Para 6.3.1 — MSO (Audit)
Original Rule Text
6.3.1 Under the departmentalised accounting system, the receipts and payments of each Ministry/Department are handled by the public sector banks (including the State Bank of India and its subsidiaries) nominated for the particular Ministry/Department by the Reserve Bank of India. The scheme does not provide for internal audit of the basic accounts records in respect of these transactions maintained in the banks by the organisation of the Controller General of Accounts. Though the audit conducted by the auditors of the banks covers Government transactions as well, it is necessary for the Comptroller and Auditor General to audit these records in the discharge of his statutory responsibility for audit of all Government transactions.
What This Means
Under the departmentalised accounting system, public sector banks (including SBI and subsidiaries) handle government receipts and payments for each Ministry/Department as nominated by RBI. Since the Controller General of Accounts does not internally audit these bank records, and bank auditors' coverage of government transactions may not be sufficient, the CAG must audit these records to fulfil their statutory responsibility over all government transactions.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Public sector banks handle government receipts and payments under departmentalised accounting
- 2Banks are nominated by RBI for specific Ministries/Departments
- 3CGA's organisation does not provide internal audit of these bank records
- 4Bank auditors cover government transactions but this is not sufficient
- 5CAG must audit these records as a statutory responsibility
Practical Example
State Bank of India's Raisina Road branch handles salary payments and receipt collections for the Ministry of Urban Development. While SBI's own internal auditors review these transactions, they focus primarily on banking compliance. The CAG's audit party inspects these government transactions specifically to ensure proper accounting, timely credit to government accounts, and compliance with government financial rules.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Why does the CAG need to audit banks if they already have their own auditors?▼
What is the departmentalised accounting system?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.