Para 10.16 — MSO (A&E)
Original Rule Text
10.16 Accountant General should keep a watch over investment of funds forming part of the Public Account of the State. It should be seen that the investments made on account of any regularly constituted Sinking or other Fund administered by the Government are of the category authorised by the statutory provisions by which the fund is governed. When there is no governing statutory provision or instrument, proper authority for the investment should be called for.
This principle also applies to investment of Cash Balances of a State Government. The Accountant General should promptly take up with the Government any of the investments which he considers to be unauthorised, irregular or unsound. Any ascertained losses connected with investments on unusual depreciation in the market price of any
- SINKING FUNDS
investment should also be reported to Government in a suitable manner with such comments as the Accountant General may think fit.
# CONTINGENT LIABILITIES ON ACCOUNT OF GUARANTEES GIVEN BY GOVERNMENT
What This Means
The Accountant General must monitor all investments made from the Public Account of the State, including sinking funds and cash balance investments. The AG must verify that investments are of the type authorized by the relevant statute or governing instrument. If no statutory provision exists, proper authorization must be obtained. Any unauthorized, irregular, or unsound investments should be flagged to the government immediately. Losses or unusual depreciation in investment value must also be reported.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1AG must watch over all investments from the Public Account
- 2Sinking fund investments must be of the category authorized by governing statutes
- 3When no statute governs, proper authority for investment must be sought
- 4Unauthorized, irregular, or unsound investments must be flagged promptly
- 5Investment losses or unusual depreciation in market price must be reported to government
Practical Example
A State Government's sinking fund statute permits investment only in central government securities. The AG discovers that Rs. 50 crore of the sinking fund has been invested in corporate bonds. The AG immediately writes to the Finance Department flagging this as an unauthorized investment category and requests that the funds be moved to eligible securities. Separately, the AG notices a 15% drop in the value of another investment and reports the depreciation to the government.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What types of investments does the AG monitor?▼
What should the AG do if an investment appears unsound?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.