AUDIT OBJECTIONS

causes and settlement

bapujisss/TOT on OP/auditt
February 18 1
objections
 ROLE OF AUDIT
• AUDIT – means
• Official examination of
records/accounts to see that they
are in order
• Examination of accounts officially
• INSPECTION – means
• Examine carefully/visit officially
to see that rules are obeyed/that
work is done properly
bapujisss/TOT on OP/auditt
February 18 2
objections
 Audit by Government agencies
STATE AUDIT DEPARTMENT
• FOR ALL LOCAL BODIES –
MUNICIPALITIES, TEMPLES,
UNIVERSITIES, PANCHAYATI RAJ
BODIES, ETC
COMPTROLLER & AUDITOR GENERAL
OF INDIA
• ALL GOVERNMENT DEPARTMENTS
• PUBLIC SECTOR UNDERTAKINGS
• MAJOR INSTITUTIONS – ZILLA
PARISHADS, ETC.
bapujisss/TOT on OP/auditt
February 18 3
objections
 AUDIT
• TYPES
1. INTERNAL AUDIT
2. PRE-AUDIT
3. POST AUDIT
4. CONCURRENT AUDIT
5. SPECIAL AUDIT
6. EXTERNAL AUDIT
bapujisss/TOT on OP/auditt
February 18 4
objections
 AUDIT
ALSO MEANS

 CENT PERCENT AUDIT

 RESIDENT AUDIT
 TEST AUDIT
 AND OTHER EXAMINATION OF
ACOUNTS AS THE GOVT. MAY
FROM TIME TO TIME SPECIFY

bapujisss/TOT on OP/auditt
February 18 5
objections
CENT PERCENT AUDIT:
• A POST AUDIT OF ALL THE
TRANSACTIONS OF A
PARTICULAR ACCOUNT OF A
SPECIFIED PERIOD
CONCURRENT AUDIT:
• A POST AUDIT OF A DAY TO-DAY
ACCOUNTS OF A SPECIFIED
PERIOD, WITH A GENERAL
REVIEW OF THE ACCOUNTS
FROM TIME TO TIME
bapujisss/TOT on OP/auditt
February 18 6
objections
POST AUDIT:
• THE DETAILED AUDIT
CONDUCTED AFTER THE
TRANSACTIONS ARE
COMPLETED
PRE AUDIT:
• THE PRELIMINARY AUDIT
BEFORE RECEIVING THE
MONEY OR ARRANGING THE
PAYMENTS
bapujisss/TOT on OP/auditt
February 18 7
objections
 RESIDENT AUDIT:
• CONCURRENT OR PRE-AUDIT OF
EXPENDITURE AND REVIEW OF
RECEIPTS
SPECIAL AUDIT:
• AN AUDIT OF ACCOUNTS
PERTAINING TO A SPECIFIED
ITEM OR SERIES OF ITEMS
REQUIRED THOROUGH
EXAMINATION
bapujisss/TOT on OP/auditt
February 18 8
objections
• OTHER TYPES:
• SOCIAL AUDIT
• ENERGY AUDIT
• QUALITY AUDIT
• MANAGERIAL STYLE AUDIT
• SECRETARIAL AUDIT
• HUMAN RESOURCES AUDIT
• ENVIRONMENTAL AUDIT
• MARKETING AUDIT, ETC.
bapujisss/TOT on OP/auditt
February 18 9
objections
AUDIT – PROCEDURE
1. VERIFICATION OF ANNUAL ACCOUNT
+ CLASSIFICATION REGISTERS
2. CASH BOOK + BANK PASS BOOK/
challans/cheques + grant files/ receipt books/
all records of moneys received/paid
3. SALARY BILLS +advances registers
4. TA/LTC/TTA BILLS + advances register
5, CONTINGENT BILLS + STOCK
REGISTERS
(telephones/stationery/equipment, vehicle log
books etc.
6. WORKS BILLS + M.books/estimates/tender
files,etc
February 18
bapujisss/TOT on OP/auditt
10
objections
 RECORDS FOR AUDIT

1. CASH BOOK + RECORDS

2. ANNUAL ACCOUNT +
REGISTERS
3. BANK PASS
BOOK/STATEMENTS
4. BANK RECONCILIATION
STATEMENT
bapujisss/TOT on OP/auditt
February 18 11
objections
 I. RECEIPTS SIDE
1. BILL BOOKS/RECEIPT BOOKS +
REGISTER
2. DAILY COLLECTION REGISTER
3. BANK REMITTANCE
CHALLANS
4. GRANT FILES
5. CHEQUES/DDs, etc. received +
REGISTER
6. DEMAND REGISTERS, etc
bapujisss/TOT on OP/auditt
February 18 12
objections
 II. EXPENDITURE SIDE
• PAY BILLS + SALARY ADVANCES
• TA/TTA/LTC BILLS + ADVANCES
• CONTINGENT BILLS + STOCK
REGISTERS / QUOTATION FILES
• WORKS BILLS + M.BOOKS / STOCK
REGISTERS / TENDER FILES /
CONTRACTORS LEDGER
• ACQUITTANCE REGISTERS
• ADVANCES REGISTERS
• PERMANENT ADVANCE REGISTER
• CHEQUES ISSUED + REGISTER
• OTHER REGISTERS, if any
bapujisss/TOT on OP/auditt
February 18 13
objections
 TYPES OF OBJECTIONS
1. RECOVERY NATURE
2. RECTIFICATION
3. ACTION ORIENTED
4. NON-PRODUCTION
5. SERIOUS IRREGULARITIES
misappropriation, etc
6. UTILISATION OF FUNDS –
excess/under/non/mis
7. NON-FURNISHING OF -
accounts/reconciliation statements/u.cs/bank
statements/challans/cheques
8. OTHERS
bapujisss/TOT on OP/auditt
February 18 14
objections
 “FEW STEPS”
for speedy settlement of audit objections
1. GROUPING
2. INITIATION OF ACTION
3. RECOVERY
4. MAINTAINING RECORDS
5. PRODUCTION OF FILES, etc
6. RENDERING – accounts/remittance challans/
cheques/bank reconciliation statement/bank
statements/u.cs /acquittances, etc.
7. FURNISHING OF REPLIES
EXPEDITIOUSLY
bapujisss/TOT on OP/auditt
February 18 15
objections
 CLASSIFICATION

of

categories of audit objections

bapujisss/TOT on OP/auditt
February 18 16
objections
 CATEGORIES OF
AUDIT OBJECTIONS
01. VARIATION IN ACCOUNT FIGURES
02. FUNDS DIVERSTION/DIVERSION
OF GRANTS
03. NON-COLLECTION OF DUES
04. NON-UTILISATION OF
ALLOCATED AMOUNTS
05. MIS-UTILISATION
06. MISAPPROPRIATIONS
bapujisss/TOT on OP/auditt
February 18 17
objections
07. ADVANCES PENDING ADJUSTMENT
08. UN-UTILISATION /
UNDER-UTILISATION
( i.e. unspent amounts)
09. EXCESS UTILISATION
10. IRREGULAR & WASTEFUL
EXPENDITURE
11. OFFICE MANAGEMENT RESULTING
IN SHORT REALISATION
12. EXCESS & INADMISSIBLE
PAYMENTS
bapujisss/TOT on OP/auditt
February 18 18
objections
13. INSTANCES OF CASES
UN-ACCOUNTED FOR
(shortage of stores/cash)
14. PURCHASES –
NON-OBSERVANCE OF RULES
15. FAILURE TO DISCHARGE CERTAIN
OBLIGATIONS UNDER THE RULES
16. PROMOTION / APPOINTMENTS
CONTRARY TO RULES
AND WITHOUT OBSERVING
QUALIFICATION NORMS
bapujisss/TOT on OP/auditt
February 18 19
objections
17. PROCEEDURAL LAPSES
18. RECORDS --
non-maintenance /non-production
19. OTHERS --
i) NO.OF POSTS
sanctioned / utilised / variation

bapujisss/TOT on OP/auditt
February 18 20
objections