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The Comptroller and Auditor General of India (CAG) is an authority in charge of auditing government accounts and public sector bodies. It safeguards public funds by ensuring proper use and compliance with financial rules.India is a constitutional body responsible for auditing all receipts and expenditures of the Union and State governments, as well as public sector undertakings.
The CAG is an independent constitutional authority appointed under Article 148 of the Indian Constitution. The office is regarded as one of the pillars of India’s democratic setup because it provides crucial oversight over the financial operations of the government.
The CAG’s audits are submitted directly to the President or the Governors and laid before Parliament or state legislatures for transparency.
The CAG operates independently of the executive and reports directly to the legislature, ensuring objectivity in its findings.
Article |
Provision |
|---|---|
Article 148 |
Establishes the office of the CAG |
Article 149 |
Prescribes duties and powers of the CAG |
Article 150 |
Authorises the CAG to prescribe accounting forms |
Article 151 |
Lays down the process of submitting audit reports to the legislature |
The Comptroller and Auditor General (CAG) performs vital audit and oversight roles:
The CAG audits receipts and expenditures of both the Union and State governments. This includes ministries, departments, and constitutional bodies.
CAG audits central and state government-owned enterprises to ensure financial propriety and adherence to policies.
Reviews funds disbursed to institutions, bodies, and NGOs that receive government grants.
The CAG certifies the Annual Financial Statement (AFS) of the Union Government, giving it legislative sanctity.
In addition to financial audits, the CAG evaluates how well government programs and departments perform in terms of efficiency and effectiveness.
Example: CAG audits have covered major national schemes such as MNREGA, Ujjwala Yojana, and PMGSY.
Can audit all receipts and expenditures from the Consolidated Fund of India and of each state.
Has the authority to check transactions of Contingency Funds and Public Accounts.
Can audit accounts of government departments, stores, and stocks.
Audits government companies, corporations, and bodies substantially financed by the government.
Can audit grants, loans, and funds given for specific purposes.
Conducts audits entrusted by the President or Governor, including certain local bodies.
Decides the scope, form, and manner of audit independently.
Heads the Indian Audit and Accounts Department to carry out audit functions.
CAG carries out various audits to ensure transparency and accountability:
Audit Type |
Purpose |
|---|---|
Compliance Audit |
Ensures that rules and regulations have been followed |
Financial Audit |
Verifies accuracy of financial statements |
Performance Audit |
Assesses whether programmes achieve intended results |
IT Audit |
Evaluates information systems used in governance |
Each audit is followed by a report that is submitted to the Parliament or the concerned state legislature.
V. Narahari Rao (1950–1954) – First CAG of independent India
Anil Kumar Chanda (1954–1960)
A. K. Roy (1960–1966)
S. Ranganathan (1966–1972)
A. Bakshi (1972–1978)
Gian Prakash (1978–1984)
T. N. Chaturvedi (1984–1989)
C. G. Somiah (1990–1996)
V. K. Shunglu (1996–2002)
V. N. Kaul (2002–2008)
Vinod Rai (2008–2013)
Shashi Kant Sharma (2013–2017)
Rajiv Mehrishi (2017–2020)
Girish Chandra Murmu (2020–Present)
The appointment and tenure of the CAG are designed to maintain its autonomy:
Appointed by: The President of India
Tenure: 6 years or until the age of 65, whichever is earlier
Removal: Same process as that for a Supreme Court judge—through impeachment by Parliament
The fixed tenure and secure removal process safeguard the CAG's independence.
The CAG plays a crucial role in ensuring accountable governance:
Role |
Impact |
|---|---|
Financial Watchdog |
Prevents misuse of public funds |
Promotes Transparency |
Makes audit reports publicly available |
Strengthens Parliamentary Oversight |
Empowers Public Accounts Committee (PAC) and Committee on Public Undertakings (COPU) |
Deters Corruption |
Uncovers irregularities and inefficiencies |
Supports Policy Decisions |
Offers data-driven insights to improve governance |
Several CAG reports have had significant impact on policy and accountability:
Year |
Audit Topic |
Impact |
|---|---|---|
2010 |
2G Spectrum Allocation |
Highlighted procedural lapses and loss to exchequer |
2012 |
Coal Block Allocation |
Estimated ₹1.86 lakh crore loss due to non-transparent allocation |
2013 |
Commonwealth Games |
Flagged cost overruns and procedural flaws |
2020 |
PMJAY Scheme Audit |
Identified issues in beneficiary identification and fraud controls |
These reports not only held authorities accountable but also triggered policy and procedural reforms.
Despite its critical role, the CAG faces several challenges:
Challenge |
Explanation |
|---|---|
Limited Enforcement Power |
CAG can report irregularities but cannot enforce corrective action |
Audit Delays |
Complexity of government accounts can lead to audit backlogs |
Resistance from Departments |
Lack of cooperation may affect access to data |
Public Awareness |
Not all citizens engage with or understand audit findings |
While the CAG ensures accountability, actual reform depends on the action taken by lawmakers and departments.
The CAG enhances democratic functioning by:
Providing an audit trail of how taxpayer money is spent
Supporting legislative scrutiny through credible data
Empowering citizens through transparency and information
The institution upholds constitutional values by ensuring that public money serves public interest.
The CAG plays a pivotal role in strengthening India’s democratic framework, ensuring that governments are held accountable for financial decisions. Its presence ensures that fiscal governance remains both transparent and responsible.
This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.
No. The CAG’s role is to audit and report. It is up to Parliament and law enforcement agencies to act on its findings.
Yes. All departments using public funds or receiving grants are subject to CAG audits.
CAG reports can be debated in Parliament, and departments can provide clarifications, but the audit itself is final unless reviewed by the CAG.
CAG reports promote responsible governance and reduce corruption, ultimately improving service delivery and public welfare.
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