After considering the replies of the Principal Officer and action taken on the audit objection and requisitions issued during audit, the result of audit shall be prepared in the following two parts- In case the original copies of objection statements and requisitions are not returned within the specified time, audit report and fair objection sheet shall be prepared on the basis of outstanding objections in the carbon copy of the objections. The fact about the non-receipt of the original objection statement after reply shall invariably be mentioned in the last para of draft audit report.
Audit and Inspection Report.-(1) Besides formal information required in Forms (L.F.A 104, 105 and 106) Audit and Inspection Report shall contain paragraphs in order set forth below-or the top of the audit and inspection report, the period of audit and the names of the Principal Office and the Drawing and Disbursing Officer shall be mentioned.
PART "A" Current Audit
(a) In the first paragraph of the audit note detailed comments on irregularities of financial and general importance particularly comments on the following subjects shall invariably be incorporated-
(i) Loss and misapplication of funds and property if any;
(ii) Embezzlement, if any;
(iii) Irregular expenditure of financial importance such as irregular expenditure of recurring nature, expenditure on account of excessive or unapproved establishment/post in excess irregular payment of salary and allowances, payments in contravention of the provisions of relevant Act and Rules wasteful of excessive expenditure etc;
(iv) Loss of revenue:
(v) Progress and utility of projects in relating in development education or other specific purposes in hand or completed during the year under audit including full financial implications of the projects completed during the year under audit with reference to profitability for the institution;
(vi) Comments on Budget and financial managements including management of financial resources:
(vii) Comments on stock accounts of movable and immovable properties and theirmanagement and utilization:
(viii) Utilization of valuable instruments;
(ix) Any other important irregularities requiring special attention of the administration.
(b) Audit paras relating to loss, waste, misapplication and irregular expenses,payments etc. should invariably contain the following aspects in the order set forth below--
(i) In the opening part of the audit para full details of the transactions quoting number and date of the receipt/voucher nature/character of income/expenditure amounts involved in the transaction etc. should be described in such a way so as to expose very clear picture of the whole transaction;
(ii) In the next part it should be clearly explained as to how a loss was caused or as towhy the expenditure was declared waste, miss-utilized, irregular, unapproved or how theexcess payment was made etc. It should also be mentioned as to which section of therelevant Act or rules or which order of the Government was infringed in the transaction.
(iii) The succeeding part of the objection should contain calculation amount of loss, waste, misuse or irregular expenditure or excess payment giving a clear picture of the extentof the loss suffered or amount involved in the irregularity:
(iv) In the concluding part of the objection, the responsibility as per rules or recordsavailable in audit should be indicated and remedial measures/action should also besuggested:
(c) During the course of audit of the major accounts, the concerned Assistant Director/District Audit Officer at the time of his visit to the local authority shall contact the Head of the Office of the account to enquire if special attention to audit was required towards any branch of account and shall ensure deep investigation of such branch of accounts, if any, and get the resultthereof incorporated in the audit report.
PART-B Last Audit Report
(1) In this paragraph comments on progress of compliance of outstanding Audit Reports of the previous years will be made. A list of audit objections settled during the course of audit shall also be prepared.
A list of all unsettled audit objections should be attached as annexure to the audit reports of all accounts except those which are to be issued by the Assistant Director/Deputy Director of the concurrent audit. A separate and up-to-date list of old and unsettled audit objections will be issued by the Assistant Director/Deputy Director of the concurrent Audit, from time to time, to the concorrent Local Authority from Register of settled and unsettled objections maintained by him.
(2) Financial Position--The financial position of Local Authority will be shown in the annexure to the audit report. In the body of the audit report only comment, if any, on the financial position of the local authority will be incorporated.
(3) Cash assets and Liabilities--Position of cash assets and liabilities will be shown in the end of the audit report as annexure.
(4) Government Grants--Position of recurring and non-recurring grants received by the Local Authority during the year under audit will be shown in Form L.F.A. 105, and will be attached with the audit report as an annexure. Similarly position of unutilized grants will also be shown in form no. L.F.A. 66, and will be attached with the audit report as an annexure. In the body, of the audit report under this para only comments will be made on the progress of utilization of grants and irregularities, if any detected in the utilization of grants.
(5) Government Loans--In the body of the audit report under this paragraph only comments will be made on their (a) repayment and (b) utilization position of receipt and unrepaid loans will also be shown in the end of the audit report as an annexure.
In the body of the audit report under this paragraph only comments will be made.
(6) Reserve and Endowment Fund--In the audit report of educational institutions theposition of the Reserve and Endowment fund will be shown in the body of the audit report.
(7) Nazul and Ferry--In the audit report of the Local Authority comments on the income and management of Nazuland Ferry will be made.
(8) Advance--In the audit report of the Local Authority comments will be made onadvances granted to various person and their recovery.
(9) Fair Objection Statement—The unsettled objections of the objection statement which are not taken into accounts for preparation of auditand inspection report, referred to in part "a" above shall be copied out by the Auditor in Form L.F.A. 53. It will be called fair copy of the objection statement. A last sheet in Form L.F.A. 53-A, of the objection statement shall be prepared and attached at the end of fair objection statement.
13. Procedure for Audit Report--(1) Before the conclusion of audit the auditor shall intimate in writing the probable date of conclusion of audit, to the Principal Officer of the Local Authority as well as to the concerned District Audit Officer or the Assistant Director. The Principal Officer of the Local Authority, the District Audit Officer; the Assistant Director and the Auditor concerned shall ensure their presence in the office of the Local Authority on the appointed date and time when the draft audit and inspection report shall be made available by the auditor for discussion. The draft audit report shall be discussed by the Principal Officer of the Local Authority with the District Audit Officer/The Assistant Director,such objections as have been complied with by the Principal Officer at the time of discussion shall be dropped.
(2) In token of evidence of discussion on the draft audit and inspection report the PrincipalOfficer of the Local Authority or the person authorised by him in this behalf shall recorda certificate on the draft copy of the audit and inspection report that the same has been madeavailable to him for discussion.
(3) If, however discussion on the draft audit and inspection report may not be held on the prefixed date due to non-availability of the Principal Officer of the Local Authority or his nominee, the auditor shall record this fact on the draft audit and inspection report and shall immediately after the date fixed for discussion submit same along with all statements to the Deputy Director, the Assistant Director or the District Audit Officer concerned, as the case may be, for further necessary action.
(4) On the receipt of the draft audit and inspection report, the replies to the audit objection as received from the concerned officers of the Local Authority and action taken by the auditor concerned thereon shall be scrutinised by the Deputy Director the Assistant Director the District Audit Officer while passing the Audit Report, Each report shall be passed within a month from the date of receipt of the draft audit and inspection report and it shall be issued to the Local Authorities and other concerned officers, within a month from the date of its passing.
(5) The fair copy of the objection statement as mentioned in Part "B" of Rule 12, shall be submitted by the Auditor concerned along with the draft Audit and Inspection Report to the Deputy Director the Assistant Director the District Audit Officer, as the case may be After review of the replies received from the Principal Officer of the Local Authority and the action taken on audit objection it shall be signed by the Deputy Director the Assistant Director the District Audit Officer, as the case may be, and be issued in original to the Principal Officer of the Local Authority.
(6) On receipt of the Audit and Inspection Report and fair copy of the objection statementaction shall be taken by the Principal Officer of the Local Authority and by the Local Fund Audit Department, in accordance with the provisions of sub-section (1) to (6) of Section 9, of the Act.
CHAPTER 5
14. Preparation of consolidated annual audit report--(1) A consolidated audit report shall be prepared under the guidance of the Director every year on the basis of audit and inspection reports of various local authorities. It shall include cases of asurcharge,misappropriation, embezzlement, loss, waste and such other serious financial irregularities as may prove helpful to the State Government for more effective financial control. It shall also indicate as to what extent the Government grants or loans given for general or special purpose have been utilized.
(2) As the time of passing the audit and inspection reports of relevant accounts the District Audit Officer/the Assistant Director of the Region, the Assistant Director / the Deputy Director of concurrent Audit shall prepare the draft paragraphs on the basis of audit and inspection reports of relevant accounts proposed to the included in the consolidated Annual Audit Report: The District Audit Officer will send the copy of draft paragraphto the concerned Assistant Director of the Region. Copies of draft paragraphs shall be sent by the Assistant Director of Region / the Assistant Director / the Deputy Director of concurrent audit, the Principal Officer of the local authority as well as to the Director, Local Fund Audit Department. The Principal Officer of the local authority shall be required to take action in accordance with the provisions of sub-sections (1), (2) and (3) of the section 9 of the Act and to ensure compliance of the objection. A copy of the compliance reportshall be sent to the Assistant Director of the region. The Assistant Director/the Deputy Director of concurrent Audit within thirty days from the date of receipt of the draft paragraph. If compliance report is not received within thirty days from the Principal Officer of the local authority a reminder will be sent to him and after further fifteen days a third reminder will also be issued.
(3) The compliance report received from the Principal Officer of the local authority shall be scrutinised by the Assistant Director of the Region/ the Assistant Director/the Deputy Director shall of the concurrent audit and thereafter the concerned Assistant Director /the Deputy Director shall send his comments to the Director along with the compliance report.
If the Director is satisfied with the compliance report of the audit objection he shall drop the objection wholly or in part and the remaining unsettled objections shall be incorporated in the Consolidated Annual Audit Report. In case the compliance report is not received from the Principal Officer of the Local Authority within the aforesaid time after issuance of three reminders, it will be presumed that the Local Authority is not interested to comply with the draft paras of the audit objection and the same shall be incorporated in the Consolidate Annual Audit Report.
The Consolidated Annual Audit Report shall be submitted by the Director to the State Government in Finance (Audit) Department for laying the same before each House of the State Legislature.
CHAPTER 6 FEE FOR AUDIT