Para 3.7.3 — MSO (Audit)
Original Rule Text
3.7.3 Deviations from contracts require authority not inferior to that required for the conclusion of the original contract. Audit should also see that any payments outside the
strict terms of the contract or in excess of the contracted rates are not made without the consent of the competent financial authority.
What This Means
Any deviation from the terms of a contract requires approval from an authority at least as senior as the one who originally approved the contract. Audit must ensure that no payments outside the strict contract terms, or in excess of the contracted rates, are made without the consent of the competent financial authority. This prevents unauthorized modifications that could increase government liability.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Deviations from contracts need authority not inferior to the original approving authority
- 2Payments outside strict contract terms require competent financial authority consent
- 3Payments in excess of contracted rates are not permitted without proper approval
- 4This prevents unauthorized modifications to contract terms
- 5Audit must actively verify these safeguards
Practical Example
A contractor was awarded a road construction project sanctioned by the Chief Engineer. During execution, the department agrees to pay 10% above contracted rates due to increased material costs. The Audit Officer verifies that this deviation was approved by an authority at least at the level of the Chief Engineer (who approved the original contract), not by a subordinate officer. Finding that only the Executive Engineer approved the rate increase, the auditor flags this as an unauthorized deviation.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Can a lower authority approve minor deviations from a contract?▼
What constitutes a 'payment outside the strict terms of the contract'?▼
Who is the 'competent financial authority'?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.