CONTRACTORS' LEDGER and Check of Contractors' Bills

CONTRACTORS’ LEDGER Para 1483 E

 Form E. 1483                                                                                         CONTRACTORS LEDGER  

Dr.	Contractor's Ledger			Cr.
	Rs.	P.		Rs.	P.

Accounts relating to contractors should be kept as personal accounts in Contractors' ledger ( form E-1483 shown below) and a separate folio should be opened in the Contractors' Ledger for each contractor. The accounts of each contractor should exhibit all transactions with him, whether relating to one or several works or to materials purchased from him or supplied to him. The Contractors' Ledger should show the number and amount of each passed bill and certificate, briefly naming the work and the number and amount of the cheque. The amount of advance granted to a contractor as well as the value of material made over to the contractor against items for which he is paid the labour and material rates should be debited to his account and a receipt for the value thereof taken from him in respect of the debits.

The Contractors' Ledger should be posted as bills are paid and it should be closed and balanced monthly. A copy of his account in the ledger may be furnished to any contractor who wants it. Stores supplied to works under execution by contract should be accounted for as follows :-

(i)         when the contract is for labour only, by a direct charge as stores to the work to which it is issued.

(ii)        when the contract is for both labour and materials, as a debit to the contractor, the cost of stores as prescribed in para 1269 being either recovered in cash or debited to the Contractor’s account for subsequent recovery by deduction from the amount due to him for work done, in these cases an unstamped acknowledgement of the receipt of the material should be taken from the contractor.

It is normally maintained agreement wise or contract wise depending whether the work is special work or zonal work which is maintained only in respect of works contracts. 

Separate pages are generally opened for each work order or agreement. On the top of each page details of name of work, work order number, date and value and period of completion of work etc.

Every time a bill is passed for payment, the ledger accounts in respect of the particular work order is credited with the gross value of the work or supply. On the debit side of the recovered towards Security Deposit , income tax, postage and other recoveries towards materials or penalties  and net amount payable to the contractor. Both the debit and credit sides are balanced.

Incase of certain special works on the Open Line and project works, the ledger account is also debited with all the values of material supplied by the railway to the contractors and as and when the same are utilized on the work, corresponding credits are afforded. The balance shown the value of material got to be used by the contractors.

In cases where advance payment to have been made to the contractors, the same should be debited to the ledger accounts adjusted and when payments are made.

The ledger accounts will be reviewed periodically to see that there is no undue delay in the execution of works or supplies against the different work order contained in the ledger.

Details of work orders not complied with up to the date of review should also be made out. The concerned executives should be addressed in the matter for remarks.

Dates of commencement and completion of the work and the Measurement Book No and folios should also be mentioned in each ledger accounts.

The postings in the ledger should be of an accumulative type (sometimes inner columns for posting the current bills and outer columns for cumulative balance) that any time the gross amount of charges of the work or supply , total amount paid to the contractor total SD recovered, total Income Tax recovered during the year etc can be extracted.

This ledger is  put up along with every bill to the AO for signature.

Extracts of the ledger can be given to the contractor on some nominal payment.

Contractors bills:

These are three types ie petty contract bills, running or on account bills and final bils.

Petty contract bills or First and Final Bill is prepared  where the single payment is involved for the work or supply completed.

Running or on accounts bills are prepared in contact work (not supplies for which suppliers bills are used)  towards part completion or stage completion of the works.

Final bills are prepared for making final payment when the running account of the work is closed finally.   A hand receipt or a bill towards advance payment is used whenever some advance is paid to the contactor.

Check of contractors bills

1. These bills are prepared in the prescribed railway forms for different types of bills.
2. The bills are initially prepared in  AXEN /ADEN offices for the Civil Engineering Dept and in respective executive offices of other Depts.
3. They are prepared with reference to the measurement recorded in the respective MB duly applying the rates shown either in the work order or agreement.
4. The bills are signed by both the contractor and the AXEN/ADEN/Executive officers
5. These are submitted along with the MB to the Divisional Office in Triplicate
6. The Divisional Office will verify the MB as well as the accuracy of the bill and submit the same in duplicate (original and duplicate) to the concerned accounts officer for check
7. Wherever there is a DA/WA is attached to the executive offices, the MB are checked by her/him and all the quantities mentioned in the bills.
8. In such a case in the accounts office, the rates and arithmetical accuracy of the bills are checked with reference to the work order or agreement.
9. Bills found to be in order are then passed for payment duly entering in the respective contactors ledger.
10. Payments are made only thru crossed cheques and sent to the contractors addresses by Registered Post with Acknowledgment Due. Now thru RTGS, EFT and NEFT to ensure transparency and quick transfer.