Printing of Vendor Name and Account Number on System Generated Cheques -AG dt 01.01.2024
OFFICE MEMORANDUM
Subject: Printing of Vendor Name and Account Number on System Generated Cheques
PUC is a letter received from Director FABS on the directions of the Controller General of Accounts, Islamabad vide No. CGA/FABS/CGA/2018/509 dated 28.11.2023.
02- As per directive cheques printed through SAP system must contain Vendor Name and Bank Account number for vendors of Companies, Business Owners, Firms and all Employees (Government and Non Government).
03- As per FABS and SAP – CC consultant, to update vendor record in SAP Vendor Master Data, Vendor Name is written in “Name” field 1 and to add/ update Bank Account Number, field next to name field i.e. Name field 2 may be used. (See Annex – I & II for reference)
Background
On January 1, 2024, the Account General (AG) issued a directive concerning the printing of vendor names and bank account numbers on system-generated cheques. This directive aims to enhance the accuracy and transparency of financial transactions conducted through the cheques issued by the government.
Key Points
- New Cheque Printing Requirements:
- The directive stipulates that all cheques generated by the system must now include two specific pieces of information: the Vendor Name and the Bank Account Number.
- This requirement applies universally to all vendors, including companies, business owners, firms, and employees, regardless of their affiliation with government or non-government sectors.
- Updating Vendor Records:
- To comply with this new directive, it is essential to update the vendor records in the system where cheques are processed. This involves making sure that the Vendor Name and Bank Account Number are correctly entered into the system.
- The system used for this process, typically an automated financial management system like SAP or similar, has designated fields for these details:
- Vendor Name: This field should be used to input the full legal name of the vendor. Accurate representation of the vendor’s name ensures proper identification and verification during the cheque processing.
- Bank Account Number: This field should capture the vendor’s bank account number where the payment is to be deposited. Correct entry of this number is crucial for ensuring that the payment is deposited into the correct account.
- Implementation Steps:
- Review Existing Records: Begin by reviewing the existing vendor records in the system to identify any missing or incorrect information. This step involves checking each record to ensure that both the vendor name and bank account number are present and accurate.
- Update Vendor Information: Access the relevant fields in the system and update them with the correct vendor name and bank account number. This might involve correcting any inaccuracies or adding information that was previously missing.
- Verification: After updating the records, it is important to verify the accuracy of the information entered. This may involve cross-checking with vendor documentation or performing a system audit to ensure that all records are correctly updated.
- Regular Maintenance: Implement a process for regular updates and maintenance of vendor records to ensure ongoing accuracy. This includes periodic reviews and updates as necessary, particularly when new vendors are added or existing vendors change their banking details.
- Benefits of Compliance:
- Improved Accuracy: Ensuring that cheques contain the correct vendor name and bank account number reduces the risk of payment errors. This leads to more reliable and efficient financial transactions.
- Enhanced Transparency: Clear and accurate cheque information helps in tracking and auditing payments. It makes financial records more transparent and easier to verify, which is important for financial audits and reviews.
- Regulatory Alignment: Complying with this directive aligns with regulatory standards and helps in maintaining good financial management practices.
Conclusion:
In summary, the directive issued on January 1, 2024, by the Account General requires that all system-generated cheques include both the Vendor Name and Bank Account Number. This change is designed to improve the accuracy and transparency of financial transactions. To comply, vendor records in the system must be reviewed and updated with the correct information.