock should be kept apart from the keys of the other lock, and
in a different person's custody when practicable. Both the custodian of the keys
must be present whenever the safe is opened and until it is again locked. At the
discretion of the Finance Director the duplicate keys of the safe may be placed
under his seal in the safe custody of a Senior Officer of the Accounts Department.
In the event of this practice being adopted, a Duplicate Key Register shall be
maintained and once a year the keys should be sent for examination and returned
under fresh seal, a note being made in the register that they have been found
correct.

14.0 Bank Account and Cheque Books

Bank Accounts in the name of Power Grid Company of Bangladesh Limited shall
be opened and operated as per resolution of the Board of Directors. Operation of
the accounts shall be by joint signatures only. Bank Accounts may be Current
Account, STD Account (Short Term Deposit Account) and/or Fixed Deposit
Account. At the Head Office such number of bank accounts shall be maintained as
are considered necessary and convenient. At each Area Office two bank accounts
shall be opened:
1. STD Account to deposit money received on account of the Company.
The balance of this account should, at periodic intervals, be
transferred to a designated bank account maintained at the Head
Office,
2. Current Account to disburse expenses by issuance of cheques
Cheque books shall be kept in the custody of responsible officers at all times and
counterfoils of all cheques shall be retained by the issuing offices as their record
and for audit purposes.
Bank Statement shall be obtained from all the banks at the end of each month and
reconciliation statements prepared.

15.0 Money Receipts (MR Form No QF-FIN-01)

Pre-numbered Money Receipt (MR - Form No: QF-FIN-01) Books should be
printed by the Head Office only and kept in safe custody of the Accounts
Department who shall maintain a Register to record their receipts and issues.

Page # 12
 Money Receipt books shall be issued to relevant offices authorized to receive
money on account of the Company. Each Money Receipt (MR) shall be in a set of
two, the original should be given to the payee and the duplicate copy should be
retained by the issuing office. Only those persons authorized by the management
shall be empowered to issue money receipts under their signature.
In respect of cheques/drafts or other instruments of negotiation which are accepted
subject to collection the Money Receipt issued should be rubber-stamped with the
notation "issued subject to realization".

16.0 Accounting for Receipts

16.01 General
Every employee of the Company shall be personally responsible for the money
which passes through his hands and for the prompt record of receipts in the.
manner prescribed below. All money not banked shall be kept in a strong fire
-proof safe as mentioned in para 15 above.
In respect of each and every receipt of cash/cheque/drafts/TTs/Bank Transfer
etc (except for remittances received by Area Offices from Head Office) a
MONEY RECEIPT (MR) must be issued. Money Receipts should be completed
in all respects particularly describing the precise nature of receipt the Account
Head (Code) to be credited, duly signed and dated.
If for any reason a Money Receipt is canceled the original must be kept
attached to the duplicate copy and remark to that effect should be inserted in
the Statement of Receipts.
16.02 16.02 Receipt of Cash
All cash received should be paid into the designated Bank Account of PGCB on
the same day.
Under no circumstances cash received should be taken into Petty Cash
or used for any other purpose. Cash should not be banked with cheques
under the same Deposit/Paying in slip. Cash received after banking hours
should be banked on the following working day.
16.03 Receipt of Cheques/Pay Orders/Drafts etc
All Cheques/Pay Orders/Drafts etc instruments received should immediately be
stamped "Account Payee only" and each cheque/draft etc should be banked
under a separate Bank Deposit Slip on the same day or if received after
banking hours the following working day.
16.04 Dishonored Cheques
In the event any cheques are dishonoured Director (Finance) should be notified
immediately and appropriate action taken for realization of the same.
16.05 Bank Credit advices
In respect of direct receipt of money into a Bank Account a Money Receipt
must also be prepared in respect of each Bank Credit Advice.
16.06 Recording of Money Receipts
All Money Receipts issued should immediately be entered in serial order on to
the prescribed Statement of Receipts (SR - Form-No: QF-FIN-05). Relevant
Area Offices should prepare Statement of Receipts in duplicate and at the end
of each month send the original to Head Office Accounts Department. The
duplicate copy of Money Receipts and Statement of Receipts should be
retained at respective offices as their record and for audit purposes.

Page # 13
 16.07 Deposit of Money into Bank
All money received whether in cash, cheques or otherwise must immediately
paid in to the designated Bank Account of the Company on the same day or the
following working day if received after banking hours. Cash must not be banked
with Cheques and separate Bank Deposit Slips should be used showing clearly
the Money Receipt Numbers and other relevant particulars. The particulars of
money deposited in to banks must be immediately entered on to the prescribed
Statement of Banking (SB -Form No: QF-FIN-06) Relevant Area Offices
should prepare Statement of Banking in duplicate and at the end of each month
send the original to Head Office Accounts Department. The counterfoils of the
Deposit Slips and the duplicate copy of the Statement of Banking should be
retained at respective offices as their record and for audit purposes.
16.08 Data Entry of Statements of Receipts and Banking
The Statements of Receipts and Statements of Banking of the Head Office and
those of Area Offices received by the-Head Office Accounts Department shall
be scrutinized to ensure that they have been duly completed, coded, signed
and dated; thereafter they shall be entered into a Input Document Control
(Computer Processing) Register (Form No: QF-FIN-11) and passed on to the
Computer Section for necessary entry in to the Computerized Accounting
System.

17.0 Accounting for Payments

17.01 General
Generally, no expenditure should be incurred or any commitment made to incur
expenditure unless it has been approved in the Budget.
Payments other than the petty cash payments, must be made, *as far as
practicable, through cheques crossed " Account Payee only". All cheques must
be signed by authorized signatories. Only persons authorized to prepare or
supervise the preparation of cheques should have access to cheque book.
Before making any payment by cash/cheque or other instrument it is essential
to ensure that the expenditure is wholly and necessarily incurred for the
purpose of the organization and has been duly approved by competent
authority as well it is within the budgetary provisions. It is also necessary for the
person authorizing payment to ensure that the goods and services have been
received in good condition, in conformity with the purchase order and checked
for the arithmetical accuracy of the bills/invoices/demands for payment.
17.02 Payment Voucher
For every payment a Payment Voucher (CP or BP Form Nos: QF-FIN-02 and
QF-FIN-03) must be prepared ensuring to give a serial number and completing
all other particulars stated therein making sure that the code numbers are
correctly given relating to the account heads to be debited/credited. Before
making any payment the person making the payment must ensure that the
Payment Voucher is completed correctly and duly approved by the authorized
person. It shall also be his responsibility to ensure that the payee's signature is
obtained as evidence of receipt of the amount paid.
A Cash Payment Voucher (CP Form No: QF-FIN-02) should be
prepared in respect of each Cash Payment.
A Cheque Payment Voucher (BP Form No: QF-FIN-03) should be

Page # 14
 prepared in respect of each payment by a cheque or negotiable
instrument.
17.03 Cash Payment/ Petty Cash
Small payments which are usually required for day to day running of business
shall be paid in cash out of Petty Cash float maintained under the imprest
system. The Director (Finance) shall determine which Area Offices and
sub-offices shall be authorized to incur petty cash expenditure and also for
each office the amount of imprest which should normally cover its monthly
requirement.
In respect of each payment a Cash Payment Voucher (CP Form no:
QF-FIN-02) shall be prepared, as earlier mentioned, and entered in the Petty
Cash Book /Statement (PC Form No: QF-FIN-08). The cash in hand should be
counted daily and agreed with the balance shown per the Petty Cash
Book/Statement. At the end of each month the Petty Cash Statements (PC
Form No: QF-FIN-08) of Area Offices should be sent to Head Office for
necessary action as stated below.
The Head Office Accounts Department shall examine the Petty Cash
Statements and verify their correctness before remitting the appropriate amount
to the respective office to restore the imprest balance.
Sub Offices which maintain Petty Cash shall submit their Petty Cash
Statements and request for reimbursement of float to their respective Area
Offices who in turn shall be authorized to remit funds, out of their own Petty
Cash float, after due scrutiny and verification. In such instances the Area
Offices shall incorporate the Sub-Offices' petty cash expenses in their own
Petty Cash Statements.
The Cash Payment Vouchers prepared by each office shall be retained at
respective office as their record and for audit purposes.
The Petty Cash Statements (PC Form No.: QF-FIN-08) of the Head Office and
of Area Offices received by the Head Office Accounts Department shall be
scrutinized to ensure that they have been duly completed, coded, signed and
dated; thereafter they shall be entered into a Input Document Control
(Computer Processing) Register (Form No: QF-FIN-11) and passed on to the
Computer Section for necessary entry in to the Computerized Accounting
System.
A Petty Cash Account for each office shall be maintained in the General Ledger
at the H.O. Accounts Department and it shall be the responsibility of that
department to ensure that the balance shown by the Petty Cash Statements of
various offices agree with the balance shown per the General Ledger.
17.04 Bank Payment/ Cheque payment
Other than Petty Cash payments all other payments should be made out of
bank accounts of the Company by "Crossed and Account Payee" cheques
issued from the Head Office. Direct Debit or specific instructions to the banks
may also be issued when necessary.
At Area Offices, prompt disbursement of funds may be necessary to expedite
operation and maintenance work and in that event Area Offices may be
authorized to operate Bank Accounts and issue of cheques under joint
signatures.
Where Area Offices are authorized to operate Bank Accounts, the funding of
these accounts shall be from Head Office only. Under no circumstances any

Page # 15
 money received on account of the Company shall be deposited in to such
accounts.
A Cheque Payment Voucher (BP Form No: QF-FIN-03) should be prepared in
respect of each payment by a cheque and entered into the Statement of
Cheques Issued (SC Form No: QF-FIN-07). At the end of each month Cheques
Issued Statements should be forwarded to Head Office. The Head Office
Accounts Department shall scrutinize these to ensure that they have been duly
completed, coded, signed and dated; thereafter they shall be entered into a
Input Document Control (Computer Processing) Register (Form No: QF-FIN-
11) and passed on to the Computer Section for necessary entry in to the
Computerized Accounting System.
The respective offices preparing the Cheque Payment Vouchers shall retain
them as their record and for audit purposes.
As the volume of cheque payment transactions at the Head Office is likely to be
substantially more, a separate Statement of Cheques Issued need not be
prepared and tile Cheque Payment Vouchers themselves, in convenient
batches, shall be passed on to the computer section on DAILY basis for
posting in to the computerized accounting system). This will not only save time
and additional paperwork but will also enable the computerized system to be
kept up to date.
For payment of salary please refer to Section VII of this manual
17.05 Cheque writing procedure
The following special precautions shall be taken in writing and signing cheques
to eliminate scope for interpolation or other malpractice:
ƒ Cheques should be written and signed in indelible ink.
ƒ Amounts of cheques should be written continuously and very close to
the printed words "Taka" leaving no space for interpolation. The
amount written in words should end with the word "Only",
ƒ Amounts written, in figures should also be written very close to the
printed "Taka" with a double line drawn along making insertion of any
figure difficult,
ƒ Figures and the words should be written neatly and clearly and in such
a way that no figure can be changed into another,
ƒ In signing cheques and in attesting correction care should. be taken to
compare the amount of the cheque with the amount shown on the
voucher/e invoice/ bill,
ƒ For large amounts additional precaution should be taken by writing
across the cheques "Under Taka (in words)". The amount so written
across may be in thousands of Taka just above the actual amount
of the cheques. Thus across a cheque for Taka fifty lac seventeen
thousand eight hundred and twenty nine only should be written "Not
over taka fifty lac and eighteen thousand only ".
ƒ When cheques are required to be crossed it should always be crossed
with the words "Account Payee Only".
ƒ Overwriting and erasing in the cheques are strictly prohibited.
Correction should be attested. Cheques containing more than one
correction should not be issued. Such cheques may be canceled over
the full signature of the Officer signing them and stating "canceled".

Page # 16
 17.06 Loss and Cancellation of Cheque
If a cheque is reported as lost, the Bank on which the cheque was drawn
should immediately be instructed to stop payment of that cheque. Fresh
cheque may be issued only after obtaining non-payment certificate from the
Bank.
When it is necessary to cancel a cheque, the cancellation should be recorded
on the counterfoil, if the cheque is in possession. If the cheque is not in
possession “Stop Payment" instruction should be issued to the bank and after
obtaining bank's confirmation of the receipt of the instruction necessary
correcting entry should be made.

18.0 Bank Direct Debits

In respect of each direct debit by bank relating to bank charges or other payments
a Cheque Payment Voucher (BP) should be prepared and marked "NOT FOR
PAYMENT" and approved by the appropriate person. No payment will be made on
this Payment Voucher as payment will have already been made by the bank. This
payment voucher will only be used for posting purposes.

19.0 Bank Reconciliation Statement

a. Bank statements in respect of each account from the respective bank shall be
obtained by the 5th of the following month.
b. Entries in the- bank statements shall be compared with the entries made in the
Company's books,
c. A list of all debits and credits appearing in the bank statements but not in the
Company's books shall be prepared. These will usually related to bank
charges, bank interest, dishonoured cheques etc. Appropriate vouchers shall
be prepared for these transactions and after due authorization shall be entered
in the- relevant books/statements for ultimate processing into the Computerized
Accounting System.
d. A list of all the receipts and payments recorded in the Company's books but not
appearing in the bank statements shall be prepared,
e. A separate bank reconciliation statement for each bank account shall be
prepared taking into account the items listed in para (d) above and the balance
shown as per the bank statement shall be agreed with the balance shown by
the relevant account in the Company's books.
Items which are not cleared through bank accounts within three months shall be
taken up with the relevant banks and appropriate parties to resolve the issues.
Area Offices which maintain and operate STD and Current Accounts with banks
will prepare their own Bank Reconciliation Statements and forward copies to the
Head Office Accounts Department. Head Office Accounts Department on receipt of
these shall scrutinize and examine them to ensure that they have been drawn up
correct and inquire in to any unusual items, The Head Office Accounts Department
shall also ensure that STD Account balances are being regularly transferred to
Head Office and that large balances are not retained in the STD Accounts at Area
Offices.

20.0 Collection Control Account

A Collection Control Account in respect of each Area Office and the Head Office
shall be maintained in the General Ledger.

Page # 17
 All money collected (as per the total of Statement of Receipts - SR) for which
money receipts have been issued by an office shall be debited to the Collection
Control Account of that office.
All sums of money of that office deposited in to banks ( as per the total of
Statements of Banking - SB) shall be credited to the Collection Control Account of
that office.
If all receipts are banked within the same month a nil balance will be shown in the
Collection Control Account. If, however, the Collection Control Account shows a
debit balance it will indicate that all collections have not been banked and will
therefore require immediate follow up. Should the Collection Control Account show
a credit balance it will most certainly indicate an error has been made and will
require immediate rectification/reconciliation.
In order to prevent any irregularities of money received by the Company the H.O.
Accounts Department should closely and- regularly monitor the balances of the
Collection Control Accounts.

21.0 Advance Payments

As a matter of general principle, advance payments shall be discouraged.
However, certain advance payments become unavoidable for which the following
provisions shall apply:
™ Purpose for advance payments
Payments in advance may generally be made for the purpose of:
ƒ purchasing small items of day to day use,
ƒ purchase of store items where supplier of goods and/ or services require
advance payments,
ƒ advance for renting of premises,
ƒ advance against traveling etc..
™ Conditions’ for advance payments
ƒ No advance payment shall be made unless the request for the advance is
duly approved by an authorized officer of the concerned department and a
responsible officer of the Accounts Department.
ƒ No advance to an individual for Traveling etc shall be made unless any
previous advance made has been fully recovered.
ƒ For purchase of goods and services advance payment shall be made in
accordance with the terms and conditions of purchase order/contract/
agreement.
™ Recovery of Advances
ƒ The amounts of advances from petty cash for purchase of small items
shall be adjusted against purchase invoice and balance settled on the
following day. Under no circumstance an amount of advance under this
category shall remain outstanding for more than 7 (seven) days.
ƒ The amounts of advances for purchase of store items should be adjusted
on receipt of the final bill from the suppliers.
ƒ The amount advanced for traveling etc should be adjusted after receipt of
vouchers and supporting documents.

22.0 Journal Vouchers (JV Form No: 4)

Journal Vouchers in the prescribed form shall only be prepared by the Head Office

Page # 18
 Accounts Department.
Journal Vouchers shall only be raised in respect of adjusting and correcting
transaction entries. Journal Vouchers duly prepared along with supporting
vouchers/ explanations must be presented to the, appropriate authorities for
approval.
Only duly approved Journal Vouchers should be passed to the computer section
for posting to the General Ledger.
Journal Vouchers must be serially numbered and for this purpose a Journal
Voucher Serial Register (Form No: QF-FIN-09) should be kept by the Accounts
Department-in-charge.

23.0 Postings to the General Ledger

Head Office Accounts Department shall maintain a Computerized General Ledger
containing separate ledger folio's for each head of account as detailed in the.
Chart of Accounts (refer to Section 32 of the manual).
The postings to this ledger shall be from the following source Input Documents
only
ƒ Statements of Receipts (Form No. QF-FIN-05-SR-relating to receipt of
money)
ƒ Statements of Banking (Form No. QF-FIN-06-SB-relating to money
deposited into bank accounts)
ƒ Petty Cash Statements (Form No. QF-FIN-08-PC-relating to Petty
Cash expenditure)
ƒ Cheque Payment Vouchers for Head Office only (Form No.
QF-FIN-03-BP- relating to cheques issued from Head Office)
ƒ Statements of Cheques Issued (Form No. QF-FIN-07-SC-relating to
cheques issued by Area Offices)
ƒ Journal Vouchers (Form No. QF-FIN-04-JV-relating to adjusting/
correcting entries)
At periodical intervals (monthly/quarterly as may be decided. by the management)
the ledger shall be balanced (End of Period Processing-EPP) and Trial Balance
and other financial reports printed out.

24.0 Trial Balance

At the end of each month after postings to General Ledger has been completed a
summary Trial Balance as well as a detail Trial Balance should be printed out of
the Computerized Accounting System and retained as hard copies for
ƒ reference purposes,
ƒ preparations of schedules as may be required and
ƒ for audit Purposes.
The Trial Balances should be bound and preserved for 12 years as required
under the Companies Act.

25.0 Financial Reports

At the end of each month after the Trial Balance has been extracted the following
Financial Reports should also be printed out of the Computerized Accounting
System:
ƒ Income Statement of each Cost Center showing Income and Expenses under

Page # 19
 each head for the current month as well as cumulative figures to date for the
year.
ƒ Consolidated Income Statement of all Cost Centers showing Income and
Expenses under each head for the current month as well as cumulative
figures to date for the year.
ƒ Balance Sheet of the Company

26.0 End of Period Processing

At the end of each month the Computerized Accounting System will require to be
processed for closing. This process closes each of the ledger accounts at the end
of the month and carries forward the closing balances as opening balances for the
next month.
Similarly, at the end of the year the system will require to be processed for year
end closing. This process closes all the Income and Expenditure accounts and
transfers the balances (the sum total of which is the net profit/loss for the year) to
the Retained Earnings Account and therefore the balances of the Income and
Expenditure accounts being nil are not carried forward. The process also closes
each of the ledger accounts relating to assets and liabilities and along with the
balance of the Retained Earnings Account are carried forward as opening
balances for the next year.
Before carrying out End of Period Processing at the end of each month and year
copies of the data should be made on diskettes or tapes as back up copies.

Page # 20
 Section -Ill Accounts Codes
27.0 General
Financial transactions are recorded and analyzed/classified according to the
requirement of an 0rganization. For this purpose therefore, an account number is
allocated to each head of account. This account number is often called the
Account Code. The structure of the Account Code should be appropriately
designed to generate the various financial reports and schedules required by the
management of the Company and the auditors.

28.0 Accounts Code Structure

28.01 Type of Accounts
For accounting purposes account heads are grouped under 4 types e.g.
Assets Type - A
Liabilities Type - L
Income Type - I
Expenditure Type - E
28.02 Account Code
The designing of the Account Code will depend to a large extent on the type of
software to be used and the types of reports to be generated from the system.
Account codes suggested for PGCB's use are (at least) six digits comprising of
ƒ MASTER ACCOUNT: (first 4 digits) and
ƒ SUBSIDIARY ACCOUNT: (last 2 digits)
28.03 Master Account Code:
The Master Account Code is given to a broad head of Account which appears
on the Balance Sheet and Income and Expenditure Accounts.
The last two digits of all Master Account Code end with . 00 and no entries can
be posted to Master Accounts (ie all account codes ending with .00). Therefore
it must be ensured that all codes for posting purposes are 6 digits ending
with .01 or above.
28.04 Subsidiary Account Code:
Subsidiary account codes are given to individual accounts under each -broad
head of account (Master Account) to provide further break up or classification.
With respect of Assets and Liabilities the subsidiary account codes shall be
used for further classification under the broad head of account (Masier
Account) for identification of an asset/liability
With respect to Income and Expenditure the subsidiary account codes shall be
used for Cost Center classification under each head of income and
expenditure.
28.05 Example of typical Code numbers:
Fixed Asset: Buildings: Code Number 1010.09
The first four digits i.e. 10 10 indicates it is the code number for Buildings The
next two digits ie. .09 indicates location of the, building say : Khulna Area Office
Current Assets: Traveling Advances: Code Number 1650.12
The first four digits ie 1650 indicates it is the code number for Traveling
Advances The next two digits i.e. .12 indicates the name to whom advance has
been given say Mr. Abdul Hashim

Page # 21
 Income: Sale of Scrap Materials: Code Number 3140.27
The first four digits i.e. 3140 indicates it is the code number for Sale of Scrap
Materials The next two digits i.e. .27 indicates the cost center location say:
Mirpur Sub-stations
Expenditure: Telephone expenses: Code Number 4270.16
The first four digits i.e. 4270 indicates it is the code number for Telephone
Expenses
The next two digits i.e. .16 indicate the cost center location say: Ghorasal
28.06 Opening of Account Codes
For the existing list of Accounts Codes please refer to attach (Annexure-A) The
Account Codes have been drawn up with sufficient provision to allow for
opening of new account numbers.
Master Account Codes have been allocated as follows:
From To
Assets 1000 1999
Liabilities 2000 2999
Income 3000 3999
Expenditure 4000 4999
If and when it is necessary to open a new code number, the Head Office
Accounts Department shall do so and inform all relevant sections/departments.

29.0 Cost Center Codes

In order to monitor income and expenditure for various control purposes each
area/location/office/workshop etc shall be treated as a Cost Center
Each Cost center shall be given a code number by reference to which periodical
income and expenditure can be drawn up from the computerized accounting
system.
Cost Center codes shall be of two digits and these will be used as Subsidiary
Account Codes for each head of income and expenditure of the Company. For a
list of Cost Center Codes please refer to Annexure-A
Examples: Cost Center Code
Head Office 01
Area Off ice- Chittagong 11
Sub Office - Gaibandha 23

30.0 Input/Document - Source Code

Each document from which data will be entered into the computerized accounting
system shall be given a Source Code. The source code will help easy identification
of the source and nature of any transaction appearing on a report. The source
code can also be used to generate certain reports by source code for checking and
audit purposes,
List of Source Codes are as follows:
Input Document Source Code
1. Money Receipt Books MR
2. Cash Payment Voucher CP
3. Cheque Payment Voucher BP
4. Journal Voucher JV

Page # 22
 5. Statement of Receipts SR
6. Statement of Banking SB
7. Statement of Cheques Issued SC
8. Petty Cash Statement PC

31.0 Preparation and verification of Input Data

Every person responsible for the preparation and checking of input documents
shall ensure that the Account Codes and Source Codes have been correctly
entered. Any mistake in coding will allocate a transaction to a wrong account
resulting in incorrect reports being generated.
Errors can also arise when entering data in to the Computerized Accounting
System. Therefore, after a batch of data entries have been made a report of
un-posted transactions shall be generated and manually verified with the input
documents to ensure that data entries are correct before proceeding to post the
transactions to the General Ledger.

32.0 Chart of Accounts

A list of Chart of Accounts are listed in the next page. Depending on the computer
software used the Chart of Accounts may require to be revised.

Page # 23
 Annexure-A
POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS
Accounts Description Master A/C Subsidiary A/C
Code No.: Code No.:
From To
ASSETS
Fixed Assets
Freehold Land 1000.00 1000.01 1000.99
Freehold Land Development 1005.00 1005.01 1005.99
Leasehold Land 1 1010.00 1010.01 1010.99
Office Bldg 1015.00 1015.01 1015.99
Res. Bldg. 1020.00 1020.01 1020.99
Plant & Machinery 1025.00 1025.01 1025.99
Office Equipment 1030.00 1030.01 1030.99
Survey Equipment 1080.00 1080.01 1080.99
Motor Vehicle 1085.00 1085.01 1085.99
Furniture & Fixture 1090.00 1090.01 1090.99
Transmission line 1095.00 1095.01 1095.99
Approach Road 1100.00 1100.01 1100.99
Internal Road 1105.00 1105.01 1105.99
Boundary Wall 1110.00 1110.01 1110.99
Ware House 1115.00 1115.01 1115.99
Store yard 1120.00 1120.01 1120.99
Bridges & Culverts 1125.00 1125.01 1125.99
Field Accommodation 1130.00 1130.01 1130.99
River Crossing 1135.00 1135.01 1135.99
Tube Well 1140.00 1140.01 1140.99
Tent & Tarpaulin 1145.00 1145.01 1145.99
Other Construction 1150.00 1150.01 1150.99
Workshop 1155.00 1155.01 1155.99
Laboratory Equipment 1160.00 1160.01 1160.99
Electrical Equipment 1165.00 1165.01 1165.99
Household Equipment 1170.00 1170.01 1170.99
Tele-communication equipment 1175.00 1175.01 1175.99
Shed 1180.00 1180.01 1180.99
Misc. Fixed Assets 1185.00 1185.01 1185.99
Accumulated Depreciation 1200.00
Accumulated Depreciation- Leasehold Land 1200.01
Accumulated Depreciation- Office Bldg 1200.02
Accumulated Depreciation- Res Bldg 1200.03
Accumulated Depreciation- Plant & Machinery 1200.04
Accumulated Depreciation- Office Equipment 1200.05
Accumulated Depreciation- Survey Equipment 1200.06
Accumulated Depreciation- Motor Vehicles 1200.07
Accumulated Depreciation- Furniture & Fixture 1200.08
Accumulated Depreciation- Transmission Line 1200.09
Accumulated Depreciation- Approach Road 1200.10
Accumulated Depreciation- Internal Road 1200.11
Accumulated Depreciation- Boundary Wall 1200.12
Accumulated Depreciation- Ware House 1200.13
Accumulated Depreciation- Store yard 1200.14
Accumulated Depreciation- Bridge & Culverts 1200.15
Accumulated Depreciation- Field Accommodation 1200.16

Page # 24
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS

Accounts Description Master A/C Subsidiary A/C

Code No.: Code No.:
From To

Accumulated Depreciation- River Crossing 1200.17

Accumulated Depreciation- Tube Well 1200.18
Accumulated Depreciation- Tent & Tarpaulin 1200.19
Accumulated Depreciation- Other Construction 1200.20
Accumulated Depreciation- Workshop 1200.21
Accumulated Depreciation- Laboratory Equipment 1200.22
Accumulated Depreciation- Electrical Equipment 1200.23
Accumulated Depreciation- Household Equipment 1200.24
Accumulated Depreciation- Telecom. Equipment 1200.25
Accumulated Depreciation- Shed 1200.26
Accumulated Depreciation- Misc. Fixed Assets 1200.27
Capital Work In Progress
Transmission Line 1250.00 1250.01 1250.99
Grid Sub-Stations 1255.00 1255.01 1255.99
Load Dispatch Center 1260.00 1260.01 1260.99

Investments 1280.00 1280.01

xxxxx 1280.01
zzzzz 1280.02
FDRs

Inventory
Inventory of Stores in hand 1300.00 1300.01 1300.99
Inventory in Transit 1305,00 1305.01 1305.99
Inventory of Stationery 1310.00 1310.01 1310.99

Accounts Receivable 1350,00

Power Development Board 1350.01
DESA 1350.02
Provision for Doubtful Debts 1390.00
Provision for Doubtful Debts 1390.01

Advances
Advance against purchase 1400.00 1400.01 1400.99
Advance against Expenses 1405.00 1405.01 1405.99
Advance against TA/DA 1410.00 1410.01 141 .99
Advance against Salary 1415.00 1415.01 1415.99
Advance against Office/ House Rent 1420.bO 1420.01 1420.99
Advance to Contractor/ Suppliers 1425.00 1425.01 1425.99
Advance against Sundry 1430.00 1430.01 1430.99
Advance for House Building 1435.00 1435.01 1435.99
Advance for Motor Cycle 1440.00 1440.01 1440.99

Deposits 1500.00
Deposit with Customs 1500.01
Deposit with Others 1500.02

Page # 25
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS

Accounts Description Master A/C Subsidiary A/C

Code No.: Code No.:
From To

Prepayments
Prepaid Rent 1510.00 1510.01 1510.99
Prepaid Insurance Premium 1515.00 1515.01 1515.99

Bank Current Accounts 1540.00

Sonali Bank, xxxxxx Office 1540.01
xxxx Bank 1540.02

Bank STD Accounts 1545.00

xxxx Bank 1545.01
zzzz Bank 1545.02

Cash In Hand 1600.00

Cash In Hand - Head Office 1600.01
Cash in Hand - xxxx Office 1600.02

Preliminary Expenses 1800.00

Preliminary Expense 1800.01

LIABILITIES:
Share Capital 2000.00
Paid up Share Capital 2000.01

Long Term Loan

IDA Loan: 2020.00
IDA Loan No. 2020.01
IDA Loan No. 2020.02

OPEC Loan: 2030.00

OPEC Loan No 2030.01

OECF Loan 2040.00

OECF Loan No: 2040.01

ADB Loan 2050.00

ADB Loan No. 2050.01
ADB Loan No. 2050.02

Government Loan 2100.00

Government Loan No: 2100.01

Reimbursable Project Aid 2150.00

Reimbursable Project Aid 2150.01

Debenture 2180.00
Debenture of XXX 2180.01

Short Term Loan 2200.00

Bank Loan 2200.01
Other 2200.02

Page # 26
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS

Accounts Description Master A/C Subsidiary A/C

Code No.: Code No.:
From To

Liabilities for Goods & Services 2250.00

xxxx 2250.01
zzzz 2250.02

Liabilities for Expenses 2260.00

Salary Payable 2260.01
Overtime Payable 2260.02
Bonus Payable 2260.03
Group Insurance Payable 2260.04
Rent Payable 2260.05
Rates & Taxes Payable 2260.06
Insurance Payable 2260.07
Telephone Charges Payable 2260,08
Electricity Charges Payable 2260.09
Gas Charges Payable 2260.10
WASA Charges Payable 2260.11
Services charge payable to PDB 2260.12
Audit Fee Payable 2260.13
Income Tax Payable 2260.14
VAT/ Sales Tax Payable 2260.15

Liabilities for other Finance 2270.00

CPF Subscription 2270.01
Karmachari Union Subscription 2270.02
Officers Association Subscription 2270.03
Provision for Gratuity 2270.04
Earnest Money 2270.05
Contractors Retention Money 2270.06
Contractors Security Deposit 2270.07
VAT withheld from contractor 2270.08
Income Tax withheld from contractor 2270.09
Liabilities for Contractor's Third Party obligation 2270.10

Interest Payable on Loan 2280.00

Loan 1 2280.01
Loan 2 2280.02
Loan 3 2280.03
Loan 4 2280.04

Page # 27
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS

Accounts Description Master A/C Subsidiary A/C

Code No.: Code No.:
From To
Expenditure 2250.00
Transmission Expenses
Officer's Salary 4000.00 4000.01 4000.99
Staff Salary 4005.00 4005.01 4005.99
Officer's D.A. 4010.00 4010.01 4010.99
Staff D.A 4015.00 4015.01 4015.99
Officer's House Rent Allowance/Ceiling 4020.00 4020.01 4020.99
Staff House Rent Allowance 4025.00 4025.01 4025.99
Officer's Conveyance Allowance 4030.00 4030.01 4030.99
Staff Conveyance Allowance 4035.00 4035.01 4035.99
Officers Gas charges 4040.00 4040.01 4040.99
Staff Gas charges 4045.00 4045.01 4045.99
Officers Washing Allowance 4050.00 4050.01 4050.99
Staff Washing Allowance 4055.00 4055.01 4055.99
Officers Compensatory Allowance 4060.00 4060.01 4060.99
Staff Compensatory Allowance 4065.00 4065.01 4065.99
Officers Medical Expenses/ Allowance 4070.00 4070.01 4070.99
Staff Medical Expenses/ Allowance 4075.00 4075.01 4075.99
Servant Allowance 4080.00 4080.01 4080.99
Entertainment Allowance 4085.00 4085.01 4085.99
Sweeper Allowance 4090.00 4090.01 4090.99
Residential Electricity 4095.00 4095.01 4095.99
Leave Encashment 4100.00 4100.01 4100.99
Recreation Allowance 4105.00 4105.01 4105.99
Gratuity 4110.00 4110.01 4110.99
Termination pay 4115.00 4115.01 4115.99
CPF Contribution 4120.00 4120.01 4120.99
Officers Festival Bonus 4125.00 4125.01 4125.99
Staff Festival Bonus 4130.00 4130.01 4130.99
Officers' Incentive Bonus 4135.00 4135.01 4135.99
Staff Incentive Bonus 4140.00 4140.01 4140.99
Officers' Ex-Gratia 4145.00 4145.01 4145.99
Staff Ex-Gratia 4150.00 4150.01 4150.99
Entertainment Expenses 4155.00 4155.01 4155.99
Staff Overtime 4160.00 4160.01 4160.99
Officer's Liveries & Uniform 4165.00 4165.01 4165.99
Staff Liveries & Uniform 4170.00 4170.01 4170.99
Officer's Traveling Expenses 4175.00 4175.01 4175.99
Staff Traveling Expenses 4180.00 4180.01 4180.99
Conveyance Charges 4185.00 4185.01 4185.99
Employees Welfare Expenses 4190.00 4190.01 4190.99
Group Insurance 4195.00 4195.01 4195.9~
Milad & Ceremonial Expenses 4200.00 4200.01 4200.99
Games & Sports 4205.00 4205.01 4205.99
Gardening Expenses 4210.00 4210,01 4210.99
Housing Expenses 4215.00 4215.01 4215.99
Office rent 4220.00 4220.01 4220.99
Office Telephone 4225.00 4225.01 4225.99
Residential Telephone 4230.00 4230.01 4230.99
Postage & Telegram 4235.00 4235.01 4235.99
Overseas Training 4240.00 4240.01 4240.99
Local Training 4245.00 4245.01 4245.99

Page # 28
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS
Accounts Description Master A/C Subsidiary A/C
Code No.: Code No.:
From To
Expenditure 2250.00
(Transmission Expenses - continued)
Advertisement & Publicity 4250.00 4250.01 4250.99
Printing 4255.00 4255.01 4255.99
Stationary 4260.00 4260.01 4260.99
Office Furnishing Expenses 4265.00 4265.01 4265.99
News paper & Magazine 4270.00 4270.01 4270.99
Electricity & Power 4275.00 4275.01 4275.99
Books & Periodicals 4280.00 4280.01 4280.99
POL 4285.00 4285.01 4285.99
Laboratory Expenses 4290.00 4290.01 4290.99
Hire charge (Transport) 4295.00 4295.01 4295.99
Legal Expenses 4300.00 4300.01 4300.99
Security Expenses 4305.00 4305.01 4305.99
Marine Insurance 4310.00 4310.01 4310.99
Other Insurance 4315.00 4315.01 4315.99
Consultancy Services 4320.00 4320.01 4320.99
C & F Charges 4325.00 4325.01 4325.99
Handling & Carrying 4330.00 4330.01 4330.99
Bank charges & Commission 4335.00 4335.01 4335.99
Donation & Subscription 4340.00 4340.01 4340.99
Crockeries & Cutlaries 4345.00 4345.01 4345.99
Rates & Taxes 4350.00 4350.01 4350.99
Repair & Maintenance- Functional Bldg. 4355.00 4355.01 4355.99
Repair & Maintenance- Res. Bldg 4360.00 4360.01 4360.99
Repair & Maintenance- Furniture , Fixture & Office Equip. 4365.00 4365.01 4365.99
Repair & Maintenance- Vehicles 4370.00 4370.01 4370.99
Repair & Maintenance- Plant & Machinery 4375.00 4375.01 4375.99
Repair & Maintenance- Transmission Line 4380.00 4380.01 4380.99
Repair & Maintenance- Road 4385.00 4385.01 4385.99
Repair & Maintenance- Other 4390.00 4390.01 4390.99
Depreciation 4395.00 4395.01 4395.99
Amortization Exp. 4400.00 4400.01 4400.99
Misc. Exp. 4405.00 4405.01 4405.99

General & Administrative Expenses

Officer's Salary 4500.00 4500.01 4500.99
Staff Salary 4505.00 4505.01 4505.99
Officer's D.A 4510.00 4510.01 4510.99
Staff D.A 4515.00 4515.01 4515.99
Officer's House Rent Allowance/ Ceiling 4520.00 4520.01 4520.99
Staff House Rent Allowance 4525.00 4525.01 4525.99
Officer Conveyance Allowance 4530.00 4530.01 4530.99
Staff Conveyance Allowance 4535.00 4535.01 4535.99
Officer's Gas charges 4540.00 4540.01 4540.99
Staff Gas charges 4545.00 4545.01 4545.99
Officer's Washing Allowance 4550.00 4550.01 4550.99
Staff Washing Allowance 4555.00 4555.01 4555,99
Officer's Compensatory Allowances 4560.00 4580.01 4560.99
Staff Compensatory Allowance 4565.00 4565.01 4565.99
Officer's Medical Expenses/ Allowance 4570.00 4570.01 4570.99
Staff Medical Expenses/ Allowance 4575.00 4575.01 4575.99
Servant Allowance 4580.00 4580.01 4580.99

Page # 29
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS
Accounts Description Master A/C Subsidiary A/C
Code No.: Code No.:
From To

(General & Administrative Expenses - continued)

Entertainment Allowance 4585.00 4585.01 4585.99
Sweeper Allowance 4590.00 4590.01 4590.99
Residential Electricity 4595.00 4595.01 4595.99
Leave Encashment 4600.00 4600.01 4600.99
Recreation Allowance 4605.00 4605,01 4605.99
Field Allowance 4610.00 4610.01 4610.99
Gratuity 4615.00 4615.01 4615.99
Termination Pay 4620.00 4620.01 4620.99
CPF Contribution 4625.00 4625.01 4625.99
Officer's Festival Bonus 4630.00 4630.01 4630,99
Staff Festival Bonus 4635,00 4635.01 4635.99
Officers incentive Bonus 4640.00 4640.01 4640.99
Staff Incentive Bonus 4645.00 4645.01 4645.99
Officer's Ex-Gratia 4650.00 4650.01 4650.99
Staff Ex-Gratia 4655.00 4655.01 4655.99
Officer's Entertainment 4660.00 4660,01 4660.99
Staff Overtime 4665.00 4665.01 4665.99
Officer's Liveries & Uniform 4670.00 4670.01 4670.99
Staff Liveries & Uniform 4675.00 4675.01 4675.99
Officers Traveling Expenses 4680.00 4680.01 4680.99
Staff Traveling Expenses 4685.00 4685.01 4685.99
Conveyance Charges 4690.00 -4690.01 4690.99
Employees Welfare Expenses 4695.00 4695.01 4695.99
Group Insurance 4700.00 4700.01 4700.99
Milad & Ceremonial Expenses 4705.00 4705.01 4705.99
Games & Sports 4710.00 4710.01 4710.99
Gardening Expenses 4715.00 4715.01 4715.99
Housing Expenditure 4720.00 4720.01 4720.99
Office rent 4725.00 4725.01 4725.99
Office Telephone 4730.00 4730.01 4730.99
Residential Telephone 4735.00 4735.01 4735,99
Postage & Telegram 4740.00 4740.01 4740.99
Overseas Training 4745.00 4745.01 4745.99
Local Training 4750.00 4750.01 4750.99
Advertisement & Publicity 4755.00 4755.01 4755.99
Printing 4760.00 4760.01 4760.99
Stationery 4765.00 4765.01 4765.99
Office Furnishing Expenses 4770.00 4770.01 4770.99
News paper & Magazine 4775.00 4775.01 4775.99
Electricity & Power 4780.00 4780.01 4780.99
Books & Periodicals 4785.00 4785.01 4785,99
POL 4790.00 4790.01 4790.99
Laboratory Expenses 4795.00 4795.01 4795.99
Transport Hire charge 4800.00 4800.01 4800,99
Legal Expenses 4805.00 4805.01 4805.99
Security Expenses 4810.00 4810,01 4810.99
Marine Insurance 4815.00 4815.01 4815.99
Other Insurance 4820.00 4820.01 4820.99
Consultancy Services 4825.00 4825.01 4825.99
C & F Charges 4830.00 4830.01 4830.99
Handling & Carrying 4835.00 4835,01 4835.99

Page # 30
 POWER GRID COMPANY OF BANGLADESH LTD.
CHART OF ACCOUNTS
Accounts Description Master A/C Subsidiary A/C
Code No.: Code No.:
From To

(General & Administrative Expenses - continued)

Crockaries & Cutlaries 4840.00 4840.01 4840.99

Rates & Taxes 4845.00 4845.01 4845.99
Repair & Maintenance- Functional Bldg. 4850.00 4850.01 4850.99
Repair & Maintenance- Res. Bldg 4855.00 4855.01 4855.99
Repair & Maintenance- Furniture Fixture & Office Equip. 4860.00 4860.01 4860.99
Repair & Maintenance- Vehicles 4865.00 4865.01 4865.99
Other Repair & Maintenance 4870.00 4870.01 4870.99
Misc. Expenses 4875.00 4875.01 4875.99
Depreciation 4880.00 4880.01 4880.99
Amortization Expenses 4885.00 4885.01 4885.99
Donation & Subscription 4890.00 4890.01 4890.99
Bank Charges & Commission 4895.00 4895.01 4895.99
Interest on Foreign Loan 4900.00 4900.01 4900.99
Interest on Local Loan 4905.00 4905,01 4905.99

Corporate Tax 4990.00 4990.01

Page # 31
 Section - 1V Accounting Forms and Books
33.00 General
Accounting Books are required to be maintained as per the provisions of the
Companies Act 1994. In order to record the various types of financial transactions
several forms (vouchers) have been designed to provide the recording of the
transactions in such manner as *to provide for maximum efficiency in processing of the
data by the Computerized Accounting System.
34.00 Accounting Forms and Books to be Maintained
34.01 at Head Office
The undernoted forms and books are required to be maintained at Head Office:
Documents/Forms/Books Source Code
1. Money Receipt Books MR
2. Cash Payment Voucher CP
3. Cheque Payment Voucher BP
4. Journal Voucher JV
5 Statement of Receipts SR
1. Statement of Banking SB
7. Petty Cash Statement PC
8. General Ledger n/a
9. Bank Account (manual) n/a
10.Cash Account (manual) n/a
11 Journal Voucher Serial Register n/a
12 Register of Money Receipt Books n/a
13 Input Document Control Register n/a
34.02 At Area Offices:
Documents/Forms/Books Source Code
1. Money Receipt Book MR
2. Cash Payment Voucher CP
3 Cheque Payment Voucher BP
4. Statement of Receipts SR
5 Statement of Banking SB
6 Statement of Cheques Issued- SC
7 Petty Cash Statement PC
8 Memorandum Cash Book
9 Fund Requisition Form
34.03 at Sub Offices:
Documents/Forms/Books Source Code
1. Cash Payment Voucher CP
2. Petty Cash Statement PC
3. Memorandum Cash Book
4. Fund Requisition Form

Page # 32
35.00 Forms to be used
The following forms are to be used for all financial transactions as applicable and
mentioned in this manual:
ƒ Money Receipt (MR) Form No: QF-FIN-01
ƒ Cash Payment Voucher (CP) Form No: QF-FIN-02
ƒ Bank (Cheque) Payment Voucher (BP) Form No: QF-FIN-03
ƒ Journal Voucher (JV) Forin No: QF-FIN-04
ƒ Statement of Receipts (SR) Form No: QF-FIN-05
ƒ Statement of Banking (S13) Form No: QF-FIN-06
ƒ Statement of Cheques Issued (SC) Form No: QF-FIN-07
ƒ Petty Cash Statement (PC) Form No: QF-FIN-08
ƒ Register of Money Receipt Books Form No: QF-FIN-09
ƒ Input Document Control Register Form No: QF-FIN-10
ƒ Journal Voucher Serial Register Form No: QF-FIN-11

Page # 33
 Section - V
FIXED ASSETS SYSTEM
36.00 Introduction
In order to comply with the requirements of the Companies Act as well as to monitor
and control the existence and safe custody of the numerous fixed assets of the
Company it is essential to have a well designed system to record acquisition and
disposal of all the fixed assets of the company. The system should be capable be easily
identifying an asset, its current location and ascertain its history, its cost and current
book value.
37.00 Computerized System
A Computerized Fixed Assets System (Fixed Assets Register) shall be maintained to
record all Fixed Assets of PGCB. The system shall be menu driven and user friendly
and capable of generating reports adequate to meet the requirements of PGCB and the
auditors of the company. The system shall be independent of the General Ledger
Accounting System.
38.00 Fixed Assets Group
For easy reference and identification Fixed Assets shall be grouped into appropriate
categories and further sub divided under each category as may be desirable. The
Group Categories of Fixed Assets shall be as follows:
ƒ Freehold Land
ƒ Leasehold Land
ƒ Buildings
ƒ Plant and Machinery
ƒ Transmission Towers
ƒ Transmission Lines
ƒ Motor Vehicles
ƒ Office Equipment
ƒ Furniture, Fixtures and Fittings
Each Group may be subdivided in to sub-groups as may be required by the
management of PGCB.
39.00 Fixed Assets Code Structure
Each item of Fixed Asset shall be given a code for identification. The structure of the
code shall comprise of the following information:
ƒ Location
ƒ Fixed Assets Group Category
ƒ Sub Category
ƒ Item numerical number
40.00 Recording movement of Fixed Assets
Immediately on purchase of a fixed asset the relevant information as mentioned in
paragraph 6 (a) below above shall be passed on to the person in charge of maintaining
the Fixed Asset System for up dating the computerized system. Simultaneously, the
item purchased shall be marked/numbered with the item code for identification.
Similarly all disposal of Fixed Assets shall be notified for system up-date. Any Fixed
Asset which is transferred from one location to another location must be assigned a

Page # 34
new code number and notified to the section for system up-date as well as the asset
shall be marked with the new code.
All acquisition/disposal and transfer of Fixed Assets must be in writing and duly
approved by the appropriate authorities. Up-dating of the Computerized Fixed Assets
System shall take place only upon receipt of approved written document.
41.00 Reports
The Fixed Assets Computerized System shall be capable of generating the following
Reports:
a) History of each Fixed Asset viz:
ƒ Item Code
ƒ Description of the item
ƒ Name of Vendor
ƒ Fixed Asset Group
ƒ Location
ƒ Date of Acquisition
ƒ Item Quantity
ƒ Cost Value (Tk.)
ƒ Life of Asset
ƒ Cumulative Depreciation
ƒ Depreciated Book Value
ƒ Remarks, if any.
b) Fixed Assets Report by Location/Project showing:
ƒ Asset Group
ƒ Item Description
ƒ Item Code
ƒ Acquisition Date
ƒ Quantity
ƒ Cost Value
ƒ Book Value
c) Consolidated Fixed Assets Report showing Fixed Assets at all locations of
PGCB showing the above information and sub-total of each group and Grand
Total of all Fixed Assets at Cost and Book Value.
d) Fixed Assets Report by Asset Group showing the information as in (b) above.
e) Report showing particulars of Fixed Assets added during a given period
f) Report showing particulars of Fixed Assets disposed off/transferred during a
given period.
42.00 Reconciliation
a) Periodical physical inspection of Fixed Assets should be carried out and reconciled
with book records. Discrepancies found shall be investigated in to and appropriate
action taken as well as remedial measures-introduced to prevent recurrence of
discrepancies.
b) Periodical reconciliation should be carried out between the Cost and Book Value as
shown by the Fixed Assets Register and the General Ledger and appropriate action
taken improve the system and to prevent any discrepancies arising in future.

Page # 35
 Section - V1
INVENTORY CONTROL SYSTEM
43.00 Introduction
In order for PGCB to provide prompt and efficient service it is essential to keep its
plants, machinery and other assets in full operational condition. These assets require to
be regularly serviced and properly maintained and for this it is necessary to have well
stocked inventory of spare parts and consumable stores at appropriate locations. At
any moment of time the management of PGCB should be capable of ascertaining the
availability of spares etc. in hand and plan procurement accordingly. The management
should also be in a position to ensure that much-needed capital fund is not idly locked
up in inventory.
The Inventory of PGCB shall comprise mainly of Spare Parts and Consumable Stores.
The inventory may also include such items of fixed assets which are to be issued to
Work in Progress of capital nature.
44.00 Computerized Inventory Control System
A Computerized Inventory Control System shall be maintained to record the quantity
and value of all items of inventory -
ƒ acquired by purchase or otherwise,
ƒ issue of items,
ƒ balance of items in hand.
The system shall be menu driven and user friendly and capable of generating reports
adequate to meet the requirements of PGCB and the auditors of the company. The
system shall be independent of the General Ledger Accounting System.
45-00 Inventory Record Maintenance
In respect of each item of inventory the following information shall be maintained:
ƒ Inventory item code number
ƒ Item Description
ƒ Inventory Group
ƒ Unit
ƒ Minimum Quantity Level
ƒ Maximum Quantity Level
ƒ Re-order Quantity Level
ƒ Location
46.00 Inventory Group
For easy reference and identification items of inventory shall be grouped into
appropriate categories and further sub divided under each category as may be required
for efficient management.
47.00 Inventory Item Code
Each item of inventory shall be given a code/part number according to its description
and group. For convenience this code shall be alpha-numeric and at-least 8 digits in
length. This code shall be used as and when an item of inventory is received or issued
48.00 Receipt of Inventory items
Receipt of inventory can be by purchase, by transfer from another source within the

Page # 36
company or return from an earlier issue of the stores item. When a new item of
inventory is received for the first time, all the required information listed in paragraph 3
above, shall require to be provided to the person responsible for operating the
Computerized Inventory Control System to update the system. In-respect of each item
of inventory purchased the following information on a Material Receipt Report (MRR)
duly signed and approved shall be provided to the operator for updating the system:
ƒ Date of receipt
ƒ Inventory Item Code
ƒ Source document reference
ƒ Quantity received
ƒ Unit Price
ƒ Value
ƒ Name of Vendor
It should be noted that all inventory items purchased shall be entered in to the
computerized system at actual cost price.
In the event of receipt by transfer or return from an earlier issue a Stores
Transfer/Return (STR) document duly signed and approved shall be used which shall
indicate the following:
ƒ Inventory Item Code
ƒ Quantity transferred/returned
ƒ Date of transaction
ƒ Location/job from where transferred/returned
The STRs shall be passed on to the operator to update the system.
49.00 Issue of Inventory items
Issue of items of inventory shall be only against duly signed and approved Stores
Requisition Slips (SRS). The actual quantity supplied shall be supported by a duly
signed and approved Stores Issue Slip (SIS). The Stores Issue Slip shall indicate the
following information:
ƒ Date of Issue
ƒ Inventory Item Code
ƒ Description of item
ƒ Unit
ƒ Quantity issued
ƒ Account Code/job to be debited
The Stores Issue Slips (SISs) shall be passed on to the operator for up dating the
system.
50.00 Issue Price
Items of inventory issued shall be priced at the average price of stock in hand at the
time of issue of the items. Thus every time a purchase is made the issue price of the
relevant inventory item shall be automatically updated by the computerized system.
51.00 Reports
The system shall be capable of displaying/generating the following reports as and when
required:

Page # 37
 a) Issue Reports
b) Cost allocation Report by Account/Job Code
c) Purchase Reports
d) Transfer/Refund Reports
e) Re-order Report
f) Stock in hand report
In respect of each of the above mentioned report the relevant undernoted information
shall be shown:
ƒ Item Code
ƒ Item Description
ƒ Date of Transaction
ƒ Source/Document Reference
ƒ Quantity Received
ƒ Quantity issued/disposed/transferred
ƒ Value of transaction
ƒ Quantity in hand
ƒ Value of quantity in hand at average price
ƒ Account Code/Job to be debited
52.00 Reconciliation
a) Periodical physical inspection of inventories shall be carried out and reconciled with
book records. and appropriate remedial measures taken to prevent recurrence of
discrepancies. Items which are obsolete shall be reported in writing to the
management for obtaining approval for disposal.
b) Periodical reconciliation should be carried out of the value of inventories in hand as
shown by the Inventory Control System and the General Ledger and appropriate
action taken improve the system and to prevent any discrepancies arising in future.

Page # 38
 Section - V11
MONTHLY SALARY SYSTEM

53.00 Introduction
Salary of Officers and staff shall be paid monthly preferably on the last working day of
each month. The basis of calculating salary and allowances will be determined by the
company's human resources policies comprising of Pay and allowances scale,
employee benefits, pension and retirement schemes, leave rules, termination rules and
such other rules as the company may introduce.
54.00 Computerized Salary System
The monthly salary of PGCB shall be prepared under a Computerized Salary System.
The system shall be menu driven and user friendly and capable of generating reports
adequate to meet the requirements of PGCB and the auditors of the company. The
system shall be independent of the General Ledger Accounting System.
55.00 Employee History Maintenance
In respect of each employee of PGCB the under noted information shall be maintained
under the Data Base Salary System:
1. Employee Identification Number (ID)
2. Full name of Employee
3. Father's Name
4. Address
5. Designation
6. Educational Qualification latest
7. Sex
8. Date of Birth
9. Date of employment
10. Date of confirmation
11. Location /Posting
12. Cost Center Allocation Code
13. Rate of Pay showing breakdown of Salary e.g. Basic, House rent,
other allowances etc.)
Immediately on appointment of any person by the Company the Personnel Department
(HRD) shall notify in writing, duly signed by an authorized person, the full terms and
conditions of employment of the employee and his personal data to the Accounts
Department. This document shall form the basis of recording the data on to the
Computerized Salary System. Any changes in the above information must be notified in
writing by the Personnel Department for updating the employee data base.
56.00 Employee Identification Code
Each employee shall be given an Identification (ID) code. This code shall be a
permanent number for an employee and shall be used on all his records. The code
shall be at least of five digits. The allocation of the code will be dependent on the
requirement of the personnel department.

Page # 39
57.00 Cost Center Allocation Account Code
The total cost to the company of each employee shall be charged or allocated to the
cost center where the employee is engaged. Therefore when an employee joins the
organization it must be determined to which cost center his costs are to be debited. The
Cost Center allocation Account Codes are available with the accounts department
58.00 Monthly Salary Variation Report
The Personnel Department shall, before the end of every month, notify in writing to the
accounts Department the following information, in a Monthly Salary Variation Report, in
respect of employees for the correct preparation of salary for the month:
ƒ Particulars of Overtime to be paid, if any,
ƒ Particulars of increment/promotion
ƒ Particulars of change of location/cost center of employee
ƒ Particulars for salary deduction in respect of absence etc.
ƒ Particulars of other deductions to be made
ƒ Particulars of Termination/Suspension etc.
ƒ Any other relevant information that affects the salary of an employee.
On receipt of the above mentioned information the Accounts Department shall make
necessary entry in to the Salary System for up dating before preparing the Monthly
Salary Statements, Pay Slips and relevant Statements/Reports.
59.00 Income Tax Deduction
Employees whose salaries are above the tax-free limit shall be subject to deduction of
Income Tax at source as per the prevailing law. The Accounts Department shall be
responsible for computing the Income Tax to be deducted in respect of employees
liable to Income Tax and make appropriate monthly deductions from the monthly salary
and the amounts so deducted shall, be paid to the Tax authorities within the specified
time period.
60.00 Reports
The Computerized Salary System shall be capable of generating the following reports:
1. Monthly Salary Sheet,
2. Gross Earnings Statement by Cost Center,
3. Deduction Statements in respect of Income Tax, Loan Recovery and Other
Deductions as may be applicable, '
4. Statement of contributions to employee benefit schemes and
5. Such other statements as the Management may require
The Computerized Salary System shall be maintained at the Head Office. If , however,
the management of PGCB decides and authorizes Area Offices to prepare monthly
salary at Area Offices in respect of employees of Area Offices and their respective sub
offices then the same Computerized Salary System shall be maintained at each Area
Office and copies of the various reports mentioned above shall be submitted to Head
Office Accounts Department for incorporation of the transactions in the central
Computerized Accounting System.
61.00 Salary payment and acknowledgment of Receipt
It is preferable to pay the salary of all employees direct in to their bank accounts to
avoid handling of cash. However, this may not be practical and a mix of payment by
cash and payment direct in to bank may have to be adopted.
Signed receipt from each employee on the body of the salary sheets should be
obtained over appropriate Revenue Stamp, upon payment of salary in cash.

Page # 40