Para 3.13.23 — MSO (Audit)
Original Rule Text
3.13.23 Audit of transactions under suspense heads consists not only in applying the ordinary procedures of audit of expenditure and receipts but also in seeing that:
(i) the unadjusted balances under these heads continue to represent bonafide assets or liabilities of Government capable of being realised or settled, as the case may be; and
(ii) satisfactory action towards such realisation or settlement is being taken by the officers responsible; and
All balances under suspense heads must be reviewed at short intervals, ensuring that no item remains unadjusted longer than is reasonably necessary to bring about its clearance in the ordinary course with due regard to the rules applicable to each case.
# Interest payments
What This Means
Auditing suspense heads involves not just normal checks on expenditure and receipts but also verifying that unadjusted balances represent genuine government assets or liabilities that can actually be realised or settled. Audit must also confirm that responsible officers are taking satisfactory action to clear these items. All suspense balances should be reviewed at short intervals to ensure nothing stays unadjusted longer than reasonably necessary.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Standard audit procedures for expenditure and receipts apply to suspense head transactions
- 2Unadjusted balances must represent genuine assets or liabilities capable of realisation or settlement
- 3Officers responsible must be taking satisfactory action toward clearance
- 4Suspense balances must be reviewed at short intervals
- 5No item should remain unadjusted longer than reasonably necessary given the applicable rules
Practical Example
During audit, the team reviews the suspense account of a government department and finds Rs 12 lakh sitting unadjusted for over two years. Investigation reveals that Rs 5 lakh relates to an advance to a contractor whose contract was terminated, making recovery doubtful. The auditor flags this as a potentially irrecoverable balance and recommends that the department either pursue recovery action or write it off through proper procedure.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What does it mean for a suspense balance to represent a 'bonafide asset'?▼
How often should suspense balances be reviewed?▼
What happens if an officer is not taking action to clear suspense items?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.