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Product of IA

            The product of internal audit includes:

(a)       Audit observations issued to the units/formations as a result of verification of castings, closing book balances and opening book balances, Linking on the receipt side, of transfer inward and of purchases and on the issue side, of transfer outward, Audit of Final Receipts and final issues etc.

b)       MFAI (Major Financial & Accounting Irregularities) reveal systemic flaw, grave violation of rules and regulations, loss of substantial amount due to theft, fraud or neglect. The report is prepared quarterly and is addressed to the GOC-in-C for Army, Command HQrs, Departmental heads with a copy to DGADS.

c)       Internal Audit Report is prepared on half-yearly basis since 1994. The I.A. report is submitted to Secretary (Def /Fin)/FA (DS), Defence Secretary, PSO’s in Service HQrs.

d)       Annual Audit Certificate forms a part of the Annual Appropriation Accounts, submitted to Secretary (Def Fin)/FA(DS).

e)       Assurance and Consultancy reports of internal audit Service-wise Internal Audit Team (IAT) constituted by CGDA under Annual Audit Plan to undertake the examination and evaluation of the adequacy and effectiveness of governance processes, risk management processes, internal controls structure, and the quality of its performance in carrying out assigned responsibilities. These activities will provide reasonable assurance to the Government and higher management that these processes are functioning as intended to enable the organization to achieve its stated goals and objectives. Internal Audit report need to be consolidated issue-wise, command-wise at CDA level and issue-wise, organisation-wise at CGDA level. In case of Ordnance Factories, consolidation of objections issue wise/Factory/operating division-wise is required to be done.

Separate IAR              (i) Services, DRDO etc.
                                     (ii) OFB, PSU
Issue based IAR        (i) Pay, Personal entitlements, Pension
                                      (ii) Procurement of stores
                                      (iii) Works

Format for Internal Audit Report (IAR) may be as follows

  IA objection Report Number : number and quarter/half year
           Name of the Establishment/Command/Factories/Labs involved
   A      Number of major objections and minor observations
   B  Financial value/Loss etc. (If any):
   C  Audit team members and Duration of audit
   D  Executive Summary
   E  Details of previous outstanding objections
   F  Each objection in the report to reflect the following
     a)     Objective: Scope, Approach, Data:
     b)     Background :
     c)     Irregularities involved :
     Relevant Rules/Orders on the subject :
     Audit suggestions for rectifying the irregularity and for improvement in the systems and procedures :
     Letter number and date under which objection referred to the Executive Authority Concerned.
           Signature :
        Date :

      Appropriation Accounts of the Defence Services:
      Financial Advisor (Defence Services) is responsible for the preparation of the Appropriation Accounts of the Defence Services and for their submission to the Comptroller and Auditor General of India and the Director General of Audit, Defence Services.

      While the Appropriation Accounts of Defence Services are prepared by the Financial Advisor (Defence Services) and signed by Defence Secretary, the Appropriation Accounts of the Defence (Civil) and Defence Pensions are prepared by the office of the CGDA and signed by the CGDA.

      The object of the Appropriation Accounts is to present the audited accounts of expenditure from the appropriations for the year with full explanations of all important variations between the final appropriations and the actual expenditure.

      The Appropriation Accounts deal with:
    i) A general review of expenditure on Defence Services.
    ii) Changes in form and classification in the accounts.
    iii) Miscellaneous observations.
    iv) Appropriation Accounts with explanations for variations between the final appropriations and actual expenditure.
    v) Review of Works Expenditure.
    • Section I - Summary of Appropriation Accounts
    • Section II - Detailed (Grant-wise) Appropriation Accounts
        Appendix A: - Write up on Renewal and Reserve Funds
    • Section III - Certificate of Controller General of Defence Accounts
    • Section IV - Review of works expenditure
    • Section V - Appendices
        Appendix A - Losses of Cash
        Appendix B - Losses of Stores
        Appendix C - Statement of in fructuous expenditure
        Appendix D - Cases of gifts and transfer of property to non-Government organizations.
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