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CMA Final · Corporate Financial Reporting · Government Accounting in India

Under the Government Accounting framework in India, the Contingency Fund of India is placed at the disposal of the President mainly for which purpose?

The Contingency Fund of India lets the President meet urgent unforeseen expenditure before Parliament authorises it. After approval, the amount is recouped from the Consolidated Fund. Provident fund balances belong to the Public Account and tax revenue goes to the Consolidated Fund, so those options are wrong.

  1. AMeeting urgent unforeseen expenditure pending authorisation by ParliamentCorrect
  2. BHolding provident fund balances of government employees
  3. CPaying salaries of Members of Parliament only
  4. DRecording revenue receipts from taxes

Explanation

The Contingency Fund is an imprest at the President's disposal to meet urgent unforeseen expenditure pending Parliamentary authorisation. Once Parliament approves, the amount is recouped to the Fund from the Consolidated Fund. Provident fund balances are in the Public Account, and tax receipts go to the Consolidated Fund.

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