ICAI has signed an agreement with the Indian Railways for moving its accounting system to the accrual format. Accrual based financial statement will support Indian Railways in better utilisation of available resources, estimation of future liabilities and prioritisation of spending.
ICAI, through its research arm, ICAI ARF has long been advocating implementation of Accrual Accounting in Government establishments for its obvious benefits as it assists in policy formulation e.g. Costing of Services, Diagnostic, MIS, etc., provides appropriate information for decision-making, assists in accountability & transparency and benchmarking for comparison and evaluation of efficiency in train services including passenger and goods.
A pilot project for introduction of accrual-based financial statement as an additional set of accounts for North Western Railway at Jaipur (Rajasthan) and Rail Coach Factory at Kapurthala (Punjab) have already been successfully implemented by ICAI ARF.