Para 2.6.16 — MSO (Audit)
Original Rule Text
2.6.16 Whenever public moneys are involved, the Constitution and the Act delineate the unique role of Comptroller and Auditor General in the audit of accounts. It is, however, not feasible or desirable that the audit of each individual transaction should be undertaken by him. Section 24 of the Act authorises the Comptroller and Auditor General to dispense with, when circumstances so warrant, any part of detailed audit of any accounts or a class of transactions and to apply such limited checks in relation to such accounts or transactions as he may determine. The use of the words “audit all receipts and expenditure” in Sub-sections (1) and (2) of Section 14 of the Act and of the word “shall” in Sub-sections (1) and (3) of Section 14, Sub-sections (2) and (3) of Section 19 and Subsection (1) of Section 20 are not, therefore, to be construed as meaning that whenever audit is taken up it is imperative that it should be a comprehensive audit of all transactions. Similarly use of the word “may” in Sub-section (2) of Sections 14 and 20 does not in any way restrict the scope of audit, once it is entrusted to the Comptroller and Auditor General. The extent of audit to be undertaken by the Comptroller and Auditor General is to be determined with reference to the circumstances of each case.
What This Means
Section 24 of the DPC Act allows the CAG to dispense with detailed audit and apply limited checks when circumstances warrant. The use of words like 'shall' or 'may' in audit provisions does not mean every single transaction must be audited. Even where audit is mandatory, the CAG has the discretion to determine the extent of audit based on each case's circumstances. Comprehensive audit of all transactions is not always required or implied.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Section 24 of DPC Act authorizes the CAG to apply limited checks instead of detailed audit
- 2The word 'shall' in audit provisions does not require comprehensive audit of all transactions
- 3The word 'may' does not restrict audit scope once audit is entrusted to the CAG
- 4The extent of audit is determined by the CAG based on each case's circumstances
- 5This provides flexibility for efficient use of audit resources
Practical Example
The CAG is mandated to audit a body that processes 500,000 transactions annually. Rather than auditing every single transaction (which would require enormous resources), the CAG's team applies statistical sampling to audit 5% of transactions in detail, conducts systems-level checks on internal controls, and performs targeted audits of high-value transactions above Rs 10 lakh. Section 24 provides the legal backing for this risk-based approach.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Can the CAG skip audit entirely under Section 24?▼
Does this mean the CAG might miss irregularities due to limited checks?▼
Who decides the extent of audit in each case?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.