Regulation 41 — Audit Regulations 2020
Original Rule Text
# 41. Audit of grants-in-aid and loans
Audit of grants-in-aid and loans is primarily an extension of audit of expenditure and the broad principles of audit of expenditure shall apply. Additionally, it examines whether the amount of Government assistance is utilised for the intended purpose.
Regulations on Audit and Accounts 2020
What This Means
Audit of grants-in-aid and loans is essentially an extension of expenditure audit, so all the broad principles of expenditure audit apply to it. In addition, a critical check is whether the government assistance was actually used for its intended purpose. This ensures that public funds given as grants or loans reach their objectives and are not diverted or misused.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Grants-in-aid and loans audit follows the broad principles of expenditure audit
- 2Additional focus: whether the assistance was used for its intended purpose
- 3Applies to both grants (non-repayable) and loans (repayable government assistance)
- 4Serves as a safeguard against diversion or misuse of public funds
Practical Example
The Central Government provides a grant-in-aid of Rs 500 crore to a State for constructing primary health centres under NHM. The CAG audit checks not only that the grant was sanctioned and disbursed properly (expenditure audit principles) but also whether the State actually used the money to build health centres — or diverted it to other purposes. Under Regulation 41, the end-use verification is a key additional check.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
What is the difference between a grant-in-aid and a loan in this context?▼
Does audit check only if the money was spent, or also how it was spent?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.