Regulation 107 — Audit Regulations 2020
Original Rule Text
# 107. Responsibility for settlement of audit observations and constitution of Audit Arrears Committee
The responsibility for settlement of audit observations is that of the management of the corporation. In case a large number of audit observations included in the inspection reports remain outstanding for more than two years, each such corporation shall constitute an Audit Arrears Committee consisting of sufficiently senior officers of the corporation for speedy settlement and clearance of outstanding audit observations. The concerned Government may
Regulations on Audit and Accounts 2020 58
take steps to ensure constitution of these committees and their effective functioning.
What This Means
The corporation's management is responsible for settling (resolving) outstanding audit observations. If a large number of observations from inspection reports remain unresolved for more than two years, the corporation must set up an Audit Arrears Committee of senior officers to clear the backlog. The government should ensure these committees are formed and function effectively.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Settlement of audit observations is the CORPORATION's responsibility, not the auditor's
- 2Trigger: large number of observations outstanding for more than 2 years
- 3Corporation must constitute an Audit Arrears Committee with senior officers
- 4Government must ensure these committees are formed and work effectively
- 5Purpose: speedy settlement and clearance of long-pending audit observations
Practical Example
Bharat Heavy Electricals Limited (BHEL) has 350 audit observations from AG inspection reports pending for over 3 years. Under this regulation, BHEL must constitute an Audit Arrears Committee chaired by a Director-level officer to systematically clear these observations. The Ministry of Heavy Industries should monitor that the committee meets regularly and makes progress.
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 'settlement' of an audit observation mean?▼
Who should be on the Audit Arrears Committee?▼
What if the corporation refuses to form the committee?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.