Para 2.2.38 — MSO (Audit)
Original Rule Text
2.2.38 Besides the question of competency of the authority sanctioning the expenditure, the scrutiny of sanctions should extend to seeing whether:
(i) the expenditure is a legitimate charge on the provision from which it is proposed to be met (see paragraph 2.2.18);
(ii) the expenditure conforms to the statutory provisions as well as the relevant financial rules, regulations and orders (see paragraph 2.2.22);
(iii) the expenditure is in conformity with the standards of financial propriety (see paragraph 2.2.47); and
(iv) a satisfactory procedure of accounting has been evolved by the sanctioning authority in the case of sanctions to new schemes, and the detailed cost and time schedules, physical targets and other objects of the expenditure have been duly stipulated..
What This Means
When auditing a sanction for expenditure, it is not enough to check whether the right authority approved it. Auditors must also verify that the expenditure is charged to the correct budget head, follows all applicable financial rules and statutory provisions, meets standards of financial propriety, and for new schemes that proper accounting procedures, cost schedules, timelines, and physical targets have been laid down.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Verify expenditure is a legitimate charge against the correct budget provision
- 2Ensure compliance with statutory provisions and all relevant financial rules
- 3Check conformity with standards of financial propriety
- 4For new schemes, confirm that cost schedules, timelines, and physical targets are stipulated
- 5Competency of the sanctioning authority alone is not sufficient for audit clearance
Practical Example
An audit team is reviewing a sanction for Rs 50 lakh issued by a Ministry for a new digital literacy programme. Beyond confirming the Secretary had authority to sanction this amount, the auditors check that funds are drawn from the correct budget head for IT training, that GFR procurement rules were followed for vendor selection, and that the sanction order includes year-wise cost breakdowns, target number of trainees, and completion timelines.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Why is checking only the sanctioning authority's competency not enough?▼
What happens if a new scheme sanction does not include cost and time schedules?▼
What are the standards of financial propriety referred to here?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.