Para 2.4.10 — MSO (Audit)
Original Rule Text
2.4.10 It is an important function of Audit to ascertain that stores materials are counted periodically and otherwise examined to verify the accuracy of the quantity balances reflected in the books. Audit shall not, except when specifically authorised to do so, assume responsibility for physical verification of stores; it, however, has the right to investigate stores balances and highlight discrepancies. Audit has to see that
(a) a certificate of verification of stores is recorded periodically by a responsible authority;
(b) the system adopted by the executive for verification is adequate and proper;
(c) discrepancies found on stock verification are properly investigated and reconciled; and
(d) the staff responsible for stock verification are, wherever possible, independent of those responsible for the physical custody of stores or for maintaining the accounts. It should also be seen that stock verifiers work, wherever practicable, directly under the control of the Government and not under the heads of the individual departments concerned.
- Audit of accounts of furniture in residences of High Officials
What This Means
Audit must ensure that government stores are physically counted and verified periodically to confirm that actual stocks match the book balances. While Audit itself does not physically count stores unless specifically authorized, it has the right to investigate discrepancies. Audit checks include: verifying that periodic stock verification certificates exist, the verification system is adequate, discrepancies are properly investigated, and the verification staff are independent of those who handle the stores.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Stores must be periodically counted and verified against book balances
- 2Audit does not physically verify stores unless specifically authorized
- 3Audit has the right to investigate stores balance discrepancies
- 4Stock verification certificates must be recorded by a responsible authority
- 5Verification staff should be independent of store-keepers
- 6Stock verifiers should work under government control, not department heads
Practical Example
During audit of a Public Works Division, auditors check whether the Executive Engineer has conducted annual physical verification of cement, steel, and other construction materials in the stores. They find that while verification was done, the same storekeeper who maintains custody also conducted the count. Audit flags this lack of segregation of duties and recommends that an independent officer verify the stores.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Why shouldn't the storekeeper also verify the stores?▼
What kind of discrepancies might audit investigate?▼
Can audit conduct surprise physical verification?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.