Group 15: Government Audit

Pressure on the constitutional auditor An executive officer proposes removing the CAG by a departmental memo, reducing the incumbent's salary as a penalty and offering a State-government post after retirement. Required: Apply the relevant government-audit principles to these facts. (3 marks)

Two reports, one wrong route A Union-account report and a State-account report are sent only to their finance secretaries. The secretaries call departmental acceptance a substitute for legislative laying and insist all findings need their approval before inclusion. Required: Apply the relevant government-audit principles to these facts. (5 marks)

Account form is not an audit licence A department argues that prescribing an account format gives the President an unrestricted power to determine CAG audit jurisdiction. It also removes Contingency Fund transactions and a departmental manufacturing account from audit because neither is ordinary Consolidated Fund expenditure. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A voted purpose, an overspend and a mistaken offset A supplied appropriation authorises Rs 120 lakh for water-pump replacements and Rs 80 lakh for staff training, as separate non-transferable purposes in this exercise. Actual pump spending is Rs 132 lakh, including Rs 15 lakh on unrelated ceremonial lights. Training spending is Rs 55 lakh. No valid supplementary authority or transfer power is supplied. The department says total actual spending is below Rs 200 lakh, so all spending is lawful; a director's signature and correct invoices allegedly cure every issue. Required: Apply the relevant government-audit principles to these facts. (10 marks)

A subordinate circular overrides the delegation A department circular permits an officer to sanction equipment up to Rs 40 lakh. A supplied higher-authority delegation caps that officer at Rs 10 lakh and grants the department no power to alter it. The officer signs a Rs 24 lakh purchase; the budget contains funds. Management says the latest circular and available funds settle authority. Required: Apply the relevant government-audit principles to these facts. (5 marks)

The technically regular but idle laboratory A district buys expensive laboratory machines after following the prescribed tender and sanction process. No trained staff, power connection or consumables are available; machines remain boxed for two years. Management says formal compliance closes the issue. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A programme that meets output counts but misses its purpose A supplied skill programme aims to train 1000 eligible adults and place 600 in sustained jobs within six months. It spends Rs 60 lakh, trains 1000 on its dashboard and claims 600 placements. Independent payroll follow-up confirms only 360 sustained jobs; 120 dashboard trainees are duplicates. Procurement files compare only machine prices, ignoring servicing and unusable machines. No external benchmark or causal proof of fraud is supplied. Required: Apply the relevant government-audit principles to these facts. (10 marks)

The receipt total reconciles but assessment is missing A State revenue office reconciles deposits to its cash book. It never checks liable persons left outside assessment, unexplained exemption codes, delayed collections or credit to the wrong revenue head. Management says receipt audit ends with bank reconciliation. Required: Apply the relevant government-audit principles to these facts. (5 marks)

The stock ledger conceals unusable stores A Union department's stores ledger agrees arithmetically. A warehouse has no physical-verification evidence, obsolete stock remains marked usable and recent issues lack authorised requisitions. Required: Apply the relevant government-audit principles to these facts. (3 marks)

A relevant contract is withheld as inconvenient During an audit within the CAG's established DPCAct mandate, a Union department provides summary totals but refuses underlying contract files and initial accounts because preparing them takes time. The person in charge answers only convenient questions. Required: Apply the relevant government-audit principles to these facts. (5 marks)

The two-limb funding test In one financial year, body A receives a qualifying Consolidated Fund grant of Rs 30 lakh and spends Rs 40 lakh. Body B receives Rs 24 lakh and spends Rs 30 lakh. No conflicting governing law, previous qualifying audit or alternative mandate is supplied. The team says both bodies qualify under the deeming explanation to section 14(1) because the grant pays most expenditure. Required: Apply the relevant government-audit principles to these facts. (5 marks)

One crore is not self-executing approval Body C receives a qualifying grant of exactly Rs 1 crore, representing 40% of its expenditure. Section 14(1) deeming conditions do not apply and no earlier qualifying audit or other mandate is supplied. An audit officer treats the amount alone as a mandatory section 14(2) audit and says approval can be obtained after completion. Required: Apply the relevant government-audit principles to these facts. (5 marks)

Funding stops after a qualifying audit A body was audited in FY 2024-25 because section 14(1) conditions were fulfilled. It receives no qualifying funding in FY 2025-26 or FY 2026-27. No fresh qualifying facts are supplied for FY 2027-28. Management says the audit stops immediately when funding falls. Required: Apply the relevant government-audit principles to these facts. (3 marks)

Purpose grants and paper-only assurance A domestic authority receives a specific-purpose Consolidated Fund grant for flood-shelter repairs. The sanction requires work completion evidence and return of unspent money. The sanctioning department accepts unsigned utilisation totals without site/work support or reconciliation. The authority permits record inspection after reasonable notice. No special statutory-corporation restriction or public-interest relief order applies. Rs 50 lakh is received, supported eligible repair spending is Rs 38 lakh and unspent cash is Rs 12 lakh; a Rs 7 lakh contractor advance is included in the Rs 38 lakh but has no completed-work support. These figures are exercise facts, not statutory thresholds. Required: Apply the relevant government-audit principles to these facts. (10 marks)

A corporation has a different statutory auditor A statutory corporation receives a specific-purpose grant. Its governing law expressly provides for audit by an agency other than the CAG. The team relies solely on section 15(1) to demand access to the corporation's books without checking additional authorisation; the sanctioning department's grant-monitoring procedures remain in scope. Required: Apply the relevant government-audit principles to these facts. (5 marks)

An entrusted audit requested by the wrong route A State-funded body has no CAG audit entrusted by Parliamentary law, and section 19 does not govern it. A departmental secretary emails an invitation to audit on unspecified terms, without a Governor request, CAG consultation, public-interest decision or opportunity for the body to make representations. The team treats the email as section 20 authority. Required: Apply the relevant government-audit principles to these facts. (5 marks)

The auditor proposes a new mandate The CAG considers an audit necessary because a substantial State investment is advanced to a body whose audit is not entrusted by law. An officer says the CAG can simply self-authorise under section 20(2), without involving the Governor or hearing the body. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A procurement finding that ignores its own evidence A public programme buys 300 pumps at Rs 20000 each, spending Rs 60 lakh. The supplied requirement is usable pumps capable of delivering a stated flow at the installation sites. A draft report calls all Rs 60 lakh a loss solely because a cheaper catalogue lists pumps at Rs 17000. The catalogue has different capacity and excludes installation. Site evidence shows 240 functioning pumps, 30 awaiting installation and 30 defective pumps covered by an untested warranty claim. Management provides a site-readiness explanation, but the draft omits it. Required: Apply the relevant government-audit principles to these facts. (10 marks)

Small value, serious public-interest context A government programme's expenditure audit finds a small payment personally benefiting the sanctioning officer. The team drops it solely because it is below its monetary planning threshold, without testing supplied eligibility restrictions or considering conflicts and public-interest consequences. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A recommendation is marked closed on a promise A prior government-audit report recommended reconciling revenue-head errors. Management sends a promise to correct them but provides no corrected ledger or reconciliation. The follow-up file marks the recommendation fully implemented. Required: Apply the relevant government-audit principles to these facts. (3 marks)

Corporations are not all governed by one audit clause A non-company corporation established under Parliamentary law and a separate corporation established under State legislative law are both assigned identical CAG audit scope by a team, without reading either governing statute. For the State corporation, no Governor request, consultation or opportunity for representations is supplied. Required: Apply the relevant government-audit principles to these facts. (5 marks)

The report goes only to the corporation chairman A CAG audit report for a corporation referred to in section 19 is received by the Central Government. It is sent only to the corporation chairman and placed online, without parliamentary laying. Another section 19 report concerns a State corporation. The team says web availability replaces every statutory route. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A limited check becomes a claim of certainty Circumstances warrant dispensing with part of detailed audit of a class of government transactions. The CAG applies a limited check under section 24. The summary then says the choice proves every omitted transaction is correct and provides absolute assurance. Required: Apply the relevant government-audit principles to these facts. (3 marks)

The financial opinion is mistaken for a programme verdict A government entity presents financial statements under a supplied reporting framework. Its financial audit finds supported presentation under that framework. The minister claims this proves all tenders comply with every rule and that the entity's service programme achieved its targets. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A direct report uses undisclosed criteria In a government water-service performance audit, the auditor selects uptime and access criteria and measures results directly. The draft gives rankings but withholds the criteria from intended users. The team calls this an attestation engagement because numbers appear in the report. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A road-maintenance dashboard uses the wrong denominator A supplied road programme requires all 200 eligible villages to receive safe year-round access by the review date. Its dashboard records 220 work entries and calls this 110% target completion. Records show 40 entries are repeat repairs in the same villages, 20 distinct entries are for ineligible villages, and the remaining 160 entries represent 160 distinct eligible villages. Independent inspection finds 140 of those 160 have safe year-round access; 20 remain impassable in rains. The programme spends Rs 100 lakh. No counterfactual impact study or external cost benchmark is supplied. Required: Apply the relevant government-audit principles to these facts. (10 marks)

The engineering expert is treated as the audit owner A public bridge performance audit needs load-testing skills not held by the team. An engineer provides a certificate but no basis for testing, competence or independence checks. The team proposes copying it and assigning the entire report responsibility to the engineer. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A performance audit becomes a personal policy preference A government service programme has a supplied lawful objective of access for remote villages. An auditor dislikes that objective and ranks the programme as ineffective solely because it did not maximise city service volume, without testing the supplied remote-access target or resource constraints. Required: Apply the relevant government-audit principles to these facts. (5 marks)

A pooled account mixes spending with refund liabilities A government department's supplied records show Rs 90 lakh procurement expense, Rs 20 lakh refundable contractor deposits in a Public Account and a Rs 10 lakh Contingency Fund transaction. The summary incorrectly labels all Rs 120 lakh as procurement expense and omits deposits and contingency transactions from audit. The Rs 90 lakh contains Rs 6 lakh paid twice for the same accepted invoice, with no recovery posted. The original valid invoice was Rs 6 lakh, and both payments are included in Rs 90 lakh. No other errors or valid reasons for duplicate payment are supplied. Required: Apply the relevant government-audit principles to these facts. (10 marks)

A programme audit bends to its sponsor An executive sponsor offers to fund an audit team's extra resources only if the team omits adverse programme findings and lets the sponsor choose all criteria. The team says public-sector resource needs justify accepting those conditions and suppressing contrary evidence. Required: Apply the relevant government-audit principles to these facts. (5 marks)