PC 22 - MCQ - Audit and Accounts Regulation With Answer

Audit & Accounts Regulations
1. The Audit and Accounts Regulations has been issued in pursuance of

a. Section 21 of the DPC Act b. Section 22 of the DPC Act
c. Section 23 of the DPC Act d. Section 24 of the DPC Act
2. The Audit and Accounts Regulations apply to

a. Officers and staff of the IA&AD
b. All ministries and departments of the Union Government, State Governments and Union Territory
Governments
c. Bodies, authorities and enterprises, to which the audit or accounts jurisdictions of the CAG of India
extend.
d. All of the given.
3. The Audit Board is constituted by the CAG for performance audits of

a. Central Public Sector Undertakings b. Government Companies
c. Ministries and Departments including autonomous bodies
d. All of the above
4. Pick the incorrect one

a. Audit Memorandum- a letter issued during the course of audit for eliciting information, confirmation of
facts or any other matter considered necessary by the audit officer in conduct of audit
b. Statutory Audit Report- an audit report containing audit observations on the accounts of an authority,
body or corporation whether or not required to be laid before the legislature
c. Audit note- a note issued by an audit office containing the results of audit conducted with reference to
data, information or documents available in an audit or accounts office
d. Practice notes- the detailed instructions on audit or on accounting matters in consistent with the
Regulations, standing orders and guidelines issued by the CAG.
5. Submission of audit report by the CAG is governed by

a. Article 149 of the Constitution b. Article 152 of the Constitution
c. Article 150 of the Constitution d. Article 151 of the Constitution
6. Who constitutes the Audit review Committee?

a. the Accountant General b. the CAG
c. the Union Government d. the State Government
7. Audit review Committee is constituted for

a. review the implementation and working of Technical Guidance Support scheme
b. advising the Accountant General on special and important audit topics pertaining to Central, State and
UT governments
c. for finalisation of performance audits of State Public Sector Enterprises
d. All of the above
8. The broad objectives of audit are to ensure legality, regularity, economy, efficiency and effectiveness of
financial management and public administration mainly through assessment as to
a. whether the financial statements are properly prepared, are complete in all respects and are presented
with adequate disclosures
b. whether the provisions of the Constitution, the applicable laws, rules and regulations made thereunder
and various orders and instructions issued by competent authority are being complied with
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Prepared by Deepak Kumar Rahi, AAO (LAD/Patna)
c. the extent to which an activity, programme or organisation operates economically, efficiently and
effectively.
d. All of the above
9. Audit has been categorised into three class. Pick the incorrect one
a. Compliance Audit b. Performance Audit
c. Performance Audit d. Supplementary Audit
10. The person in charge of any office or department, the accounts of which have to be inspected and
audited by the Comptroller and Auditor General, shall afford all facilities for such inspection and comply with
requests for information in as complete a form as possible and with all reasonable expedition under the provision
of
a. Section 18 of DPC Acts b. Section 19 of DPC Acts
c. Section 17 of DPC Acts d. Section 15 of DPC Acts
11. Pick the correct one

i. Auditors should ordinarily not become members of management committees and if advice is to be
given, it should be conveyed as audit advice or recommendation and acknowledged clearly as such
ii. Audit should be ready to advise the executive in such matters as accounting standards and policies, the
form of financial statements and alternative ways of execution of policies to attain efficiency,
effectiveness and economy.
iii. There is no power of direction by the executive in relation to the performance of the audit mandate.
iv. The CAG may, in special circumstances and if so required, utilise specialised skills from external sources
in carrying out an audit or accounts task
a. i, ii and iii b. i, ii and iv

c. i, iii and iv d. All of the above
12. Extent of audit means

a. the quantum of audit including the period b. the units of the auditable entity
c. the extent of test check and the boundaries of audit enquiry to be covered in an audit.
d. All of the above
13. When circumstances so warrant, dispense with any part of detailed audit of any accounts or class of
transactions and apply such limited check in relation to such accounts or transactions as he may determine under
the provision of
a. Section 23 of DPC Act b. Section 24 of DPC Act
c. Section 22 of DPC Act d. Section 26 of DPC Act
14. Audit will be conducted

a. with reference to such accounts, vouchers and records as may be received in the audit office and/or in
the accounts office and may include online data, information and documents of the auditable entity
b. in the office of the auditable entity or at the site where the relevant records for audit are available or at
such other place as may be decided by Executive/Auditee unit.
c. Both a & b
d. None of the given
15. The CAG or any officer so authorised shall give due consideration to a request for special audit of a
programme, project or organisation within the audit jurisdiction provided that every such request
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i. is made with the approval of the Cabinet/Chief Secretary to Government.
ii. shall state the justification and reasons that necessitate a special audit, including the results of any
preliminary inquiry, investigation or study that may have already been conducted; and
iii. specify the period to be covered in the special audit.
iv. The decision of the CAG or any officer so authorised in regard to the special audit shall be final.

c. ii, iii and iv d. All of the above
16. The norms which the auditors are expected to follow in conduct of audit and provide guidance to the
auditor to help determine the auditing steps and procedures that should be applied in audit and constitute the
criteria or the yardstick against which quality of audit results is evaluated
a. Audit norms b. Audit Standards
c. Audit Manual d. Accounting Standards
17. The auditing standards include the

i. Basic postulates ii. General standards
iii. Field standards iv. Reporting standards
a. i, ii and iii b. ii, iii and iv

18. Match the following
Option Standard Option Brief Description

A Basic Postulates I establish a foundation for credibility of work of the auditor
and the audit institution.
B General Standards II provide an overall framework for the auditor and the audit
institution for reporting the results of audit
C Field Standards III help in developing auditing standards and guide the auditors
in forming their opinions and reports, particularly in cases
where no specific standards apply
D Reporting Standards IV provide an overall framework for conducting and managing an
audit.
a. A-I, B-II, C-III and D-IV b. A-II, B-I, C-IV and D-III
c. A-III, B-I, C-IV and D-II d. A-IV, B-III, C-II and D-I
19. Basic postulates includes

i. The auditing standards shall be complied with by the auditors in all matters that are deemed material.
ii. The auditors shall apply their own judgement to the diverse situations that arise in the course of audit.
iii. The CAG or his officers shall ensure the promulgation of acceptable accounting standards for financial
reporting and disclosure that are relevant to the needs of the Government and that result in true and fair
presentation of financial position and results of operations.
iv. The Government shall ensure cooperation of auditable entities in providing access to all relevant data,
information and documents necessary for audit
a. i, ii and iv b. ii, iii and iv

c. i, ii and iii d. All of the above.
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20. Audit shall avoid conflict of interest between the auditor and the auditable entity is a located in
a. Reporting Standard b. Field Standard
c. General Standard d. Basic Postulate
21. Who shall be responsible for establishment, development and enforcement of adequate information,
control, evaluation and reporting systems within the Government to facilitate the accountability process?
a. the CAG b. the Government
c. Auditee unit d. All of the above
22. Which describes the qualifications of the auditor and the audit institution, the compliance of which
enables them to carry out the tasks related to conduct of audit and reporting of audit findings in a competent and
effective manner?
a. Basic Postulates b. General Standards
c. Field Standards d. Reporting Standards
23. The general standards include

i. Independence ii. Professional Competence
iii. Due care iv. Professional Judgement
v. Quality Control
a. i, ii, iii and iv b. i, iii, iv and v

c. ii, iii, iv and v d. All of the above
24. Due care element of general standards means

a. The auditors should exercise due care and caution in complying with auditing standards particularly in
planning audits, specifying, gathering and evaluating evidence and in reporting findings, conclusions and
recommendations
b. The auditee institutions should exercise due care in providing all records, documents and information
requisitioned by the auditors during the course of audit.
c. Both a & b
25. Professional Competence is applicable to

a. the auditors b. the audit institutions
c. the auditors and the auditee institutions d. the auditors, the auditee institutions and auditee units

a. Professional judgement represents the application of the individual knowledge, skills and experience of
an auditor involved with an assignment and not the collective the professional judgement of the all the
personnel involved with an assignment.
b Professional judgement represents collaboration with other stakeholders, outside experts and the
management in the audit institution.
c. Both a & b
d. All of the above
27. State whether true or false

Separate field standards may be formulated for financial audit, compliance audit and performance audit.
a. True b. False
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28. Field audit standards are related to
a. General Standards b. Reporting Standards
c. Both a & b d. None of the given
29. The elements of the field audit standards are

i. Planning ii. Supervision and review
iii. Examination and evaluation of internal control
iv. Compliance with applicable laws, rules and regulations
v. Audit evidence
a. ii, iii, iv and v b. i, iii, iv and v

c. i, ii, iii and iv d. All of the above
30. Audit evidence should be

a. Complete, Relevant and Reliable b. Competent, Relevant and Reasonable
c. Compact, Reliable and Reasonable d. Concise, Relevant and Reliable
31. Reporting standards include element

i. Reporting standards shall be meant to assist, and not to supersede, prudent judgement of the auditor in
framing and reporting audit findings, conclusions and recommendations.
ii. The reports should be complete, accurate, objective, convincing, clear, concise, constructive and
timely.
iii. In formulating the audit opinion or report, the auditor should inter alia give due regard to the
materiality of the matter keeping in view the amount, nature and context
iv. Performance audits, besides reporting on individual cases of non-compliance and abuse, also require
reporting on weaknesses that exist in systems of financial management and internal control

32. The form and content of all audit opinions and reports need to be consistent with the principles of
i. objectives and scope ii. Completeness
iii. addressee iv. timeliness.


The CAG examines and certifies the Finance Accounts and the Appropriation Accounts of the Union and
the Accountant General (Audit) of the State and the Union Territory having a legislative assembly certifies the
Finance Accounts and the Appropriation Accounts of the State and UT concerned.
a. True b. False
34. Reports pertaining to which types of audit should not concentrate solely on adverse assessment of the
past but should be constructive. Recommendations should, as far as feasible, suggest what improvements are
needed and how to achieve them?
a. Compliance Audit b. Financial Audit
c. Performance Audit d. Supplementary Audit
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35. The primary purpose of financial audit is to verify except
a. whether the accounts of Government are properly prepared
b. whether the accounts of Government
c. whether the accounts of Government are complete in all respects and are presented with adequate
disclosures.

a. Government departments shall send copies of all orders of re-appropriation and surrender of funds to
the audit office and the accounts office as soon as these are issued.
b. A consolidated statement of all such orders issued during a financial year shall also be sent to the audit
office and the accounts office so as to reach within 15 days after the close of the financial year.
c. A nil statement shall be sent if no such order was issued.
37. Government departments and the agency responsible for the compilation of accounts and financial
statements shall supply to the audit officer
i. the reasons for any significant variations between the amounts of expenditure and the amounts of
receipts of the year of accounts and the corresponding amounts for the preceding year
ii. the statement of periodic book adjustments together with the copies of the general or special orders
authorising such adjustments
iii. the explanation for differences, if any, in the cash balance as per the books of accounts and the
balance as per the books of the Reserve Bank of India
iv. the explanation for any items that are prima facie unusual including adverse and insufficient balances
a. ii, iii and iv b. i, ii and iv

c. i, ii and iii d. All of the above
38. Government departments and the agency responsible for the compilation of accounts and financial
statements shall supply to the audit officer
i. details of the outstanding amounts of loan and interest on loans.
ii. details of guarantee given, guarantee invoked and guarantee fee received during the year
iii. the details of complete works costing more than the limit prescribed by the audit office from time to
time
iv. the reasons for variations, if any, between the closing balances of the preceding year and the opening
balances of the year of accounts in respect of heads of accounts that do not close to Government
account;

39. An annual action plan for the timely completion of certification of financial statements shall be prepared
by
a. Audit Office
b. agencies responsible for preparation and compilation of accounts
c. Audit Office and agencies responsible for preparation and compilation of accounts
d. Audit Office, agencies responsible for preparation and compilation of accounts and the Government
concerned
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40. Compliance audit examines the transactions relating to
a. expenditure and receipts b. assets and liabilities
c. expenditure, receipts and assets and liabilities
d. expenditure, receipts, assets and liabilities and performance of the entity
41. Compliance audit examines the transactions relating to expenditure, receipts, assets and liabilities of
Government for compliance with
a. the provisions of the Constitution of India and the applicable laws
b. the rules, regulations, orders and instructions issued by the competent authority either in pursuance of
the provisions of the Constitution of India and the laws or by virtue of the powers formally delegated to it
by a superior authority.
c. Neither a nor b
d. Both a and b

a. Government departments shall invariably endorse or otherwise send to the audit office(s) and the
accounts office(s) copies of all rules, regulations and general orders regulating the raising of revenues,
incurring of expenditure and liabilities and management of assets and liabilities, as soon as these are
issued.
b. Wherever possible, any revision of rules or substantive codes undertaken by the Government
departments and having financial, accounting or auditing implications may be referred to the concerned
Accountant General (Accounts and Entitlement) or Accountant General (Audit), as the case may be, for
scrutiny after issue.
c. Both a & b
43. The CAG has been authorised to audit all expenditure from the Consolidated Fund of India and of each
State and of each Union Territory having a legislative assembly under the provision of
44. Audit checks the expenditure for

i. Appropriation and re-appropriation and confirmation that the expenditure is within the scope and
intent of the grant and does not attract the limitation of new service or new instrument of service
ii. Authorisation by the authority that is competent to do so
iii. Compliance with the requirement of the applicable laws, rules, regulations, orders and instructions in
actual disbursement
iv. Evidence by way of vouchers, payees’ acknowledgements etc.

45. Audit checks the expenditure for

i. Record in the books of the spending officer, including cross-verification with the records of the treasury,
pay and accounts office, bank, etc.
ii. Identification of potential tax assessees, ensuring compliance with laws as well as detection and
prevention of tax evasion;
iii. Accounting in the books of the Government
iv. Monitoring, control and reporting as prescribed in the Government rules.
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46. Pick the correct one regarding Endorsement of copies of sanction orders and contract agreements to
Audit
i. Copies of all orders sanctioning expenditure issued by Government departments shall be endorsed or
otherwise sent to the audit office as soon as these are issued.
ii. Heads of departments shall also send to the audit office quarterly statements on the 15th day of
following month of the quarter concerned of all sanctions issued in respect of their department during
the preceding quarter.
iii. Copies of contract agreements need to be sent to the audit office along with quarterly statements
iv. The CAG, by a general or special order, may exempt any department or a particular class or classes of
orders from the requirement of sending copies to audit office.
a. i, ii and iv b. i, ii and iii

47. Who shall endorse or otherwise send to the audit office and the accounts office, copies of all sanctions of
advance from the Contingency Fund as well as resumption of the advance to the Contingency Fund as soon as
these are issued?
a. Finance Ministry/Department b. President/Governor
c. Parliament/Legislature d. Reserve Bank of India
48. The CAG has been authorised to audit all receipts of the Government of India and of Governments of
each State and of each Union Territory having a legislative assembly under the provision of
49. With regard to audit of receipts, the CAG has to satisfy himself that the rules and procedures are designed
to secure an effective check on the
a. Assessment of revenue b. Collection of revenue
c. Assessment and collection of revenue
d. Assessment, collection and proper allocation of revenue
50. Audit of receipts includes an examination of the systems and procedures and their efficacy in respect of
i. pursuit of claims with due diligence and that these are not abandoned or reduced except with adequate
justification and proper authority
ii. prompt investigation of losses of revenue through fraud, default or mistake including, if required,
through the review of other similar cases
iii. exercise of discretionary powers in an appropriate manner including levy of penalties and initiation of
prosecution
iv. achievement of targets, accounting and reporting of receipts and their cross-verification and
reconciliation with the accounts records

51. Audit of receipts includes an examination of the systems and procedures and their efficacy in respect of
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i. appropriate action to safeguard the interests of the Government on the orders passed by departmental
appellate authorities
ii. amounts that may have fallen into arrears, maintenance of records of arrears and action taken for the
recovery of the amounts in arrears
iii. other ancillary and non-assessment functions including expenditure incurred by the departments
iv. amounts of refunds, rebates, drawbacks, remissions and abatements to see that these are correctly
assessed and accounted for
v. any other matter, as may be determined by the Government
a. ii, iii, iv and v b. i, ii, iii and iv

c. i, ii, iv and v d. All of the above
52. An annual statement to the Accountant General (Audit) containing the details of follow up action taken
on audit observations, including recoveries, in respect of accepted paragraphs included in the audit reports laid
before Parliament or legislature till the end of that financial year shall be furnished by the department within
a. one month of the close of financial year b. six months of the close of financial year
c. three months of the close of financial year d. two months of the close of financial year
53. The CAG to audit and report on the accounts of the stores and the stock kept in any office or department
of the Union or of a State or of a Union Territory having a legislative assembly under the provision of
54. The accounts of stores and stock shall be kept in the manner prescribed by
a. Head of the auditee unit b. Parliament
c. the CAG in consultation with the Union Government
d. the Union Government in consultation with the CAG

Audit shall not normally assume responsibility for physical verification of stores which rests with the
Government. It, however, reserves the right to investigate store balances and highlight discrepancies.
a. True b. False

a. Audit of Store and Stock -Extension of audit of expenditure
b. Audit of Grant-in-aid- Extension of audit of receipt
c. Audit of Loans-Extension of audit of expenditure
d. All of the above
57. Audit of Government assistance in form of grants-in-aid or loans shall be conducted to verify whether
systems and procedures are in place and are being complied with for
i. proper and transparent identification and selection of persons, bodies and authorities for Government
assistance with reference to their antecedents, absorptive capacity, financial position, systems and
management practices
ii. clear enunciation of purpose for the sanction of the Government assistance and determination of
amount of assistance and its timely release
iii. proper accounting of assistance by the grantee or the loanee including maintenance of accounts in
such form as may be prescribed
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iv. monitoring and ensuring the economical, efficient and effective end use of assistance including
achievement of the objectives of assistance
a. ii, iii and iv b. i, ii and iii


a. Economy issues focus on the cost of the inputs and processes. Economy occurs where equal-quality
resources are acquired at least cost.
b. Efficiency is the relationship between the output, in terms of goods, services or other results and the
resources used to produce them.
c. Effectiveness is the extent to which objectives are achieved and the relationship between the intended
impact and the actual impact of an activity.
d. All of the above
59. Where the use of financial, human, physical and information resources is such that output is maximised
for any given set of resource inputs, or input is minimised for any given quantity and quality of output, it leads to
existence of
a. economy b. effectiveness
c. efficiency d. All of the above.
60. Which parameter addresses the issue of whether the scheme, programme or organisation has achieved
its objectives?
a. economy b. effectiveness
c. efficiency d. All of the above.
61. An Entry Conference shall be held before commencing detailed work of performance audit
a. by the AG with the Secretary to the Government of concerned department
b. by the Secretary to the Government of concerned department with the AG
c. by the AG with the Secretary to the Government of Finance department
d. by the Secretary to the Government of Finance department with the AG
62. Sec 14(1) of the DPC Act authorises the CAG to audit the receipts & expenditure of a body or authority if
a. the amount of Government grant or loan paid to it in a financial year is not less than rupees twenty-five
lakh
b. the amount of such grant or loan is not less than seventy-five per cent of its total expenditure during
the year. Audit under this Section is subject to the provisions of any law applicable to the body or
authority.
c. either a or b
d. both a & b.
63. The audit of bodies and authorities, other than Government establishments and companies, by the
Comptroller and Auditor General is governed by the provisions contained in Sections
a. 14 and 15 b. 19(2), 19(3), 19A and 20 of the Act
c. 14, 15, 19(2), 19(3), 19A and 20 of the Act d. 14, 15, 18, 19(2), 19(3), 19A and 20 of the Act
64. The CAG may audit all receipts and expenditure of a body or authority where the amount of Government
grants or loans to the body or authority in a financial year is not less than rupees one crore
a. Suo moto
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b. with previous sanction of the President/Governor/Administrator
c. both a & b
d. on calling upon to do so by the President/Governor/Administrator with previous sanction of the CAG
65. The CAG may audit all receipts and expenditure of a body or authority where the amount of Government
grants or loans to the body or authority in a financial year is not less than rupees one crore under the provision of
a. Section 14 (1) of DPC Act b. Section 14 (2) of DPC Act
c. Section 15 (1) of DPC Act d. Section 15 (2) of DPC Act
66. Where the receipts and expenditure of a body or authority are audited by the CAG under sub-section (1)
or (2) of Section 14 for a particular year, the CAG is authorised under Section 14(3) of the Act to continue to audit
its receipts and expenditure for
a. a further period of two years even if the conditions stated in sub-section (1) or (2) are not satisfied
during any of the two subsequent years.
b. a further period of two years if the conditions stated in sub-section (1) or (2) are satisfied during any of
the two subsequent years.
c. a further period of three years even if the conditions stated in sub-section (1) or (2) are not satisfied
during any of the two subsequent years.
d. a further period of three years if the conditions stated in sub-section (1) or (2) are satisfied during any
of the two subsequent years.
67. Government departments and other officers empowered to sanction grants and/or loans to anybody or
authority shall
a. endorse a copy of each letter of sanction of grant or loan to the audit office;
b. mention in the sanction, the amount of the budgeted expenditure of the body or authority
c. ensure that the assisted body or authority makes available all the relevant records to the audit officer
for audit, wherever and whenever necessary, and that a requirement to this effect is incorporated in the
letter of sanction to the grant and/or loan.
d. All of the above
68. Governments and heads of departments shall furnish to the audit office an annual statement of such
bodies and authorities to which grants and/or loans
a. aggregating rupees ten lakh or more were paid during the preceding year indicating
b. amounting rupees ten lakh on a single occasion or aggregating rupees fifty lakh or more were paid
during the preceding year
c. aggregating rupees twenty five lakh or more were paid during the preceding year indicating
b. amounting rupees twenty five lakh on a single occasion or aggregating rupees one crore or more were
paid during the preceding year
69. The annual statement showing the details of grant and/or loan made shall be furnished to the audit office
by the end of
a. April b. July
c. June d. December
70. Pick the correct one regarding computation of quantum of Government assistance u/s 14 of DPS Act
i. the aggregate of the amounts of grant(s) and loan(s) paid to a body or authority shall be reckoned
together
ii. the amounts of grant(s) and loan(s) paid to a body or authority by the Union Government, the State
Government(s) and the Union Territory Government(s) shall be aggregated
iii. the amounts of grant(s) and loan(s) paid to a body or authority by the World Bank shall be aggregated
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iv. the amounts of grant(s) and loan(s) paid during a year shall include any amounts remaining unspent
out of grant(s) and loan(s) paid to the body or authority during preceding year(s) but not refunded to the
Government.
a. i, ii and iii b. i, iii and iv

c. i, ii and iv d. All of the above
71. Where any grant or loan is given for any specific purpose from the Consolidated Fund of India or of any
State or of any Union Territory having a legislative assembly to any authority or body, not being a foreign state or
international organisation, the CAG is authorised under Section 15 (1) of the DPC Acts to
a. scrutinise the procedures by which the sanctioning authority satisfies itself as to the fulfilment of the
conditions subject to which such grants or loans were given
b. scrutinise the procedures by which the grantee/loanee accounts for the grants or loans and their
utilisation for the purpose for which they were given
c. both a& b
d. None of the above
72. Under Section 15 (2) of the DPC Acts

a. The President/Governor/Administrator may, after the consultation with the CAG, authorise him to
carry out the audit of a body or authority receiving Government grant for any specific purpose.
b. The President/Governor/Administrator may, after the consultation with the CAG, appoint him the sole
auditor of a body or authority receiving Government grant for any specific purpose
c. The President/Governor/Administrator may, after the consultation with the CAG, relieve him from
scrutinising the procedures by which the sanctioning authority satisfies itself as to the fulfilment of the
conditions subject to which such grants or loans were given
d. The President/Governor/Administrator may, after the consultation with the CAG, relieve him from
audit of a body or authority receiving Government grant for any specific purpose.

i. As per Section 19(2) of the Act, the duties and powers of the Comptroller and Auditor General in
relation to audit of accounts of corporations established by or under law made by Parliament are
performed and exercised in accordance with the provisions of the respective legislations.
ii. Every corporation that is subject to audit by the CAG shall send copies of the agenda notes and minutes
of the meetings of its governing body, by whatever name called, and the audit committee, if formed, to
the CAG.
iii. Where the CAG is the sole auditor of a corporation, the financial audit is conducted in accordance with
the auditing standards issued by the CAG
iv. Accounts of the corporation comply with the accounting standards prescribed by the Institute of
Chartered Accountants of India.

74. In addition to the financial audit of accounts of a corporation, the CAG may conduct any other type of
audit, pick the incorrect one
a. test check of transactions entered into by the corporation with a view to examining their legality,
competence and propriety and report on cases of infraction, waste, mismanagement, frauds and other
irregularities
b. performance audit with a view to ascertaining the extent to which the corporation operates
economically, efficiently and effectively for the achievement of the stated objectives.
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c. The scope of above audits, however, may not extend to more than one financial year.
d. None of the given.
75. If the observations and qualifications are of such nature as may not warrant certification of accounts as
presenting a true and fair view of the financial position of the corporation, certificate to be given will be
a. Disclaimer b. Adverse
c. unqualified d. qualified
76. On the completion of financial audit, the audit office shall send a draft audit report that will form part of
the audit certificate on the accounts to
a. the chief executive officer b. the Government
c. Audit Review Committee d. All of the above
77. Audit Report pertaining to financial audit is also called

a. Special Audit report b. Supplementary Audit report
c. Staff Appraisal Report d. Separate Audit report
78. Reply to draft audit report on financial audit shall be furnished within
a. one week b. two weeks
c. four weeks d. six weeks
79. In case a reply is not received within the specified period or any extended period agreed to, the audit
officer
a. may bring the matter into the notice of the CAG and proceed after his approval.
b. may proceed on the assumption that the corporation and the Government where a copy of the draft
separate audit report is sent to it has accepted the audit observation.
c. may proceed on the assumption that the corporation and the Government where a copy of the draft
separate audit report is sent to it has no comments, observation and explanation in the matter.
d. All of the above.
80. The Accountant General (Audit) shall send the audit certificate and the separate audit report which will
form part of the audit certificate on the accounts of the corporation to
a. the chief executive officer of the corporation with a copy to the Secretary to Government of the
concerned department
b. the Secretary to Government of the concerned department with a copy to the chief executive officer of
the corporation
c. the chief executive officer of the corporation with a copy to the Secretary to Government of the
concerned department and the CAG
d. the Secretary to Government of the concerned department with a copy to the chief executive officer of
the corporation and the CAG

a. The chief executive officer shall place the audit certificate and the separate audit report before the
governing body and intimate to the Accountant General (Audit) the date on which these are presented to
the governing body.
b. The Government shall cause every audit certificate and separate audit report to be laid before
appropriate legislature(s) in accordance with Section 11 of the Act.
c. The Secretary shall intimate to the Accountant General (Audit) the date of presentation of the audit
certificate and the separate audit report to the legislature.
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The results of audit other than financial audits of accounts including compliance and performance audits
of a Government corporation are reported through audit notes, inspection reports and audit reports.
a. True b. False
83. Who shall create an Audit Arrears Committee?

a. the CAG b. the Government concerned
c. the AG concerned d. the Corporation concerned
84. Audit Arrears Committee is created for

a. furnishing replies to draft report in time to the AG (Audit) concerned
b. a large number of audit observations included in the inspection reports remain outstanding for more
than two years
c. Both a & b
85. Audit Arrears Committee consists of

a. senior officer of the corporation concerned
b. senior officer of the corporation concerned and officers from audit office.
c. senior officer of the corporation and officers from department concerned.
d. senior officer of the corporation concerned, officers from audit office and officers from department
concerned.
86. Who should take steps to ensure constitution of Audit Arrears Committees and their effective
functioning?
a. the Chief Executive Officer b. the AG (Audit)
c. the CAG d. the Government
87. Audit of State Corporations may be entrusted to the CAG after having consulted him under the provision
of
a. Section 19 (1) b. Section 19 (2)
c. Section 19 (3) d. Section 19A

No request to CAG regarding audit of State Corporation shall be made except after consultation with the
Comptroller and Auditor General and after giving reasonable opportunity to the corporation to make
representation with regard to the proposal for such audit.
a. True b. False

i. Section 20 (1) deals with audit the accounts of such authority or body if the CAG is requested in this
behalf, after prior consultation, by the President or the Governor of State/Administrator of a Union
Territory having a Legislative Assembly, on such terms and conditions as may be agreed upon between
the CAG and the Government concerned
ii. Section 20 (2) empowers the President or the Governor of a State or the Administrator of a Union
Territory having a Legislative Assembly to entrust the CAG to undertake the audit of the accounts of
anybody or authority, not entrusted to the CAG for audit, with the prior approval of the CAG, if the
14
President or the Governor of a State or the Administrator of a Union Territory is of the opinion that such
audit is necessary
iii. Audit under Sub-sections (1) and (2) of Section 20 of the Act can be entrusted to the CAG only in public
interest and only after giving a reasonable opportunity to the concerned authority or body to represent in
respect of the proposal for such audit
iv. Audit of Government Companies is conducted in accordance with the provisions of the Companies Act,
1956 contained in Sections 617 and 619 and of Corporations set up by or under law made by the
Parliament, in accordance with provisions of the respective Legislations

90. The conditions for undertaking audit of a body or authority at the request of the President or the
Governor of a State or the Administrator of a Union Territory having a legislative assembly under Section 20(1)
are the
i. Audit shall be entrusted to the Comptroller and Auditor General preferably for a period of five accounts
years. The arrangement will be reviewed after the expiry of this period.
ii. The Comptroller and Auditor General may appoint a primary auditor to conduct audit on his behalf and
in accordance with the directions or guidelines issued by him.
iii. The CAG or an officer so authorised in this regard, will communicate the results of audit to the
governing body of the body or the authority with a copy to the concerned government. The governing
body shall submit a copy of the report to the concerned Government along with its observations.
iv. Any expenditure incurred by the CAG in connection with the audit of the body or authority, including
the expenditure incurred for the services of the primary auditor, if any, shall be paid by the Government
concerned to the CAG

91. Proposal for entrustment of audit to be submitted to

a. the CAG in respect of Union Government and UT not having a Legislative Assembly and respective AG in
respect of State Government and UT having Legislative Assembly
b. the CAG in respect of all Governments
c. Respective AG in respect of Union Government and UT not having a Legislative Assembly and the CAG
in respect of State Government and UT having Legislative Assembly
d. the AG concerned in respect of all Governments
92. The duties and powers of the CAG in relation to the audit of accounts of Government companies shall be
performed and exercised by him in accordance with the provisions of the Companies Act, 1956 under
93. Every company that is subject to audit by the Comptroller and Auditor General shall send copies of the
agenda notes and minutes of the meetings of its board of directors, board level committees and the audit
committee, if formed, to
a. the Accountant General (Audit) b. the CAG
c. the Government d. All of the above
94. The administrative ministry/department concerned shall intimate within one month of occurrence of the
event the Comptroller and Auditor General in writing about except
15
a. the formation of a new Government company or a deemed Government company
b. a Government company or a deemed Government company ceases to be so
c. a company becoming a Government company or a deemed Government company
95. Appointment of statutory auditor

i. The statutory auditor of a Government company or a deemed Government company shall be appointed
by the CAG from amongst persons qualified to act as auditors under the Companies Act, 1956
ii. Statutory auditor shall be appointed through a process of selection as may be prescribed and
thereafter, re-appoint him on year to year basis unless special circumstances warrant appointment for a
longer period.
iii. The total period of appointment including the initial appointment should not ordinarily exceed four
financial years
iv. The statutory auditor shall send acceptance of the audit assignment in writing to the Comptroller and
Auditor General within one month of the date of issue of communication of appointment, failing which
the offer of appointment is liable to be cancelled without any notice.


a. In case serious irregularities are noticed in the discharge of professional duties by the statutory auditor,
the CAG may, if considered necessary, on the recommendation of a committee appointed by him and
after giving due opportunity to the statutory auditor to represent, debar him from further appointment as
auditor of a Government company or a deemed Government company for such period as may be
considered fit.
b. The matter may also be referred to the Government for taking disciplinary action against the statutory
auditor.
c. both a & b
97. Responsibility with reference to annual accounts of a Government company or a deemed Government
company rests with
a. the Statutory auditor b. the Management
c. the AG (Audit) d. All of the above
98. Role of the C&AG with regard to audit by statutory auditor are
a. direct the manner in which the statutory auditor shall audit the accounts of the company and to
give to such auditor instructions in regard to any matter relating to the performance of his functions as
such
b. conduct a supplementary or test audit of the accounts of the company
c. None of the above
d. Both a & b.
99. To conduct an effective audit in an efficient and timely manner, the statutory auditor should prepare the
programme of audit
a. in consultation with the company b. in consultation with the AG (Audit)
c. in consultation with the company and the AG (Audit)
d. in consultation with the company, the AG (Audit) and the Government concerned.
16
100. Statutory auditor shall furnish reply to the provisional comments of the Accountant General (Audit) within
a. three days of issue b. three days of receipt
c. seven days of issue d. three days of receipt
101. Statutory auditor shall retain the record of work done by him in the form of working papers with
sufficient details so as to support his observations and conclusions for a period of
a. two years unless required for a longer period
b. five years unless required for a longer period
c. four years unless required for a longer period
d. seven years unless required for a longer period
102. Audit of the a Government company or a deemed Government company by the CAG is called
a. Special Audit Report b. Supplementary Audit Report
c. Separate Audit Report d. Independent Audit Report
103. Annual accounts a Government company or a deemed Government company include

a. Balance Sheet and Profit & Loss Statement b. Trading and Loss and Profit & Loss Statement
c. Trading and Loss, Profit & Loss Statement and Balance Sheet
d. Trial Balance and Trading and Loss, Profit & Loss Statement and Balance Sheet
104. Annual accounts duly adopted by the board of directors of a Government company or a deemed
Government company and audited by the statutory auditor shall be submitted to the Accountant General (Audit)
within
a. 9 months of the close of the year of accounts b. 2 months of the close of the year of accounts
c. 6 months of the close of the year of accounts d. 3 months of the close of the year of accounts

The period of submission of the Annual accounts duly adopted by the board of directors of and audited by
the statutory auditor to the Accountant General (Audit) is different for a Listed and Non-Listed Government
company or deemed Government Company.
a. True b. False
106. a. It is the statutory auditor who is primarily responsible for expressing an opinion on the accounts of the
company.
b. The scope of supplementary audit of annual accounts of a Government company and a deemed
Government company by the CAG shall include an examination of selected accounting records and a
review of the audit report of the statutory auditor including the opinion expressed by him on the annual
accounts of the company.
c. Both a & b
107. The significant and material observations made in supplementary audit shall be issued as
a. Audit Report b. Comments
c. Management Letter d. Appraisal

a. Any comments made by the Comptroller and Auditor General upon or supplement to the audit report
on the accounts of the company shall be signed by the CAG
17
b. The comments shall be placed by the management before the annual general meeting of the company
at the same time and in the same manner as the audit report of the statutory auditor
c. Both a & b
109. The CAG may dispense with supplementary audit of the accounts of a company for any particular year
a. With the previous consent of the Chief Executive Officer of the Company concerned
b. With the previous consent of the Government concerned
c. With the previous consent of the Chief Executive Officer of the Company and Government concerned
d. At his discretion.

a. The CAG has, in consultation with the Government of India, established an Audit Board for central
public sector undertakings.
b. The Audit Board is a temporary body for performance audits of the central public sector undertakings
conducted at periodic intervals focusing on critical areas of their performance on thematic issue
c. The issues may relate to a particular entity or cut horizontally across several entities. The scope of
performance audit may extend to more than one financial year.
111. Who shall be the chairperson of Audit Board?

a. the CAG b. the Dy. CAG (Central Revenue)
c. the Dy. CAG (Commercial) d. the AG concerned.
112. i. One or two technical experts in the related field appointed by the CAG in consultation with the
administrative ministry may be co-opted as special invitees.
ii. An officer shall be appointed to act as Secretary to the Audit Board who shall keep the minutes of the
meetings of the Audit Board.
iii. The meetings of the Audit Board shall be held with the available members and there shall be no
requirement of a quorum.
iv. The Audit Board may at its discretion confine itself to making recommendations for the selection of
topics for performance audit and the audit may, thereafter, be conducted by the AG (Audit) without any
further reference to the Audit Board.

113. Where the Audit Board decides to guide a performance audit, it shall do the following except
a. meet to consider and make recommendations on the audit objectives, criteria, guidelines, and
methodology
b. meet to consider the draft audit report and make recommendations for its finalisation
c. carry out the audit by itself
114. Pick the incorrect one regarding the Audit Review Committee
a. The AG (Audit) concerned shall be the chairperson of the committee. AG (Audit) or AG (A & E) in a
neighbouring State will be another member. The chairperson may, at his discretion, call a special invitee
for seeking opinion on technical issues.
18
b. The Secretary to Government of the concerned department and the chief executive of the concerned
public sector enterprise shall be the Government and public sector enterprise nominees on the
committee. In case some technical issues are involved, the State Government has the option to nominate
a technical member for expert opinion.
c. Dy. CAG or Addl. Dy. CAG (State Commercial) may nominate an officer for attending the meeting of the
committee as a representative of the CAG
115. The reports of the CAG in relation to the accounts of a Government company or a deemed Government
company shall be submitted to the Government concerned under Section
a. 19B of the DPC Act b. 19A of the DPC Act
c. 19(1) of the DPC Act d. 19(2) of the DPC Act
116. In case of both Central and State public sector enterprises, the responsibility for settlement of audit
observations lies with
a. the management of the company b. the Government concerned
c. the CAG for Central PSEs and the AsG for State PSEs
d. All of the above
117. The legislature of a State may, by law, make provisions with respect to the maintenance of accounts and
the auditing of accounts of Panchayati Raj Institutions and Urban Local Bodies under the provision of
a. Article 243 K and 243 X respectively b. Article 241 K and 241 X respectively
c. Article 241 J and 241 Z respectively d. Article 243 J and 243 Z respectively
118. Where audit of Panchayati Raj Institutions and Urban Local Bodies is entrusted to the CAG as Sole Auditor
under Section
a. 18 or Section 19 of the DPC Act b. 18 or Section 20 of the DPC Act
c. 19 or Section 20 of the DPC Act d. 17, 18, 19 or Section 20 of the DPC Act
119. The model forms in which the accounts of Panchayati Raj Institutions and Urban Local Bodies may be kept
and the forms in which their budgets may be prepared and presented, have been prescribed by the
a. the Government b. the CAG
c. the Government in consultation with the CAG
d. the CAG in consultation with the Government.
120. The functions of technical guidance and support (TGS) to audit Panchayati Raj Institutions and Urban
Local Bodies have been entrusted to the CAG under Section
a. 20 of the DPC Act b. 20 (1) of the DPC Act
c. 19 (1) of the DPC Act d. 20 of the DPC Act
121. The local fund auditor will prepare an annual audit plan for audit of panchayati raj institutions and urban
local bodies in the next financial year by the end of
a. December b. January
c. February d. March
122. The annual audit plan for audit of panchayati raj institutions and urban local bodies in the next financial
year prepared by the Local Fund Auditor shall be submitted to the
a. State Government b. AG (Audit) of the State
c. CAG d. All of the above
19
123. i. The local fund auditor will furnish returns in such format as may be prescribed by the CAG for advice
and monitoring.
ii. The AG (Audit) would conduct test check of some of panchayati raj institutions and urban local bodies
in order to provide technical guidance.
iii. The report of the test check would be sent to the local fund auditor for pursuance of action to be taken
by panchayati raj institutions and urban local bodies.
iv. The local fund auditor will pursue the compliance of such paragraphs in the inspection reports of the
Accountant General (Audit) in the same manner as if these are his own reports

124. a. The local fund auditor shall develop, in consultation with the CAG a system of internal control in his
organisation.
b. The AG (Audit) shall also undertake training and capacity building of the local fund audit staff.
c. both a & b
125. Audit of panchayati raj institutions or urban local bodies by the Accountant General (Audit) under
technical guidance and support does not include the certification of accounts of panchayati raj institutions or
urban local bodies
a. True b. False
126. The AG (Audit) will send to the concerned Secretary or Secretaries to the Government every year an
annual technical inspection report based on the results of audit of panchayati raj institutions and urban local
bodies conducted by his office during the preceding year by the end of
a. April b. September
c. June d. July
127. i. The form, type and extent of data, information and documents required for audit tests and evidence
shall be determined by the audit officer.
ii. Data, information and documents would also include those obtained by the auditable entity from a
third party and relied upon by it in performance of its functions.
iii. If such third party evidence as relied upon by auditable entity is found to be insufficient in Audit,
additional information may be requisitioned by Audit from the auditable entity with prior approval of the
Accountant General (Audit).
iv. On receipt of such requisition, the same shall be obtained by the audit from the third party.

128. Where external agency or expert is engaged, the following will apply except
a. The engagement letter appointing an agency or expert shall clearly specify the terms of reference
including the duties, obligations and powers of the agency or expert so associated.
b. The audit office shall inform the concerned Government department and the auditable entity regarding
the association of the external agency or expert as soon as the engagement letter is issued and before the
external agency or expert commences work, including the terms of reference containing the duties,
obligations and powers of the agency or expert so associated.
20
c. The audit office shall be responsible for the opinions formed, or the conclusions reached, or the
recommendations made in its report on the basis of the work of the external agency or expert.
129. Heads of departments shall supply to the audit office a list of the offices under them as at the end of
December so as to reach the audit office before the end of
a. April of the following year b. January of the following year
c. March of the following year b. June of the following year

a. The audit office shall as far as possible give advance intimation of a minimum period of three weeks to
the officer in charge of the office to be audited.
b. The intimation for audit shall state the likely duration of audit and also provide a list of the basic
records that should be kept ready before the arrival of the audit team.
c. In cases where the audit involves an element of surprise check, an advance of a week in maximum
needs to be given
d. None of the above.
131. Cases of failure to provide data, information and documents shall be reported by the audit office to the
controlling officer and, if considered necessary, the concerned Government for appropriate action and these
authorities shall inform the audit office about the action taken within
a. one month of such report b. three months of such report
c. two months of such report d. four months of such report
132. Results of audit conducted with reference to data, information and documents of any auditable entity
that are available in an audit office or an accounts office will be communicated to the auditable entity in the form
of
a. Audit Notes b. Action Taken Notes
c. Inspection Notes d. Short Notes
133. The audit office shall as far as possible issue the inspection report or audit notes within
a. four weeks from the date of completion of audit
b. six weeks from the date of completion of audit
c. three weeks from the date of completion of audit
d. eight weeks from the date of completion of audit
134. Pick the correct one regarding reply to audit observation by auditable unit
a. The officer in charge of the auditable entity shall send the reply to an audit note or inspection report
within four weeks of its receipt.
b. Even if it is not feasible to furnish the final replies to some of the observations in the audit note or
inspection report within the aforesaid time limit, the first reply shall not be delayed on that account and
an interim reply may be given indicating the likely date by which the final reply shall be furnished.
c. Both a & b
135. The reply shall be sent through the next higher authority along with the observations of that authority in
the case of an inspection report that relates to the
a. Ministry/Department b. Autonomous Bodies and Local Bodies
c. Government Corporation/Companies d. Public Works Department.
21
136. On intimation of the major irregularity by AG (Audit), the Government shall undertake prima facie
verification of facts and send to AG (Audit) a preliminary report confirming or denying the facts within
a. four weeks of receipt of intimation b. six weeks of receipt of intimation
c. two months of receipt of intimation d. three months of receipt of intimation

a. Where the fact of major irregularity is not denied by the Government in the preliminary report, the
Government shall further send a detailed report to the AG (Audit) inter alia indicating the remedial action
taken to prevent recurrence and action taken against those responsible for the lapse
b. The detailed report shall be submitted to the AG (Audit) within six months of preliminary report of the
Government.
c. both a & b
138. Pick the incorrect one regarding the significant audit observations to be communicated to Secretary
a. The AG (Audit) may write a management letter to the Secretary to Government of the concerned
department by the end of July every year communicating significant observations and conclusions
emerging out of audit during the preceding year.
b. The management letter shall inter alia mention the systemic and other deficiencies noticed during the
period, the extent of control compliance, cases of persistent irregularities and the level of adequacy of
response to audit observations, besides the more important individual cases that merit attention and
action, with appropriate recommendations where necessary.
c. The Secretary shall inform the Accountant General (Audit) of the action taken within a period of three
months
d. None of the above.

a. Government may establish audit committees for the purpose of monitoring and ensuring compliance
and settlement of pending audit observations.
b. Each committee so established shall comprise of a representative each from the administrative
department, Audit and a nominee from the Finance Department besides the head of the department of
the auditable entity.
c. In the case of Central Government establishments located in the States, the Ministry may nominate a
State level audit committee in consultation with CAG for settlement of audit observations.

a. The AG (Audit) of the State shall in the first quarter of each year make an annual public statement
regarding pending audit observations relating to the State Government.
b. The Chief Secretary to the Government shall in the first quarter of each year make an annual public
statement regarding pending audit observations relating to the State Government.
c. The Secretary to Finance Department shall in the first quarter of each year make an annual public
statement regarding pending audit observations relating to the State Government.
d. Each Head of Department shall in the first quarter of each year make an annual public statement
regarding pending audit observations relating to his department.
141. i. The AG (Audit) shall send a copy of the proposed audit observations in the form of a draft paragraph to
the concerned Secretary to Government by name for communicating the comments, observations and
explanation of the Government within a period of six weeks from the date of the letter or within such
other period of time as may be specified.
ii. The AG (Audit) shall also offer to discuss the draft paragraph including draft performance audit report
with the Secretary at mutual convenience within the aforesaid period.
iii. The AG (Audit) shall simultaneously send one copy of the draft paragraph to the Secretary to the
Government, Ministry of Finance or Finance Department, by name.
22
iv. The reply shall be signed by the Secretary or carry an indication of approval by the Secretary. The
Accountant General (Audit) shall give full consideration to the reply of the Government.

142. Consistent with the schedule of preparation, finalisation and presentation of the audit report in the
legislature, the AG (Audit) may consider a request made by the concerned Secretary to Government for extension
of time for sending the reply to the draft paragraph. Every such request shall
a. specify the reasons for seeking extension beyond the time stipulated
b. state the date by which the final reply to the draft paragraph shall be sent to the AG (Audit).
c. both a & b
d. None of the above
a. Audit report duly signed by the CAG is sent to the Secretary to the Government, Ministry of Finance or
Finance Department as the case may be, who shall take prompt action for the submission of the audit
report to the President or the Governor or the Administrator for further action and for the presentation
of the report in Parliament or the State or Union Territory legislature.
b. Copies of the audit reports under Section 19A of the Act shall be sent to the Secretary of the Ministry
or department concerned or the Administrator of a Union Territory having legislative assembly, who shall
take prompt action for laying the same in the Parliament or the legislature of the State or Union Territory.
c. A signed copy of the audit report shall simultaneously be sent to the Secretary to the President or the
Governor or the Administrator.

The Accountant General (Audit) shall send copies of the audit report to the Secretary to Government of
concerned department after the presentation of the report in Parliament or the legislature, as the case may be.
a. True b. False
145. Action Taken Note (ATN) is prepared for submission to

a. the AG (Audit) b. Secretary Finance Ministry/Department
c. President/Governor/Administrator d. PAC/COPU
146. i. The Secretary to Government of the concerned department shall send two copies of the draft self-
explanatory action taken note to the AG (Audit) for vetting along with the relevant files and documents
on which the explanatory note has been formulated, properly referenced and linked.
ii. The AG (Audit) shall return the self-explanatory action taken note to the Secretary duly vetted as soon
as possible but not later than two months.
iii. The Secretary shall send the requisite number of copies of the vetted note, as prescribed by the
PAC/COPU, to the secretariat of the PAC/COPU in accordance with the time schedule prescribed by the
latter and also forward a copy each to Ministry of Finance or Finance Department as the case may be, and
the AG (Audit).
iv. The Government’s response on the recommendations of the Public Accounts Committee/Committee
on Public Undertakings shall be sent to the Accountant General (Audit) for vetting before its submission
to the respective Committee

147. In respect the State Government, the AG (Audit) shall report the cases of delay to
a. the CAG b. the Chief Secretary
c. the Secretary Finance Department d. the Governor
23
148. The duties and powers of the CAG in regard to the accounts of the Union and State Governments are laid
down under Articles 149 and 150 of the Constitution of India and
a. Sections 10 to 20 and 23 of the DPC Act b. Sections 10 to 18 and 23 of the DPC Act
c. Sections 10 to 16 and 23 of the DPC Act d. Sections 10 to 12 and 23 of the DPC Act

a. Under Section 10 read with Section 2(e) of the Act, the CAG shall be responsible for compiling the
accounts and for keeping related accounts of the Union and of each State and Union Territory having a
legislative assembly
b. The President in the case of the Union, the Governor in case of the State Government and the
Administrator in case of Union Territory having a legislative assembly with the previous approval of the
President in the case of a State/UT, may after consultation with the CAG, by order, relieve him from the
responsibility of compiling or keeping the accounts concerned.
c. Under Section 11 of the Act, the CAG shall submit these accounts, wherever these responsibilities
continue with him, to the President or the Governor of a State or Administrator of the Union Territory
having a legislative assembly, as the case may be.
150. The CAG shall in so far as the accounts, for the compilation or keeping of which he is responsible, enable
him so to do, give information and render assistance to the Union Government or the State Government or the
Government of Union Territory having a legislative assembly, as they may from time to time require under
a. Section 10 (2) of the Act b. Section 22 of the Act
c. Section 12 of the Act d. Section 23 of the Act
151. The CAG is authorised to lay down general principles of Government accounting under Section
a. 10 of the DPC Act b. 12 of the DPC Act
c. 22 of the DPC Act d. 23 of the DPC Act

For the purpose of Section 23 of the Act, the General Financial Rules shall be deemed to be the general
principles of Government accounting
a. True b. False
153. Government Accounting Standards Advisory Board (GASB) set up in the office of the CAG with the support
of the Government of India is responsible for making recommendations regarding accounting standards
to be observed in Government departments and organisations.
ii. The Board is chaired by the Dy. CAG and has various stakeholders including the Controller General of
Accounts, the Controller General of Defence Accounts, the Financial Commissioner (Railways) as
members.
iii. The GASB is entrusted with the responsibility of formulating and proposing standards with a view to
improve the usefulness of the financial reports based on the needs of the users of these reports.
iv. The Government Accounting Standards Advisory Board is entrusted with the responsibility of preparing
a framework and a roadmap for shift to cash accounting.

154. The hierarchy of instructions of the Comptroller and Auditor General shall be in the order
a. Regulations standing orders/guidelines and practice notes
b. Practice notes, regulations and standing orders/guidelines
c. Standing orders/guidelines, practice notes and regulation
d. Any of the given order.
24
Answer
1 2 3 4 5 6 7 8 9 10 11 12
C D A B D A C D D A C D
13 14 15 16 17 18 19 20 21 22 23 24
B A C B D C A D B B D A
25 26 27 28 29 30 31 32 33 34 35 36
C B A C D B A D B C D B
37 38 39 40 41 42 43 44 45 46 47 48
D B C C D A B D C A A D
49 50 51 52 53 54 55 56 57 58 59 60
D D B B A D A B D D C B
61 62 63 64 65 66 67 68 69 70 71 72
A D C B B A D A B C A D
73 74 75 76 77 78 79 80 81 82 83 84
C C B A D B C B B A D B
85 86 87 88 89 90 91 92 93 94 95 96
A D B A D C A B A D C A
97 98 99 100 101 102 103 104 105 106 107 108
B D C A B B A D A C B B
109 110 111 112 113 114 115 116 117 118 119 120
D B C A C D B A D C B B
121 122 123 124 125 126 127 128 129 130 131 132
D B D B A C A D B C B A
133 134 135 136 137 138 139 140 141 142 143 144
B C D B A A C D B C C A
145 146 147 148 149 150 151 152 153 154 155 156
D C B D B C D B C A ---- ----
Explanatory Note
1. Section 23 of the Act authorises the CAG to laydown general principles of Government accounting.
5. 149-Framing of rules and give direction in all matters pertaining to the audit of the accounts for which he
was responsible.
150- The form in which the accounts of the Union and of the States shall be kept.
13. Alternative way of execution shall not be suggested by the Audit.
14. At other place as decided by the Audit
15. Made with the approval of Secretary of the concerned Ministries/Departments
19. Appropriate authorities in Government shall ensure promulgation of such standards.
24. The general standards describe the qualifications of the auditor and the audit institution, whereas
providing documents and records is the responsibility of the auditee entity.
26. Professional judgement represents the application of the collective knowledge, skills and experience of all
personnel involved with an assignment as well as the professional judgement of the individual auditors.
31. Reporting on individual cases of non-compliance and abuse, also require reporting on weaknesses that
exist in systems of financial management and internal control is made under Compliance Audit
33. Certification is done by the CAG in respect of Finance and Appropriation Accounts of Union, State and
UTs.
35. Whether the accounts of Government are properly prepared, are complete in all respects and are
presented with adequate disclosures.
36. A consolidated statement of all such orders issued during a financial year shall also be sent to the audit
office and the accounts office so as to reach within one month after the close of the financial year.
25
38. The details of incomplete works costing more than the limit prescribed by the audit office from time to
time
42. Referred to the concerned AG (A&E) or AG (Audit), as the case may be, for scrutiny before issue.
45. (i) Appropriation and re-appropriation (ii) Authorisation by the authority that is competent to do so (iii)
Compliance with the requirement of the applicable laws, rules, regulations, orders and instructions in
actual disbursement (iv) Evidence by way of vouchers, payees’ acknowledgements, etc. (v) Record in the
books of the spending officer, including cross-verification with the records of the treasury, pay and
accounts office, bank, etc. (vi) Accounting in the books of the Government and (vi) Monitoring, control
and reporting as prescribed in the Government rules.
46. Copies of contract agreements need not be sent to the audit office. Only quarterly statements (including
nil statements) of all contracts entered into in the preceding quarter need to be sent to audit office as per
time schedule given above.
51. Any other matter, as may be determined by the CAG.
70. Amount of grants and loans received from outside the Government shall not be taken into consideration.
73. Copies are sent to the AG (Audit) and not the CAG.
74. The scope of audits in question may extend to more than one financial year.
96. The case may be referred to the Institute of Chartered Accountants of India for taking disciplinary action
against the statutory auditor.
108. Any comments made by the CAG upon or supplement to the audit report on the accounts of the company
shall be signed by the AG (Audit) and not by the CAG
110. The Audit Board is a permanent body for performance audits of the central public sector undertakings
conducted at periodic intervals focusing on critical areas of their performance.
112. Appointed by the administrative ministry in consultation with the CAG
113. Audit Board is an advisory body and not executing one.
124. The local fund auditor shall develop, in consultation with AG (Audit) and with CAG, a system of internal
control in his organisation.
127. On receipt of such requisition, the same shall be obtained by the auditable entity from the third party and
provided to Audit.
130. In cases where the audit involves an element of surprise check, no advance intimation need be given.
137. The detailed report shall be submitted to the AG (Audit) within three months of preliminary report of the
Government
138. By the end of April every year and not July
139. In consultation with AG (Audit) and not with the CAG
141. A discussion may not be necessary in the case of a draft performance audit report that has been
separately discussed with the Secretary at an exit conference in terms of these Regulations.
143. The Accountant General (Audit) shall simultaneously send one copy of the draft paragraph to the
Secretary to the Government, Ministry of Finance or Finance Department, by name.
146. Not later than one month in place of two months
149. The President in the case of the Union including UTs and the Governor with the previous approval of the
President in the case of a State, may after consultation with the CAG, by order, relieve him from the
responsibility of compiling or keeping the accounts of the party concerned.
26

PC 22 - MCQ - Audit and Accounts Regulation With Answer

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PC 22 - MCQ - Audit and Accounts Regulation With Answer

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Audit & Accounts Regulations

1. The Audit and Accounts Regulations has been issued in pursuance of

2. The Audit and Accounts Regulations apply to

3. The Audit Board is constituted by the CAG for performance audits of

4. Pick the incorrect one

5. Submission of audit report by the CAG is governed by

6. Who constitutes the Audit review Committee?

7. Audit review Committee is constituted for

11. Pick the correct one

a. i, ii and iii b. i, ii and iv

12. Extent of audit means

14. Audit will be conducted

a. i, ii and iii b. i, ii and iv

17. The auditing standards include the

a. i, ii and iii b. ii, iii and iv

18. Match the following

Option Standard Option Brief Description

19. Basic postulates includes

a. i, ii and iv b. ii, iii and iv

23. The general standards include

a. i, ii, iii and iv b. i, iii, iv and v

24. Due care element of general standards means

25. Professional Competence is applicable to

26. Pick the correct one

27. State whether true or false

29. The elements of the field audit standards are

a. ii, iii, iv and v b. i, iii, iv and v

30. Audit evidence should be

31. Reporting standards include element

a. i, ii and iii b. i, ii and iv

a. i, ii and iii b. i, ii and iv

33. State whether true or false

36. Pick the incorrect one

a. ii, iii and iv b. i, ii and iv

a. ii, iii and iv b. i, ii and iv

42. Pick the correct one

44. Audit checks the expenditure for

a. i, ii and iii b. ii, iii and iv

45. Audit checks the expenditure for

a. i, ii and iv b. i, ii and iii

a. i, ii and iii b. ii, iii and iv

a. ii, iii, iv and v b. i, ii, iii and iv

55. State whether true or false

56. Pick the incorrect one

a. ii, iii and iv b. i, ii and iii

58. Pick the correct one

a. i, ii and iii b. i, iii and iv

72. Under Section 15 (2) of the DPC Acts

73. Pick the correct one

a. i, ii and iii b. i, ii and iv

77. Audit Report pertaining to financial audit is also called

81. Pick the incorrect one

82. State whether true or false

83. Who shall create an Audit Arrears Committee?

84. Audit Arrears Committee is created for

85. Audit Arrears Committee consists of

88. State whether true or false

89. Pick the correct one

a. i, ii and iii b. i, iii and iv

a. ii, iii and iv b. i, ii and iv

91. Proposal for entrustment of audit to be submitted to

95. Appointment of statutory auditor

a. ii, iii and iv b. i, ii and iv