Andhra Pradesh State Audit Manual

IX

Andhra Pradesh State Audit Manual

Chapters CONTENTS PAGES

I Evolution of State Audit Dept. and General Principles of Audit 1 to 42

II Audit of the Accounts of PR Institutions 43

Part I Audit of the Accounts of Gram Panchayat 43 to 82

Part II Audit of the Accounts of Mandal Parishad 83 to 98

Part III Audit of the Accounts of Zilla Parishad 99 to 134

III Audit of the Accounts of Municipal councils 135 to 194

IV Audit of the Accounts of Charitable and HRI and Endowments 195 to 245

V Audit of the Accounts of Agriculture Market Committees 247 to 264

VI Audit of the Accounts of Zilla Grandhayala Samsthas 265 to 284

VII Audit of the Accounts of Universities 285 to 293

Chapter I Evolution and General Principles of Audit

Page No.

1.  Introduction 1

i.  Evolution of the Department 1

ii. A.P. State Audit Act, 1989 2

iii.  A.P. State Audit Rules, 2000 7

iv.  Powers and functions of the Director of State Audit 14

v. Auditable Institutions 14

vi.  Director to be under the technical guidance of the C&AG of India 14

2.  General Principles of Audit 15

i.  General 15

ii.  Audit of Receipts 15

A)  Taxes & Non Taxes, 15

B)  Other Income, 18

C)  Assigned Revenue 19

D)  Grants – in – Aid 19

E)  Donations & Contributions 19

F)  Endowments 19

G)  Loans 19

H)  Investments 19

I)  Provident Fund 20

J)  Deposits 20

K)  Advances 20

iii.  Audit of expenditure 20

A) General 20

B)  Salaries including Wages, Surrender of Earned leave etc. 20

C)  TA, TTA, LTC, 21

D)  Pensions, 21

E)  Contingencies 22

F)  Maintenance of vehicles 22

G)  Works expenditure 22

H)  Parks 23

iv. Capital expenditure 23

A)  General 23

B)  Purchase of vehicles 24

C)  Tools & Plant, Furniture and Equipment 24

v. Audit against Regularity 25

vi. Efficiency – cum – Performance Audit 26

vii. Verification of Annual Accounts 27

viii. Drafting of Audit Reports and follow up Action (Result of Audit) 28

APPENDIX I -- Audit Checks of Establishment Vouchers 32

1. Check of Establishment Vouchers 32

2. Check of Traveling Allowance Vouchers 34

3. Check of Leave Travel Concession Vouchers 35

4. Check of Surrender Earned Leave Vouchers 36

5. Check of Education Fee Reimbursement Vouchers 36

6. Check of Medical Reimbursement Vouchers 36

7. Loans and Advances 37

APPENDIX II – Expenditure of Works – Audit Checks 40

a) Check of Estimates 40

b) Examination of Tender files 40

c) Agreement 41

d) Measurement Books 41

e) Contract Certificates 42

Chapter II Audit of the Accounts of PR Institutions 43

Part I Audit of the Accounts of Gram Panchayat 43

1. General / 43
2. Scope of Audit / 43
3. Budget / 43
4. Lodging of funds / 44
5. Process of Audit / 44
6. Receipts / 45
6.1 General Instructions: / 45
6.2 Details of Receipts: / 45
(A) Taxes - Mandatory / 45
(B) Taxes - Optional / 45
(C) Non-Taxes Receipts – Fees for Licences and Permissions. / 45
(D) Others / 45
1. Remunerative enterprises / 45
2. Assigned Revenues / 45
(E) Income from grants / 46
1. State government Grants / 46
2. Central government Grants / 46
(F) Deposits and advances / 46
6.3 Categorization of receipts and audit checks / 46
(A) Revenue having fixed demand / 46
a) Verification of outstanding items of revenue / 46
b) Verification of Writes-off and Remissions / 48
c) Check of collection / 48
d) Verification of Demand, Collection and Balance Statement / 49
(B) I) Revenue leased out / 49
II) Sales by auction / 51
III) Sale of usufruct and trees / 51
(C) Revenue managed departmentally / 52
(D) Fluctuating items of revenue / 53
6.4 The Levy, Assessment and Collection of taxes, Licences and fees, Assigned revenues, Items of revenue realized by leases and collected departmentally, grants received from Govt etc., and audit checks are detailed hereunder. / 53
(A) Taxes - Mandatory / 53
(a) Assessment and Collection of taxes / 53
(b) House Tax - Assessment of House tax- Appeal-Collections
and Exemptions / 54
(c) Library cess / 57
(d) Kolagaram or Katarusum / 57
(e) Tax on advertisement / 57
(f) User charge / 57
(B) Taxes – optional / 58
(a) Tax on Agricultural land for a specific purpose / 58
(b) Land Cess / 58
(C) Non-Tax Receipts / 58
(a) Licence fees for use of places for specified purposes / 58
(b) Fees for granting permission for layout and construction of
building / 59
(c) Fees on cattle stalled in the community cattle sheds / 59
(d) Issue of licence with penalty to unlicensed pigs and dogs / 59
(e) Fees on Tap connection / 60
(f) Entertainment Tax on Cable TV networks operated by Cable
TV operators / 60
(g) Warrant/distraint fees / 60
(h) Penalties / 60
(i) Fees on Animals brought for sale into or sold in public markets. / 60
(j) Licence fee for Private Markets / 60
(k) Licence fee for private cart stands / 61
(l) Fees and Rent for use of public slaughter house / 61
(m) Fees on erections or projections and pandals / 61
(n) Fees on each head of cattle stalled in the community cattle sheds / 61
(o) Fees for issue of certificates / 61
(D) Others / 62
1. Remunerative Enterprises - Income from leases and rents / 62
(a)Income from leasing of public-halting places, cart- stands etc. / 62
(b) Share of income derived from Markets in GP areas / 62
(c) Share of income derived from Fairs and Festivals / 62
(d) Income from lease of road wides vested in GP / 63
(e) Income from management of ferries / 63
(f) Income from sale of usufruct and trees vested in GP / 63
(g) Income from Endowments and Trusts / 63
2. Assigned Revenues / 64
(a) Surcharge on stamp duty / 64
(b)Seigniorage fees / 64
(c) Entertainment Tax / 64
(d) Magisterial Fines / 64
(E) Income from Grants / 65
1. Grants Released By State Government / 65
(a) Rs.4/- Per capita Grant / 65
(b)Salary Grant for provincialised staff of GP / 65
(c) (c)Grant towards Honorarium of Sarpanch, GP / 65
(d) Profession Tax / 65
(e)Best Gram Panchayat Award / 65
2. Central Government Grants / 65
(a) Central Finance Commission Grants / 65
(b) Centrally sponsored schemes/ Grants / 65
(F) Deposits and Advances / 66
(a) Deposits for water taps / 66
(b) Earnest Money Deposit / 66
(c) Security Deposits / 66
(d) Election Deposits / 66
(e) People’s contribution / 66
(f) Lapsed Deposits and other forfeiture / 66
(g) Sale proceeds of tools, plant, sweepings, old stores and materials / 66
6.5 Registers to be checked / 66
7. Expenditure / 67
7.1 General / 67
7.2 Allocation of General Funds / 67
7.3 General checks of Expenditure / 67
7.4 Establishment -- General / 68
7.5 Audit checks of Establishment Vouchers / 68
7.6 TA and DA to Sarpanch, Upa-Sarpanch and Members of GP / 69
7.7 Honorarium to Sarpanches / 69
7.8 Registers to be checked / 69
8. Contingent Audit / 70
8.1 General nature of Contingent Audit / 70
8.2 Procedure for purchase of materials required for providing sanitation and amenities and audit checks / 70
8.3 Audit checks of the items of contingent expenditure / 71
(a) Purchase of Furniture / 71
(b) Telephone charges / 71
(c) Total literacy programme / 71
(d) Expenditure towards celebration of Independence Day and Republic Day / 72
(e) Purchase of Television set / 72
(f) Contribution to Sports Council / 72
(g) Purchase of computers / 72
(h) Petrol, Oil, Lubricants (POL) / 72
(i) Stationery articles / 73
(j) Electrical material, sanitary goods such as phenyl, water supply material / 73
(k) Postage Stamps / 73
(l) Advertisements / 73
(m) Contributions to construction of Marriage Halls / 73
(n) Contribution to Mahila Mandal Building construction / 74
(o) Legal charges / 74
(p) Election expenses to be borne by the Government / 74
(q) Purchase of Bill Books and forms / 74
(r) Periodical Charges / 74
(s) Acquisition of land for all or any purposes of the Act / 75
8.4 Registers to be checked / 75
9. Audit of Work Vouchers / 75
9.1 General / 75
9.2 Identification of works and Preparation of estimates / 76
9.3 Administrative Sanction / 76
9.4 Technical Sanction / 76
9.5 Execution of works – Entrustment to Agencies / 76
9.6 Calling of tenders / 77
9.7 Expenditure on Works / 78
9.8 Registers to be checked / 78
10. Refund Vouchers / 78
11. Annual Account / 78
11.1 Registers relating to accounts to be verified / 78
11.2 Verification of Annual Account / 79
ANNEXURE I – Registers and accounts to be maintained in GP / 81

Part II Audit of the Accounts of Mandal Parishad

1. Scope of Audit / 83
2. Budget / 83
3. Lodging of funds / 83
4. Sources of Income of Mandal Parishad / 83
4.1 Assigned Revenues / 84
4.2Own Sources / 84
4.3Government grants / 84
4.4 Others – Grants under Schemes / 84
4.5 The important checks of the receipts / 84
1. Assigned Revenues / 84
i) Surcharge on Stamp Duty / 84
ii) Seigniorage Fees / 84
iii) Entertainment Tax / 85
2. Own resources / 85
i) Market Fees collected from the Markets and Fairs / 85
a) Income from Markets / 85
b) Income from fair and festivals / 85
ii) Income from commercial complexes of the Mandal Parishads / 85
iii) Income from ferries / 86
iv) Income from usufruct trees in the compound of the Mandal
Parishad Schools, Road-wides of the Mandal Parishad Roads / 86
v) Income towards rent from the Staff Quarters / 86
vi) Unclaimed Deposits for more than three years / 86
vii) Income from sale of unserviceable articles / 87
3. Government Grants / 87
4. Grants under Schemes / 87
4.6 Registers to be checked / 87
5. Expenditure / 88
5.1 Purpose for which Mandal Parishad Funds shall be applied / 88
1) Earmarking of Funds / 88
2) Expenditure incidental to administration / 88
5.2 General checks of Expenditure / 88
5.3 Establishment – General / 90
5.4Audit Checks of Establishment vouchers / 90
5.5 Allowances for Meeting of the Mandal Parishad / 90
5.6 Payment of Allowances to the persons invited to attend the
Meeting of Mandal Parishad / 90
5.7 Registers to be checked / 91
6. Contingent Audit / 91
6.1 General nature of Contingent Audit / 91
6.2 Tender Procedure for Purchase of Stores / 91
6.3 Audit checks of the items of Contingent expenditure / 92
a) Liveries to Class IV Employees and Drivers / 92
b) Expenditure on vehicles / 92
c)Stationery / 92
d)Legal charges / 93
e) Books and Forms / 93
f) Election Expenses / 93
g) Office Rent / 93
h) Telephone Charges / 94
i) Repairs to Furniture and Black Boards / 94
j) Furniture / 94
k) Advertisements / 94
l) Cell phone Expenditure / 94
m) Postage stamps / 94
n) Periodical Charges / 94
o) Contributions / 95
p) Acquisition of land for all or any purposes of the Act / 95
6.4 Registers to be checked / 95
7. Audit of Work bills / 96
7.1 General / 96
7.2 Identification of works and preparation of Estimates / 96
7.3 Administrative Sanction / 96
7.4 Technical Sanction / 96
7.5 Execution of works –Entrustment to agencies / 97
7.6 Calling of Tenders / 97
7.7 Expenditure on Works / 98
7.8 Registers to be checked / 98

Part III Audit of the Accounts of Zilla Parishad

1. Scope of Audit / 99
2. Budget / 99
3. Lodging of Funds / 99
4. Sources of Income / 99
4.1 Own Resources / 99
4.2 Assigned Revenue / 100
4.3 Government Grants / 100
4.4 Grants of Schemes and other purposes / 100
4.5 Check of Receipts / 100
1. Own Resources / 100
1) Income from ferries / 100
2) Income from usufruct trees and auction of Markets / 100
3) Rent from commercial complexes etc., / 101
4) Lapsed Deposits / 102
2. Assigned Revenue / 102
1) Surcharge on Transfer of Property / 102
2) Seignorage Fees / 102
3. Government Grants / 102
4. Grants for schemes and other purposes / 102
4.6 Registers to be checked / 103
5. Expenditure / 103
5.1 Purposes for which Zilla Parishad funds are applied / 103
1) Earmarking of Funds / 103
2) Expenditure incidental to administration / 104
5.2 General Checks of Expenditure / 104
5.3 Establishment --General / 105
5.4 Audit Checks of Establishment vouchers / 105
5.5 Allowances for attending meeting of a Zilla Parishad or a standing
committee / 105
5.6 Honorarium / 105
5.7 Payment of Allowances to the persons invited to attend meetings of ZP
or its standing committees / 105
5.8 Registers to be checked / 106
6. Contingent Audit / 106
6.1 General nature of Contingent Audit / 106
6.2 Tender Procedure for Purchase of Stores / 106
6.3 Audit Checks of items on contingent expenditure / 107
a) Liveries to class IV employees and drivers / 107
b) Books and Forms / 107
c) Propulsion and Maintenance charges of Zilla Parishad Vehicles / 107
d) Stationery Articles / 108
e) Legal Charges / 108
f) Election Expenses / 108
g) Office Rent / 108
h) Telephone Bills / 109
i) Cell Phone Expenses / 109
j) Postage Stamps / 109
k) Furniture / 109
l) Computers / 109
m) Periodical Charges / 109
n) Contributions / 110
o) Acquisition of land for all or any purposes of the Act / 110
6.5 Registers to be checked / 111
7. Audit of Work Bills / 111
7.1 General / 111
7.2 Identification of works and preparation of Estimates / 111
7.3 Administrative Sanction / 111
7.4 Technical Sanction / 112
7.5 Execution of works – Entrustment to Agencies / 112
7.6 Calling of Tenders / 112
7.7 Expenditure on Works / 113
7.8 Registers to be checked / 113
8. Annual Account / 113
a)Registers relating to accounts to be verified / 113
b)Verification of Annual Account / 114
ANNEXURE II -- Registers and Accounts to be maintained in Mandal Parishad/ Zilla Parishad / 115
APPENDIX – Audit Checks of Registers maintained in GP/MP/ZP / 117
a) Registers connected with Receipts / 117
b) Registers connected with Establishment matters / 123
c) Registers connected with Contingent expenditure / 126
d) Registers connected with Works / 130
e) Registers connected with Accounts / 130

Chapter III Audit of the Accounts of Municipal councils