Page 94 - Account 10

Employees’ Provident Fund

(Karmachari Sanchaya Kosh)

The employees’ provident fund is a type
of financial institution, which collects the
amount of 10% compulsory deduction of
the salary of the permanent government
employees as well as voluntary deduction
of employees of some corporate bodies and
organizations and provides compound
interest on such deposit. The concerned
office adds cent percent of the deducted
amount and deposit in the Employee
Provident Fund in the account of concern Karmachari Sanchaya Kosh building
employees.
At first, in 1991 B.S. to collect only the amount of army called ‘Sainik Drabya Kosh’ was
established with objective of providing financial help after their retirement. Department
of Civil Servant Provident Fund was established in 2001 B.S. Employees’ Provident Fund
was established in 2017 B.S. as Karmachari Sanchaya Kosh Bibhag. On 3 Bhadra, 2019,
st
Provident Fund Act was introduced and employee provident fund was established under
this Act in 2019 B.S. as the perpetual and autonomous organization.

Key Point Employee’s provident fund is the fund collect from the employees’ salary
of the government offices, non-government offices and private offices
as the compulsory deduction according to the rule of government and
the organizations:

Functions of Employees’ Provident Fund
i. It collects the deposit of the deducted amount and contribution
made by the employees and keeps the records under the different
individual accounts.
ii. It pays the deposited amount along with the interest and bonus to
the employee after the retirement.
iii. It provides loan to employees/depositor (home loan, education
loan, special loan) at the time of necessity as well as financial EPF logo
support. It charges lower rate of interest.
iv. It provides information to the employees about the different services and facilities
providing through it.
v. It invests the collected amount in different productive sectors and generate income
for the additional benefit for the employees.

vi. It also provides loan to the government as per the requirement.

94 Aakar’s Office Practice and Accountancy - 10 Financial Institutions 95