Stress laid on strict compliance to Accounting Standards
Mohinder Verma
JAMMU, Mar 31: Comptroller and Auditor General (CAG) of India has pointed out that several Autonomous Bodies have failed to submit accounts for years together even after receiving substantial funding from the budget, which is nothing less than serious financial irregularity.
In respect of eight Autonomous Bodies which were to render annual accounts to CAG, 37 accounts were not rendered for the period ranging between one to 12 years as on March 31, 2022, the supreme audit institution of the country has mentioned in the latest report tabled in the Parliament recently.
These Autonomous Bodies are Compensatory Afforestation Management and Planning Authority (CAMPA), Sher-i-Kashmir University of Agricultural Sciences and Technology-Kashmir, Sher-i-Kashmir University of Agricultural Sciences and Technology-Jammu, JK Employee Provident Funds Organization, Jammu & Kashmir Housing Board, J&K Khadi and Village Industries Board, J&K Building and Other Construction Workers Welfare Board and J&K State Legal Services Authority (SLSA).
“CAMPA has submitted the accounts for audit for period up to 2008-09 while as accounts for 12 years are pending. Likewise, SKUAST-Kashmir has not submitted its accounts for audit for last 11 years”, the CAG said, adding “non-submission/delay in submission of accounts by these Autonomous Bodies receiving substantial funding from the budget is a serious financial irregularity persisting for years”.
“Despite taking up issue of preparation and submission of accounts with the Government, the accounts are in arrears”, the report said, adding “in view of this non-compliance, the audited accounts of these Statutory Bodies have not so far been presented to the Legislature as required under the Statutes under which these Bodies were created. The delay/arrears in finalization of accounts carry the risk of financial irregularities going undetected and entails possibility of fraud and mis-appropriation”.
Pointing out non-submission of details of grants/loans given to bodies and authorities, the CAG said that in order to identify institutions/ organizations which attract audit under Sections 14 and 15 of the Comptroller and Auditor General’s (Duties, Powers and Conditions of Service) Act, 1971, the Government / HODs are required to furnish to audit every year the detailed information about the financial assistance given to various institutions; the purpose for which the assistance is granted, and and total expenditure of the institutions.
Further, Regulations on Audit and Accounts (Amendments) 2020 provides that Governments and HODs, who sanction grants and/or loans to bodies or authorities shall furnish to audit by the end of July every year a statement of such bodies and authorities to which grants and/or loans aggregating Rs 10 lakh or more were paid during the preceding year.
“The Government, however, did not furnish the requite information, which is in violation of Regulations on Audit and Account (Amendments) 2020”, the CAG said, adding “in absence of information audit could not identify the bodies /authorities attracting audit under Section 14 and 15 of the Act of 1971”.
The CAG has also pointed out that Indian Government Accounting Standards are not being complied in the Union Territory of Jammu and Kashmir.
As per Section 71 of Jammu and Kashmir Re-organization Act, 2019, the Lieutenant Governor may, on the advice of the Comptroller and Auditor General of India, prescribe the form of accounts of the Union Territory of Jammu and Kashmir.
Further, as per Article 150 of the Constitution of India, the President of India, on the advice of the Comptroller and Auditor General of India, has so far notified three Indian Government Accounting Standards (IGAS). However, there was no compliance to these Accounting Standards by the Government of Union Territory of Jammu and Kashmir during 2021-22 financial year, the supreme audit institution of the country has mentioned in its latest report tabled in the Parliament recently.
Pointing towards Indian Government Accountant Standard-2, which deals with Accounting and Classification of Grants-in-Aid, the CAG said, “the essence of this Standard is to prescribe the principles for accounting and classification of Grants-in-Aid in the Financial Statements of Government both as a grantor as well as a grantee. However, this Standard has not been complied with”. Due to this, certain Grants-in-Aid to be classified under Revenue Section have been classified under Capital Section and information has not been furnished in respect of Grants in Aid given in kind by the UT Government.
About Indian Government Accounting Standard-3, which pertains to Loans and Advances made by the Government, the CAG said, “this Standard too has not been complied with although its essence is to ensure adequate disclosure on loans and advances made by the Government consistent with best international practices”.
“Due to this, the closing balances have not been reconciled by the Loanee Entities/ Government of UT and the Government has not furnished figures in respect of certain loans and advances for which they maintain detailed accounts”, the CAG further said.
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