Para 3.12.7 — MSO (Audit)
Original Rule Text
3.12.7 Local audit of the Provident Fund Accounts maintained by departmental officers will involve the following:
(i) Selection of representative sample for test check, keeping in view the efficiency of the internal control mechanism in the department concerned.
(ii) Tracing of the entries in the selected accounts from the recovery schedules, payment vouchers, personal ledger cards and broadsheets and verification of the correctness of the debits/credits as reflected in the broadsheets with reference to the corresponding details appearing in the monthly accounts.
(iii) Examination of the efficacy of system followed by the departmental officers for the periodical reconciliation of the debits and credits with the accounts maintained by the A&E Office.
(iv) Scrutiny of systems and procedures in force for enrolment of subscribers and maintenance of Index Registers.
(v) Verification of annual closure of accounts and despatch of annual account statements to subscribers on the scheduled dates.
(vi) Analysis of un-posted debits and credits and missing credits, particular attention being paid to minus balances in the ledger accounts to ascertain the reasons for the minus balances.
(vii) Scrutiny of ledger accounts to verify that sanctions to advances or withdrawals and acceptance of balances have been noted therein.
(viii) Examination of the adequacy of the action taken to locate missing debits.
(ix) Verification of
(a) the correctness of carry forward of closing balances at the end of the financial year as opening balances of the subsequent year and of the interest calculations with reference to the applicable rates; and
(b) the reporting of adjustment of interest afforded to individual accounts to the A&E Office before closure of accounts for the year.
Note: In States where the Accountant General (A&E) is responsible for maintaining the Provident Fund accounts of State Government employees, the Central Audit Branch of the Audit Office will look into the aspects mentioned in paragraphs 3.12.6 and 3.12.7.
# Utilisation/investment of accumulations
What This Means
Local audit of departmentally-maintained Provident Fund accounts involves selecting a representative sample for test check, tracing entries from recovery schedules and vouchers through ledger cards and broadsheets, checking reconciliation with A&E Office records, verifying enrolment and index register systems, confirming annual account closure and statement dispatch to subscribers, and analysing unposted items and minus balances. Auditors also verify that interest calculations are correct and that interest adjustments are reported to the A&E Office before year-end closure.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Representative samples are selected based on internal control quality
- 2Entries are traced from recovery schedules through ledger cards to broadsheets
- 3Periodic reconciliation with A&E Office records must be verified
- 4Annual account closure and subscriber statement dispatch are checked
- 5Minus balances and unposted credits/debits require special attention
Practical Example
An audit team visiting a State PWD office selects 50 GPF accounts for test check. They trace salary deductions from recovery schedules to individual ledger cards, check that annual statements were sent to subscribers by the due date, and investigate three accounts showing minus balances. They also verify that the department reconciled its PF records with the AG (A&E) office records and reported interest adjustments before year-end closure.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
How are sample accounts selected for test check?▼
What causes a minus balance in a PF ledger account?▼
When must interest adjustments be reported to the A&E Office?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.