Accounting is the most essential function of each and every concern-both commercial and non-commercial. Accounting is necessary to find out the final results of the concern and to assess its financial position. Unlike profit seeking concerns, viz. Partnership firms, companies etc., the financial management of any organization must have a prudent financial system backed by sound and effective accounting processes and internal controls. A well- designed and well managed accounting system helps ensure proper control over funds. Accounting policies and procedures are designed to compile accounts, fulfilling legal/procedural requirements that govern financial control. Accounts are an integral part of financial management of activities. On the basis of accounts, the Government determines the shape of its monetary and fiscal policies. The aim of the Government is not to make profit, but to pave the way for the development of the country and welfare of the society as a whole. And yet accounting is one of the most important aspects of any Government’s function.