{"id":32375,"date":"2024-11-19T19:09:34","date_gmt":"2024-11-19T13:39:34","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=32375"},"modified":"2024-11-19T19:09:36","modified_gmt":"2024-11-19T13:39:36","slug":"audit-diwas-and-role-of-cag","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/19-11-2024\/audit-diwas-and-role-of-cag","title":{"rendered":"Audit Diwas and Role of CAG\u00a0"},"content":{"rendered":"\n<p><strong>Syllabus: GS2\/ Polity &amp; Governance<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>On <strong>Audit Diwas (November 16th)<\/strong>, the Lok Sabha Speaker said that the <strong>Comptroller &amp; Auditor General (CAG)<\/strong> has played a key role in fostering accountability, transparency and good governance in the country.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>About the Comptroller &amp; Auditor General (CAG)<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Brief:\u00a0<\/strong>\n<ul class=\"wp-block-list\">\n<li>It is a constitutional authority responsible for auditing the <strong>accounts of the Central and State governments.<\/strong><\/li>\n\n\n\n<li>The Comptroller and Auditor General of India (CAG) is <strong>appointed by the President <\/strong>of India by a warrant under his hand and seal.<\/li>\n\n\n\n<li>Prior to taking over his\/her office, the Comptroller and Auditor General of India (CAG) makes and subscribes to an <strong>oath or affirmation before the President of India.<\/strong><\/li>\n\n\n\n<li>The CAG holds office for <strong>6 years or up to the age of 65 years<\/strong>, whichever is earlier.<\/li>\n\n\n\n<li>CAG can be removed by the President of India on the same grounds and in the same manner as a<strong> judge of the Supreme Court.<\/strong>\u00a0<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Constitutional Mandate:<\/strong>\n<ul class=\"wp-block-list\">\n<li><strong>Article 148:<\/strong> Establishes the office of the CAG, appointed by the President for 6 years or until 65 years of age. Removal follows the process for Supreme Court judges, ensuring independence.<\/li>\n\n\n\n<li><strong>Article 149: <\/strong>Defines the duties and powers of the CAG to audit Union, State, and public corporation accounts, as determined by Parliament.<\/li>\n\n\n\n<li><strong>Article 150: <\/strong>Mandates that Union and State accounts are maintained in a format prescribed by the President on the advice of the CAG.<\/li>\n\n\n\n<li><strong>Article 151:<\/strong> Requires the CAG&#8217;s audit reports to be presented to Parliament or State Legislatures through the President or Governor.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Functions and Responsibilities:\u00a0<\/strong><\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Audit of Government Accounts:<\/strong> The CAG audits the accounts of the Union and State governments and public sector organisations.\n<ul class=\"wp-block-list\">\n<li>It includes financial audits, compliance audits, and performance audits.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Reporting to the Legislature: <\/strong>The CAG submits audit reports to the President or the Governor, who then places them before the Parliament or the State Legislature.\n<ul class=\"wp-block-list\">\n<li>These reports highlight any discrepancies or inefficiencies in the use of public funds.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Advisory Role<\/strong>: The CAG advises the government on financial matters and helps in the formulation of policies to improve financial management and accountability.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>CAG: Ensuring Transparency and Fixing Accountability<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Irregularities in Public Projects:<\/strong> The CAG&#8217;s reports have unveiled substantial cost escalations and financial mismanagement in major infrastructure projects.\n<ul class=\"wp-block-list\">\n<li>For instance, the construction cost of the Dwarka Expressway skyrocketed from \u20b918 crore per kilometre to \u20b9250 crore per kilometre.<\/li>\n\n\n\n<li>Such findings have raised questions about the prudence and transparency of project management.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Misallocation of Funds:<\/strong> The CAG has highlighted the diversion of funds from welfare schemes.\n<ul class=\"wp-block-list\">\n<li>In one instance, funds meant for the <strong>National Social Assistance Programme (NSAP)<\/strong> were redirected to promote other government schemes, impacting the intended beneficiaries. It has led to calls for stricter adherence to fund allocation guidelines.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Healthcare Scheme Irregularities: <\/strong>The audit of the<strong> Ayushman Bharat\u2014Pradhan Mantri Jan Arogya Yojana (PMJAY) <\/strong>revealed that \u20b96.97 crore was disbursed for the treatment of patients who were recorded as deceased.\n<ul class=\"wp-block-list\">\n<li>Such discrepancies underscore the need for robust oversight mechanisms to prevent financial irregularities.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Key Concerns<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Increasing Complexity of Audits: <\/strong>As public administration and financial management become more complex, the CAG&#8217;s audits must <strong>adapt to new forms of corruption and maladministration<\/strong> that are increasingly difficult to detect.\n<ul class=\"wp-block-list\">\n<li>It includes <strong>auditing public-private partnerships (PPPs)<\/strong> and other innovative financial arrangements that require specialised knowledge and skills.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Technological Advancements: <\/strong>While the adoption of <strong>emerging technologies like artificial intelligence and data analytics<\/strong> can enhance audit processes, it also presents a challenge.\n<ul class=\"wp-block-list\">\n<li>The CAG must continuously update its technological capabilities and ensure that its staff are adequately trained to use these tools effectively.<\/li>\n\n\n\n<li>It is essential for maintaining the credibility and accuracy of audits in a rapidly evolving digital environment.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Maintaining Independence: <\/strong>The independence of the CAG is fundamental to its role in promoting accountability.\n<ul class=\"wp-block-list\">\n<li>However, there have been concerns about potential attempts to curtail the powers of the CAG, which could compromise its ability to conduct impartial audits.<\/li>\n\n\n\n<li>It is essential to safeguard the CAG&#8217;s autonomy to ensure that it can operate without undue influence from the executive or other entities.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Capacity Building:<\/strong> Building and maintaining the capacity of the CAG&#8217;s workforce is another significant challenge.\n<ul class=\"wp-block-list\">\n<li>It includes not only technical training but also fostering a culture of integrity and professionalism. Continuous professional development and capacity-building initiatives are necessary to equip auditors with the skills needed to tackle emerging challenges effectively.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Public Perception and Trust:<\/strong> Maintaining public trust in the CAG&#8217;s findings is crucial for its effectiveness. Any perception of bias or inefficiency can erode confidence in the institution.\n<ul class=\"wp-block-list\">\n<li>The CAG must ensure transparency in its operations and communicate its findings clearly to the public to uphold its reputation.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Way Ahead: Strengthening the CAG<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Adoption of Emerging Technologies:<\/strong> The CAG has proactively adopted emerging technologies, including artificial intelligence, to enhance its audit processes and ensure greater transparency.\n<ul class=\"wp-block-list\">\n<li>It is crucial for keeping pace with the dynamic landscape of public administration.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>International Collaboration:<\/strong> The CAG has strengthened its global presence by securing re-elections as the external auditor for several international organisations, such as the World Health Organization and the International Labour Organization.\n<ul class=\"wp-block-list\">\n<li>These roles underscore the CAG&#8217;s commitment to upholding high standards of professionalism and integrity in audit practices.<\/li>\n\n\n\n<li>The CAG has signed multiple Memorandums of Understanding (MoUs) with various countries to collaborate on public sector auditing. It includes recent <strong>agreements with Seychelles, Kenya, and Saudi Arabia.<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Institutional Support:<\/strong> There have been calls to provide the CAG with adequate institutional support to discharge its constitutionally enshrined role effectively.\n<ul class=\"wp-block-list\">\n<li>Strengthening the CAG involves ensuring its independence and empowering it to conduct comprehensive audits without undue interference.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n\n<p><a href=\"https:\/\/cfo.economictimes.indiatimes.com\/news\/tax-legal-accounting\/cag-played-key-role-in-fostering-accountability-transparency-and-good-governance-speaker-om-birla\/115399909\" target=\"_blank\" rel=\"noopener\">Source: ET<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>On Audit Diwas (November 16th), the Lok Sabha Speaker said that the Comptroller &#038; Auditor General (CAG) has played a key role in fostering accountability, transparency and good governance in the country.<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-32375","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/32375","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=32375"}],"version-history":[{"count":1,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/32375\/revisions"}],"predecessor-version":[{"id":32376,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/32375\/revisions\/32376"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=32375"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=32375"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=32375"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}