If you have been wondering what Treasury single account means and how it works like I have, then this ‘15 things to know about Treasury Single Account (TSA)’ as published on Premium Times might help. Read below:
- TSA refers to Treasury Single Account, a public accounting system using a single account, or a set of linked accounts by government to ensure all revenue receipts and payments are done through a Consolidated Revenue Account (CRA) at the Central Bank of Nigeria (CBN).
- The pilot TSA scheme commenced in 2012 using a unified structure of accounting for 217 government Ministries, Departments and Agencies, MDAs, for accountability and transparency in public fund management.
- All government MDAs remit their revenue collections to the CRA through their individual commercial banks on a fee-for-service remuneration basis.
- Although all monies earned by the federal government through value added tax (VAT), customs duties, immigration and other charges, are supposed to be paid into the CRA, a few exceptions border on accounts operated by joint venture partners with government, like oil mining leases (OMLs) in the oil and gas industry.
- Deposit Money Banks (DMBs) are allowed to maintain revenue collection accounts for MDAs, but all collections must be remitted to the CRA at the end of every banking day; that is MDAs’ accounts with DMBs must be at zero balance at the end of every banking day.
- TSA allows government banking to be unified, to enable the relevant stakeholders, such as the Ministry of Finance and Accountant General of the Federation to have full oversight of all cash flows across different bank accounts.
- The different TSA account types include main account; subsidiary or sub-account; transaction account; zero balance account; imprest account; transit and correspondence accounts for different transaction purposes.
- TSA helps check incidence of multiple accounts operated by government MDAs for collection and spending of government revenues.
- TSA will ensure adequate monitoring of government revenue receipts and expenditures and block leakages, as no MDA is allowed to keep any operational bank account.
- TSA will help check incidence of idle cash lying over extended periods in bank accounts held by spending MDAs, while government continues to borrow to execute its budgets.
- Under TSA, DMBs using public sector funds deposited by MDAs to make free profits will not be possible.
- To pay money under TSA, depositors make payment to a transit account in a commercial bank and the funds are automatically remitted to the CRA in the CBN at regular intervals, say at the end of the business day or at more frequent intervals
- Payments through the TSA follow an electronic system, with direct payments or deposits to the bank account of the beneficiary MDA.
- MDAs registered on the electronic payment platform, or CBN Payment Gateway, through the Settlement Centre, Funds Department, Office of the Accountant General of the Federation are granted access to funds collected on their behalf at the CBN.
- The TSA scheme covers all MDAs as well as other institutions and parastatals that collect revenues and monies payable to FGN, including all forms of receipts, refunds, operating surpluses, transfers, donations, over-payment, taxes and customs duties, etc.
Click HERE to subscribe to this blog via email for immediate notification.