CAG’s(DPC) Act, 1971
Section 14: Audit of receipts and expenditure of bodies or authorities
substantially financed from Union or State Revenues
(1) CAG audit and report on all receipts and expenditure of substantially financed
bodies or authorities
Note: If grant/loan given to a body in a FY from Consolidated Fund of India/State/UT
is >=25 lakhs and not less than 75% of total expenditure of this body then such
body is called as substantially financed
(2) CAG can audit it with previous approval of President/Governor/Administrator
if grant/loan in a FY is not less than 1 Crore
(3) CAG may audit for further 2 years irrespective of fulfilment of above conditions
Section 15: Function of CAG in the case of grants/loans given to other authorities
or bodies
(1) When grant/loan is given for specific purpose from Consolidated Fund ,not being
a foreign state or International Org, CAG will scrutinise the procedures of
granting this loan and shall have right to access(after giving notice) to the
books & accounts of authority or body
President/Governor/Administrator can relieve him from this duty after
consulting CAG itself (in public interest)
(2) The right to access the books/accounts of any corporation where the law
establishing it provides for audit by an agency other than CAG, is available to
CAG only with the authority of the President/Governor/Administrator otherwise
not.
CAG’s(DPC) Act, 1971
(3) Such authorisation is made after consultation of CAG and after giving the
concerned corporation a reasonable opportunity of making representations with
regard to the proposal to give the CAG right of access to its books and accounts.
Section 16: Audit of Receipts of Union or of States
● CAG should audit all the receipts which are payable to Consolidated Fund of
India/State/UT
● Also satisfies himself that rules and procedures are designed to secure an
effective check on the Assessment, Collection, and Proper Allocation of Revenue
Section 17: Audit of accounts of stores and stock
CAG audit and report on the accounts of stores and stock kept in any office or
department of the Union or of a State
Section 18: Power of CAG related to Audit of accounts
(1) CAG has
● Authority /right to inspect any office of Union/State
● Right to access any book of accounts at any place
● Right to summon or inquire
(2) Person-in-charge of office shall afford all facilities & comply with requests for
information
CAG’s(DPC) Act, 1971
Section 19: Audit of Government companies and corporations
(1) CAG will audit Government Companies according to Companies Act
(2) CAG has power to audit accounts of Corporations established by or under law
made by Parliament and shall exercise such power according to provisions of
respective legislation
(3) Where the Governor/Administrator requests CAG (in public interest) to audit
Corporations established by law of the State legislature or UT legislature, CAG
shall do that. Such request can only be made after consultation with CAG
Section 19A: Laying of reports in relation to accounts of Government companies
and corporation
● The CAG report of audit of Govt Co. or Corp. is submitted to the Government
concerned
● The Government shall cause to laid these reports before the Parliament/ State
Legislature/ UT legislature concerned
Section 20: Audit of accounts of certain authorities or bodies
(1) President/Governor/Administrator after consultation with CAG can authorise CAG
to audit accounts of any authority or body which is not entrusted to him by or
under any law made by parliament
(2) CAG can submit a proposal to the President/Governor/Administrator for
authorisation to undertake the audit of accounts of any body or authority whose
audit has not been entrusted to him by law, if CAG is of the opinion that
substantial amount has been invested in or advanced to such body or authority
CAG’s(DPC) Act, 1971
Chapter-4 Miscellaneous
Section 21: Delegation of Power of Comptroller and Auditor-General
● Authorises CAG to delegate any power exercisable by him under this Act, to any
officer of his department,by general or special order
● Provided that except during absence of CAG on leave or otherwise, no officer
can submit Audit Report on behalf of CAG
Section 22: Power to make Rules
(1) Central Govt,may after consultation with CAG, by notification in the official
Gazette,make rules for maintenance of Accounts
(2) Such rules may provide for -
● Manner in which initial/subsidiary accounts shall be kept by
treasuries,offices
● Manner in which accounts of Union/State are to be compiled or kept
● Manner of accounts of stock & stores
● Any other matter
(3) Every rule made by central govt (as above) shall be laid before both the houses
of Parliament,while it is in session, for a total period of 30 days
Section 23: Power to make regulations
CAG is authorised to make regulations for carrying into effect the provisions of this Act and
as per this section, CAG has made
CAG’s(DPC) Act, 1971
● Regulations on Audit & Accounts,2007 to determine scope and extent of the
audit.
● General Principles of Government accounting
● Manual of standing orders(Audit)
Section 24: Power to dispense with detailed audit
CAG has power to dispense with detailed audit of any account/class of transactions
Section 25: Repeal
CAG’s(Condition of Service) Act, 1953 is repealed
Section 26: Removal of Doubts
For removal of doubts, it is hereby declared that on the commencement of this Act the
Government of India (Audit and Accounts) Order, 1936, as adapted by the India
(Provisional Constitution) Order, 1947, shall cease to be in force
