In short, all possible ways should be thought of to check the recurrence of the irregularity, and make amends for the wrong done.
CHAPTER IXREVIEW OF THE BUDGET—I (Audit Report)
98. (1) Review of the budget forms the last of the four budgetary stages; it completes the financial cycle starts with the preparation of the budget.
(2) In a parliamentary form of Government, the Executive and the Legislature have well-defined prerogatives and spheres of responsibility. While it is the responsibility of the Executive to formulate demands for money, it is the prerogative of the Legislature to grant the money required for public expenditure. This power to make grants for specific purposes (appropriate) is not, in practice, adequate for controlling expenditure. For legislative control over expenditure to be complete, the Legislature should also have the means to satisfy itself that the appropriations are, in fact, spent by the Executive for the purposes for which they are intended. This is provided by the audit of public accounts by an independent statutory authority—the Comptroller and Auditor General—and the examination of his report by a legislature committee—the Public Accounts Committee or the Committee on Public Undertakings, as the case may be. It is also equally important to have a detailed examination of the estimates presented to the House, and see how best the plans and programmes embodied therein could be executed efficiently and economically. This work has been entrusted to another legislature committee, specially constituted for the purpose—the Estimates Committee.
(3) Accordingly, the work of review of the budget may be sub divided into —3
AUDIT REPORT
100. Draft paragraph.—The Accountant General, acting on behalf of the Comptroller and Auditor General, examines the accounts to ensure that the grants made by the Legislature have been applied in the amounts intended and to the purposes for which they were intended, and that they have been spent according to law, rules, and regulations.
If, in the course of such examination, an irregularity comes to his notice, which, in his opinion, deserves to be mentioned in the Audit Report, he sends a draft of the paragraph proposed for inclusion in the Audit Report to the secretary to Government concerned, by name, for verification of facts.
Simultaneously, copies of the ‘Draft Paragraph’ are endorsed to the Finance Secretary and the Head of the Department concerned. This is to ensure that the irregularity commented upon the officers who will have to appear as witnesses before the Public Accounts Committee* when the Audit Report is taken up for consideration by the Committee. It is, therefore, the duty of the officer who receives the Draft Paragraph to see that the reply to the Accountant General, after verification of facts, is sent only after obtaining his approval so that the facts mentioned in the Audit Para will not be challenged when the Audit report is examined by the Committee.
(2) Facts noticed after finalisation.—Facts coming to the notice of the Secretariat or the Department after the Draft Paragraph has been finalised by the Audit should also be reported to the Accountant General, for due verification and posting the Public Accounts Committee with up-to¬date information at the time the case is taken by for consideration by the Committee.
102. Verification to ensure that facts agree.—It is not necessary that contents or the language of the Draft Paragraph should be specifically agreed to. Nor is it necessary to reach prior agreement on what is to be mentioned in the Audit Report. However, it is desirable that there is no dispute regarding the facts of the case, based on which the Accountant General is free to draw his own conclusion and express his own opinions. This does not preclude a Secretary to Government from taking up with the Accountant General the desirability of mentioning a particular case in the Audit Report.
104. Watching the disposal of Draft Paragraph.—In order to ensure the prompt disposal of Draft Paragraphs, Secretaries to Government and the Heads of Departments should maintain a separate register to note the date of receipt of the Paragraphs and the date of sending the reply. A senior officer (who, in the case of the Secretariat, should be one not below the rank of a Deputy Secretary) should be declared as responsible for watching the prompt disposal of Draft Paragraphs. He should personally verify on the first working day of every month, the register maintained for the purpose. It should be borne in mind that if a final reply is not sent within the prescribed time-limit (six weeks), the Paragraph, as prepared by Audit, will be treated as final and incorporated in the Audit Report. Situations necessitating the challenging of facts mentioned in the Audit Para should not arise at a later stage on any account, particularly owing to the default of the departments to apprise the Accountant General of the correct position at the time of verification of the Draft Paragraph.
105. Files required by Audit.—The files required by Audit for the preparation of Draft Paragraphs should be readily made available. If the contents of a file or any part of it is ‘secret’, the file may be sent to the Accountant General by name, specifying this fact. The Accountant General will then deal with it is accordance with the standing instruction for the handling and custody of such documents.