MBH POWER-AS IS DOCUMENT

1.1 Group Companies

The main companies in the Groups are as follows :

1.4.1 (MBH– India1000) Power limted

MBH is the flag ship company doing business of Iron Ore mining in Goa. VMSB has
14 leases across three mines in Goa at Velguem, Sigao, and Sacordem. It has Three
Divisions Shipping, Mumbai & Delhi. It owns Transhipper vessel M.V.Vishal Hira
which is used for Loading its cargo.

1.4.2 (GMPL -1100) Goa Minerals Pvt. Ltd.,

GMPL is a Private Limited Company incorporated under the Companies Act 1956 on
21-12-1982. It operates at Cudnem mine as Ore Raising Contractor for KRG

1.4.3 (VMSI -1200) VM Salgaocar Sales International.

VMSSI is a Partnership firm registered under partnership Act on 25.10.1991. The

partnership firm is engaged in Trading of Iron ore. The Firms owns two Barges M.V.
Vishal Ranjit & M.V. Vishal Yeshwardhan which are used for transportation of own
and third party cargo.

1.4.4 (SVSI -1300) S V Salgaocar

S. V. Salgaocar is an Individual. He owns Barge M.V. Vishal Swati

1.4.5 (SVSH –1400) S V Salgoacar HUF

S. V. Salgaocar ( HUF ) is Hindu undivided family it has two Barges M.V. Vishal
Niharika & M.V. Vishal Ranjana.

1.4.6 (TMPL – 1500) Tumkur Minarals Pvt Ltd

TMPL is a Private Limited Company incorporated under the Companies Act 1956 on
13.12.2004. It has mining lease at Sondenahalli Village C.N Halli Taluka. Tumkur
Karnataka.
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1.4.7 (MREL -2000) Mahadhan Real Estate LLP

Mahadhan Real Estates LLP., (erstwhile Mahadhan Real Estates Pvt. Ltd.,) is a Limited
Liability Partnership Firm bearing LLP identity No. AAB-2159, registered under
Limited Liability Partnership Act, 2008 on 15th November, 2012. Its main businesses
are Construction, development, & improvement of land and/or building and Renting of
buildings.

Castle Rock Tourist Resort Pvt. Ltd.is a Private Limited Company incorporated under
the Companies Act 1956 on 1st September 1983.

1.4.23 (KUSH -4150) Kushavati Mining Pvt. Ltd.

Kushavati Mining Pvt. Ltd. Ltd is a Private Limited Company incorporated under the
Companies Act 1956 on 5th September 1991.

1.4.24 (AMIF -4160) Amona Infrastructure Pvt. Ltd.

Amona Infrastructure Pvt. Ltd. is a Private Limited Company incorporated under the
Companies Act 1956 on 24th April 2008. It has investment in Land property

1.4.25 (SMET – 4170) Salgaocar Metals & Minerals Pvt. Ltd.

Salgaocar Metals & Minerals Pvt. Ltd. is a Private Limited Company incorporated
under the Companies Act 1956 on 7th May 1993.

1.4.26 (ZNTY -4180) Zantye & Company Pvt. Ltd

Zantye & Company Pvt. Ltd is a Private Limited Company incorporated under the
Companies Act 1956 on 14th May 1964. The company has Mining Lease in Sarvona
Bicholim Goa. Presently there are no activities carried out.

1.4.27 (SSCB -4190) Salgaocar Sports Club

Salgaocar Sports Club is a Private Limited Company domiciled and incorporated in

india under the Companies Act, 1956. Registered under section 8 of the Companies Act,
2013. The registered office of the company is located at Salgaocar House, F L Gomes
Road, Vasco Da Gama, Goa. It is engaged in the business of promotion of sports.

1.4.28 (SMIN – 4200) Salgaocar Minerals & Ores Pvt. Ltd.

Salgaocar Minerals & Ores Pvt. Ltd is a Private Limited Company incorporated under
the Companies Act 1956 on 7th May 1993.

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2 MASTER DATA

2.1 List of Master Data

Presently the business uses the following master data:
o GL Master
o Cost Center Master
o Asset Class Master
o Transaction Code Master
o Tax Masters
o Customer Master
o Vendor Master

3 GL ACCOUNTING PROCESS

3.1 Accounting Process Summary

 Indian Accounting Standards (Ind. AS) is applicable to majority of companies in a

Group.
 Company follows April to March as its accounting year.
 Books of Accounts are maintained for the 12 months period from April to March
every year.
 Transactions are posted in GL accounts, the following logic is used to classify the GL
Accounts:

1 = Assets
3 = Liability
6 = Expenditure
7 = Revenue

3.2 CURRENCY

 Books of accounts are maintained in Indian Rupee (INR).

 Company also deals in USD , Euro, Yen etc for Exports , Imports and for expenses
however accounting is done in Indian Rupees.

3.5 ACCOUNTING STRUCTURE

 Accounts are maintained in Oracle based software.

 Day to day transactions are recorded in journals.
 Separate journals are maintained as follows :

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o Cash Books
o Bank Books
o Iron Ore Purchases Register
o Truck Freight Register
o TDS register
o General Journal
o Expense Journal
o Credit Note Register (Purchases )
o Civil Contractors
o Bill Register (Sales)
o Credit Note Register (Sales)
o Imprest Cash Journal
o Stores & Spares Purchases Register
o Iron Ore Sales Register
o Miscellaneous Sales Register
o Fixed Assets Register
o General Ledger
o Subsidiary Ledger

3.6 Transaction Codes ( Document Types)

TR. CODE DESCRIPTION
001 CASH RECEIPTS
002 CASH PAYMENTS
003 BANK OF INDIA, VASCO -CURRENT A/C NO. 3 - RCPT
004 BANK OF INDIA, VASCO -CURRENT A/C NO. 3 - PYMT
223 CASH RECEIPTS
224 CASH PAYMENTS
225 PACKING CREDIT LOAN - BOI , VASCO - WITHDRAWLS
226 PACKING CREDIT LOAN - BOI , VASCO - REPAYMENTS
273 BANK OF INDIA, VASCO - CC 565 - RCPT
274 BANK OF INDIA, VASCO - CC 565 - PYMT
300 IRON ORE PURCHASES
301 TRUCK FREIGHT (CONTRACTORS)
302 T. D. S.
309 PURCHASES OTHERS
310 GENERAL JOURNAL
311 EXPENSE JOURNAL
312 DEBIT NOTE REGISTER ( PURCHASE SECTION)
313 CREDIT NOTE REGISTER (PURCHASE SECTION)
314 CIVIL CONTRACTORS
319 CREDIT NOTE SUPPLY OF GOODS & SERVICES NON TAXABL
322 CREDIT NOTE REGISTER (SALES SECTION)
323 CREDIT NOTE - SALES WIND MILL DIVISION

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324 DEBIT NOTE REGISTER (SALES SECTION)

325 IMPREST CASH JOURNAL
326 CREDIT NOTES - SALE OF GOODS
327 CREDIT NOTE SUPPLY OF SERVICES
328 TAX INVOICE - SUPPLY OF SERVICES
330 SALES OTHERS
340 STORES PURCHASES
350 IRON ORE SALES
351 IRON ORE SALE - EXPORT/LOCAL
353 WIND POWER ENERGY SALES
354 BILLS
355 MISCELLENEOUS SALES
356 MISCELLENEOUS SALES
358 MISCELLANEOUS SALES - TAX INVOICE - SALE OF GOODS
359 BILL OF SUPPLY-SALE OF NON VATABLE GOODS & SERVICE
366 MISCELLANEOUS SALES

3.7 Accounts Payable Groupings and Number Ranges

Sub
Code(A From No.
Sl. No. Description /c. Gp) Range To No. Range
1 Sundry Creditors – Control A/c 3511 0001 9999
2 Sundry Creditors – Outside Goa - 3512 0001 9999
Control A/c
3 Extraction & Civil Engg. 3513 0001 9999
Contractors – Control A/c
4 Truck Contractors – Control A/c 3514 0001 9999
5 Sundry Creditors - Players 3521 1001 9999
6 Accounts Payable Unbilled – 3516
Trade Payable

3.8 Accounts Receivable Grouping and Number Ranges

Sl. Description Sub From No. To No. Range
N Code Range
o (A/c.
. Gp)
1 Sundry Debtors – Control A/c 1401 0001 9999

3.9 Fixed Asset GL

Sl. No Description Acct. Code
1 Land 1101
2 Buildings 1102
3 Tippers & Dumpers 1103
4 Plant & Machinery 1104
5 Furniture & Fittings 1105

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6 Vehicles 1108
7 Other Equipments 1109
8 Bridges, Roads, & Jetties 1110
9 Barges, Lcts& Launches 1111
10 M. V. Vishal Hira 1112
11 Electrical Equipments 1115
12 Boats / Ships 1116
13 Lease Hold Land & Buildings 1117
14 Goodwill 1118
15 Mining Rights 1119

3.10 Job Code for Capital Work in Progress

For every new job a job code is opened under 1121 Account code the following are some of
the Job codes for capital work in progress.

Sl. No Description Acct. Code

1 Construction of residential building near cine el- 11210536
monte
2 Wheel washing system 11212018
3 Development of mobile android application 11212019

3.11 Expenses Codes

Sl. No Description Acct. Code

1 Heavy machinery hire charges 643101
2 Excavation & hire charges 643102
3 Other machinery hire charges 643103
4 Repairs & maintenance - Plant & machinery 645201
5 Salaries 620100
6 Royalties 631300

3.12 Income Codes

Sl. No Description Acct. Code

1 Sale of Iron ore Exports 710101
2 Sale of Iron ore Local 710201
3 Truck Hire Receipts 720101
4 Machinery Hire Receipts 720201
5 Barge Hire Receipts 720401
6 Dividend Income – Long Term Investment 730101

3.13 Accounting Entries in VMSB Books

Sr. No Particulars Debit Credit Description

1. Expense A/c Dr XXX Expense posting entry for
To Cash A/c XXX Cash payments

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2. Expense A/c Dr XXX Expense posting entry for

To HDFC Bank Ltd A/c XXX Bank payments

3. Expense A/c Dr XXX Expense posting entry for

To Sundry Creditor A/c XXX Bill Booking

4. Sundry Debtor A/c Dr XXX Export sales posting entry

To Sale of Iron Ore Exports XXX

5. Investment in Mutual Fund XXX Re-investment of Dividend

A/c
To Dividend Income-Short XXX Income on Mutual Funds
Term Investment

6. Inventory A/c XXX Purchase of stores items

To Sundry Creditor A/c XXX

7. Consumption A/c XXX Consumption of Stores

To Inventory A/c XXX

8. Truck Freight A/c XXX Entry to record Gross

Truck
To Various Truck parties XXX Freight Earnings
A/c

8. Various Truck parties A/c XXX Entry to record Sale of

HSD
To Sale of fuel & Oil A/c XXX To Truck contractors

4 ACCOUNTS PAYABLE PROCESS

4.1 TRANSACTION CODES FOR BOOKING EXPENSES:

 Following are some of the transaction codes for booking expenses.

300 IRON ORE PURCHASES

301 TRUCK FREIGHT (CONTRACTORS)
310 GENERAL JOURNAL
311 EXPENSE JOURNAL
314 CIVIL CONTRACTORS
002 CASH PAYMENTS
004 BANK OF INDIA, VASCO
034 SYNDICATE BANK VASCO

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060 HDFC BANK, VASCO

4.2 Royalty Calculation and Payment Process

 VMSB has mining leases at Velguem, Sigao and Sacordem. Presently only
velguem Mine is operational.
 Payment of Royalty & Contribution to funds has to be made before
transportation of Iron ore from Leases.
 Mining department gives estimated quantity, type of ore & grade to be
transported to Export Department.
 Based on the request of Mining Department Export Department calculates the
royalty & other contributions payable to funds.
 Royalty is calculated based on the latest IBM sale value available. Generally
the IBM rates are published after 2-3 months.
 After making calculation as above the export Department raises the requisition
for payment which is approved by CMD.
 On receipt of requisition from Export Dept. the payments are processed by
accounts department.
 After the payments are processed Export Department writes a letter to DMG
for obtaining Royalty & Transit permit challan.
 Application to issue Transit permit is made to DMG.
 On receipt of Transit permit it is associated with weighbridge.
 Transportation of ore will commence against the transit permit. Each truck
will be issued trip sheets.
 Details of transportation of ore showing actual quantity, type of ore & grade is
received by export department.
 Once the actual quantity, grade and IBM sale value of a particular month are
available the reconciliation of royalty is done.
 Difference if any towards Royalty or contribution to funds is paid or adjusted
as the case may be.

 Attached herewith the Royalty Calculation in Excel:

Royalty.xlsx

4.3 Accounting Entries for Royalty

Sl. No Particulars Debit Credit Description

1. Party A/c Dr XXX Entry for Advance payment

To Bank A/c XXX

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2. Royalty A/c Dr XXX Expense posting entry on

To Party A/c XXX Receipt of Royalty challan

3. Party A/c Dr XXX Entry for differential

payment
To Bank A/c XXX

4. Royalty A/c Dr XXX Expense posting entry on

To Party A/c XXX Receipt of Royalty challan

5. Party A/c Dr XXX Entry for reversal of

Expense
To Royalty A/c XXX In case of Excess royalty
payment

4.4 Procurement Process - Stores

 Under Transaction code – 340 stores bills are accounted

 Duly approved Purchase Order is received from the Materials Dept.
 Bills along with the GRN’s after due certification are received for payment with Bill
forwarding memo reference Number written on the bills.
 Invoices & GRN’s are verified with the Purchase Order.
 Invoices are accounted in the FAS against the Bill forwarding memo reference
number. By Debiting Stores A/c & Crediting party A/c.
 Remittance is prepared after Invoice is accounted & sent to Cash section for drawing
cheques/NEFT/RTGS/Bank transfer/Net Banking.
 Payments of stores are generally processed in a Batch once in a month.
 At the close of the Month the Stores account is reconciled with inventory.
4.5 Procurement of Capital Asset / Other Expenses

 Invoices sent by the respective Departments are verified against Contract / Work
Order/Purchase Order as the case may be. In some cases the bills are without work
orders. In all the cases approvals for payments are checked.
 Under Transaction code – 314 Civil Jobs bills are accounted.
 Under Transaction code – 311 Expense bills are accounted
 Under Transaction code - 310 Journal Vouchers are accounted.
 Invoices are accounted in FAS against the Bill Forwarding Memo reference.
 TDS as applicable are deducted while accounting the Invoices. TDS amount is picked
in the TDS register automatically after the PV is confirmed.
 Advances if any given are adjusted in Advance adjustment screen

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 Bank Remittance is prepared after confirming PV where in the TDS & other
recoveries like P. F., LBWF, Retention (if any) are made. Thereafter the remittance is
sent to Cash section for drawing payment.
 Payment documents are confirmed by the Cash Section.
4.6 Invoices without Purchase Order/Work Order/Rate
Contracts:

 Invoices sent by the respective Departments with due certification/approval are

accounted in the FAS by debiting Expense & crediting party account. TDS if
applicable is deducted at the time of confirming the PV. This is picked up in the TDS
register automatically.
 In some cases where there are no frequent transactions with party and where the TDS
is not required to be deducted the said bills are processed directly as Bank payment.
 Remittance is prepared after Invoice is accounted & sent to Payment section for
drawing payment.

4.7 TDS REGISTER:

 Entries in the TDS register are automatically captured from PV or Bank remittance
Screen and in case of TMS from JV screen.
 For Mumbai & Delhi division the entries are manually entered.
 TDS register is processed at the end of the month.
 After processing the TDS register JV is created by Debiting Party’s account &
crediting respective TDS Payable account.
 The TDS remittance is generated, and payment is made through net banking.

4.8 Vendor Advance Payment and TDS

The TDS process in the SAP system can be divided into the following steps:

 Down Payment
 Invoice Receipt
 Down payment clearing
 Provisions at period end
 Reversal of provisions on first day of next month
 WHT Receipt print
 TDS will be deducted at source at the time of payment or Invoice whichever is first.

The following e.g. is used to explain the various scenarios:

 Advance / Down Payment:

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At the time of Advance / down payment the total amount of payment inclusive of TDS
payable debits the vendor accounts. A sample accounting entry follows:

GL Accounts Debit / Credit BS / PL Amount

Vendor A/c (Advance to Debit B/S XXX
suppliers With sp GL)
TDS Payable Credit B/S XXX
Bank Outgoing A/c Credit B/S XXX

5 CASH MANAGEMENT PROCESS

5.1 CASH TRANSACTION:

 Working timing of Cash Counter :

o Monday to Friday : 10.30 am to 12.30 pm

o Saturday : 10.30 am to 12 pm

 We have one main cashier, Four travelling cashiers & Twenty Eight Imprest Holders.
 Travelling cashiers are used for withdrawing cash from Bank, Disbursement of
payments at mines & also as a replacement in absence of main cashier.
 Cash of 36 companies are maintained in cash section.
 Minimum balance for VMSB is Rs 1,00,000/-, and for other group companies, the
balance is maintained as per the individual companies requirements.
 The cash withdrawal is done as per cash requirement. There is no frequency for cash
withdrawal.
 The cash withdrawal date is informed to all concerned sections, accordingly selves
cheques are drawn by respect sections and given to main cashier, Main Cashier enter
all selves cheques on register & put up for signature of authorized signatories. After
obtaining Signature, Travelling Cashier withdraws cash from Bank.

5.2 CASH RECEIPTS

 Cash withdrawal from Bank

 Agricultural income, Rental Income
 Refund of Imprest Fund/ Advances taken by Staff/officer

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5.3 CASH PAYMENTS :

 Cash Remittances for payment are received from different sections

 Most of the cash payments are Imprest reimbursement, Reimbursement of

Expenses to staffs, staff advance, ROC filing Fees, house tax, RTO payment
etc.
 Maximum cash payment limit is Rs. 10,000/- per person per day.
 After making Cash payment the Vouchers are confirmed by main cashier in
FAS system.

5.4 MINES PAYMENT:

 Travelling cashier goes to mines location in the second week of every month.
 Cashier carries cash to be disburse along with Cash Remittance Advices &
Cash Receipt copies.
 Cash along with Cash Remittance advices & Cash Receipt copies are given to
Mines cashier of each location.

 Following are the Locations of mines disbursement.

 Beneficiation Plant.
 Vagus Establishment
 Soddo Weighbridge
 Velguem Surla Mine
 Surla Office
 Cudnem Mine

5.5 CASH COUNTING:

Cash counting is done on first day of each month before making any cash transaction.
Surprised cash counting is also done as and when required.

5.6 DAILY REPORT:

Cash Balance summary & Cash scroll of all companies is prepared every day.

6 BANK ACCOUTING PROCESS

6.1 BANK ACCOUNTS:

 Sixteen Current Accounts
 Four Exchange Earners Foreign Currency (EEFC) Accounts.
 No Overdraft and Loan Account.

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6.2 LIST OF OPERATING CURRENT ACCOUNT

 Bank of India, Vasco

 Syndicate Bank, Vasco
 Canara Bank, Vasco
 HDFC Bank Ltd. Vasco
 State Bank of India, Vasco
 HDFC Bank Ltd. Tax Account

6.3 LIST OF BANK ACCOUNTS WITH NET BANKING FACILITY:

 HDFC Bank Ltd. Tax Account

 Bank of India. Tax Account

6.4 LIST OF FOREIGN CURRENCY ACCOUNTS:

 Bank of India, Vasco EEFC Account

 Syndicate Bank, Vasco EEFC Account
 Canara Bank Vasco EEFC Account
 HDFC Bank Ltd. Vasco EEFC Account

6.5 LIST OF BANK ACCOUNTS WITH ONELINE VIEWING FACILITY:

 Bank of India,Vasco C/A No. 3

 Syndicate Bank, Vasco C/A
 Syndicate Bank, Pale C/A
 Canara Bank, Vasco C/A
 State Bank Of India,Vasco, C/A
 State Bank Of India,Harbour Branch C/A
 HDFC Bank Ltd. Vasco Da Gama C/A

6.6 EXPORT BILLS ARE GENERALLY NEGOTIATED IN FOLLOWING

BANKS:

 Bank of India, Vasco Account

 Syndicate Bank, Vasco Account
 Canara Bank Vasco Account
 HDFC Bank Ltd. Vasco Account

6.7 LIST OF AUTHORISED SIGNATORIES:

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Sr. Mode of Operation

No. Name of the Signatories
Singly
1. Mr.Shiivanand V. Salgaocar
2. Mr. T.G.Sundaram
3. Mr. S. Veeraraghavan
4. Mrs. Shilpa N. Bene Jointly By Any Two
5. Mr. Ze Lucas A. Braganca
6. Mr. Ajay R. Borkar
7. Mr. Jonathan F.S. Gonsalves

6.8 BANK RECONCILIATION

 Bank Reconciliations are done on Monthly basis.

 Bank Reconciliations are prepared manually.

6.9 FUND REQUIREMENT REPORT

 Fund requirement report is done on weekly basis based on information

given by Each Section.
 Major payments are TDS, Salary, PF, Truck Payment, Royalty,
NMET,DMF,GIOPF, IOC payment, Bunkering of Vishal Hira, Barge
Freight, MPT & Wharfage charges, Shipping Division fund
requirement

6.10 DAILY REPORT

 FD Balance, Mutual Fund Balance, Bank Balance summary & Bank

scroll is to be submitted to HOD daily.

 Bank Balance summary & Bank scroll is to be submitted to CMD daily

6.11 EEFC ACCOUNTS (exchange earners foreign currency )

 EEFC Accounts register is maintain in US $

 Inward remittance is converted at TT Buying rate

 Outward remittance is converted at TT Selling rate/spot rate

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 Periodically Difference in Exchange is accounted

 Re-statement is done at the end of year

6.12 FIXED DEPOSIT

 As per instruction of Finance Dept. Fixed Deposits are kept with Bank.
 Instruction to Bank for placement of deposits given through letter.
 Tenure & Rate of deposit is negotiated by Finance Dept. with banks
and intimated to accounts department.
 Fixed Deposit report is kept in Excel
 Tracking of maturity date of Deposit is done Manually.
 TDS & Interest earned on deposits are accounted on the basis of Bank
advices.
 TDS certificates are obtained Quarterly from Banks .

 Some Fixed deposits are lien with Bank as a 100 % margin money against
Bank Guarantees, Import LC

6.13 PAYMENT

 Bank remittances are received from Bill section, Pay roll Section &
Investment section
 Mode of payment is instructed by respective section.
 Generally payments are made through cheques, DD, RTGS /NEFT or
through letter ,
 Net Banking facility to transact online payment of direct & indirect
Taxes, PF, Custom Duty, DGFT Application & License.
 In case of VMSB Cheques are printed on Printer.
 Cheques are signed jointly by any two of Authorized Signatories
 Bank Payment vouchers are accounted on same day

 Day end all signed cheques are sent to CMD for Approval

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6.14 Cheque Delivery Report:

FAS generate Cheque delivery report based on the input provided at the time
of payment voucher confirmation. Same is used to dispatch cheque to various
departments.

6.15 Receipt
 Mutual Fund : is accounted on redemption of Mutual Fund.

 Interest on Fixed Deposit : Interest Earned on deposit is accounted on

date of Maturity
 Sale of Assets, oil
 Rent income
 Refund of staff/officer advance
 Barge Hire charges
 Export Realisation
 Despatch money

6.16 Export Realisation

 Presently No export bills are discounted.

Export bill is send for collection though our Bank. It take about 15 days to
realise, on realisation of Export Invoice the funds are either converted in
Indian rupees or are Parked in EEFC account as per instructions of Finance
Department. The realisation of export invoice is accounted on base of letter
issued by finance dept. to the banker.

6.17 FOREIGN EXCHANGE TRANSACTION

For all Foreign outward remittance, we give details of payment to taxation

Department for obtaining 15 CA & 15 CB, Which is to be submitted to Bank
along with request letter for payment
Type of Foreign outward remittance are as given below

 Demurrage
 Foreign Sampling Charges
 Purchase of spares
 Foreign Subscription
 Overdrawn export Invoice
 P & I insurance
 Import LC
 Freight Charges

6.18 BANK GURANTEES

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 Finance Dept forwards to Cash section request letter of Bank Guarantees for
Signature of Authorised person. After Verifying, the Signed letter is return back to
Finance Dept
 Fixed deposits are lien with Bank as a 100 % margin money against Bank guarantees
 Cash section keep the record of Bank Guarantees in excel

6.19 LC PROCESS ( IMPORT & EXPORT )

The LC is used for export sales (for China Shipments)

 The Buyer shall open an irrevocable LC in favour of Seller after the contract is fully
signed by both parties, with an International Bank to be accepted by the Seller, for an
amount in US Dollars sufficient to cover value of the shipment.
 The said LC to remain valid for a period agreed in the contract (normally it is for 90
days), the validity can be extended further if required.
 Bank Charges outside LC issuing bank are for the account of the Seller(beneficiary).
 The said LC shall be payable by opening bank available against the Seller’s sight
draft to the extent of the value of the shipment, when accompanied by the following
documents
6.19.1 In case of provisional documents submitted to bank
 Seller’s Provisional Invoice
 Full set of Bills of Lading
 Certificate of weight at Load port
 Certificate of Analysis at Load port
 Certificate of Origin
 Certificate of shipment advice
 any other certificate
6.19.2 In case of final documents submitted to bank
 Seller’s Final Invoice
 Certificate of weight at Discharge port (CIQ)
 Certificate of Analysis at Discharge port (CIQ)
The above documents are forwarded to negotiating bank for receipt of funds.
6.19.3 PROCEDURE
 After signing contract with the buyer, either we receive/send from/to buyer the draft
LC application for confirmation. The LC should be in line with the contract.
 Once the draft LC application in confirmed, buyer opens the LC.
 The LC opening bank advises us the LC through advising bank.
 The original LC is received by export dept. from finance dept.
 We do LC scrutiny, in case required we may ask for LC amendment.
 After shipment, we forward entire set of export documents including original LC to
negotiating bank via finance dept.
 The Negotiating bank forwards the entire set of documents to LC opening/issuing
bank.

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 Upon receipt of documents in compliance with the terms and conditions of the LC,
9. HDFC Bank Ltd., Vasco 00722000003489 Current A/c
the issuing bank effect payment.
 In some cases, issuing bank may raise discrepancies in documents.
 GL account effecting the effect the LC and Bank Charges

6.20 List of banks with account number

Sl. No Name of Bank Account No Type Of Account

1 Bank of India, Vasco 100020100000003 Current A/c
2 Bank of India, Vasco 015020400400829 EEFC A/c
3 Bank of India, Vasco 100020110000081 Current A/c
4 Syndicate Bank Vasco 72113050000018 Current A/c
5 Syndicate Bank Vasco 72111070000029 EEFC A/c
6 Canara Bank, Vasco 0311201000712 Current A/c
7 Canara Bank, Vasco 0311241000002 EEFC A/c
8 HDFC Bank Ltd., Vasco 00722320000552 Current A/c
9 HDFC Bank Ltd., Vasco 00722000003489 Current A/c
10 HDFC Bank Ltd., Vasco 00722000004466 Current A/c
11 HDFC Bank Ltd., Vasco 50200024269452 EEFC A/c
12 State Bank of India, Vasco 10539547694 Current A/c
13 ICICI Bank Ltd. Vasco 022605000295 Current A/c
14 ICICI Bank Ltd. Vasco 136406000007 EEFC A/c
15 State Bank of India, Mormugao 10438017297 Current A/c
16 Syndicate Bank Pale 72053070000070 Current A/c
17 Canara Bank Bangalore 431201015051 Current A/c

6.21 Bank Account entries

1 Cheque Receipts
Dr. Bank XXXX
Cr. Party XXXX

2 Cheque Issue Dr. Expense/AP XXXX

Cr. Bank XXXX

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7 ACCOUNTS RECEIVABLE PROCESS

7.1 Export Sales - Iron Ore Invoice Accounting

 Once the Vessel is sailed Provisional Export Sales Invoice for 100% of
shipment value is raised, it is stated in the invoice that 95% provisional
Invoice value has to be paid by party and the balance 5% is to be settled by the
party on final analysis report at destination port.

 Provisional Invoices is raised in US$, 100% of invoice value(US$) is

accounted in Indian Rupees by considering the exchange rate as on date of Bill
of Lading. The Invoice shows 95% & 5% value separately. The entry will be
Debit to Party and Credit to Export Sales Income.

 After receiving the 95% Sales proceeds through our bank we account the
proceeds by crediting to party. The exchange difference arising on account of
95% invoice value and receipt value transferred to exchange difference -
Export A/c.
 When vessel reaches the destination port, ore analysis is done by the party and
reports are send to us to raise the final invoice. Final Invoice is raised with
100% value, Less the 95% Provisional invoice value balance receivable /
payable to party.
 Accounting treatment to final invoices, we reverse the 5% value which is
accounted as per Provisional Invoice (The entry will be Credit to Party
and Debit to Export sales - Income,) and then Final Invoice is accounted on
exchange rate as on date of Bill of Lading.
 After receiving the 5% Final Invoice proceeds through the bank the exchange
difference is transferred to Exchange difference - Export A/c.
 Year end if any Provisional or Final Invoice is raised but not realised, we re-
state the Invoice value as at 31st March exchange rate.
 From 01-04-2017 onward all Export Sales of I/Ore Shipments are on CFR FO
Basis (Cost Freight Free Out). Wherein Ocean Freight is incurred by the
company and debited to expenses.

7.2 Dispatch on Vessel :

 Dispatch on Vessel is accounted at the exchange rate prevailing on the Bill
date.

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 On realisation of proceed the difference in exchange is transferred to

Exchange Difference account.
 If at the year end the bill is not realised, it is restate as at 31st March rate.

7.3 Sales Of Iron Ore Export

 After completing the all process of Export Sale as per terms and condition of
contract, once the Vessel is completed and sailed, the account Dept. receives
hard copy of Provisional Invoice along with requisition in FAS from Export
Dept.
 The Provisional Invoice shows 95% and 5% value of Invoice in foreign
Currency (USD), after verifying the correctness of the Invoice we convert the
USD in INR 95% & 5% by applying exchange rate as on the Bill of Lading
date.
 The entry Vessel is completed and sailed, the account Dept. receives hard
copy of Provisional Invoice along with requisition in FAS from Export Dept.
The Provisional Invoice shows 95% and 5% value of Invoice in foreign
Currency (USD), after verifying the correctness of the Invoice we convert the
USD in INR 95% and 5% by applying exchange rate as on the Bill of Lading
date.
 Accounting Entry as follows :

Party Account Dr 100%

Export Sales Income Cr 95%
Export Sales Income Cr 5%

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 After receiving 95% sale proceeds through our bank from party we accounts
the proceeds (only 95% realised in INR) the entries:

Bank Account Dr 95%

Party Account Cr 95%

 The difference in exchange on realization of provisional invoice is accounted.

Party Account Dr XXXX

Exchange Difference Account Cr XXXX

 On receipt of destination report the export dept raises the final Invoice,
following entries are passed. The 5% accounted as per Provisional invoice
now being reversed.

Sales Account Dr XXXX

Party Account Cr XXXX

 The Final Invoice is being accounted by applying exchange rate as on Bill of

Lading date.

Party Account Dr XXXX

Sales Account Cr XXXX

 After receiving final invoice proceeds through our bank from party we
accounts the proceeds (5% realised) the entries:

Party Account Dr XXXX

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Sales Account Cr XXXX

 The difference in exchange on realization of final invoice is accounted.

Exchange Difference -Export Dr XXXX

Party Account Cr XXXX

 In case of contract where the rates are provisional and final rates are to
determine based on the index price of the month on arrive at destination port.
In such cases many a times the final invoice is negative wherein we have to
pay party by raising a credit note.
 Note:
 Base on Export Sales inputs the various Export related report are being
prepared for our various requirement (Format attached) Copy of Provisional
And Final Invoice is attached. (All Accounting entries in our Books are in
Indian Rupees)
 GST not applicable for Export Sale of I/Ore
 Export Duty is not applicable for grade below 58%
 From 01-04-2017 onward all Export Sales of I/Ore Shipments are on CFR FO
Basis (Cost Freight Free Out)

7.4 Local Sale of Iron ore:

 Sales of Iron ore to local customers base on the terms and condition of
contract. Invoice is being raised by Export Dept

Party Account Dr XXXX

Local Sales of Iron Ore Cr XXXX
CGST Payable Account Cr XXXX
SGST Payable Account Cr XXXX
TCS Payable Account Cr XXXX

Note:
All Local sale of Iron Ore are in Indian Rupees

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2.5% CGST on Value

2.5% SGST on Value
1% TCS is applicable (Value + GST)

7.5 Sale of Services :

VMSB’s Truck supplied for our group company VMSSI & GMPL to transport the Ore from
one location to routes are pre-fixed with rate to be charged. Truck management module keeps
a track of route month the bill are being raised & Accounted in the FAS The entry:

Party Account Dr XXXX

Truck Hire Receipt Cr XXXX

Note :
The Bill raised at TMS Module and Req. in FAS along with hard copy of signed
(Copy of Bill is Enclosed)
GST is not applicable if the value of per trip is below R.1500/-

7.6 Hire Charges of Machinery/Jetty

7.6.1 Machinery Hire Receipt

Machinery given on hire to third parties at agreed rate, Bills are raised by us
applying the applicable rate of GST
 The Accounting Entry is as follows:

Party Account Dr XXXX

Machinery Hire Receipt Cr XXXX
CGST Payable Account Cr XXXX
SGST Payable Account Cr XXXX

7.6.2 Jetty Hire Receipts

Company’s Jetties are given on hire to third parties at an agreed rates, many a times the
composite provided which includes Jetty Hire, Barge Hire and Truck Transportation where
the rates are fixed The bills are raised by Export Dept.

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Party Account Dr XXXX

Hire Receipt Cr XXXX
CGST Payable Account Cr XXXX
SGST Payable Account Cr XXXX

7.6.3 Hire Charges

The Company does not own any barges however in case of composite services wherein the
company services to third parties, barges are hired by company from group entities for said
services. The rate Bill is being raised by our Export Dept.

Party Account Dr XXXX

Hire Receipt Cr XXXX

Note : The Barge Freight rate is as per Goa Mineral Ore Exporters Association

7.6.4 Tran shipper Loader Receipts

Tran shipper Vishal Hira is used for Loading Foreign going Vessels given to VMSSI
and outside parties as per the agreed rate. The Export Dept. raises the bill.
The Accounting Entry :

Party Account Dr XXXX

Transhipper Income Cr XXXX
CGST Payable Cr
SGST Payable Cr

Note : Tran shipper Income booked by Shipping Division GST paid by H.O.

7.6.5 Manpower Supply:

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Company provides Manpower to Group companies for which billing is done on monthly
basis.
Bill is being raised by applying applicable GST
7.7 Other Income :

 Interest Income - Cash & Bank

 Dividend Income: - Investment Dept.
 Profit on Sale of Assets - Asset Dept.

7.8 Proceeds from Rent Income

 VMSB Flats/Houses given on Rent, every month Bills are raised as per the
agreement. In case of renting premises GST as applicable is charged.
 Accounting Entry

Party Account Dr XXXX

Rent Income Cr XXXX

7.9 Miscellaneous Income:

 Miscellaneous Income includes:

 Vehicle accidental Insurance claim

 Sale of Scrap
 Sale of Loan application forms

7.10 Other Operating Revenue

7.10.1 Sale of Stores, Spares and Components etc.,

 HSD, Stores & Spares parts are sold to scheme Trucks and Contractors and group
Companies based from Inventory dept. Necessary Invoice are raised by applying
applicable taxes.

7.11 Following Monthly reports are received from Inventory Dept.

 Monthly Consumption Entry of Stores and Spares with consumption analysis

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 Consumption return Entry

 Sales Entry with Supporting
 Capital entry
 Adjustment Entry
 Store to Store transfer entry
 Entry to issues to Shipping division
 GRN Matching Report
 Value of Stock Statement
 Ledger Summary

8 GST - GOODS AND SERVICE TAX

8.1 GST on Goods Transport Agency (GTA)

 Services of GTA attract GST at either 5% or 12%. The liability to pay GST devolves
on the recipients of such GTA Services.
 The rate of 5% is subject to the condition that credit of Input Tax charged on goods or
services used in supplying the service has not been taken. If Input Tax credit is to be
availed, then the GST rate would be 12%.
 The services provided by individual transporters who do not issue a consignment note
are exempted from GST.
 Consideration charged for the transportation of goods on a consignment transported in
a single carriage are exempt, if it does not exceed Rs 1,500/-.
 Consideration charged for the transportation of all such goods for a single consignee
are exempt if it does not exceed Rs 750/-
 Any intermediate/ ancillary service provided in relation to transportation, like loading
/ unloading, packing/ unpacking, trans-shipment, temporary warehousing, etc. are also
covered under GTAIf these services are not provided as independent activities.

8.2 Reverse Charge Mechanism in GST (RGST)

 Reverse charge means the liability to pay tax is on the recipient of supply of goods or
services.
 There are two types of reverse charge categories. First is dependent on the nature of
supply and the Second is dependent on the taxable supplies by any unregistered
person to a registered person.
 The first category of services includes Legal Services, Sponsorship Services, Services
received from Govt., Services provided by a Director (not being an employee) etc.
 The second category includes all supplies of goods and services received from GST
unregistered dealers.

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The rates of GST applicable to the above mentioned services are as follows:
Sl. Particulars SGST CGST IGST
No
1 GTA Services – 5% 2.5% 2.5% 5%
2 Legal Services – 18% 9% 9% 18%

3 Sponsorship Services – 18% 9% 9% 18%

4 Services Received from Govt. – 9% 9% 28%

18%

5 Services provided by Director 9% 9% 28%

(not being an employee) – 18%
6 Goods and Services received Various Rates as listed in above table
from GST Unregistered dealers

8.3 Input Tax Credit in GST

 Any registered person can avail credit of tax paid on the inward supply of goods or
services or both, which is used or intended to be used in the course or furtherance of
business.

 The pre-requisites for availing credit by registered person are:

 He is in possession of tax invoice or any other specified tax paying document.
 Tax is actually paid by the supplier and also GST Returns has been filed by him.
 If the inputs are received in lots, he will be eligible to avail the credit only when the
last lot of the inputs is received.
 He should pay the supplier, the value of the goods or services along with the tax
within 180 days from the date of issue of invoice, failing which the amount of credit
availed by the recipient would be added to his output tax liability, with interest [rule
2(1) & (2) of ITC Rules]. However, once the amount is paid, the recipient will be
entitled to avail the credit again. In case part payment has been made, proportionate
credit would be allowed.

 ITC is not available on:

 Goods and/or services provided in relation to food and beverages, outdoor catering, health
services, Membership of a club, health and fitness centre; Rent-a-cab, life insurance,

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health insurance except where it is obligatory for an employer under any law and Travel
benefits extended to employees on vacation such as leave or home travel concession;
 Works contract services when supplied for construction of immovable property, other
than plant & machinery, except where it is an input service for further supply of works
contract;
 Goods or services received by a taxable person for construction of immovable property
on his own account, other than plant & machinery, even when used in course or
furtherance of business;
 Goods and/or services on which tax has been paid under composition scheme;
 Goods and/or services used for private or personal consumption, to the extent they are so
consumed;
 Goods lost, stolen, destroyed, written off, gifted, or free samples;
 Any tax paid due to short payment on account of fraud, suppression, mis-declaration,
seizure and detention
ITC, in all the above cases, is to be availed within 1 year from the date of issue of invoice by
the supplier

8.4 GST on Construction of Residential complexes.

 GST @12% is applicable if sale or advance is received before Occupancy

certificate.
 No GST if sale or consideration is received after taking occupancy
 If sale is exempt No input Tax credit is available.
 If any Additional work is carried out after occupancy GST @ 18% is
applicable.

8.5 Nature of outward supplies provided by VMSB & group and their
applicable GST rates

Sr. No Particulars GST Rule

1 Manpower Supply Services 18%

2 Transhipper Services 18%

3 Renting of Commercial Premises 18%

4 Renting of Residential Premises Exempt

5 General Insurance Services 18%

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6 Permit & Registration Fees 18%

7 Sale of Used Motor Vehicles Taxable at

Various Rates
plus
Compensation
Cess as
applicable
8 Sale of Stores, Spares & Components Taxable at
Various rates
9 Transportation of Goods through Inland Exempt
Waterways
10 Sale of HSD Non GST

11 Transfer of Right to use machinery Taxable at

various rates
12 Transfer of Right to use launch vessel Exempt

13 Programme Membership Fees 18%

14 Export of Ore 0%

15 Local Sale of Ore Generally 5%

16 Ore Processing 18%

17 Construction of Residential Complexes 12%

18 Sponsorship Services 18%

19 Business Auxiliary Services 18%

9 WITHHOLDING TAX PROCESS

 TDS as applicable are deducted while accounting the Invoices in PV Screen.

 The TDS rates are specified in the Party Master.
 Entries in the TDS register are automatically captured from PV, Bank remittance
or from JV in case of TMS.
 For Mumbai & Delhi division the entries are entered manually in TDS register.
 TDS register is processed at the end of the month.
 After processing the TDS register JV is created by Debiting Party’s account &
crediting respective TDS Payable account.
 The TDS remittance is generated, and payment is made by net banking.
 TDS returns is prepared quarterly from the TDS Register data.

Following are some of TDS rates applicable to VMSB Group:

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Rate of TDS
Section Nature of Payment Thresh Hold Limit
Code Individual Others
/ HUF

Rs. 30,000/- ( Single

194 C Payment to Contractors Payment ) / 1% 2%
Rs.1,00,000/- Yearly
Payment
194 H Commission / Brokerage Rs. 15,000/- 5%
194 I Rent of Plant & Machinery Rs. 1,80,000/- 2%
194 I Rent of Land or Building or Rs. 1,80,000/- 2%
Furniture & Fittings
194 IA Immovable property (other than Rs. 50,00,000/- 1%
Agricultural Land)
194 J Payment to Professionals Rs. 30,000/- 10%

10 ASSET ACCOUTING

 Presently there is no sub ledger Accounting for Asset except for Capital work in
progress.
 Assets Posting is directly done to General Ledger in books of accounts
 Detailed asset register is maintained separately in FA Module.

Following are Assets GL Codes

Sr. No Particulars Account Code

1. Land 1101

2. Buildings 1102

3. Tippers & Dumpers 1103

4. Plant & Machinery 1104

5. Furniture & Fittings 1105

6. Vehicles 1108

7. Other Equipments 1109

8. Bridges, Roads & Jetties 1110

9. Barges, LCTS, & Launches 1111

10. Electrical Equipments 1115

11. Lease Hold Land & Buildings 1117

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12. Mining Rights 1119

10.1 The VMSB has following Class of Assets

Useful
L
if
e
Class (
Depr.
C I
Asset Class Type Residual R
o Asset Type Description n
Description Code % at
d Y
e
e e
a
r
s
)
01 LAND 11 PURCHASED LAND 0 0 0
12 LEASEHOLD LAND 0 0 0
02 BUILDINGS 11 RESIDENTIAL HOUSE/FLATS - RCC STRUCTURE 5 60 4.87%
12 OFFICE BUILDINGS - RCC STRUCTURE 5 60 4.87%
13 FACTORY BUILDINGS 5 30 9.50%
14 HOTEL BUILDINGS - RCC STRUCTURE 5 60 4.87%
15 FENCES, WELLS, TUBE WELLS 5 5 45.07%
OTHERS (INCLUDING TEMPORARY
16 STRUCTURES) 5 3 63.16%
RESIDENTIAL HOUSE / FLATS - OTHER THAN
21 RCC STRUCTURE 5 30 9.50%
OFFICE BUILDINGS - OTHER THAN RCC
22 STRUCTURE 5 30 9.50%
HOTEL BUILDINGS - OTHER THAN RCC
24 STRUCTURE 5 30 9.50%
PLANT &
03
MACHINERY 11 TIPPERS & DUMPERS 5 8 31.23%
PLANT &
04
MACHINERY 11 EARTHMOVING MACHINERIES 5 8 31.23%
12 GENERATORS 5 15 18.10%
13 AIR COMPRESSORS 5 15 18.10%
14 PUMP SETS 5 15 18.10%
15 WORKSHOP MACHINERIES 5 15 18.10%
16 BEN. PLANT MACHINERIES 5 15 18.10%
17 PRINTING PRESS MACHINERIES 5 15 18.10%
18 EDP EQUIPMENTS 5 3 63.16%
19 OTHER MISC. MACHINERIES 5 15 18.10%
FURNITURE &
05
FITTINGS 11 OFFICE FURNITURES 5 10 25.89%
12 HOTEL FURNITURES 5 8 31.23%
08 VEHICLES 11 TRUCKS, VANS, AMBULANCE ETC. 5 8 31.23%
12 CARS & JEEPS 5 8 31.23%
13 IMPORTED CARS 5 8 31.23%
14 TWO WHEELERS(SCOOTERS, BIKES, MOPEDS) 5 10 25.89%
OTHER
09
EQUIPMENTS 11 OFFICE EQUIPMENTS 5 5 45.07%
14 REFRIGERATORS/COOLERS 5 5 45.07%

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15 AIR CONDITIONERS 5 5 45.07%

16 T.V.s ETC. 5 5 45.07%
17 SILVER ARTICLES 5 5 45.07%
18 OTHER MISC. EQUIPMENTS 5 5 45.07%
EDP EQUIPMENTS - HARDWARE (Desktops,
19 Laptops etc.) 5 3 63.16%
20 EDP EQUIPMENTS - SOFTWARE 0 3 63.16%
EDP EQUIPMENTS - HARDWARE (Networks &
29 Servers ) 5 6 39.30%
ROADS, BRIDGES
10
& JETTIES 11 BRIDGES, JETTIES, CULVERTS ETC. 5 30 9.50%
12 CARPETED ROADS - RCC 5 10 25.89%
13 NON-CARPETED ROADS 5 3 63.16%
22 CARPETED ROADS - OTHER THAN RCC 5 5 45.07%
11 BARGES 11 BARGES 5 28 10.15%
ELECTRICAL
15 INSTALLATI
ON 11 ELECTRICAL INSTALLATION & EQUIPMENTS 5 10 25.89%
MINING LEASE
19
RIGHTS 01 MINING LEASES 0 0 0
CAPITAL WORK IN
21
PRPGRESS 11 CAPITAL WORK IN PROGRESS 100 0 0

10.2 PROPERTY PLANT & EQUIPMENTS

The Cost of Asset includes the cost of acquisition and other attributable costs for bringing the
asset to its working condition including any interest on the borrowings up to the date of
commissioning.

10.3 DEPRECIATION ON TANGIBLE ASSETS

Depreciation is provided on Written down Value Method to write off the cost of the assets
less their residual values over their useful lives. In respect of additions to the assets,
depreciation is provided from the date of purchase/installation and in respect of assets sold,
depreciation is provided up to the date of sale on pro-rata basis. Assets are scrapped by way
of 100% Depreciation.

Accounting Entry for Asset Depreciation:

Depreciation Account Dr XXXX

Provision for Depreciation Cr XXXX

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10.4 Amortisation of intangible assets

In case of Intangible Assets Depreciation is provided over the useful life of asset.

Accounting Entry for Amortization:

Depreciation Account Dr XXXX

Provision for Depreciation Cr XXXX

10.4.1 Types of assets:

 Purchased Assets
 Self-constructed Assets ( where the Job Code is opened presently to capture the cost )

10.4.2 Additions to Assets:

 Once the bill is received in Account dept. it is verified with purchase order or Work
order, Approvals are checked and the bill is accounted in FAS. In case of Tangible
assets the Bill is forwarded along with the GRN & Issue note. Following entry is
passed in Books.

Resplective Asset Account Dr XXXX

Party Account Cr XXXX

 Following details of assets are entered in FA Module.

 Name of the Party

 Date of Commencement /put to use
 Location of assets
 Item description
 Quantity
 Rate per unit
 Value of assets
 Capitalized (flag Yes /No)

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 After making entries in the interface it is retrieved in Asset Master Introduction

(FY2014 Onwards) and verified. Further following details are entered.

 Asset class code

 Asset type code
 Cost centre code
 Asset finance code
 Provision for depreciation finance code
 Depreciation finance code

 After verifying above details documents is confirm and asset code is generated in
Fixed asset registered.

10.5 Sale of Asset

 When any Asset is sold, the bill is raised on the party which is accounted in the books.
Following Entry is passed to account the sale.

Party Account Dr XXXX

Sale of Asset Account Cr XXXX
GST Payable Cr XXXX

 Thereafter the following details are entered in Fixed Asset module in Asset Sale Entry
screen. On saving the document the asset gets deleted from the register.
 Invoice date
 Party code
 Asset code ( Code of Asset which is to be sold )
 Sale quantity
 Sale value
 On the basis of above details sale register report is generated showing following
details
 Asset code
 Description of asset
 Original cost
 Op. Accumulated Depreciation
 Depreciation upto sale date
 WDV at sale date
 Sale price

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 Profit / loss
 Capital gain
 Name of customer (sold to)
 Invoice no. & date

All entries for deletion of assets are passed manually. Only depreciation entry is passed by
system automatically once the depreciation is processed.

 In case of deletion of asset following entries are passed.

Provision for Depreciatoin Account Dr XXXX

Sale of Asset Account Dr XXXX
Asset Account Cr XXXX
Profit on Sales Cr (entry in case of Profit on XXXX
Sales of Asset)

10.6 Reports are available in the FAS

 Details of Assets purchased
 Details of Assets scrapped
 Asset Sales Register
 Summery schedule of Fixed Assets
 Detailed Fixed Asset Register

11 Procedure for Travel Management

 Employees has to fill the form with respect to his travel along with travel
date, destination purpose and duration of visit and estimated amount of
advance.

 After filling the form HOD of concern department authorises the same and
sent for management approval.

 After seeking management approval, source department enters the requisition

for advance in FAS module and generate the requisition no. which is entered
on the documents and sent to the accounts dept.

 Using the requisition number the voucher is codified in system and advance
remittance is prepared which is sent to GM Accounts for approval.

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 After approval the document is sent to cash section for processing payment.

 Once employee returns from his trip the employee submits his expense
statement ( time frame is not define for submision ) after HOD &
management approval.

 On receipt of expense statement it is verified by the accounts Dept. and if

found in order accounted in FAS.

 Any differential amount on account of recovery/ payable will be

received/disbursed by preparing disbursement voucher.

 Presently employee masters are maintained with numerical codes.

11.1 Following accounting entries are passed .

01 Advance given
Employee Account Dr XXXX
Bank / Cash Account Cr XXXX

02 Expenses (Bills) are submitted.

Travelling Expneses Account Dr XXXX
Bank /Cash Account Cr(if Advance is excess) XXXX
Employee Account Cr XXXX
Bank / Cash Account Cr (if advance is short) XXXX

12 Salary Process

 Based on the appointment letters data is entered in the HR &

payroll Module by HR & Payroll dept. the same is received by
accounts dept. which is verified at our end.
 Attendance inputs are received from source dept.
 Society & other deduction like Income Tax are manually entered
 Additional Income like OT & Exgratia if any is manually entered.
 Salary is processed by 27th of the Month.
 Checking of variations if any with previous month’s salary.
 Printing Net salary listing of employee for Bank transfer

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12.1 Following JV is passed for accounting salary & other deductions.

SALARY A/C DR
OVERTIME A/C DR
LEAVE ENCASHMENT DR
CO'S CONTB.TO PROVIDENT FUND DR
CO'S CONTB.TO FAMILY PENSION
FUND DR
CO'S CONTB.TO E S I C DR
TO SALARY PAYABLE CR
TO PROVIDEND FUND PAYABLE CR
TO FAMILY PENSION PAYABLE CR
TO ESIC PAYABLE CR
TO GOA LABOURE WELFARE
PAYABLE CR
TO PROFESSIONAL TAX PAYABLE CR
TO HOUSING LOAN RECOVERY CR
TO COMPANY LOAN PAYABLE CR
TO FESTIVAL ADVANCE CR
TO LIC RECOVERY PAYABLE CR
TO SOCIETY RECOVERY PAYABLE CR
TO TDS PAYABLE CR
TO HOUSING LOAN INTEREST A/C CR

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