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Global audit framework for local bodies in the works: CAG

Feb 28, 2024

Apex auditors, including India's Comptroller and Auditor General (CAG) Girish Chandra Murmu, are developing an international framework for auditing regional and municipal bodies to assess their performance. India aims to host a conference in September to deliberate on a preliminary draft of auditing standards for such entities.

The apex government auditors of various nations, including India, are firming up a global framework for auditing regional and municipal bodies to gauge the performance of such grass-root level institutions that play a crucial role in taking various welfare programmes to the common man, comptroller and auditor general (CAG) of India Girish Chandra Murmu said on Wednesday.

India is planning to host a conference of the supreme audit institutions (SAIs) of Asia in September where a preliminary draft framework for such auditing standards could be deliberated on, Murmu said on the sidelines of a three-day International Conference on Strengthening of Grassroots Democracy in the national capital.

Better audit standards will not just result in greater transparency but also effective last-mile delivery of various schemes. As many as 262,000 local bodies exist in rural India alone, Murmu said. Local bodies directly get a 4.2% of the Union government’s total divisible tax pool, which runs into billions of rupees annually.

Once the framework is finalised, every member of the International Organization of Supreme Audit Institutions can adopt it. The global body currently has 195 members, five associate members and two affiliate ones.

The conference, organised by India for the first time, is being attended by the senior functionaries of the SAIs of various nations.

District-centric audit

Recognising governance challenges at the grassroots level, the CAG has embarked on audits of local governments focusing on districts– administrative divisions encompassing multiple villages and cities. The primary focus of the district-centric audit is on service delivery, the last mile connecting the government with its people, Murmu said in his speech at the conference.

“At the grassroots level, where governance meets the everyday lives of citizens, these (audit) principles are not mere ideals but the bedrock upon which the edifice of good governance stands,” he said, calling for more effective scrutiny of auditing at local level institutions.

“From our experience, we find the functioning of local governments different from that of the federal and provincial governments in India…. This reality calls for an ‘out of the box’ audit approach,” he said.

Pool of auditors

Murmu said the CAG has tied up with the Institute of Chartered Accountants of India (ICAI) to offer a diploma course to students in an effort to prepare a specialised pool of auditors for local bodies. Students can opt for this course after the 12th class and can become the official account keepers for panchayats and municipalities.

[The Economic Times]

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