CAG

CAG

 

1. Consider the following statements about the

Controller General of Accounts (CGA):

1. CGA is an independent constitutional

body.

2. It is the apex accounting agency for

Central Government.

3. The CGA is also the head of the Indian

Audit and Accounts Department.

Which of the statements given above is/are

correct?

(a) 1 and 2 only

(b) 2 only

(c) 1 and 3 only

(d) 2 and 3 only

2. Consider the following statements with respect

to the Comptroller and Auditor General of

India (CAG):

1. This institution came into being only after

Independence.

2. The President has the power to determine

powers and service conditions of CAG.

3. CAG is disallowed to hold any other

Government office after his term expires.

4. The contingency fund of India which is

placed at the disposal of the President is

not subjected to CAG's audit.

Which of the statement given above is/are

correct?

(a) 1 and 3 only

(b) 3 only

(c) 1, 2 and 4 only

(d) 2, 3 and 4 only

3. The Comptroller and Auditor General’s Report is examined by the:

(a) Estimates Committee

(b) Public Accounts Committee

(c) Committee on Public Undertakings

(d) Economic Affairs Committee.

4, Expenditure from which of the following accounts/funds is/are audited by the Comptroller and

Auditor General (CAG) ?

1. Consolidated Fund of India

2. Contingency Fund of India

3. Public Account of India

Select the correct answer using the code given below.

A. 1 only

B. 1 and 2 only

C. 2 and 3 only

D. 1, 2 and 3

 

5 With reference to Attorney General of India, consider the following statements:

1. He receives such remuneration as the president may determine.

2. He must be a person who is qualified to be appointed a judge of the Supreme Court.

Which of the statements given above is/are correct?

A. 1 only

B. 2 only

C. Both 1 and 2

 

Answers

 

 

1.B

• Statement 1 is not correct: CGA works under the Ministry of Finance, Government of India. Though it

itself is not a constitutional body, it derives its mandate from Article 150 of the Constitution which says:

"The accounts of the Union and of the States shall be kept in such form as the President may, on the  advice of the Comptroller and Auditor-General of India, prescribe". Thus while CAG (Comptroller

and Auditor General of India) is an independent constitutional body, CGA works under the Ministry of

Finance and not a constitutional body.

• Statement 2 is correct: It is the principal account adviser or the apex accounting authority of the Union

Government. Its statutory mandate (duties and functions) have been defined in the Allocation of Business

Rules, 1961

• Matters relating to the Controller General of Accounts includeo

general principles of Government accounting relating to Union or State Governments and form of

accounts, and framing or revision of rules and manuals relating thereto;

o reconciliation of cash balance of Union Government with Reserve Bank in general and, in particular,

of Reserve Deposits pertaining to Civil Ministries or Departments;

o overseeing the maintenance of adequate standards of accounting by Central Civil Accounts Offices;

o consolidation of monthly accounts, preparation of the review of trends of revenue realization and

significant features of expenditure, etc. and preparation of annual accounts (including Summary, Civil

Appropriation Accounts) showing under the respective heads, the annual receipts and disbursements

for the purpose of the Union Government;

o administration of Central Treasury Rules and Central Government Account (Receipts and Payments

Rules 1983);

o coordination and assistance in the Introduction of management accounting system in Civil Ministries

or Departments;(g) cadre management of Group 'A' (Indian Civil Accounts Service) and Group 'B'

Officers of the Central Civil Accounts Offices;

o matters relating to the Central Civil Accounts staff belonging to Group ‘C’ and ‘D’;

o disbursement of Pension through Public Sector Banks (PSBs) in respect of Central Civil Pensioners,

Freedom Fighters, High Court Judges, Ex-M.P.s and Ex-Presidents.

• Statement 3 is not correct: The CAG is also the head of the Indian Audit and Accounts Department, the

affairs of which are managed by officers of Indian Audit and Accounts Service.

 

2.B

• The institution of Comptroller and Auditor General of India was set up to bring about transparency,

accountability, and probity in public life. The Institution came into existence in 1860. The importance

of such an institution was realized by the then British Government immediately after they assumed power

from the East India Company in 1858. The Government of India Acts of 1919 & 1935 enhanced its

position and in 1950 the position of the Auditor General of India was enshrined in the Constitution

and re-designated as the Comptroller & Auditor General of India. Hence statement 1 is not correct.

• The Constitution of India has mandated the institution as the auditor to the nation. Articles 148 to 151 of

the Constitution prescribe a unique role for the Comptroller and Auditor General of India in assisting the

Parliament to enforce the said accountability of the Government departments.

• The Constitution enables the independent and unbiased nature of audit by the CAG by providing for:

o His appointment by the President of India

o Special procedure for removal (like a Supreme Court Judge)

o Salary and expenses Charged (not Voted) to the Consolidated Fund of India

o Disallowing his holding any other Government office after his term expires. Hence statement 3

is correct.

• As envisaged in Article 149 of the Constitution, the Parliament enacted detailed legislation called

the CAG’s Duties, Powers and Conditions Act in 1971 which describes CAG's mandate and puts almost

every spending, revenue collecting or aid/grant receiving unit of the Government (the Centre and the

States) under CAG's audit domain. Hence statement 2 is not correct.

• The duties of the CAG as defined by the Duties, Powers, and Conditions of Service (DPC) Act, 1971:

o All receipts into and spending from the coffers (called the Consolidated Fund) of the Union and

State Governments.

o All transactions relating to the Emergency expenses (called Contingency Funds) and relating to

the money of the public held by the Government e.g. Postal savings, Vikas Patras (called Public

Accounts) at Central as well as State level. Hence statement 4 is not correct.

o Accounts of all autonomous bodies and authorities receiving Government money e.g. municipal

bodies, IIMs, IITs, State Health societies

• In order to carry out his wide audit mandate in an unfettered manner, CAG is provided with

o Power to inspect any office or organization subject to his audit.

o Power to examine all transactions and question the executive.

o Power to call for any records, papers, documents from any audited entity.

o Power to decide the extent and manner of the audit.

 

3. Answer: (b)

Explanation: The function of the Public Accounts Committee is to examine the annual

audit reports of the Comptroller and Auditor General of India (CAG), which are laid before

the Parliament by the President. The CAG submits three audit reports to the President,

namely, an audit report on appropriation accounts, an audit report on financial accounts

and the audit report on public undertakings. The Committee examines public expenditure

not only from a legal and formal point of view to discover technical irregularities but also

from the point of view of economy, prudence, wisdom and propriety to bring out the cases

of waste, loss, corruption, extravagance, inefficiency and nugatory expenses.

Therefore, the correct answer is (b).

 

4.Correct Answer : D

Answer Justification :

All the statements are correct.

The duties and functions of the CAG as laid down by the Parliament and the Constitution are:

1. He audits the accounts related to all expenditure from the Consolidated Fund of India,

consolidated fund of each state and consolidated fund of each union territory having a Legislative

Assembly.

2. He audits all expenditure from the Contingency Fund of India and the Public Account of

India as well as the contingency fund of each state and the public account of each state.

5.Correct Answer : C

Answer Justification :

The Constitution (Article 76) has provided for the office of the Attorney General for India1. He is the

highest law officer in the country.

The Attorney General (AG) is appointed by the president. He must be a person who is

qualified to be appointed a judge of the Supreme Court. In other words, he must be a citizen

of India and he must have been a judge of some high court for five years or an advocate of some

high court for ten years or an eminent jurist, in the opinion of the president. Hence, statement 1

is correct.

The remuneration of the AG is not fixed by the Constitution. He receives such remuneration as the

president may determine. Hence, statement 2 is correct.