Regulation 25 — Audit of government expenditure verifies that prop

25. Examination of systems and procedures and certain checks to be applied in audit of expenditure

Audit of expenditure examines and verifies whether adequate, proper and sound systems and procedures are in place and are being complied with, both in letter and spirit, for spending public money. Audit inter alia checks the expenditure for:

(1) Appropriation, i.e., the availability of funds in the budget, including supplementary grant

(s) and re-appropriation; this also includes

(a) Examination of the orders of re-appropriation and surrender for their legality, competence and propriety;

(b) Confirmation that the expenditure is within the scope and intent of the grant and does not attract the limitation of new service or new instrument of service;

Regulations on Audit and Accounts 2020 25

(c) The amount of actual expenditure for its legal availability for and application to the service or purpose in accordance with the scope and intent of the grant;

(d) The explanations for the significant variations between the amounts of actual expenditure and the amounts authorised by the legislature, beyond the prescribed limits of such variations, for their veracity.

(e) Compliance with the requirement of the applicable laws, rules, regulations, orders and instructions in actual disbursement;

(f) Evidence by way of vouchers, payees’ acknowledgements, etc.;

(g) Record in the books of the spending officer, including crossverification with the records of the treasury, pay and accounts office, bank, etc.; and

(h) Monitoring, control and reporting as prescribed in the Government rules. The above carries an embedded, but essential, requirement of the examination of expenditure for compliance with the broad and general principles of financial propriety. (2) In the case of Appropriation Accounts, in addition to the above, Audit verifies whether adequate, proper and sound systems and procedures are in place and are being complied with, both in letter and spirit, for spending public money. (3) Audit is required to report not only significant cases of irregularity and breach of rules, regulations and orders but also every matter which, in the judgment of the Audit, appears to involve significant unnecessary, excessive, extravagant or wasteful expenditure of public money and resources despite compliance with the rules, regulations and orders or expenditure that has not yielded the intended outputs and/or outcomes.

Regulations on Audit and Accounts 2020

What This Means

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

• 1Audit verifies budget availability (appropriation) including supplementary grants and re-appropriations
• 2Checks that expenditure is within the scope and intent of the grant and not a 'new service'
• 3Requires proper documentation — vouchers, payees' acknowledgements, and cross-verification with treasury/bank records
• 4Must report significant excess or shortfall in expenditure beyond prescribed limits
• 5Reports wasteful or extravagant spending even when rules are technically followed (propriety audit)
• 6Flags expenditure that failed to deliver intended outputs or outcomes

Practical Example

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.