Para 3.16.16 — MSO (Audit)
Original Rule Text
3.16.16 In cases where provisional adjustments have been made due to non-availability of correct figures before the closure of the accounts for the year, it should be verified whether the competent authority's sanction has been obtained for such adjustment. It should also be seen whether adequate action has been taken to collect the particulars necessary for carrying out the final adjustment at the earliest and if possible in the same year’s accounts by a belated journal entry. The practice of restricting adjustments in accounts to the extent of the available provision is against the principles of Parliamentary
control of public finance. The proper course to be followed, where details are available for adjustment, is to make the adjustment and explain suitably the excess/saving in the Appropriation Accounts.
Note: The basis of adjustment of interest on Provident Fund in Government account by the Accountant General (A&E) should be verified while checking the Appropriation Accounts and any case of defective budgeting in the ‘Interest Appropriation’ should be reported to the Headquarters Office.
# Check of Classification
What This Means
When exact figures are unavailable before accounts close for the year, provisional adjustments may be made. Audit must verify that these provisional entries have been sanctioned by the competent authority and that follow-up action is taken to finalize them as soon as possible, ideally within the same year. Restricting adjustments just to stay within available provision is improper because it undermines Parliament's control over public finances.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Provisional adjustments require sanction from the competent authority
- 2Final adjustment must be carried out at the earliest, preferably in the same year's accounts
- 3Restricting adjustments to available provision is against principles of parliamentary financial control
- 4The correct approach is to make the full adjustment and explain excess or saving in the Appropriation Accounts
- 5Interest on Provident Fund adjustments by AG (A&E) must be independently verified
Practical Example
At year-end, the accounting office does not have final figures for electricity charges across 40 offices. It books a provisional amount of Rs 3 crore based on estimates. The auditor verifies that the Controller sanctioned this provisional entry and checks whether final bills have been collected for a belated journal entry to correct the figure before the Appropriation Accounts are published.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Why can't the accounts simply limit adjustments to the available budget provision?▼
What should an auditor do if Provident Fund interest has been incorrectly budgeted?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.