ANNEXURE TO CIRCULAR NO.CA–241 (Letter No.

700-55/2010-11/CA-III Dated 16 -11-2010

PROFORMA ‘C’
SCOPE OF WORK FOR INTERNAL AUDITORS OF BSNL

It has been observed that the Internal auditors of BSNL are simply pointing out the errors and mistake
without rendering any assistance to the Units of BSNL for rectification of mistakes / which is totally against
the idea of engagement of the internal auditor, by BSNL Management. The Internal Auditors are
supposed to take pro-active steps for rectification of defects as well as assisting the unit / circles
authorities to bring about improvement in the quality of accounts. Moreover, the scope of work fixed by
BSNL Management are not followed by the Internal Auditor as well as comments are made by the Internal
Auditors which is against the Accounting Policy of BSNL. The main purpose of engagement of the CA
firms as internal auditor by BSNL Management is not only to identify the areas of weakness but also to
get the defects rectified on the spot by active participation of both the Internal auditors as well as BSNL
units so that BSNL accounts depicts true and fair picture.
The Scopes of work mentioned below are the guidelines for internal audit. The Internal Auditors appointed
by BSNL Management shall check all the points mentioned below in addition to other items covered by
generally accepted accounting procedure but subject to BSNL accounting policy, and also ensure that
necessary entries are passed in the accounts (General Ledger) as well as in the sub-ledger / register /
statement in order to set right defects / shortcomings detected during internal audit. Audit Report shall
reflect not only the comments on all the points mentioned below but also the details of action taken by the
internal auditor to set right the things. It is further mentioned that Internal Auditor must not function as
External Auditor i.e. Branch & Statutory Auditor. The performance of internal auditor will be judged by the
Management mainly based on pro-active action taken by the auditor to rectify any error, defects, omission
etc so that all the financial transactions are correctly reflected in the accounts within the scope of
accounting procedure as well as accounting policy.
Sl No Scope of Work Findings, observations / comments Pro-active steps action taken by
of Internal Auditor and details of the Internal Auditors to set right
discrepancies if any the discrepancy / shortfall i.e.
accounting entries passed / sub-
ledger & Register updated /
concerned official of BSNL trained.
1 FIXED ASSETS
1.1 Whether Fixed Asset Register It is maintained and updated till
(FAR) is maintained in 21- F.Y 2009-10, but not updated
column format prescribed by the
for current Financial year.
Corporate Office.

1.2 Whether each asset reflected in Fixed Assets register is not

the FAR is having all the
information such as situation of
assets, quantitative details etc.
1.3 Whether asset number is
assigned to the individual asset
and equipment.
updated for current Financial
year, so we are not able to
comment on the same.
No, it is not in practice at the
unit.

1.4 Whether the particulars of all Fixed Assets register is not

assets acquired from vendors or updated for current Financial
constructed in house, which are
year, so we are not able to
put to use / commissioned / have
started generating revenue comment on the same.
during the financial year in
question, are reflected in the
FAR.
1.5 Whether in case of acquisition of assets from
Yes, it has followed the proper
vendors, proper rules have been followed.
rules.

1.6 Whether value of all the assets Yes, all the assets have been
 commissioned / put to use / booked to concerned accodes
started generating revenue for fixed assets and included in
during the financial year in
the trial balance.
question (the details of which
have been entered in the FAR)
has been booked to concerned
accodes for fixed assets by
passing necessary accounting
entries, and whether such
accounting entries has been
included in the Trial Balance.

1.7 Whether there is any fixed asset Yes, all the assets capitalised
which is purchased / constructed and accounted in Fixed assets
during the financial year in
Accounts of Trial Balance.
question or in any previous
financial years but not yet
capitalized / not put to use and
accounted in Fixed Asset
Accounts of trial balance and
reflected in FAR.

1.8 Whether the assets valued up to Fixed Assets register is not

Rs. 5000/- have been properly updated for current Financial
entered in the FAR.
year, so we are not able to
comment on the same.
1.9 Whether the ATDs which are ATDs received during the
pending to be accepted at the current Financial Year for the
beginning of the financial year in
assets transferred have not
question, and the ATD received
during the current financial year been accepted by the unit.
for the assets transferred by the
Project Circle / Installation Wing
of same circle / other circles,
have been accepted and
accounted for in the Trial
Balance, and whether the details
of such assets have been
entered in FAR.
1.10 Whether proper records are kept It will be made on year end.
regarding fixed assets added
during the year in the category of
less than 180 days, 180 days &
above which is required for
calculation of depreciation as per
Income Tax Act.
1.11 Whether proper accounting The unit has not transferred
entries have been passed and any assets.
included in the Trial Balance,
and ATDs have been raised
during the financial year in
question, in respect of assets
transferred from one accounting
unit to another accounting unit of
either same circle or different
circle during the financial year in
question. And whether such
ATDs have been accepted by
the consignee unit/circle.
1.12 Whether the Circle / units have No such process undertaken
undertaken the process for by Unit during the FY for
identification of the assets found identification of obsolete /
to be obsolete / unserviceable as unserviceable assets.
per rule
1.13 Whether the assets which are No such fixed assets declared
found to be obsolete / obsolete/unserviceable by the
unserviceable and identified as Unit during the FY.
such during the financial year in
question, have been
decommissioned and declared
as obsolete / unserviceable in
the same financial year by the
competent authority as per rule.

1.14 Whether proper accounting Not applicable.

entries have been passed to
transfer the net depreciated
value of assets declared as
obsolete & unserviceable, to
decommissioned asset accodes
by passing necessary
accounting entry and including
the same in the trial balance.

1.15 Whether entries have been Not applicable.

made in the FAR in respect of
asset declared as obsolete /
unserviceable.

1.16 Whether provision has been Not applicable.

made in respect of assets
declared as obsolete /
unserviceable during the
financial year in question, for the
difference between NRV & net
depreciated value of such assets
provided the NRV is less than
the net depreciated value.

1.17 Whether the details of all assets Not applicable.

declared obsolete /
unserviceable i.e. description of
assets, quantity, date of
withdrawal of assets from use,
net depreciated value, NRV,
amount of provision made,
physical location of such assets,
sanction particulars regarding
declaration of such assets as
obsolete/unserviceable by
competent authority, particulars
about disposal such obsolete /
unserviceable assets etc. are
correctly kept in the Obsolete /
Unserviceable Asset Register.

1.18 Whether value of obsolete / Not applicable.

unserviceable assets reflected in
the accounts (under
 decommissioned asset accode)
are reconciled with the entries
made in Obsolete /
Unserviceable Assets Register
and the difference if any
between the two sets of records
is settled.
1.19 Whether obsolete & Not applicable.
unserviceable assets lying under
decommissioned asset head are
disposed off promptly under
proper sanction of the competent
authority.

1.20 Whether proper accounting Not applicable.

entries have been passed for in
respect of obsolete /
unserviceable assets disposed
off during the financial year in
question i.e. provision made if
any at the time of declaring such
assets as
obsolete/unserviceable have
been utilized / written back and
proper accounting entries have
been passed to account for sale
value.

1.21 Whether there are any assets, No such case noticed during
which have been retired from the period of audit.
service forever, but not removed
from Fixed Asset Accounts (TB)
and FAR, and depreciation is
continued to be charged on such
assets
.
1.22 Whether in case of addition or The FAR is not updated for
deletion of assets proper records current Financial year, so we
are kept for the purpose of
are not able to comment.
preparation of Fixed Asset
Schedule (Proforma II
Statement).
1.23 Whether the value of all the The FAR is not updated for
assets reflected in the FAR is current Financial year, so we
reconciled with the value
are not able to comment.
reflected in the trial balance and
whether the difference found
during the financial year has
been settled in the same
financial year
.
1.24 Whether depreciation has been It will be charged at year end .
charged correctly in respect all
assets reflected in the FAR.

1.25 In case of assets i.e. put to use / It will be charged at year end .
commissioned during the
financial year in question
whether depreciation has been
charged from the date of
commission / put to use.
1.26 Whether depreciation has also Not applicable.
been charged in respect of
assets which have been
decommissioned / dismantled
temporarily for utilization of the
same in some other location or
for some other purpose
1.27 Whether in respect of assets Not applicable.
declared as obsolete /
unserviceable during the year,
depreciation has been charged
in the accounts correctly i.e. up
to last date of functioning of such
asset.
1.28 Whether depreciation has also There is no stand by assets.
been charged in respect of
stand-by assets.

1.29 Whether full depreciation has There is no asset, valued up to

been charged on assets valued Rs 5000/- commissioned /
up to Rs. 5000/- in the 1 st year of
installed.
installation/commissioning as
per instructions issued by
corporate office.

1.30 Whether fixed asset have been Fixed assets have not been
physically verified as per order of physically verified.
Corporate Office.

1.31 Whether detailed record of No any detailed record of

physical verifications has been Physical verification has been
prepared in the format
made.
prescribed by Corporate Office.

1.32 Whether all the assets, which Physical verification has not
are physically available as per been carried out.
physical verification, are
reflected in the FAR.

1.33 Whether there is any difference Not applicable.

between the assets, which are
found on physical verification,
and as reflected in FAR, and if
so whether the difference has
been reconciled and rectification
entries have been made in FAR.

1.34 Whether the value of assets Not applicable.

found on physical verification
have been reconciled with the
value of the asset reflected in
the FAR as well as in the trial
balance and whether difference
in value if any has been set right
by passing necessary
accounting entries.

1.35 Whether replacement of assets There is no any replacement of

has been accounted as per assets.
instructions issued by Corporate
 Office.

1.36 Whether intangible assets have The unit has no intangible

been properly accounted and assets.
amortized as per order of the
Corporate Office.

1.37 Whether all the lands in The unit has no land either
possession of the units / circles freehold or leasehold.
have been analysed and
completely bifurcated as
freehold and leasehold.

1.38 Whether initial lease value of The unit has no land either
leasehold land is properly freehold or leasehold.
amortized over the lease period
on straight-line method.

1.39 Whether proper action has been Not applicable.

taken by the Unit / circle
authorities to renew the lease
period of the leasehold land
whose lease period has already
expired / to be expired very
soon.

1.40 Whether any leasehold land in Not applicable.

possession whose lease period
has been expired, but not yet
renewed.

1.41 In case of theft of assets / loss of There are no any such cases.
asset due to natural calamity,
fire etc whether proper
accounting entry has been
passed to relieve the Fixed
Asset Account (General Ledger)
& FAR and whether provision for
the net depreciated value of
assets lost has been made

1.42 In case of loss of asset due to There is no such case.

natural calamity whether the net
depreciated value of such assets
has been written off by the
competent authority and
provision made earlier if any,
has been utilized and adjusted in
the accounts.

1.43 In case of loss of asset due to There is no such case.

theft and other reason whether
action has been taken by the
authority for recovery of asset.
Whether provision has been
made for the net depreciated
value of such asset. In case of
non-recovery of such asset or
 partial recovery of such assets
whether competent authority
has written off the net
depreciated value of such assets
and provision made earlier has
been utilized / written back.

1.44 Whether obsolete and Not applicable.

unserviceable assets as
reflected in Register of
Obsolete / Unserviceable assets
have been verified physically
and difference if any has been
reconciled and settled.

1.45 In case of misclassification of There is no such case.

fixed asset / components i.e.
fixed asset / component has
been booked to wrong accodes,
whether rectification of
misclassification has been done
properly as well as depreciation
charged earlier has been
adjusted correctly.
1.46 Whether the amount of assets, There is no such case.
CWIP, Accumulated
Depreciation, Sundry Debtors,
Sundry Creditors etc. relating to
MSC based CDMA service
which were earlier reflected in
Basic Segment has been
transferred to CMTS Segment
by passing proper accounting
entries.
2. Capital – Work – In – Progress
(including Civil & Electrical works
of capital nature)

2.1 Whether the competent authority Not applicable

has sanctioned the project and
detailed estimate for the works
under execution.

2.2 Whether any cost overrun in Not applicable

respect of each work
completed / under execution has
occurred and whether such cost
overrun has been sanctioned by
the competent authority.

2.3 Whether CWIP register / Works It is maintained and updated till

Register / Sub-ledger has been F.Y 2009-10, but not updated
maintained by the units for each
for current Financial year.
of the works under execution.

2.4 Whether details of each work CWIP register is not up to date.

under execution have been hence, unable to comment.
reflected in the CWIP Register /
Works Register / sub-ledger.
2.5 Whether CWIP register / Works CWIP register is not up to date.
Register / sub-ledger in respect hence, unable to comment.
of each work has been updated
with the transactions occurred
during the financial year in
question i.e. services availed
from contractor for execution of
work, payment is made for such
services to the contractor,
material is purchased and
utilized in works

2.6 Whether Measurement Book has No

been maintained for recording
the details of works executed by
the contractor

2.7 Whether the project executing CWIP register is not up to date.

authority have recorded the hence, unable to comment.
details of work executed by the
contractor and services provided
by the contractor during the
year, in the Measurement Book.

2.8 Whether based on entries made Not applicable

in the measurement book
expenditure / payment has been
approved and paid to the
contractor. Whether
Measurement book has been
updated in respect of payment
made to the contractor

2.9 Whether ATDs for material / Not applicable

stores received from Store
Depots of BSNL / other units of
BSNL for execution of works,
have promptly been accepted
and booked to concerned
accode of CWIP account.
Whether necessary entries have
been made in CWIP Register /
Works Register / sub-ledger in
respect of such stores
immediately.

2.10 Whether the stores / equipments CWIP register is not up to date.

issued to the Contractor / hence, unable to comment.
turnkey project executing vendor
for execution of works / turnkey
projects have been accounted to
accode for “Material / stores with
 contractor”.

2.11 Whether material / equipment CWIP register is not up to date.

actually utilized by the contractor hence, unable to comment.
/ turnkey project executing
vendor in the works, have been
booked to CWIP accode by
giving credit to accode for
“Material / stores with
contractor”.

2.12 Whether necessary entries CWIP register is not up to date.

about utilization of stores by the hence, unable to comment.
contractor / turnkey project
executing vendor have been
made in CWIP Register / Works
Register / sub-ledger.

2.13 Whether on completion of works CWIP register is not up to date.

the un-utilized / surplus materials hence, unable to comment.
have been taken back to store
Depot and accounted to
inventory head by giving credit to
“Material / equipment with
contractor”.

2.14 Whether amount booked to CWIP register is not up to date.

accode for “Material / equipment hence, unable to comment.
with contractor” have been
reviewed from to time and
proper adjustment has been
made about utilization of the
material / equipment in the
project and / or return of un-
utilized items to Store Depot.

2.15 Whether material issued to CWIP register is not up to date.

contractor / turn-key project hence, unable to comment.
executing vendor but remained
un-utilized at the close of the
financial year, have been
physically verified and tallied
with value of the material
reflected under accode for
“Material / equipment with
contractor”.

2.16 Whether overheads have been CWIP register is not up to date.

charged to capital works as per hence, unable to comment.
policy of BSNL i.e. on actual
basis i.e. whether salary of staff
who have actually been engaged
in execution of concerned
project work has been charged
as overhead to the project
 estimate / account of the said
work, and whether administrative
expenditure, which are directly
attributable and identifiable to a
particular capital work, have
been charged as overhead to
the project account / estimate of
the said work.
2.17 Whether depreciation of testing CWIP register is not up to date.
instruments, motor vehicle etc. hence, unable to comment.
which have been utilized for
execution of a project work, has
been charged as overhead to
capital account / estimate of the
said work.

2.18 Whether necessary accounting CWIP register is not up to date.

entries have been passed and hence, unable to comment.
included in the trial balance for
transferring the overhead from
‘Remuneration’, ‘Administrative
Expenditure’ & ‘Depreciation’
Schedules by giving debit to
CWIP accode of concerned
project work / estimate and
credit to accodes for ‘Deduct
Expenditure’ available in
concerned ‘Remuneration’,
‘Administration’ & ‘Depreciation’
schedules.

2.19 Whether expenditure of revenue CWIP register is not up to date.

nature has been charged to hence, unable to comment.
Project works / CWIP and if so
whether rectification entries have
been passed in the trial balance
to withdraw such revenue
expenditure from CWIP as well
as necessary rectification entry
has been made in the CWIP
Register / Works Register / Sub-
ledger

2.20 Whether liability has been CWIP register is not up to date.

created in the accounts for the hence, unable to comment.
value of services provided by the
contractor for execution of works
during the financial year in
questions particularly for the
services provided by the
contractor at the fag end of the
financial year for which either bill
has not been received or no
payment has been made within
the close of the financial year.

2.21 In respect of project work CWIP register is not up to date.

completed during the financial hence, unable to comment.
year in question whether all the
liabilities for executing the said
works (cost of stores utilized,
 cost of services of contractor
utilized, overhead i.e. salary of
staff engaged in execution of
work & administrative overhead
directly attributable to concerned
work, and other liabilities if any)
have been taken into account for
transferring the total cost of the
said completed project work to
the consignee circle / consignee
unit of same circle and for
capitalization of the said
completed projects by the
concerned custodian / owner of
the assets.

2.22 Whether payment made to CWIP register is not up to date.

contractor for execution of hence, unable to comment.
project has been debited to
accode for ‘liability’ / ‘provision’
where the amount of liability
which was created earlier for the
said work either on actual basis
or on estimated basis, is
reflected.

2.23 Whether reconciliation of entries CWIP register is not up to date.

made in the CWIP Register / hence, unable to comment.
Works Register / sub-ledger in
respect of expenditure incurred
on capital work has been carried
out with the entries made in the
CWIP Account of General ledger
and whether the difference found
if any between two sets of
figures has been settled by
passing necessary entries either
in the accounts or in the CWIP
Register / Works Register / sub-
ledger during the same financial
year

2.24 Whether Telecom Project Circles CWIP register is not up to date.

/ Civil & Electrical wing / hence, unable to comment.
installation wing of territorial
telecom circles have transferred
the capital cost of all the works
completed during the financial
year in question to the
consignee i.e. Maintenance
circles / other Circles / units of
same circle, through ATD along
with all related documents
immediately after the work has
been completed / commissioned.

2.25 Whether Telecom Project CWIP register is not up to date.

Circle / Civil & Electrical Wings / hence, unable to comment.
Installation wing of territorial
telecom circles have taken
proper steps to get all the ATDs
(raised by it) accepted by the
 consignee circles i.e.
Maintenance Circles / Other
circles / units of same circle
within the financial year in
question in which the ATDs have
been raised.

2.26 Whether there are instances of CWIP register is not up to date.

handing over all the hence, unable to comment.
completed works and raising
of huge number of ATDs only
at the close of the financial
year by Project Circles and
other installation wing
including Civil & Electrical
wings. In such cases what
action taken by the Internal
Auditor.

2.27 Whether there are project works No

which have been completed
during the financial year in
question by the Telecom Project
Circles / Installation wing of
Territorial Telecom Circles / Civil
& Electrical Wings, as well as
put to use / started generating
revenue, but could not be
capitalized due to non-issue of
completion report / management
certificate regarding completion
by the Project executing
authority; or completed project
works have not been handed
over to the concerned circles /
units; and value of such
completed works has not been
transferred to consignee circles /
units by Telecom Project
Circles / installation wing / Civil &
Electrical Wings through ATD.
2.28 Whether consignee circles / Works has not been completed
units have accepted the during the year.
completed works received from
Telecom Project Circles /
Installation wing of Territorial
Telecom Circles / Civil &
Electrical Wing during the
financial year in question,
capitalized the same in the same
financial year, entered the
particulars of such assets in
FAR, and accounted the cost of
the asset in asset accode of
general ledger on acceptance of
the ATD in the same financial
 year.
2.29 Whether consignee circles have Works has not been completed
received the completed works during the year
but could not accept, capitalize
and account for the cost of
completed projects due to non-
receipt of completion report /
management certificate, other
relevant details, or due to receipt
of partial information / data etc
from the Project Executing
authority.

2.30 Whether project sanctioning and CWIP register is not up to date.

project executing authority have hence, unable to comment.
reviewed all the pending CWIP
particularly the old outstanding
projects, whether age-wise
analysis of all pending project
works has been done by the
project sanctioning and project
executing authority, whether
project sanctioning & project
executing authority have taken
appropriate steps for completion
of old project work particularly
the projects which are pending
for more than one year, whether
the project sanctioning and
project executing authority have
reviewed the pending project
works from the angle of cost
overrun and time overrun and
whether appropriate action has
been taken by the project
sanctioning and project
executing authority
Management to complete each
project within the time frame
fixed for completion and within
the sanctioned cost.

2.31 Whether Project Executing CWIP register is not up to date.

Authority has completed the hence, unable to comment.
CWIP during the financial year in
question for which provision was
made in previous financial
year(s) based on the Branch and
Statutory Auditor’s observations
(being an old project) and
whether the provision created in
previous financial year(s) for
such old projects has been
written back due to completion of
such project works in the current
financial year.

2.32 Whether any project works has CWIP register is not up to date.
been abandoned during the hence, unable to comment.
financial year in question by the
competent authority.
2.33 Whether appropriate accounting CWIP register is not up to date.
entries have been passed and hence, unable to comment.
incorporated in the CWIP
account of General Ledger and
provision has been made for the
estimated loss in respect of
project work, which has been
abandoned under the sanction of
the competent authority.

2.34 Whether entries have been CWIP register is not up to date.

made in the CWIP Register / hence, unable to comment.
sub-ledger in respect of projects
abandoned during the financial
year in question.

2.35 Whether serviceable stores / CWIP register is not up to date.

equipments recovered from such hence, unable to comment.
abandoned projects have been
transferred to Store Depots /
other works and necessary
accounting entries have been
passed

2.36 Whether damaged / Not applicable

unserviceable stores /
equipments recovered from
abandoned projects have been
disposed off and necessary
accounting entries have been
passed for the sale value etc.

2.37 Whether necessary write off CWIP register is not up to date.

sanction for the actual loss hence, unable to comment
(worked out after taking into
account the amount to be
realized on disposal of
equipments / stores, value of
serviceable items / stores
returned to the Store Deport /
other works) has been issued by
the competent authority in
respect of project works
abandoned by the competent
authority. In case provision
exists for such abandoned CWIP
whether it has been utilized and
excess provision has been
written back.

2.38 Whether physical verification of Physical verification has not

CWIP has been carried out by been carried out during the
the authorities of Circle / unit as
year.
per instructions of the Corporate
Office.
2.39 Whether details of physical Not applicable.
verification of CWIP are
recorded in the format
prescribed by Corporate Office

2.40 Whether reconciliation of CWIP Not applicable.

found on physical verification,
 has been made with the
particulars of concerned CWIP
as available in the CWIP
Register / Works Register / sub-
ledger and the difference if any
has been settled by passing
necessary entries in the CWIP
Register / Works Register / Sub-
ledger.

2.41 Whether value of CWIP Not applicable.

physically available has been
reconciled with the value
reflected in CWIP account of
General ledger and difference if
any has been settled by passing
necessary accounting entries.

2.42 Whether stores found surplus at Not applicable.

worksite in respect of completed
works have been sent back to
stores depots or transferred to
other works (where required)
and necessary accounting
entries have been made by the
debiting the Inventory Account
(in case stores sent to store
depot) / debiting the works
account (in case stores
transferred to other work) by
giving credit to CWIP accode for
concerned Project work.

2.43 Whether surplus stores lying Not applicable.

with contractor in respect of
completed works have been
taken back from the contractor
and transferred to stores depots
or to other works (where
required) and necessary
accounting entries have been
made by the debiting the
Inventory Account (in case
stores sent to store depot) /
debiting the works account (in
case stores transferred to other
work) by giving credit to accode
for ‘material issued to contractor
where value was earlier booked
at the time issue of such stores
to contractor.

2.44 Whether diversion of inventory / Not applicable.

equipment from one project work
to another project work has been
properly accounted.
3. Inventory

3.1 Whether Wholesale Depot, It is not practice to maintain

 Circle Telecom Store Depots Bin cards and Price Store
and Store Dumps have Ledger in the store.But,
maintained the bin cards and
quantitywise Stock Register is
Priced Store Ledger.
maintained.

3.2 Whether all the stores / material The same is recorded in Stock
received from Vendor / supplier register immediately on their
during the financial year in
receipt.
question or in any of the
previous financial years, have
been recorded in the Bin Card,
Priced Store Ledger (quantity
and other details) immediately
on their receipt and acceptance
by the consignee. (Stores /
material received must not be
directly charged to CWIP but to
be routed through Inventory
Account).
3.3 Whether full liability for stores Yes, Necessary entry is made.
received in good condition from
supplier/vendor as per terms and
conditions of purchase order
during the financial year in
question, has been created,
whether accounting entries for
such liability has been passed
and included in the Inventory
Account of General Ledger,
whether necessary entry for the
value of such stores has been
made in the Priced Store Ledger
immediately on acceptance of
the material by the consignee in
case the accounting unit of the
consignee is the paying authority
of the stores received. And
whether payment made to
vendor / supplier subsequently
against such stores has been
debited to accode where the
amount of liability / provision has
been credited at the time
creating the liability (on actual
basis) / provision (on estimation
basis).

3.4 In case the paying authority for No Such Case.

the stores received, is a different
accounting unit whether the
value of the stores has been
accounted in the Inventory
account of general ledger
immediately on receipt of ATD or
from the information / data of
ATDs uploaded by the paying
authority in IBTMS Package and
 whether necessary entry about
value of such stores has been
posted in the Priced Stores
Ledger immediately.

3.5 In case of stores / material No Such Case.

received during the financial
year in question or any of the
previous financial years from
other units of BSNL whether
entries about quantity and other
information of the stores have
been made in the Bin card &
Priced Stores Ledger
immediately on receipt of Stores.
Whether value of such stores
has been accounted in the
inventory account of general
ledger immediately on receipt of
ATD or from the information of
ATDs uploaded by the
accounting unit of consignor
(BSNL unit) in IBTMS Package
and whether necessary entry
about value of such stores has
been made in priced stores
ledger immediately.
3.6 Whether valuation of inventory Not applicable
has been made taking into
account all cost including cost of
stores paid to the supplier /
vendor, transportation cost –
primary distribution cost and
excluding the CENVAT portion
for excise duty & CVD. Whether
the amount of inward freight,
taxes and duties (not eligible for
CENVAT), octroi etc in question
have been merged with the
value of inventory and not
booked separately to accodes
which had been allotted earlier
but deleted latter on. Whether
store-keeping charges have not
been taken for valuation of
inventory.

3.7 Whether weighted average rate Weighted average rate is not

of each item of store has been calculated.
calculated at the time receipt of
new consignment. Whether
weighted average rate has been
entered in the Priced Store
Ledger.
3.8 Whether stores have been Yes, Stores are issued on the
issued on the basis of approved approval of DGM.
(by the competent authority)
indent placed by the consignee /
indenter.

3.9 Whether particulars of stores Such particulars are maintained

issued during the financial year in Stock Register.
in question have been noted in
the Bin Card, Priced Stores
Ledger immediately on issue of
the stores to the
consignee/works.

3.10 In respect of stores issued from Not applicable

the Store Depot / units of BSNL
to works during the financial year
in question whether ATDs for the
value of stores worked out at
weighted average rate prevailing
at the time of issue, have been
sent along with all document of
issue to the accounting units of
consignee immediately the
stores are issued, whether
corresponding entries for such
issue have been made in the
Priced Stores Ledger, whether
accounting entries have been
made in inventory account of
General Ledger and whether
particulars of ATDs have been
noted in IBTMS package so that
consignee can account for the
same.

3.11 Whether entries in Bin Card Bin Cards and Price Store
about receipt and issue of stores Ledger are not maintained.
have been reconciled with the
entries available in the Priced
stores ledger and difference if
any, has been settled promptly.

3.12 Whether the value of the stores Not applicable

reflected in the Priced Store
Ledger has been reconciled with
the value reflected in the
Inventory account of General
Ledger and difference if any has
been settled immediately within
the financial year in question.

3.13 Whether proper stock register Not applicable

has been maintained for the
stores lying at work sites and
 with the contractor.

3.14 Whether physical verification of Physical Verification of

inventory has been carried out at Inventory has not been carried
the close of the financial year
out in current financial year.
covering all items of inventory.

3.15 Whether proper documents of Not applicable

physical verification of stores
have been prepared in the
format prescribed by Corporate
Office (Circular No. 132 dt.
17.04.2008 & Circular No. CA-
240 dt. 15.11.2010)

3.16 Whether the quantity of stores Not applicable

found on physical verification
has been reconciled with those
reflected in the Bin card & Priced
Store Ledger and whether the
difference if any has been sorted
out / settled immediately by
making necessary entries.

3.17 Whether value of stores found Not applicable

on physical verification has been
reconciled with the value of
stores reflected in Inventory
account of General Ledger and
Priced Stores Ledger and
whether difference if any has
been settled within the financial
year by passing necessary
accounting entries.

3.18 In case of stores found short Not applicable

during physical verification as
compared with the quantity
reflected in the Bin card / priced
stores ledger and such
shortage / difference could not
be settled within the financial
year in question, whether
provision has been made for the
value of the shortage and
necessary accounting entry
regarding such provision has
been incorporated in the
accounts i.e. in the general
ledger.

3.19 In case of stores found short Not applicable

during physical verification
conducted in previous financial
year(s) and such shortage could
 not be settled in previous
financial year(s), whether such
shortage has been totally settled
during the current financial year
and whether the provision if any
made in previous financial
year(s) for such shortage, has
been fully adjusted in the current
year’s account by passing
necessary accounting entry.

3.20 Whether physical verification has Not applicable

been carried out as per order of
Corporate Office in respect of
inventory lying unutilised with the
contractor and lying un-utilized
at work site at the close of the
financial year and whether
difference if any, has been
settled immediately.
3.21 In case of loss of stores due to No Such Case
natural calamity, fire etc whether
proper accounting entry has
been passed to relieve the
Inventory Account of General
Ledger, whether entries has
been made in Bin Card and
Priced Stores Ledger for such
stores, whether provision for the
value of such stores has been
made, whether the value of such
store has been written off by the
competent authority and whether
provision for such stores made
earlier, has been adjusted by
passing necessary accounting
entry in the general ledger.

3.22 In case of loss of inventory due No Such Case

to theft and other reason
whether proper accounting entry
has been passed to relieve the
Inventory Account of General
Ledger, whether entries has
been made in Bin Card and
Priced Stores Ledger for such
stores, whether provision for the
value of such stores has been
made, whether the value of such
store has been written off by the
competent authority due to non-
recovery / partial recovery of
such stores and whether
provision for such stores made
earlier has been utilized /
adjusted by passing necessary
accounting entries.
3.23 Whether inventory has been Such identification has not
totally verified by the Stores been made.
Scrapping Committee to identify
the obsolete / unserviceable /
non-moving inventory and slow
moving.

3.24 Whether report of the Store Not applicable.

scrapping committee and the
details of stores identified as
obsolete and unserviceable has
been submitted to the competent
authority for declaring such
stores as obsolete /
unserviceable.

3.25 Whether NRV has been Not applicable.

ascertained for the stores
identified as obsolete /
unserviceable

3.26 Whether proper provision has Not applicable.

been made for the difference
between the NRV and book
value of stores declared as
obsolete / unserviceable
provided the NRV is less than
book value of the stores.

3.27 Whether the stores declared as Not applicable.

unserviceable / obsolete by the
competent authority have been
accounted to accode for
‘unserviceable/obsolete stores’
by crediting to inventory account.

3.28 Whether the details of all Obsolete / Unserviceable Store

inventory declared obsolete / Register is not maintained
unserviceable i.e. description of seperately.
stores, quantity, book value,
NRV, amount of provision made,
physical location of such
inventory, sanction particulars
regarding declaring such stores
as obsolete/unserviceable by
competent authority, particulars
about disposal of such obsolete /
unserviceable stores etc. have
been kept in the ‘Obsolete /
Unserviceable Store Register’.

3.29 Whether obsolete / Not applicable.

unserviceable stores reflected in
 the accounts have been
reconciled with the entries made
in ‘Obsolete / Unserviceable
Store Register’ and the
difference if any between the two
sets of records has been settled.

3.30 Whether obsolete & Not applicable

unserviceable stores lying under
obsolete/unserviceable inventory
accode has been disposed off
promptly under proper sanction
of the competent authority,
whether provision made if any at
the time of declaring the stores
as obsolete/unserviceable has
been utilized / written back,
whether proper accounting
entries has been made to
account for sale value, and
whether loss occurred on
disposal of such obsolete /
unserviceable stores has been
written off by the Competent
authority.

3.31 Whether appropriate action has No such action has been

been taken by the Circle Heads / undertaken.
Planning Section to utilize the
slow moving and non-moving
items of inventory either in works
of the Circle or works of other
circle
3.32 Whether stores lying unutilised Yes
with contractor at the close of
the financial year has been
taken to inventory account by
passing accounting entries and
at the beginning of the next
financial year such entry has
been reversed.

3.33 Whether storage arrangement Yes

for keeping inventory is
adequate, proper and safe.
3.34 A status report regarding
computerization of inventory
records must be given in the
Internal Audit report

3.35 Whether the quantity of Not applicable.

inventory which have been
procured during the current
financial year are actually
required i.e. whether decision for
procurement of quantity of stores
in question during the current
financial year has been taken
based on the total quantity of
stores required for execution of
already sanctioned projects; and
taking into account the quantity
 of such stores which are already
lying in stock of the Circle and
quantity of such stores which are
on the pipeline at the time of
deciding procurement of such
fresh quantity in question during
the current financial year, and
whether the conditions
mentioned above have been
considered before taking
decision of procuring the
quantity of stores in question.

3.36 Whether obsolete and Not applicable.

unserviceable inventory as
reflected in Register of
Obsolete / Unserviceable
inventory have been verified
physically and difference if any
has been reconciled and settled.

3.37 Whether proper accounting of No Such case.

tradable equipments has been
done as per instructions issued
by CA Section through Circular
No. CA-218, CA-218A, & CA-
218B
4 Bank & cash transaction

4.1 Whether cashbook and Yes, Cash book and Bank book
bankbook are properly are properly maintained and
maintained and updated on daily
updated on daily basis.
basis with all transactions taken
place during the day.

4.2 Whether cash collected during a Yes, it is remitted to bank on

day has been remitted to bank the same day.
on the same day and there is no
delay in the remittance

4.3 Whether amount collected on Yes, it is remitted to bank on

the last working day of the the same day.
financial year has been remitted
to bank on the same last day of
the financial year.

4.4 Whether bank has credited the Yes, the bank has credited the
cash remitted by the unit in cash remitted by the unit in
collection bank account of the
collection bank account of the
unit on the date of remittance, if
not what action the unit has unit on the same day.
taken to get the credit.

4.5 Whether the unit has reconciled The unit has not any Escrow
the amount transferred by the account.
Bank from the Escrow Account.

4.6 Whether cheques has been Yes, cheques have been

remitted to bank on the date of remitted to bank on the date of
 their receipt and there is no their receipt.
delay in remittance

4.7 Whether cheques / DD received Yes, it has been remitted to

on the last day of the financial bank on the same last day of
year have been remitted to bank
the financial year.
on the same last day of the
financial year.

4.8 Whether all the cheques / DDs Yes, it has been treated as part
received on the closing day of of cash balance.
the financial year but could not
be remitted to bank on the same
day due to circumstance beyond
control, have been treated as
part of cash balance and
disclosure in this regard has
been given in the annual
accounts.

4.9 Whether all the cases of Yes, it has been analysed and
cheques deposited but not matter has been properly
credited by bank (as reflected in
pursued with the bank
the Bank reconciliation
statement), have been analysed authorities.
age-wise, and whether matter
has been properly pursued with
the bank authorities for early
credit to BSNL account.

4.10 Whether in respect of Yes, the instruments have been

dishonored / stale cheques the timely forwarded by the banks
instruments have been timely
along with consolidated list.
forwarded by the banks along
with consolidated list, whether
the accounting unit has reversed
the amount of such dishonored
cheques in the Bank Book and
billing system and whether
appropriate action has been
taken by TRA Branch and other
concerned branch of unit for
realization of such amount from
debtors.

4.11 Whether there are instances that There is no such case.

cash / cheques / DDs have been
remitted / deposited to / with
bank but not accounted for by
the Accounting unit in the
accounts.

4.12 Whether the banks have Yes, the banks have transferred
transferred the money from the the money from the Collection
Collection Account of Units to Account of Units to Circle IFA
 Circle IFA and in turn from IFA to without any float.
Corporate Office without any
float. In case of delay in
transferring the money by bank
whether accounting unit and IFA
have recovered interest for the
delay as per terms and
conditions of agreement entered
with the banks.
4.13 Whether TT sent by the units to Yes.
IFA collection account have
been credited by bank to IFA’s
collection account correctly and
promptly and there is no
difference between the amount
accounted by the remitting unit
to concerned originating accode
for bank transfer & IFA to
concerned responding accode
for bank transfer.

4.14 Whether all the cases of TT sent Yes.

by the Units to Circle IFA and by
Circle IFA to Corporate Office,
but not credited to IFA collection
account / Corporate office
account or wrongly credited or
credited short, have been
analyzed age-wise and whether
the Unit and Circle office have
vigorously pursued the case with
the bank authorities to get the
credit and to settle all such
cases.

4.15 Whether all the accounting units Yes, the unit has carried out
having bank account have bank reconciliation in respect of
carried out bank reconciliation in each and every bank accounts of
respect of each and every bank units and reconciliation has been
accounts of units and done in respect of all transactions
reconciliation has been done in
occurred .
respect of all transactions
occurred up to the close of the
financial year, whether bank
reconciliation statements have
properly been prepared showing
all the pending items and sent to
the banking cell at circle
headquarters.

4.16 Whether details of each and Yes, the details of each and
every item pending in the Bank every item pending in the BRS
reconciliation statement are
are available in the unit and the
available in the unit, whether
Unit has reviewed thoroughly all unit has reviewed thoroughly
such pending items pending in all such pending items .
the Bank Reconciliation
Statement of each bank account,
whether segregation of various
types of items have been done,
whether the unit has made age-
wise analysis of the pending
 items in the range of > 6 months
but < 1 year, >1 year but < 2
years, > 2 years.

4.17 Whether the unit and SSA have Yes, the unit has taken
taken appropriate action to settle appropriate action to settle the
the wrong / excess / short / debit
wrong / excess / short /debit
and credit afforded by banks
which are reflected in Bank and credit afforded by Banks
reconciliation statement and how which are reflected in BRS and
many old wrong / excess / short annexure 1 is attached for
debit and credit items (both details.
quantity and value involved)
which were pending at the
beginning of the financial year in
question, have been settled by
the Unit / SSA during the current
financial year.

4.18 Whether SSA / accounting unit No Such Case

have taken proper action to clear
the unlinked debit and credit
reflected in the Bank
Reconciliation Statement and
how many old un-reconciled
unlinked debit and credit items
(both quantity and value
involved) have been settled /
cleared by the SSA / unit during
the current financial year.
4.19 Whether the amount recoverable Not applicable.
from bank which will be reflected
under accode 1130816 has been
tallied with the details of
individual amount recoverable
from bank kept in subsidiary
records, whether appropriate
action has been taken to settle
the cases, how many cases
have been settled during the
current financial year (amount
involved) and what are the
pendency.
4.20 Whether proper accounting Yes, proper accounting entries
entries have been passed in have been passed in respect of
respect of cheques issued but cheques issued but not presented
not presented to bank by party to bank by party and has become
and has become time barred, time barred and full details are
whether full details of all the time
available and it has been
barred cheques have been kept
reconciled.
in the register of Time-barred
cheques, whether details of all
the time barred cheque as
available in the register of time
barked cheques have been
reconciled with the amount
reflected in the accode for ‘Time
barred cheque and whether any
payment made subsequently
against such time barred
cheques, has been routed
through the Register of time
 barred cheque and debited to
accode for ‘time barred cheque’
where the amount was credited
earlier when the cheque became
time barred, and necessary entry
about such payment has been
made in the Register of time
barred cheque against the
corresponding entry..

4.21 Whether there is any un- There is no such case.

identified difference / un-
reconciled balance / un-
confirmed balance in the
cashbook and bankbook and
whether the same has been
settled promptly by the units.

4.22 Whether sweeping facility has Yes, the unit has availed
been availed by the units in sweeping facility.
respect of operation bank
account and whether interest
afforded / to be afforded by bank
in such cases has been
accounted by the units on
accrual basis.

4.23 Whether interest afforded by the Yes, the interest afforded by the
bank on account of sweeping bank on account of sweeping
facility or delay in remitting the facility or delay in remitting the
money of collection bank money of collection bank
account to IFA and IFA to account to IFA is correct.
Corporate Office is correct. If not
correct whether appropriate
action has been for recovery of
the same from the bank.
4.24 Whether charges debited by Yes, the charges debited by
bank to operation / collection bank to operation / collection
bank account are as per bank account are as per
agreement with the bank, if not agreement with the bank.
whether all such cases has been
vigorously pursued by units and
settled by the bank authorities.

4.25 Whether higher officers have Yes, higher officers have verified
verified the cash and imprest the cash balance.
balance during the current
financial year.

4.26 Whether the units have Yes, higher officers have verified
maintained authorized cash and the cash balance.
bank balance and there is no
holding of abnormal cash and
bank balance in the operation
account.
4.27 Whether bank contra & cash Yes.
contra has been tallied and no
difference is left at the end of
each month and also at the
close of the financial year.

4.28 Whether insurance policy has No, there is no insurance policy

been taken in respect of cash in has been taken in respect of
chest and cash in transit.
cash in chest and cash in
transit.

4.29 Carry out surprise check of cash Surprise check has been carried
at least twice once before 31st out as on 28/12/2010.
December and another before
31st March and ensure that
certificate of cash in hand and
cash on bank are correct.
4.30 Whether payment through cash Yes, it has been made as per
has been made as per rule and rule and acknowledgement of
acknowledgement of receipt of
receipt has been taken.
cash by the receiver has been
obtained by the cashier.

4.31 Whether revenue stamp has It is not in practice at the unit.

been affixed as per applicable
rules.

4.32 Whether the accounting unit has Yes

obtained the confirmation of
balance in the bank account at
the close of the financial year
and the same has been tallied
with balance as per bankbook
maintained by the unit.

4.33 Whether booking made to inter Yes, The same has been tallied.
bank transfer accode i.e.
19801xx (originating), 19802xx
(responding),
49801xx(originating) and
49802xx (responding) i.e.
originating and responding for
transfer of fund from Circle IFA
to SSA / Accounting of Circle
and vice versa have been totally
reconciled and whether the
balance under originating
accode has been totally tallied
with balance under
corresponding responding
accode.

4.34 Whether amount booked to inter- Yes, The same has been tallied.
current bank transfer originating
accode 19701xx and 49701xx by
the Circle IFA for transfer of fund
of IFA’s collection bank account
 to Corporate Office as well as
the amount booked to
responding accode 19702xx &
49702xx to acknowledge the
amount received from Corporate
Office has been tallied with the
booking made by Corporate
Office to accode 19702xx &
49702xx
4.35 Internal Auditor should review Yes, cash & cheque
the control procedure available management is adequate and
for cash, cheque management
proper at the unit.
and suggest better system and
make detailed mention about
this in their report.

4.36 In case of fake notes received, The unit has not received any
whether provision has been fake notes.
made for the amount of fake
notes and whether appropriate
action has been taken to recover
the amount from the officials /
external entity and in case of
non-recovery whether the loss
has been written off as per
sanction of the competent
authority.

4.37 Whether proper accounting has Yes, proper accounting has

been made in respect of deposit been made in respect of
made as per order of the Court
deposit made as per order of
and in respect of amount
withdrawn by statutory authority the court.
from BSNL Bank Account.
5 Sundry Debtors

5.1 Whether there is difference as There is no any difference.

on 1st April of the current
financial year between the total
amounts of all type of debtors as
reflected in sub-ledger of debtors
and debtors as reflected in
accodes of debtors under
General Ledger. If so the
quantum of difference shall be
mentioned.

5.2 Whether difference as on 1st Not applicable.

April of current financial year,
between all types of debtors
including debtors for leased and
VPN circuits as reflected in the
sub-ledger and the total amount
of debtors as per General
Ledger has been thoroughly
analysed and reconciled. The
details of such difference of
debtors settled / cleared during
the current financial year shall
be furnished.
5.3 Whether the debtors booked Yes.
in the general ledger from 1 st
April of current financial year
to 31st March has been totally
reconciled with sub-ledger of
debtors and no difference
exist in respect of such
debtors at the close of the
current financial year. If there
is any difference the same
shall be reported.

5.4 Whether ageing analysis of Ageing analysis of sundry

sundry debtor pending at the debtor will be done at the close
close of current financial year in
of financial year.
the range of < 6 months, >6
months but <1 year, > 1 year but
< 2 years and >2 years has been
correctly worked out.

5.5 Whether appropriate action has Such effort has not been taken.
been taken to collect the
outstanding bills particularly the
old outstanding from the debtors
and out of such efforts how
much recovery against the
outstanding bills has been made
during the financial year?

5.6 How much recovery of old Not applicable.

outstanding has been made
during the financial year
through projects / schemes
launched as per
recommendation of M/s BCG
and against such collection
how much cost has been
incurred in the form of
incentives, TA & DA etc apart
from the salary of staff and
whether such scheme and
project are cost effective.
5.7 Out of the old outstanding There is no such case.
cleared during the financial year
how much old outstanding
have been cleared through
actual collection of cash and
how much by cancellation &
write off. The break up in this
regard shall be indicated in the
report.

5.8 Whether all the payment There is no such case.

received against the billed
amount, which remained
unadjusted due to various
reasons, have been thoroughly
reviewed, linked to concerned
 debtors and adjusted. The
details of such adjustment shall
be mentioned in the report

5.9 Whether the bills, which have There is no such case.

been cancelled during the
current financial year, are proper
as per rules and whether such
cancellations have been
adjusted against revenue and
not against provision for
doubtful debt.

5.10 Whether debts, which have been There is no such case.

written off during the financial
year, are proper as per rules and
supported by sanction given by
the competent authority as per
financial powers.

5.11 Whether the debts, which have There is no such case.

been written off during the year,
have been charged to P&L A/c
and not to provision for doubtful
debt as per the instructions
given in Circular 118 dt.
06.02.2008.

5.12 Whether provision for doubtful Provision for doubtful debt is to

debt at the close of the financial be made at the close of the
year is done as per policy of
financial year.
BSNL and according to Circular
118 dt. 06.02.2008 & 137 dt.
15.05.2008.
6 Loans & Advances given to
employees (including unabsorbed
employees who are either working
in BSNL or presently working in
DOT, DOP, MTNL)

6.1 Whether proper Register of loans Yes, it has maintained proper

and advance / Recovery Register Register.
has been maintained by the units to
record all types of interest bearing
& non-interest bearing loans and
advances (including pay advance,
TA Advance, medical advance,
excess payment etc) given by BSNL
to its employees and unabsorbed
employees who are presently either
working in BSNL or in DOT / DOP /
MTNL
6.2 Whether proper entries have been Yes, it is updated at the time of
made in the Register at the time of disbursement of loan and
disbursing such loans and advances advances.
(including other advance, excess
payment etc) to such employees.
6.3 Whether recovery of principal Yes, it is updated at the time of
amount of loans and advances and recovery of loan and advances.
other advances, excess payment etc
wherever applicable, has been
made on regular basis as per rule
and noted in the Register.

6.4 Whether the details of balance of Yes.

each type of loans and advances
pending to be recovered as
reflected in the Register of
employee’s loans & advance have
been reconciled with those
reflected in the General and no
difference exists between two sets
of figures.

6.5 Whether the difference between There is no such case.

the amount of loans and advances
as reflected in the Register of loans
and advances and the amount of
loans and advances as per General
Ledger which was pointed out by
the Branch Auditors and C&AG in
previous financial years, have been
fully settled during the current
financial year.
6.6 Whether interest on loans and Yes, interest on loans and
advances wherever applicable has advances have been correctly
been correctly calculated, interest calculated, interest has been
has been recovered and noted in recovered.
the Recovery Register.

6.7 Whether loans and advances given Yes, it has not been booked as
by DOT to absorbed employees and current assets and recovery of
employees on deputation in BSNL such loan will be remitted to
has not been booked as current CCAs.
assets of BSNL. (Only the recovery
of such loan and advances will be
remitted to CCAs of DOT)
7 Various type of deposits made by
BSNL units with different
authorities / local bodies / others
and advances given to vendors /
contractors / Govt. companies &
organization etc.

7.1 Whether proper sub-ledger / Yes, it has maintained.

Register has been maintained for
various types security deposits /
other deposits such as deposit with
Electricity Board / local authorities
made by BSNL units
7.2 Whether proper sub-ledger / Yes, it has maintained.
Register has been maintained for
advances given to supplier /
contractors / Govt. companies &
organization etc.

7.3 Whether proper entries have been Yes.

made in the sub-ledger / Register
for security deposits and Register of
advances at the time of giving
Security deposit / other deposits
and advances.

7.4 Whether recovery of amount of Yes.

advances given to vendor / supplier
/ contractor / Govt. companies &
organization and interest thereon
has been made as per terms and
conditions of giving advance and
such recovery has been noted in
the concerned Register

7.5 Whether the balance of security Yes, it has been reconciled.

deposits / other deposits and
advances as reflected in the
concerned Register / sub-ledger has
been reconciled with entries made
in the general ledger and no
difference exists between two sets
of figures.

7.6 Whether the difference between There is no such difference.

the amount of security deposits /
other deposits and advances as
reflected in the Register of Security
Deposits / other deposits and
Register of advances and the
amount of security deposits /
deposits and advances as reflected
in the General Ledger, which was
pointed out by the Branch Auditors
and C&AG in previous financial
years, have been fully settled
during the current financial year.
8 EMD, SD given by BSNL Units
and Bank guarantee given by
BSNL Units to others
8.1 Whether proper sub-ledger / Yes, it has been maintained.
Register has been maintained
for keeping details of EMD & SD
given by BSNL Units.

8.2 Whether refund of EMD & SD Yes, the EMD/SD register has
has promptly been obtained on been maintained and refund is
fulfilment of all the terms and
noted properly in the same.
conditions related to it and same
has been noted in the EMD/SD
Register.

8.3 Whether the details of EMD & Yes, it has been reconciled.
SD as reflected in the EMD &
SD register / sub-ledger have
been totally reconciled with the
booked figure of EMD / SD
reflected in the General Ledger
and difference if any, between
two sets of figure has been
settled.

8.4 Whether Register for Bank No such case noticed during

Guarantees given by BSNL Unit the year.
has been maintained and details
of all such bank guarantees
have been kept in the said
Register.

8.5 Whether BSNL units have got the No such case noticed during
bank guarantees released promptly the year.
on fulfillment of terms and
conditions.
9 Temporary advance & Imprest

9.1 Each and every expenditure Yes, the expenditure made

made from temporary advance from temporary advance has
and the Internal Auditor must
been scrutinized.
scrutinize imprest from
proprietary angle.

9.2 The genuineness of at least The vouchers of temporary

25% of vouchers of temporary advance have been vouched
advance and imprest for items
and it is found to be correct.
procured / services availed must
be checked by the Internal
Auditor. The findings of such
checking should be reported in
the Internal Audit Report.
9.3 Whether there are incidence of There is no such case.
taking temporary advance
involving huge amount
frequently / within short
interval by selective group of
officers and whether there is
justification for such
temporary advance in view of
the fact that repair &
 maintenance of most of assets
are done through annual
maintenance contract and
most of other works of
recurring nature are carried
out through contractor
selected through established
procedures. The Internal
Auditor to the Circle IFA must
report any abnormality in this
respect. The findings should
be given in the internal audit
report.

9.4 Whether there are instances of There is no such case.

granting temporary advance
without adjusting the previous
one. If so, what action has been
taken by the IFA / Head of the
Unit to prevent such type of
irregularities must be indicated
by the Internal Auditor in the
Audit Report.

9.5 Whether there are instances of Yes, interest has been

non-submission of bills against recovered for the delay.
temporary advance within the
scheduled time frame for
adjustment of temporary
advances. In case of delay
whether interest has been
recovered for the delay as per
order from the concerned
officer who has defaulted, and
credited to BSNL Account.
The Internal Auditors in the Audit
Report shall indicate the
remedial action taken by the
Management in this regard.

9.6 The Internal Auditor in the Audit The head of the unit has
Report shall indicate what action implemented a system to not
has been taken by the Head of Unit sanction any further temporary
and IFA of the Circle to control the advance until the first one is
expenditure from Temporary
settled (i.e. bill & invoice
Advance and Imprest.
submitted and balance is
settled)
10 Amount recoverable from DOT,
DOP, MTNL

10.1 Whether Control Registers / Yes, Control Registers have

Sub-ledgers have been been maintained for various
maintained for various type of type of amount recoverable
amount recoverable from DOT from DOT such as GPF
such as GPF advance/final advance.
withdrawal given by BSNL to its
absorbed staff, salary of BSNL
staff working in DOT, leave
salary paid to BSNL employees
working in DOT on deputation.
10.2 Whether proper entries have
been made in the Register /
Sub-ledger at the time of
disbursement of such amount to
concerned staffs, which are
recoverable from DOT.
Yes, proper entries have been
made in the Sub-ledger at the
time of disbursement of such
amount to concerned staffs,
which are recoverable from
DOT.

10.3 Whether Register / Sub-ledger is Not applicable.

maintained for amount
recoverable from DOP such as
rent of BSNL buildings occupied
by DOP, house keeping charges
of such buildings, services
provided by BSNL to DOP etc.

10.4 Whether claim bills supported by Not applicable.

detailed schedules for each type
of claim have been preferred to
DOT & DOP promptly, noted in
the Register, and active
persuasion has been made for
recovery of such claim
particularly the old claim bills.

10.5 Whether payment received from Not applicable.

DOT & DOP has been noted in
register.

10.6 Whether balances which are Not applicable.

pending to be recovered from
DOT & DOP as reflected in the
Register / Sub-ledger have been
reconciled with the balances as
reflected in the General Ledger
and difference if any has been
settled.

10.7 Whether details of amount Not applicable.

recoverable from DOT on
various account have been
uploaded in Web based system
and the same has been tallied
with booked figure reflected in
General ledger.

10.8 Whether claim bills supported by No such case noticed during

detailed schedules for recovery the year.
of principal amount of loans and
advances (including pay
advance, medical advance, TA
advance) which have been given
by BSNL to unabsorbed
employees who are presently
working in DOT, DOP & MTNL,
have been preferred to DOT,
DOP & MTNL
10.9 Whether claim bill for recovery of Not applicable.
interest on loan & advances
(wherever applicable) given by
BSNL to unabsorbed employees
who are presently working in
DOT, DOP & MTNL, have been
preferred to DOT, DOP & MTNL

10.10 Whether the Unit has actively Not applicable.

pursued and taken proper steps
for recovery of principal amount
of such loan and advances and
interest thereon (wherever
applicable) from DOT, DOP &
MTNL and whether the details of
principal and interest amount
recovered from DOT, DOP &
MTNL have been noted in the
Register of loans & advances as
mentioned Sl. 6.1 above.
11 Various deposits taken from the
subscribers / other operators

11.1 Whether there is any booking Not applicable at the unit.

under the accode for “Before
connection deposit”. If so,
whether all the details of all such
deposits are available in
“Register of Before connection
deposit”.

11.2 Whether refund / adjustment of Not applicable at the unit.

‘Before Connection Deposit’ has
been routed through the sub-
ledger / register of Before
connection Deposit and such
refund / adjustment has been
correctly noted in the Register of
Before Connection Deposit.

11.3 Whether before connection Not applicable at the unit.

deposit reflected in Register of
‘Before Connection Deposit’ has
been reconciled with the waiting
list and the difference if any has
been settled.

11.4 Whether the total balance of Not applicable at the unit.

‘Before Connection Deposits’ as
reflected in the Register / Sub-
ledger are tallied with those
reflected in General Ledger and
difference if any has been
settled.
11.5 Whether details of all After Not applicable at the unit.
connection Deposits have
properly been maintained in
‘Register of after connection
Deposit’.

11.6 Whether refund / adjustment of Not applicable at the unit.

‘After Connection Deposit’ has
been routed through the
Register of After Connection
Deposit and such refund and
adjustment have been correctly
noted in the Register of After
Connection Deposit.
11.7 Whether the balance of ‘After Not applicable at the unit.
Connection Deposit’ as reflected
in the Register of After
Connection Deposit’ have been
reconciled with the booked figure
in General Ledger and difference
if any between two sets of figure
has been fully settled. Whether
the details of after connection
deposits have been reconciled
with the working connection and
there is no difference.

11.8 Check whether proper details of Yes, it has been maintained.

all other deposits (other than
before connection and after
connection deposit) taken from
subscribers / other operators /
service providers have been
maintained in the Sub-ledger /
Register of other deposits.

11.9 Whether refund / adjustment of Yes.

other deposits has been routed
through the Register / Sub-
ledger of other deposit and such
refund and adjustment have
been correctly noted in the
Register of other Deposit.
11.10 Whether the balance of all such Yes, it has been reconciled.
other deposits as reflected in
Register of other deposits are
reconciled with those reflected in
the General Ledger and
difference if any has been fully
adjusted.

11.11 Whether liability for interest on No interest has been charged

subscribers deposit wherever on other deposits.
applicable, has been created
and accounted.
12 EMD, SD, Bank Guarantee
taken by BSNL from others

12.1 Whether details of EMD & SD Yes, it is maintained by the

taken by BSNL Units have been unit.
properly kept in sub-ledger /
Register of EMD / SD.

12.2 Whether EMD & SD are Yes.

refunded promptly on fulfilment
of all the terms and conditions
related to it and same is noted in
the EMD/SD Register.

12.3 Whether refund / adjustment of Yes.

EMD & SD has been routed
through the sub-ledger / register
of EMD & SD and such refund /
adjustment has been correctly
noted in the Register of EMD &
SD.
12.4 Whether the total balance of Yes, it has been reconciled.
EMD & SD as reflected in the
EMD & SD register/sub-ledger
have been reconciled with the
booked figure of EMD / SD
reflected in the General Ledger
and difference if any, has been
settled.

12.5 Whether register has been Yes, It is maintained by Unit.

maintained for bank guarantee
taken by BSNL Units from others

12.6 Whether details of bank Yes, It is maintained by Unit.

guarantee taken by BSNL units
have been kept in the Register.
12.7 Whether bank guarantee taken Yes, It is found in order.
by BSNL units has been
released promptly on fulfilment
of terms and conditions.

12.8 Whether the Units has got the Yes.

bank guarantee renewed
wherever required as per terms
and conditions, on expiry of
validity period of the bank
guarantee in question.

12.9 Whether the Unit has encashed No such case noticed during
the bank guarantee promptly as the year.
per terms and conditions related
to such bank guarantees.
13 Sundry creditors & provisions
13.1 Whether Sub-ledger / Register Yes,it is maintained by the unit.
for Creditors has been
maintained for all types of
creditors i.e. vendors, suppliers,
contractors, service providers,
other telecom operators etc and
whether the details all types of
liabilities and provisions payable
to such creditors have been
noted in the Sub-ledger /
Register of Creditors at the time
of creation of such liabilities /
provisions.

13.2 Whether all the payment to Yes.

creditors has been routed
through the Register for
Creditors and debited to
accodes for liabilities / provisions
where the amount of liabilities /
provisions had been credited at
the time of creation of such
liabilities / provisions. Whether
payment particulars have been
noted in Sub-ledger/Register for
creditors.

13.3 Whether details of all the Yes, it has been reconciled.

pending liabilities / provisions
reflected in the Sub-
ledger/Register of Creditors
have been reconciled with the
total amount of liabilities and
provisions as reflected in the
General Ledger and difference if
any between two sets of figure
has been totally settled.

13.4 Whether liabilities / provisions There is no such case.

found excess on review of the
total liability / provision created,
actual liability / provision and
payment already made, have
been written back promptly and
whether the balance under
accodes for liability / provision of
general ledger and pending
items of Sub-ledger / Register of
Creditors reflect the actual
liability / provision pending to be
disbursed.
13.5 Whether the circle has taken No Such action has been taken
action to obtain confirmation of
the creditors at the close of the
financial year.
14 Payable to DOT / DOP
14.1 Whether proper liability / The unit sent schedule to circle
provision has been and circle make payment to
created for pension
DOT.
contribution (for
absorbed and
unabsorbed employees
working in BSNL) &
leave salary contribution
(for unabsorbed
employees on
deputation in BSNL)
payable to DOT.
14.2 Whether the detailed schedules Yes, the detailed schedules for
for monthly pension contribution monthly pension contribution
and leave salary contribution and leave salary contribution
payable to DOT has been payable to DOT have been
prepared and whether total prepared and it has been
amount of such schedules has tallied.
been tallied with amount of
liability as reflected in the
general ledger

14.3 Whether detailed schedules for Yes, detailed schedules for

monthly recovery of principal monthly recovery of principal
amount of loans and advance amount of loans and advance
(given by DOT to absorbed and interest thereon, monthly
employees of BSNL and GPF subscription & GPF
unabsorbed employees on advance recovered from
deputation in BSNL) and interest absorbed has been prepared.
thereon, monthly GPF
subscription & GPF advance
recovered from absorbed and
unabsorbed employees, monthly
recovery of CGEGIS in case of
unabsorbed employees, has
been prepared and whether total
of such schedules has been
tallied with monthly amount of
recovery as reflected in the
General Ledger.

14.4 Whether Register for liabilities Monthly schedule prepared by

towards pension & leave salary the unit and sent to corporate
contribution, and Register for
office.
Recovery (GPF subscription &
advance, CGEGIS, loans &
advances given by DOT)
payable to DOT has been
maintained and whether entries
have been made in such
Register as when liabilities have
been created, recovery has been
made, and subsequent payment
against such liabilities.

14.5 Whether amount of monthly Yes.

pension & leave salary
 contribution; monthly recovery of
GPF Subscription, GPF
Advance, loans & advance,
CGEGIS has been paid to CCA
of DOT within due date and
whether payment has been
noted in the Register and
debited to the concerned accode
for pension & leave salary
contribution and accodes for
recovery.

14.6 Whether quarterly GR & AGR The same calculation is made

have been calculated correctly by circle.
as per instruction of Corporate
Office, whether based on such
AGR quarterly License Fee,
USO levy & Spectrum charges
have been calculated correctly,
whether liability for LF, USO levy
and spectrum charges has been
created by debiting the
expenditure accodes 171 & 471
schedules and crediting the
provision accodes of 120 & 420
schedule and whether details of
such liability has been noted in
liability register for LF, USO levy
and spectrum charges.

14.7 Whether payment of license fee, The same calculation is made

USO levy & spectrum charges by circle.
has been routed through
provision accodes of 120 & 420
schedules and liability register,
whether payment has been
made within due date and details
GR, AGR & details of license
fee, spectrum charges have
been submitted to CCAs of DOT
and whether the payment
particulars have been noted in
the liability register.

14.8 Whether liability towards rent for Not applicable for the unit.
space of DOP building occupied
by BSNL, house-keeping
charges for such DOP building
occupied by BSNL, postal
services provided by DOP to
BSNL etc has been created and
accounted to concerned
accodes of liability as and when
the liability accrues; whether
details of such liability has been
noted in the liability Register for
DOP; and whether payment
against such liability has been
made within due date and noted
in the liability register.
14.9 Whether the closing balance of Not applicable for the unit.
various liabilities payable to DOT
& DOP as reflected in the
General Ledger has been
reconciled with the details of
pending liabilities as reflected in
the liability register for DOT &
DOP and difference if any
between two sets of figure has
been settled.

14.10 Whether principal amount of loans Not applicable for the unit.
& advances (given by DOP / MTNL
to absorbed employees of BSNL or
unabsorbed employee presently on
deputation in BSNL), and interest
thereon have been recovered by
BSNL from such employees through
pay bill, and paid to the DOT /
MTNL.
15 Salary payable & bills payable
to employees

15.1 Whether Sub-ledger / Register of Yes, Sub-ledger of liabilities

liabilities payable to employees payable to employees has been
has been maintained for all maintained for all types of
types of liabilities towards salary liabilities towards salary and
and other claims of the other claims of the employees
employees and whether details and register of liabilities has not
of all sorts of such liabilities has been maintained.
been noted in the said Register
as and when such liabilities have
been accrued and created by
debiting the relevant expense
accodes for salary.

15.2 Whether payment disbursed Yes, payment disbursed against

against such liabilities have been such liabilities have been
debited / adjusted to concerned debited / adjusted to concerned
accodes for liabilities payable to accodes for liabilities payable to
employees where the amount of employees.
liability had been credited at the
time of creation of the liability,
whether particulars of such
payment have been noted in
sub-ledger / register of liabilities
payable to employees.

15.3 Whether details of liabilities Yes, it has been reconciled.

payable to employees reflected
in the sub-ledger / Register have
been totally reconciled with the
liabilities reflected in the General
Ledger and difference if any has
been settled.
15.4 Whether the monthly salary has Yes, the monthly salary has
been drawn for the staffs who been drawn for the staffs who
are covered by the sanctioned are covered by the sanctioned
strength of staff and who are strength staff and on
working or on leave sanctioned sanctioned leave.
by competent authority.

15.5 Whether total of monthly gross Yes, it has been tallied.

salary drawn and booked to
concerned expense accodes has
been totally tallied with the (i)
total amount of recoveries /
deductions made from salary on
account of loans & advances,
GPF subscription & advance,
EPF (employees share of
contribution), Income Tax and
other items of recovery which
have been credited to various
accodes of liabilities / credited to
accodes for recoverable – under
current asset / out of account
etc, plus (ii) the net amount
payable to employees which are
booked to liability accodes for
salary payable to employees.

15.6 Whether various other claims of Yes, it has been correctly

employees (other than the worked out and sanctioned by
salary) i.e. TA & DA, medical
competent authority and
with vouchers & indoor
treatment, children education liability has been created.
allowance, reimbursement of
expense on newspaper etc have
been correctly worked out and
sanctioned by competent
authority, whether liability was
created by booking the expense
to concerned expenditure
accode and crediting to accode
for bills payable to employees,
whether corresponding payment
or adjustment of such liability
against some other recovery has
been debited to concerned
accodes for bills payable to
employees.
16 Income / Revenue

16.1 Whether in respect of post paid Bills are generated by EZBC,

connections bills has been Kolkata.
generated in respect of all
working connections
16.2 Whether telephone connections Not applicable.
for which billing has been made
as per billing cycle, has been
reconciled with the details of
 working connections as shown in
MIS statements.

16.3 Whether un-addressed bill has Not applicable.

been generated and also
whether there are instances of
un-addressed bill for consecutive
two cycles in respect of same
telephone number.
16.4 Whether the Management has Not applicable.
identified customers in respect of
all un-addressed bills, bills have
been issued to such identified
customers and the amount of bill
has been realized from the
customer. Whether revenue in
respect of un-addressed bill has
been recognized only when the
customer has been identified.

16.5 What corrective action has been Not applicable.

taken by the Management to
ensure that bills in respect of all
working connections are
generated with correct address?

16.6 Whether the value of MCU Bills are generated by EZBC,

(except the MCU for free calls) Kolkata.
has been tallied with the amount
of revenue booked as call
charges and there is no
difference between two sets of
values.
16.7 In case of post paid service Yes
whether proper reconciliation
has been carried out in every
billing cycle between the amount
of revenue billed for various
items and the amount of revenue
for various items which has been
recognized as income in the
accounts during the said billing
cycle and whether the difference
if any between two sets of figure
has been properly explained.

16.8 Whether the ‘Category’ assigned Yes

to each connections (particularly
the connections to which the
category of unlimited call
facility, concessional tariff
Plan, NI, service connection,
RSTC, other concessional
facility etc has been assigned)
has been thoroughly reviewed,
checked and found correct by
the competent authority in order
to ensure that appropriate tariff
is applied, charges to be
recovered are correctly
 calculated, there is no leakage
of revenue due to assignment
of wrong category.

16.9 Whether OYT rebate has been Not applicable.

properly monitored and whether
the rebate has been stopped
immediately after the prescribed
period for rebate is over.

16.10 Whether bills in respect of Not applicable.

concessional telephone
connections given to employees
as per terms and conditions of
service has been issued,
accounted and realization of the
amount of such has been made.

16.11 Whether in respect of all service Not applicable.

telephone connection (RSTC)
bills have been generated,
issued, amount of bill beyond
the concessional limit has
been accounted and such
amount has been recovered
from the concerned
employees.
16.12 Whether in respect of Not applicable.
disconnected telephone
connection, revenue has been
recognized strictly as per
existing rules and orders issued
by BSNL.

16.13 Whether appropriate portion Not applicable.

(applicable to the current month /
financial year) of the revenue
which was been received in
advance in previous financial
year(s) / month(s), has been
recognized as income of the
current month / financial year by
passing necessary accounting
entry.

16.14 Whether revenue received in the Not applicable.

current month / current financial
year but applicable for future
period, has been accounted as
income received in advance by
passing necessary accounting
entry.

16.15 Whether all provisional bills Not applicable.

issued in case of dispute and the
rebate given in respect of such
bills, have been verified by
higher authorities and found
correct as per their findings, and
whether all cases of provisional
bill has been settled promptly
and no delay occurs in
 finalization of such cases.

16.16 In case of cancellation of bills Cancellation of Bill are done by

whether the cancellation has AOTR.
been done by the appropriate
authority and whether immediate
higher authorities have
examined all such bills cancelled
bills and whether as per their
findings such cancellation is
correct.

16.17 Whether there are instances of There is no case of delay in

delay in disconnection due to disconnection due to Non
non-payment and also instances
payment. It is done
of delay in permanent closure of
telephones and what action has automatically by EZBC, Kolkata.
been taken by the Management
for such delayed disconnection
and permanent closure.
16.18 Whether in case of closed Yes
connection accounts have been
finalized within the time frame
fixed for the purpose, by
adjusting the deposits against
the pending claim bills and
whether effective steps have
been taken to recover the
balance outstanding if any.
16.19 Whether the entire amount of There is no such case.
revenue, which was booked, as
accrued in previous financial
year, has been totally reversed
in the beginning of the current
financial year.

16.20 Whether charges for all working Not applicable for the unit.
circuits (leased & VPN circuits)
details of which are available
TARIT-PLUS system, has been
calculated correctly, bills for
such charges have been raised,
such charges have been
recognized either as revenue of
the current financial year or as
revenue in advance, and the
amount of claim has been
realized. Whether reconciliation
has been carried out between
the amounts of bills raised and
the amount recognized as
revenue. Whether reconciliation
of number of circuits
commissioned / working with the
number of circuits billed has
been done and there is no
difference. Whether charges for
circuits have been calculated
 from the date of giving the
connection and accordingly
claims have been preferred.

16.21 Whether revenue from DSPT Not applicable for the unit.
service has been recognized,
accounted and realized.

16.22 Whether USO subsidy for DSPT Not applicable for the unit.
service (one time at the time of
installation of DSPT & annually
equated subsidy for five years)
has been recognized as
revenue, proper accounting has
been done, and subsidy has
been realized from CCAs.

16.23 Whether the claim for Not applicable for the unit.
reimbursement of expense i.e.
charges for diesel, electricity and
other items from USPs who are
sharing the USO Infrastructure
(tower) installed & maintained by
BSNL, as per terms and
conditions of agreement with
USO Administrator and USPs
have been correctly calculated,
bills for such reimbursement
have been preferred to USPs,
amount of bills has been
accounted, and the same has
been recovered from USPs as
per order of Corporate Office.
Whether in the last month of
each quarter the amount of
expenditure to be reimbursed by
USPs for the said quarter, has
been neutralized i.e. credited to
expenditure accode where the
expenditure incurred has been
debited during the quarter.
Whether a portion of such
expenditure has been
transferred through ATD to
CMTS vertical of BSNL for
sharing the same USO tower by
the latter.
16.24 Whether fixed charges towards Not applicable for the unit.
diesel generator set(s) and other
items to be recovered from other
USPs who are sharing the USO
infrastructure installed and
maintained by BSNL, has been
correctly calculated, bills for
such fixed charges have been
preferred to USPs, amount of
bills has been accounted as
income and charges have been
recovered from USPs. Whether
a portion of such fixed charges
has been transferred through
inter-segment ATD to CMTS
 vertical of BSNL by recognizing
the same inter-segment income.

16.25 Whether the details of the claims Not applicable for the unit.
for reimbursement of expense
and fixed charges, which are
pending to be recovered from
USPs and as reflected in the
sub-ledger have been reconciled
with outstanding amount as per
general ledger and there is no
difference.
16.26 Whether CMTS vertical have Not applicable for the unit.
accounted the expense on
diesel, electricity and other items
by accepting ATD as well as
recognized the fixed charges as
inter-segment expense by
accepting the inter-segment
ATD.

16.27 Whether claims for USO subsidy Not applicable for the unit.
for USO Infrastructure (tower)
has been correctly calculated as
per agreement and order issued
by corporate office, claims for
such subsidy have been
preferred to CCAs of DOT,
amount of claim has been
recognized as income on accrual
basis and the same has been
realized from CCA.

16.28 Whether claims USO subsidy in Not applicable for the unit.
respect of Rural wire-line
connection n (i.e. rural house
hold connection, VPT,
replacement of MARR system
etc.) installed on or after
01.04.2002 and Rural
Broadband have been correctly
calculated, claims have been
preferred to CCA, amount of
claims has been recognized as
income on accrual basis and the
same has been realized from
CCA.

16.29 Whether outstanding claims for Not applicable for the unit.
USO subsidy in respect USO
Infrastructure, Rural Telephony,
Rural Broad band as per Sub-
ledger have been reconciled with
amount of such outstanding
claims reflected in the General
Ledger and there is no
difference.
16.30 Whether IUC recoverable from Not applicable for the unit.
other service providers has been
correctly calculated as per
IOBAS data, claims for IUC have
 been preferred; amount of
claims has been recognized as
income and realized from other
telecom operators.

16.31 Whether charges for Not applicable for the unit.

infrastructure (such as ports,
space, tower) given on rent to
other telecom service providers
at point of interconnection (POI)
level have been calculated
correctly, claims for such
charges have been preferred to
other telecom service providers,
amount of claim has been
accounted as income on accrual
basis and the same has been
recovered from them.
16.32 Whether IUC recoverable from Not applicable for the unit.
MTNL has been got accounted,
recognized as income, and
realized from MTNL through
Northern Telecom Region.

16.33 Whether revenue share for Not applicable for the unit.
inward traffic received from
SAARC countries during the
financial year in question has
been correctly calculated, claims
for revenue share have been
preferred to SAARC countries,
amount of claims has been
recognized as revenue on
accrual basis and such revenue
share has been recovered.

16.34 Whether revenue to be Not applicable for the unit.

recovered from other ILD
operators / ILD service provider
for incoming ILD traffic has been
correctly calculated, bills has
been preferred, amount of bills
has been recognized as income
on accrual basis and realized
from such operators / service
provider.

16.35 Whether international roaming Not applicable for the unit.

revenue recoverable from
international roaming service
provider has been correctly
calculated, claims for such
revenue share has been
preferred, roaming revenue has
been recognized as income on
gross basis and realized from
such operators.
16.36 Whether outstanding claims for Not applicable for the unit.
infrastructure, IUC, SAARC
revenue, revenue for incoming
ILD traffic, international roaming
revenue as per Sub-ledger have
 been reconciled with amount of
such outstanding claims
reflected in the General Ledger
and there is no difference.
16.37 Whether revenue generated Not applicable for the unit.
from various value added
services provided to BSNL
subscribers through channel
partners / service providers has
been correctly segregated as
revenue of BSNL and revenue
share payable to channel
partners / service providers as
per agreement, BSNL’s portion
has been recognized as revenue
of BSNL, and liability has been
created for the share of revenue
payable to channel partners /
service providers.

16.38 Whether accounting of revenue Not applicable for the unit.

from the subscribers registered
under Free EPABX Scheme and
accounting of revenue share to
be given to the EPABX
Manufacturer / Empanelled
Franchisees has correctly been
as per Circular No. 113 dt.
30.11.2007.

16.39 Whether accounting of tradable Not applicable for the unit.

items (stand alone sale or sale
of such items bundled with
service), and recognition of
revenue has been done as per
circulars issued by Corporate
Office (refer latest circular in this
regard).
16.40 Whether income for services Yes
provided to MTNL (other than
IUC) has been recognized as
per order of Corporate Office.

16.41 Whether net revenue has been Yes

booked wherever agreement
with franchisees, channel
partners, DSA, PCO holder is on
‘principal to principal’ basis.

16.42 Whether revenue accrued and Not applicable.

due but not billed for has been
calculated on actual basis (i.e.
fixed charges, usage charges &
other charges for the period not
billed for up to 31st March) and
not on the basis of estimation
and accounted as accrued
revenue.

16.43 Whether inter-segment income Not applicable for the unit.

has been correctly calculated in
 respect of traffic taken place
between Basic & CMTS of BSNL
and vice versa during the
financial year in question,
recognized as inter-segment
income in CFA & CM and
corresponding entry has been
made to recognize the inter-
segment expenditure by CM &
CFA respectively. There should
not be any difference between
inter-segment income and inter-
segment expenditure.

16.44 Whether charges for services Not applicable for the unit.
provided by BSNL to DOP and
for infrastructure of BSNL shared
by DOP has been calculated
correctly, such charges have
been recognized as income of
BSNL, claims for such charges
has been raised and realized
from DOP.
16.45 Whether charges for various Not applicable for the unit.
infrastructure (such as space in
administrative and operative
buildings, residential quarters,
inspection quarters, duct,
electrical installation etc) other
than those given at POI location
and towers, given to external
entities as per new policy of
BSNL, have been properly
calculated, bills for such charges
have been raised, claims have
been recognized as income of
BSNL and realization has been
made.
16.46 Whether charges for training Not applicable for the unit.
services provided by Training
Centres of BSNL to external
entities have been correctly
calculated, bills have been
raised, the amount of bill has
been recognized as revenue and
realization of amount of claim bill
has been done.
16.47 Whether all other sorts of Not applicable for the unit.
income which are categorized /
defined as “Other Income such
as license fee for residential
quarters, charges for inspection
quarters, water charges, sale of
waste papers, sale tender forms,
examination fee, interest on
short term bank deposits /
sweep in facility, interest
recovered from employees on
loans & advance, interest
recovered from employees as
penalty, profit on sale of assets,
RTI fee and related other
 charges recovered if any,
charges for water and electricity
provided to contractor, charges
for usage of BSNL assets by
contractor etc have been
correctly recognized in the
accounts.
16.48 Whether revenue meant for a Yes.
financial year has been
accounted as income in the said
financial year and no excess
revenue has been accounted
and no revenue has been left to
be accounted.

16.49 Whether revenue has been Yes.

booked to correct head of
account.

16.50 Whether the revenue generation Yes, the revenue generation

and recognition throughout the and recognition throughout the
year is more or less uniform and year is more or less uniform.
not concentrated on the last few
months of the financial year.

16.51 Whether revenue billing package Not applicable for the unit.
used by the Circle has been got
audited.

16.52 Whether credit limit given to Yes, Credit limit is monitored

subscribers has been on Daily basis.
continuously monitored and
action has been taken to get
recoupment from the subscribers
promptly and service is restored
immediately on getting the
recoupment.

16.53 Whether continuous monitoring Not applicable for the unit.

has been done in case of
connection like ‘JODI’, ‘Tricon’
etc in order to stop the
concerned concessional facility
as and when the subscribers
have failed to observe the terms
and conditions of such
connection.

16.54 Whether accrued revenue has Not applicable for the unit.
been calculated correctly at the
close of the financial year based
on actual meter reading and
accordingly the accrued revenue
has been recognized.

16.55 Whether Tatkal deposit (after Not applicable for the unit.
connection) has been
recognized as revenue per order
issued by Corporate Office.
17. Revenue from prepaid items
17.1 Whether Register for all types of Yes
pre-paid items such as SIM
Card, Recharge coupon,
CELLONE Vouchers, E-Pin,
VCC, ITC, Internet card etc has
been maintained at all levels of
BSNL Units.

17.2 Whether proper entries of all Yes

types of pre-paid items have
been made in the Registers of
prepaid items / software
functioning for the purpose (i.e.
(i) opening stock of prepaid
items at the beginning of the
financial year, (ii) receipt of
prepaid items from vendors /
telecom factories during the
financial year, (iii) issue of
prepaid items to various selling
points / CSCs of BSNL during
the financial yea, (iv) actual sale
either bulk sale or retail sale of
prepaid item to subscribers,
direct selling agent, franchisees
and others, (v) extension of
validity of expired prepaid items
under the sanction of the
competent authority; (vi) prepaid
items destroyed under the
sanction of the competent
authority, (vii) closing balance of
prepaid items), and whether
reconciliation of such entries
made in the Register / software
has been carried out with the
physical items of such prepaid
item and relevant records i.e.
bill-cum-delivery challans for
consignment received, issue
voucher / slips, sale voucher,
sanction memo of the competent
authority for extension of validity
period, sanction memo for
destruction of prepaid items etc.

17.3 Whether closing stock of SIM Yes

and various other prepaid items
as reflected in the Registers /
software functioning for the
purpose, has been reconciled
with the physical stock of
prepaid items which are
remaining unsold at all levels of
BSNL units from time to time
and at the end of the financial
year no difference exists
between physical stock and
 book stock.

17.4 Whether total value of prepaid Yes

items actually sold to
subscribers, direct selling agent,
franchisees and others by
various selling units of BSNL as
reflected in Register / software
have been reconciled with the
amount of revenue recognized in
the accounts as income plus the
value of prepaid items given free
or given as gift, incentive, trade
discount, commission etc and no
difference exists between the
two.
17.5 Whether proper accounting of Yes
CELLONE vouchers sold in bulk
to Solution Providers (SP) has
been done; utilization of such
vouchers by CELLONE
customers for payment of
CELLONE bills as well as
utilization of such CELLONE
vouchers by wire-line customers
for payment of their wire-line bills
has been correctly accounted
and the amount of such utilized
CELLONE vouchers i.e. credit
has been transferred to
concerned circles / units for
adjusting the sundry debtors of
Post paid & wire-line service,
and required reconciliation has
been carried out at every stage
as per instructions issued
through Circulars having No 110
and 187 by CA Section.

17.6 Whether correct accounting of Yes

has been done in respect of
Online Recharge of BSNL pre-
paid Mobile through BSNL Portal
and necessary reconciliation has
been done as per instructions
issued through Circular No. 187

17.7 Whether revenue from top-up, Yes

CellOne vouchers etc. sold
through channel partners,
franchisees and others are
properly recognized and there is
no leakage of revenue.

17.8 Whether the total value of all Yes

types of prepaid items i.e. SIM,
recharge vouchers, e-PIN,
CTOP UP etc; recharge made
online through BSNL Portal;
CELLONE Vouchers etc which
 have been activated in IN
platform during a financial
year, have been reconciled
with the (i) total amount of
prepaid revenue from various
prepaid items which has been
recognized as income from
prepaid service during the
said financial year, plus (ii) the
value of prepaid items given
as free and/or given as gift,
incentives, trade discount,
commission etc, during the
said financial year, plus (iii)
total value of CELLONE
vouchers utilized for payment
of CELLONE bills & wire-line
bills during the financial year
which has been accounted by
respective units as credit to
Sundry debtors for Post paid
CMTS and Basic service, and
no difference exists between
two sets of figures.

17.9 Whether prepaid items given as Yes

free or gift has the sanction of
competent authority and the
same is supported by policy of
BSNL.

17.10 Whether prepaid items given as Yes

incentives, trade discount,
commission etc are as per policy
of BSNL and has the sanction of
the competent authority.

17.11 Whether the payment received Yes

through Bill Desk, online, credit
cards etc. has been properly
reconciled, classified and
adjusted.

17.12 Whether the details of Yes

distributors, DSA, Franchisees,
channel partners and related
terms and conditions have been
properly maintained in a
Register.
18 Expense

18.1 Whether expense in respect of Yes.

pay & allowances of staff,
pension contribution, leave
salary contribution (for
unabsorbed staff), employer's
share of contribution to EPF,
administrative charges towards
EPF etc related to the financial
year has been recognized in
accounts of the said financial
year by debiting the concerned
 expense accode as and when
the liability has accrued, and
corresponding liability has been
created by crediting to
concerned liability accode.

18.2 Whether expense in respect of Yes.

all types of employees benefits
(other than pay & allowances of
staff, pension contribution, leave
salary contribution (for
unabsorbed staff), employer's
share of contribution to EPF,
administrative charges towards
EPF) i.e. expense on TA & DA,
medical (medical allowance,
outdoor treatment with voucher,
indoor treatment), CEA, Tuition
fee, newspaper etc related to the
financial year in question has
been has been correctly
calculated and recognized in
accounts of said financial year
by debiting the concerned
expense accode as and when
the liability has accrued, and
corresponding liability has been
created by crediting to
concerned liability accode.

18.3 Whether expense in respect of Yes.

(i) various types of services
availed by BSNL during the
financial year in question i.e.
repair & maintenance service,
professional service, transport
service, security service,
insurance service, postal service,
courier service, technical service
(for processing CDR, IOBAS, TAP
IN TAP OUT etc) etc provided
contractors, professionals,
transporters, insurer, courier
companies, post offices, various
other service providers etc and
(ii) material / stores and office
stationery, raw material of
telecom factories received
against purchase order during
the financial year in question,
has been recognized in the
accounts of the said financial
year as and when the liability
has accrued, has been
recognized by debiting the
concerned expense accode and
corresponding liability has been
 created by crediting the
concerned liability accode, and
whether subsequent payment
or adjustment of liability has
been debited to concerned
accode for liability / provision.
18.4 Whether expense in respect of It is maintained at circle level.
IUC related to the financial year
in question payable to other
telecom service provider has
been correctly calculated and
recognized in the accounts of
said financial year by debiting
the concerned expense accode
and corresponding liability has
been created as and when the
liability has accrued and actual
payment made for IUC has been
adjusted against the liability.

18.5 Whether expense towards IUC Not applicable for the unit.
payable to MTNL related to the
financial year in question has
been recognized and accounted
in the accounts of the said
financial year through NTR and
corresponding liability has been
created.

18.6 Whether expense towards Not applicable for the unit.

outward traffic originated from
BSNL Subscribers and
terminated in SAARC countries
during the financial year in
question has been correctly
calculated and recognized in the
accounts of same financial year
and corresponding liability has
been created.

18.7 Whether expense related to the Not applicable for the unit.
financial year in question in
respect of international roaming
charges payable to other
Operators has been calculated
correctly and recognized in the
accounts of said financial year
by debiting the expense accode
by Nodal circle and
corresponding liability has been
created and paid.

18.8 Whether expense in respect of Not applicable for the unit.

outgoing ILD traffic originated
during the financial year in
question has been correctly
calculated and recognized in the
accounts of said financial year
by Nodal circles and
corresponding liability has been
created and paid.
18.9 Whether expense on all types of Not applicable for the unit.
bandwidth and related service
taken by BSNL from others for
the financial year in question has
been correctly calculated and
recognized by nodal circles in
the said financial year and
liability has been created.

18.10 Whether expense on Not applicable for the unit.

transponder taken by BSNL from
Antrix Corporation for the
financial year in question has
been correctly calculated and
recognized by nodal circle in the
said financial year and liability
has been created.

18.11 Whether expense towards lease Not applicable for the unit.
charges for various types of
assets taken on operating lease
by BSNL for the financial year in
question has been correctly
calculated and recognized by the
units in the said financial year
and liability has been created.

18.12 Whether expense pertaining to Not applicable for the unit.

the financial year in question on
maintenance of sub-marine
cable has been correctly
calculated by nodal circle and
recognized in the said financial
year and liability has been
created.

18.13 Whether expense for Not applicable for the unit.

infrastructure / USO
infrastructure which are owned
by other operators / organization
but shared by BSNL, has been
calculated as per agreement for
the period of use related to the
financial year in question, and
recognized in the accounts of
the said financial year and
liability has been created.

18.14 Whether expense on negative Not applicable for the unit.

subsidy payable to USO
Administrator for provision of
mobile service through USO
towers for the financial year in
question has been correctly
calculated and recognized in the
said financial year and liability
has been created.

18.15 Whether expense in respect of Yes

discount & commission which
are applicable for the financial
year in question and payable to
 franchisees, retailers, PCOs,
post offices, banks, collection
agents etc. as per agreement
entered by BSNL with the
formers, has been calculated
correctly and recognized in the
accounts of the said financial
year and liability has been
created.
18.16 Whether expense for the works Yes.
performed by the contractor
during the financial year in
question has been correctly
calculated and recognized in the
said financial year and
corresponding liability has been
created.

18.17 Whether expense on rent for the Yes.

accommodation owned by
others but utilized by BSNL for
the period of use pertaining to
the financial year in question has
been correctly calculated and
recognized in the said financial
year and corresponding liability
has been created.

18.18 Whether expense on electricity Yes.

and diesel consumed during the
financial year in question has
been correctly calculated and
recognized in the said financial
year and corresponding liability
has been created.
18.19 Whether the utilization of diesel Not applicable for the unit.
in exchanges is reasonable with
reference to power cuts as per
records maintained. 20% test
check shall be carried out from
Electricity authority about power
cut.
18.20 Whether expense on rates and No such types of expenses
taxes payable to local bodies, incurred during financial year.
other authorities etc applicable
to the financial year in question
has been correctly calculated
and recognized in the said
financial year and corresponding
liabilities have been created.
18.21 Whether expense on rent for Not applicable for the unit.
postal building occupied by
BSNL for the period of use
pertaining to the financial year in
question, and housekeeping
charges for the said period has
been calculated as per rate fixed
by FRAC, and recognized in the
said financial year and
corresponding liability payable to
DOP has been created.
18.22 Whether expense on marketing, Not applicable for the unit.
advertising etc for the financial
year in question has been
correctly calculated and
recognized in the said financial
year and liability has been
created.

18.23 Whether expense towards No

amount payable to Ministry of
Health & Family Welfare for
extending the CGHS benefit to
BSNL employees related to the
financial year in question has
been correctly calculated,
recognized in the said financial
year and liability has been
created.
18.24 Whether quarterly GR, AGR has Not applicable for the unit.
been calculated as per orders
(particularly the orders regarding
calculation of AGR as per
judgement of Hon’ble TDSAT)
issued by Corporate Office and
expense on license fee, USO
levy and spectrum charges
payable to DOT, has been
correctly calculated, recognized
and liability has been created.
Whether the liability towards
License fee, USO levy &
Spectrum charges has been
booked to accodes allotted
under 120 & 420 schedule and
payment to CCA against such
liability has been routed through
the concerned accodes of 120 &
420 schedules. Whether
spectrum charges for the 1st
quarter of the financial year
which is payable in advance i.e.
on 25th March of previous
financial year, has been properly
accounted as paid in advance
and at the beginning of the next
financial year the same has
been recognized as expense on
spectrum.

18.25 Whether there is no lapse in Yes,

creating the liability for services
availed and material / stores
received up to the close of
financial year so that prior
period booking is totally
avoided.

18.26 Whether all sorts of expenses Yes, all sorts of expenses have
have been incurred on the basis been incurred on the basis of
of approval accorded by approval accorded by
competent authority. competent authority.
18.27 Whether expenditure has been Yes, expenditure has been
incurred against the budget incurred against the budget
allotment and variation has been
allotment and variation has
covered by supplementary
been covered by
allotment.
supplementary allotment.

18.28 Whether procurement of Yes.

services and material has been
done through tendering system
approved by the Management.

18.29 From propriety angle checking of

the following types expenditure /
items shall be carried by the
Internal Auditor:
a) the expenditure on cable a) Not applicable.
laying contracts right from
the inception stage to the
final execution. b) Not applicable.
b) the expenditure on
rehabilitation and up
gradation works right from
the inception to completion
and physical retrieval of
dismantled materials,
accounting the net
depreciated value to
concerned accode in the
Books and disposal of such
items as per rules.
c) supplier’s bill for supply of c) Not applicable.
material / stores /
equipments with reference
to total quantity ordered,
total quantity supplied, total
payments made, proof of
receipt of stores / material
issued by the consignee
etc. d)yes same is followed as per
d) the expense incurred for approval
advertisement / hoarding.
e) medical bills involving e) yes.
indoor treatment.
Observations and
suggestions in this regard
will be mentioned in the
management summary.
f) vouchers pertaining to f) Not applicable.
expenditure incurred on
projects.
18.30 Whether in respect of traffic Yes, it has been properly
taken place during the financial calculated and recognised as
year in question between Basic
inter- segment expenses.
& CMTS of BSNL and vice
versa, inter-segment expense
has been properly calculated,
recognized as inter-segment
expense in the said financial
year and corresponding contra
entry has been made in other
segment towards segment
 income.
19 CMTS

19.1 Check the procurement of No equipment has been

equipments for CMTS through procured during this financial
tender; accounting of receipt of
year.
CMTS such equipment;
accounting of issue of such
equipment to turn-key project
executor and utilization of such
equipments in project work by
turn-key project executor;
accounting of surplus equipment
lying with turn-key project
executor; accounting of entire
turnkey projects; accounting of
other projects of CMTS,
capitalization of completed
CMTS projects, creation of
liability for such projects,
disbursement of payment
against liability, accounting of
payment against liability accode
etc.

19.2 Check the procurement of Not applicable.

maintenance services for CMTS
through tender for CMTS,
creation of liability, disbursement
of payment against liability,
accounting of payment against
liability accode etc

19.3 Whether pay and allowances of It is to be done at year end.

staff & officer who are actually
engaged for CMTS work /
providing service to CMTS, are
recognised as expense in the
accounts of CMTS Segment.

19.4 Whether Administrative It is to be done at year end.

expenditure, which is actually
related to CMTS Service, are
recognised as expense in the
accounts of CMTS Segment.

19.5 Whether IUC recoverable and Not applicable.

payable from / to other telecom
service providers in respect of
CMTS traffic received and
transferred from / to other
telecom service providers
pertaining to the financial year in
question has been correctly
calculated, recognized in the
accounts of said financial year
as IUC income & expense and
sundry debtors and liability for
such income and expense have
been created.

19.6 Whether Inter-segment expense Yes

 & income in respect of traffic
taken place during the financial
year in question between CMTS
& Basic of BSNL and vice versa
have been correctly calculated,
recognized as inter-segment
expense and income in CMTS
segment, reconciliation between
income & expense has been
made to see that no difference
exists between the bookings
made to accodes for inter-
segment transactions by Basic &
CMTS unit.

19.7 Check the reconciliation of Prepaid items has been

prepaid items as mentioned Sl. reconciled.
17 above.

19.8 Check the reconciliation of E-pin All these has been reconciled
generated, prepaid voucher, and found to be correct.
SIM, CELLONE vouchers
printed etc.

19.9 Check the revenue sharing Not applicable.

arrangement with other content
providers for VAS on CMTS,
share of such revenue
recognized by BSNL, revenue
share to be paid to content
providers, liability created for
revenue share payable to
convent provider.

19.10 Check the Post paid billing - ABF Not applicable.

accounting, payment
reconciliation, reconciliation of
sundry debtors with general
ledger as mentioned at Sl 5
above.

19.11 Check the complete revenue Not applicable.

assurance activity for prepaid
and post paid subscribers at
zonal billing centre. (The
Internal Auditor of the Circle
where the Zonal-billing centre
is situated will do this job).

19.12 Whether transfer of capital Not applicable.

expenditure, revenue
expenditure and income of
CMTS from one CMTS unit to
another CMTS Unit of same
circle or different circle (intra &
Inter), transfer of CMTS income
& expenditure by Basic Segment
to CMTS segment (both inter &
intra), transfer of Inter-segment
IUC expense & income in
between Basic & CMTS (only
intra-segment) and transfer of
 BASIC income & expenditure by
CMTS Segment to BASIC
segment (both inter & intra) have
been accounted and settled
through remittance accode
allotted by Corporate Office.
Whether reconciliation of such
Inter-segment ATD & ATC (both
originating & responding) has
been done.
19.13 Any other job related to CMTS Not applicable.
as deemed fit by the Circle
authority and as specified in the
scope of work.

19.14 Whether claims for BSNL Not applicable.

Towers which have been shared
by other operators, have been
correctly calculated as per terms
and conditions of the agreement
entered into by BSNL with other
operators, bills for such claims
have been preferred to other
operators, amount of claims
have been accounted as income
and claims have been recovered
from other operators. Whether
outstanding claims as per Sub-
ledger have been reconciled with
amount of such outstanding
claims reflected in the General
Ledger and there is no
difference.

19.15 Whether claims for USO Subsidy Not applicable.

for provision of mobile service
through USO tower by NE I, NE
II & J&K circles have been
correctly calculated as per
agreement with USO
Administrator, claims bills have
been submitted to CCA, the
amount of claims has been
recognized as income and
recovery of claims has been
made.
20 Intra & Inter circle Remittance

20.1 Check whether ATD and ATC Yes, it is tallied.

has been raised immediately
after the remittance transaction
(intra circle and inter circle in
respect of BASIC & CMTS, and
inter-segment) has taken place
and the same is reflected in Trial
Balance of the month in which
the transaction has occurred as
well as the same has been
uploaded in IBTMS package
duly reconciled with booked
figure. Whether all the
supporting details i.e. vouchers
 and other documents etc have
been furnished by the originating
units to responding units along
with the ATD and ATC

20.2 Check whether all types of ATD Yes.

and ATC has been accepted by
the responding unit immediately
on receipt and accounted the
debit or credit in the trial balance
as well as the information about
acceptance of ATD & ATC has
been uploaded in IBTMS
package immediately the ATD &
ATC have been accepted.

20.3 Whether there has been any Not applicable.

delay in raising as well as
acceptance of ATD & ATC
particularly the ATD for transfer
of expenditure on completed
projects by Project Circles /
Installation wing of circle to the
consignee circles / units and
what corrective steps have been
taken by the Management to
avoid the delay completely.

20.4 Whether in case of transfer of Yes.

staff ATD/ATC for the
outstanding loans and advances
(excluding those given by DOT)
has been sent along with the
LPC, such ATD / ATC has been
accounted in the trial balance of
same month and uploaded to
IBTMS Package.

20.5 Whether complete review of all Yes.

the ATD / ATC which remain to
be accepted by the responding
unit, has been carried out
regularly by the originating unit
and whether the originating unit
has taken steps for getting those
pending ATD / ATC accepted by
the responding unit.
21
Payment to Central Excise &
other Departments

21.1 Whether payment of Service Tax Yes.

& other Excise Duty has been
made through E-payment facility
wherever it is mandatory.

21.2 Whether units have remitted the Yes.

service tax collected on account
of output service, to Service Tax
Authority within the stipulated
dates.
21.3 Whether TDS has correctly been Yes, it has been correctly
deducted on items covered by deducted and in some cases
Section 40(i)(a) of Income Tax
SHEC & EC has been ignored/
Act and remitted to the tax
authorities within due date and collected at lower rate.
there is no case of non-
deduction of TDS or less
deduction of TDS or delay in
depositing TDS recovered or
non-remittance of TDS deducted
or less remittance of TDS
deducted (since in such cases
the expenditure will be
disallowed).

21.4 Whether in cases of other items There is no such case.

(not covered by Section 40(i)(a))
whether TDS has been correctly
deducted and deposited within
the due date and there is no
case of non-deduction of TDS or
less deduction of TDS or delay
in depositing TDS recovered or
non-remittance of TDS deducted
or less remittance of TDS
deducted (since in such cases
penalty & interest are charged
as well as BSNL has to pay the
amount TDS from its own
pocket}.

21.5 Whether each individual There is no any payment of

payment amounting to more more than Rs. 20000/- has
than Rs. 20000/- has been made
been made in cash.
by BSNL unit through cheque
only.

21.6 Whether credit for Service Tax Yes, credit for Service Tax on
on input service, Excise duty / input service has been availed
CVD etc on capital goods, inputs by the unit as per CENVAT
has been availed wherever credits Rules.
applicable as per CENVAT
credits Rules. Whether CENVAT
credit has been availed only out
the credit lying as unutilised at
the end of immediate previous
month.

21.7 Whether TDS certificate in Yes.

respect of TDS deducted by
paying authority of BSNL have
been issued promptly within the
prescribed time limit.

21.8 Whether Service Tax Return / Yes.

input service distribution return /
dealership return, and TDS
returns etc have been filed within
due dates.

21.9 Whether ST-3A return has been The unit has filed such return.
 filed within due date in cases
where permission for payment of
service tax on output service on
provisional basis has been
granted by Service Tax authority
to BSNL unit.

21.10 In case of centralized No.

registration of service tax issued
by the Commissioner of Central
Excise whether all the premises
(i.e. exchanges / BTS / MSC
etc.) have been included in the
service tax registration
certificate.

21.11 Whether the amount of TDS Yes.

deducted by the other parties
from BSNL’s claim has been
properly accounted under
relevant account head i.e. gross
amount of claim preferred by
BSNL, have been booked to
income head and the amount of
TDS has been booked to TDS
accode and the total amount of
TDS accounted in general ledger
has been tallied with the TDS
certificates obtained. Whether
TDS Certificates has been sent
to Corporate Accounts Section
of Corporate Office timely.
21.12 Whether information regarding No any information regarding
wealth tax has been sent to wealth tax is available at the
Corporate Office.
unit.
21.13 Whether employer's contribution Yes.
to EPF, administrative charges
and employee contribution have
been remitted timely to EPFO
and monthly returns as well as
annual returns have been
submitted in time

21.14 Whether reconciliation of Yes.

booking under accodes for
‘Service Tax Recoverable’ and
‘Service Tax Payable’ has been
carried out and no difference
exists between two sets of
figures.

21.15 Whether monthly pension Yes.

contribution, leave salary
contribution, GPF subscription
and GPF advance recovered
from employees have been paid
to CCAs within the due date.

21.16 Whether Telecom Factories Not applicable.

have correctly accounted the
excise duty on raw material
 purchased, excise duty payable
on finished product, excise duty
payable on scrap. Whether
credit for excise duty paid on raw
material has been availed.
Whether provision for excise
duty on finished product lying at
stock at the close of the financial
year has been made by Telecom
Factories.

21.17 Whether the Units have Yes.

complied with the provisions of
Income Tax Rules / CENVAT
Rules / Service Tax etc.

21.18 The Internal Auditors will also Yes, it has been done.
assist the units in maintenance
of all documents and registers
connected with CENVAT. They
should also impart necessary
training to the staff/officers
dealing with Service Tax /
CENVAT matters. Internal
Auditors must guide and assets
the units of BSNL so the units
can avail 100% credit on input
service.
22 Checking of trial balance

22.1 Whether there is unauthorised No such un-authorized accods

accodes in the Trial Balance. are used by Unit during the
period.
22.2 Whether there is adverse There is no any adverse
balance in any accode as balance in any accodes and it is
reflected in trial balance and
reviewed.
whether such adverse balance
has been reviewed, reconciled
and set right wherever required.

22.3 Whether opening balance Yes.

intimated by Corporate Office /
Circle office has been properly
incorporated in the Trial
Balance.

22.4 Whether reconciliation of the Yes.

monthly booking in trial balance
in respect of loans & advances,
GPF subscription and recovery
of advance, Pension & leave
salary contribution, employees
share of contribution towards
EPF and other items has been
reconciled with the detailed
monthly schedules of above
mentioned items.

22.5 Whether detailed records / Vouchers are available in

vouchers in support of the support of the booking made in
booking made in the each
the each accode but detailed
 accode as reflected in trial records are not available .
balance are available and
reconciliation has been made.

22.6 Whether in respect of any fixed It will be done at the year end.
asset reflected in a fixed asset
accode is having the booking for
accumulated depreciation and
depreciation under the accode
for accumulated depreciation
and depreciation, which are
relevant to such asset accode.

22.7 Whether in respect of provision Not applicable at the unit.

for obsolete & unserviceable
asset and obsolete &
unserviceable inventory reflected
under accodes for provision
there are booking for obsolete &
unserviceable fixed assets and
inventory in the accodes which
are relevant to

22.8 To certify that the trial balance is

supported by the correct
schedules. No Internal Auditor
can certify the trial balance with
the remarks 'that it is subject to
qualifications' in their report

22.9 Whether circles have compiled all Not applicable.

the information for disclosures as
per Schedule VI requirements
23 Action taken in respect of
qualification of Branch &
Statutory Auditor & C&AG

23.1 The internal auditor must go Yes.

through all the observations and
comments of Branch Auditors,
Statutory Auditor and C&AG on
the accounts of the Circles
pertaining to previous financial
year(s).

23.2 Whether SSAs / Accounting Yes, rectification/adjustment

Units of circles / Circle
authorities have taken action in
the current financial year in
respect of all the observations
and comments made by the
Branch Auditors & Statutory
Auditors on the accounts of
Circles pertaining to previous
financial years(s), and
rectification / adjustment entries
wherever required, have been
passed and incorporated in the
current financial year accounts
to settle concerned
qualifications. Whether SSAs /
entries have been passed and
incorporated in the current
financial year, but the unit has
not taken proper action in the
current financial year in respect
of other qualification such as
proper maintenance of fixed
assets register, carrying out
physical verification of assets,
proper record of physical
verification.
 Accounting units / circle
authorities have taken action in
the current financial year in
respect of other qualifications
such as proper maintenance of
sub-ledgers, fixed asset register,
other register, priced stock
ledger; reconciliation of sub-
ledger with general ledgers;
carrying out physical verification
of assets and inventory, and
proper records of physical
verification; bank reconciliation;
unlinked debit and credit, excess
debit & credit, wrong debit &
credit relating to bank
transactions; prompt
capitalization of completed
works; charging of overhead;
valuation of inventory; creation
of proper liability; payment of
statutory dues within dues dates
etc.

23.3 Whether SSAs / Accounting We have not received any

Units of circles / Circle records relating to the same.
authorities have taken action in
the current financial year in
respect of all the observation &
comments made by C&AG while
certifying the audited annual
accounts of previous financial
year(s).

23.4 Whether decision taken by the We have not received any

Audit Qualification Reduction records relating to the same.
Committee, has been
implemented by the concerned
accounting unit within the time
frame fixed.

23.5 Whether action has been by the Not applicable.

Circles to set right the
discrepancies pointed out by the
Audit Committee.

24. Additional Duties of Lead Not applicable.

Auditor
The additional duties of the lead
auditor will be to coordinate the
activities of other Internal Audit
CA firms, to give guidance, to
have constant interactions with
BSNL officers, to ensure that
other firms also complete the
work as per appointment letter
within the time stipulated and
finally act as the interface
between branch auditors and
BSNL officers.
25. Audit Report & Management It is annexed in Part -B of
Summary Report.
Audit report must cover all the
items mentioned at Sl 1 to Sl 23
above and pro-active taken by
them to set right the defects and
shortcomings if any, should be
mentioned in column 4.
All Auditors shall attach a
management summary to their
report. In the management
summary internal auditors will
be required to give detailed
comments on the internal
control system.

(Arundati Panda)
Sr. GM (CA)