Para 3.7.9 — MSO (Audit)
Original Rule Text
3.7.9 Unusual items in the contracts and agreements should be scrutinised carefully if necessary in consultation with the Propriety Audit/Higher Audit Section in the headquarters. The OAD (Headquarters) Section should also be informed of such purchases without delay so that they may arrange a programme of local audit to enable scrutiny of the relevant purchase files.
- Notes:
(i) The Principal Director of Audit, Economic and Service Ministries, conducts a detailed examination of selected contracts (other than those relating to contingent and miscellaneous expenditure to which the instructions contained in this paragraph will apply) entered into by the Directorate General of Supplies and Disposals under the Ministry of Commerce and by the Department of Food under the Ministry of Food and Agriculture with reference to the connected files and other documents during local audit undertaken concurrently.
(ii) When payments included in contingent bills are made at contracted rates that need not be communicated to the Audit Office, a certificate should be obtained from the competent authority to the effect that the claim is correct with reference to such contracted rates.
What This Means
Unusual items in contracts and agreements must be carefully scrutinized, with help from the Propriety Audit or Higher Audit Section at headquarters if needed. The OAD (Headquarters) Section should be informed promptly about such purchases so it can schedule a local audit visit to examine the relevant purchase files. The Principal Director of Audit (Economic and Service Ministries) conducts detailed concurrent examination of selected DGS&D and Department of Food contracts during local audit. For contingent bill payments at contracted rates not communicated to Audit, a certificate from the competent authority confirming the claim's correctness is required.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Unusual contract items require careful scrutiny, possibly with headquarters consultation
- 2OAD Headquarters must be informed without delay for local audit programming
- 3DGS&D and Food Department contracts undergo detailed concurrent local audit
- 4Contingent bill payments at un-communicated contracted rates need a competent authority certificate
- 5Propriety Audit Section provides expert review of unusual contract provisions
Practical Example
During central audit, an Audit Officer finds an unusual clause in a government contract allowing the supplier to revise prices based on an internal cost index rather than a published market index. She consults the Propriety Audit Section at headquarters for guidance and simultaneously informs the OAD Section so they can schedule an early local audit visit to examine the complete purchase file and understand the circumstances that led to this unusual provision.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What qualifies as an 'unusual item' in a contract?▼
Why must the OAD Headquarters be informed 'without delay'?▼
What is the certificate required for contingent bill payments?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.