Para 2.6.18 — MSO (Audit)
Original Rule Text
2.6.18 Section 14(2) of the Act empowers the Comptroller and Auditor General to audit, with the prior approval of the President or Governor of a State or the Administrator of a Union Territory having a Legislative Assembly, the receipts and expenditure of any body or authority where the grants or loans to such body or authority from the Consolidated Fund
(s) is not less than rupees one crore in a financial year. Similar provision to obtain prior authorisation exists in Section 20(2) of the Act in regard to the audit to be undertaken by the Comptroller and Auditor General at his initiative of the accounts of any body or authority. Again, Sub-section (2) of Section 15 of the Act envisages such prior authorization for the Comptroller and Auditor General to have access to the books and accounts of a corporation for the purpose of his scrutiny under Sub-section (1) of Section 15, if its accounts are audited by another agency under the provisions of the law establishing the corporation. Suggestions for taking up audit under Section 14(2) or
What This Means
Before the CAG can take up audit of a body under certain provisions (Section 14(2), 15(2), or 20(2)), prior approval from the President, Governor, or UT Administrator is needed. The Accountant General may suggest taking up such audit, with the CAG's approval, especially when the sanctioning agency's control is inadequate, accounts are in poor condition, there are chronic delays in finalization, no external audit exists, the institution suffers persistent losses, or the government has guaranteed large amounts despite small direct investment.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Prior approval of President/Governor/UT Administrator required for audit under Sections 14(2), 15(2), and 20(2)
- 2Suggestions for taking up audit need specific or general approval of the CAG
- 3Six trigger situations are specified for recommending CAG audit
- 4These include inadequate control, unsatisfactory accounts, chronic delays, no external audit, persistent losses, and large government guarantees
- 5The process ensures CAG audit is targeted at high-risk entities
Practical Example
An Accountant General notices that a state-funded agricultural marketing board has not finalized its accounts for five years, has no external audit arrangement, and has accumulated losses of Rs 80 crore. The AG proposes to the CAG that audit be taken up under Section 20(2). After CAG's approval, the proposal is sent to the Governor, who authorizes the audit. The CAG's team then takes up the audit and discovers systematic misuse of market fee collections and fraudulent procurement of storage facilities.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What are the six situations that justify recommending CAG audit?▼
What does 'right of access' under Section 15(2) mean?▼
Can the Accountant General initiate audit without CAG headquarters' approval?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.