CAG – Comptroller and Auditor General of India

CAG of India: The Comptroller and Auditor General (CAG) of India holds one of the most pivotal offices in the country; the CAG controls the entire financial system of the country (Article 148) both at the Union level as well as the state level. 

On 7th August 2020, Girish Chandra Murmu was appointed as the CAG (Comptroller and Auditor General) of India. He was the lieutenant governor of the Jammu and Kashmir Union Territory.

Dr. B.R. Ambedkar had addressed the CAG as the most important officer under the Constitution of India as he is the guardian of the public purse, and he must ensure that funds from the Consolidated Fund of India or a state are not spent without the authority of the appropriate legislature. He is the pivot of the audit and accounts system of India.

Girish Chandra Murmu – CAG of India

About CAG of India

The appointment and range of powers of the CAG reflect the importance of his office. The CAG needs to have a neutral identity, someone who is devoid of any political affiliation. He also enjoys protection against biased removal from office. His salary and pension are charged from the Consolidated Fund of India, which cannot be altered to his disadvantage. To keep his office away from conflict, the CAG is not eligible for further employment.

The concept of the CAG of India was taken from the United Kingdom. Sir Edward Drummond was appointed as the first Auditor General of India in the year 1860. The office of the CAG in the Constitution is inspired by the Auditor General under the Government of India Act 1935. 

Appointment and Tenure of CAG

Here’s the appointment, tenure, oath, qualification, etc. of the CAG ( Comptroller and Auditor General of India ):

• Part V, Chapter V of the Indian Constitution (Articles 148-151) deals with the CAG.
• The office of the CAG is included in the Union list of India.
• The salary of the CAG of India cannot be reduced during the term of his office under any circumstances except when a financial emergency is imposed (Article 360).
• The CAG of India, who is the guardian of the public money, is appointed by the President for a term of 6 years or 65 years of age.
• The salary of the CAG is determined by the Parliament of India and is charged from the Consolidated Fund of India.
• The CAG is not eligible to be re-elected.
• The CAG, after the completion of their tenure, can’t be re-appointed, neither by the Government of India nor by any state government.
• The procedure for removal of the CAG is similar to that of the judges of the Supreme Court of India. The CAG of India may be removed by the President of India on the recommendation of the Parliament of India.

Read More: Parts of the Indian Constitution

Responsibilities and Powers of CAG

The responsibilities and the range of the powers exercised by the Comptroller and Auditor General of India (CAG) are given below:

• The CAG’s Duties, Powers, and Conditions of Service Act’ was enacted by the Parliament of India in 1971. It was amended in 1976.
• The CAG shall perform duties and exercise powers concerning the Union accounts and the accounts of the states or any other government authority or body as prescribed by any law.
• Originally, the CAG had two duties which he/she had to Account and Audit, but presently CAG only audits the accounts of the Government of India, the Government of the States, and the accounts of government-owned companies (DVC, ONGC, etc.)
• The CAG also audits the accounts related to all the expenditure from the Consolidated Fund of India (CFI), Public Accounts Fund of India (PAFI), Contingency Fund of India, Consolidated Fund of the States (CFS), Public Accounts Fund of the states (PAFS) and Contingency Fund of the state.
• The CAG audits the accounts of any other authority as well when requested by the President or the Governors of the states. For instance, the local bodies, several Public-Private Partnership Projects (PPP)
• The CAG also audits the accounts of the Union Territories, which have a legislative Assembly.

List of CAG( Comptroller and Auditor General) of India

Here is the list of CAG of India from 1948 to Present:

List of CAG of India	Term
V. Narahari Rao	1948 -1954
A.K Chanda	1954 -1960
A.K Roy	1960 -1966
S. Ranganathan	1966 -1972
A.Bakshi	1972 -1978
Gian Prakash	1978 -1984
T.N Chaturvedi	1984 -1990
C.G Somiah	1990 -1996
V.K Shunglu	1996 – 2002
V. N. Kaul	2002 – 2008
Vinod Rai	2008 – 2013
Shashi Kant Sharma	2013 –  2017
Rajiv Mehrishi	2017 – Aug 2020
Girish Chandra Murmu	Present

Impact of CAG’s work on Governance

The work of CAG enhances transparency in government operations. By conducting audits and examinations, the CAG brings to light the financial aspects of government activities.

• CAG’s scrutiny helps in preventing financial irregularities and mismanagement in government departments and agencies. The prospect of facing audits encourages government entities to adhere to financial regulations and guidelines.
• Through performance audits, the CAG assesses the efficiency and effectiveness of government programs and activities. The findings and recommendations contribute to improving the delivery of public services and achieving better outcomes.
• CAG reports often include recommendations for improving financial management, governance structures, and operational efficiency. Implementing these recommendations can lead to positive changes in the functioning of government entities.
• CAG reports are accessible to the public, fostering public awareness about government spending and performance. This transparency builds public confidence in the government’s ability to manage finances and deliver services effectively.
• CAG reports are submitted to the Parliament, and they play a crucial role in the legislative oversight of government activities. Lawmakers use these reports to question government officials, ensuring checks and balances in the system.

Challenges Faced by CAG

These are some of the challenges faced by the CAG:

• Limited Resources: CAG doesn’t always have enough people or money to check everything thoroughly.
• Government Complexity: The government does many different things, and understanding and checking all of them can be hard.
• Technology Issues: As the government uses more technology, CAG needs to keep up to check things like online transactions and data security.
• Timely Audits: CAG needs to finish their checks on time to be effective, but sometimes it takes too long.
• State Coordination: In countries like India, CAG works in states too, and making sure all states are checked the same way can be tricky.
• Follow-up and Changes: CAG can suggest changes, but making sure the government actually makes those changes is a challenge.
• Political Sensitivity: CAG may find things that could upset politicians, and dealing with that without causing problems is hard.
• Globalization Issues: Governments now do things with other countries, and checking these international things is a challenge.
• Public Communication: CAG needs to tell the public about their findings in a way that everyone can understand.

Audit Reports of CAG

Here are the audit reports of the CAG of India regarding the account of the Union, account of the states and public accounts committee of India:

• The report of the CAG regarding the account of the Union is submitted to the President of India; he again submits it before the Parliament for their reconsideration.
• The reports of the CAG regarding the accounts of the States are submitted to the Governor; he then submits it before the state legislature.
• The Public Accounts Committee of India examines the annual audit report of the CAG of India.

The CAG is the unbiased head of the audit and accounts system of India. The constitution of India has ensured his/her smooth functioning without interference from the executive in terms of his/her appointment, terms of service, salary, and removal. It is his duty to uphold the ideals of the Constitution of India and laws of the Parliament in the sphere of financial administration. The functions of the CAG are very important in Indian parliamentary democracy to ensure accountability and transparency. He thus has been guaranteed the freedom to perform his functions freely and independently without any interference, and act as the ‘Guardian of Indian Purse’. 

UPSC Prelims Questions on CAG of India

1. Who described the Comptroller and Auditor General (CAG) of India as the guardian of the public purse?

A. Dr. B.R. Ambedkar

B. Sir Edward Drummond

C. The President of India

D. The Prime Minister of India

2. What is the term of office for the CAG of India?

A. 5 years

B. 6 years

C. 7 years

D. 8 years

3. The salary of the CAG of India is charged from which fund?

A. Consolidated Fund of India

B. Contingency Fund of India

C. Public Accounts Fund of India

D. Consolidated Fund of the States

4. Which act governs the duties, powers, and conditions of service of the CAG of India?

A. The Constitution of India

B. The Comptroller and Auditor General Act, 1971

C. The Financial Emergency Act, 1962

D. The Audit and Accountability Act, 1980

5. The CAG of India is not eligible for re-election. True or False?

A. True

B. False

6. What procedure is followed for the removal of the CAG of India?

A. The President’s recommendation

B. The Supreme Court’s recommendation

C. The Parliament’s recommendation

D. The Prime Minister’s recommendation

7. The CAG of India audits the accounts of which of the following?

A. Only the Union accounts

B. Only the accounts of the States

C. Union accounts and accounts of the States

D. Private companies

8. Which fund does the CAG of India not audit?

A. Public Accounts Fund of India (PAFI)

B. Contingency Fund of India (CFI)

C. Consolidated Fund of the States (CFS)

D. Consolidated Fund of India (CFI)

9. Who examines the annual audit report of the CAG of India regarding the account of the Union?

A. The President of India

B. The Parliament of India

C. The Public Accounts Committee of India

D. The Prime Minister of India

10. The CAG of India’s role in the Indian parliamentary democracy is to ensure

A. Efficiency of government operations

B. Accountability and transparency in financial administration

C. National security

D. Political stability

Summary – CAG of India

The Comptroller and Auditor General (CAG) of India holds a crucial position, overseeing the financial systems at both the Union and state levels. Dr. B.R. Ambedkar considered the CAG the guardian of public funds. The CAG’s appointment, tenure, and powers are designed to ensure neutrality and independence, and they play a pivotal role in auditing government accounts. The CAG’s work enhances transparency, prevents financial irregularities, and contributes to the efficiency of government programs. Despite challenges such as limited resources and political sensitivity, the CAG’s reports provide crucial insights into government spending, promoting accountability and transparency. The CAG’s impact on governance is very significant for the country.

FAQs on CAG of India

1. Who is the Current Comptroller Auditor General of India?

G. C. Murmu is the current Comptroller and Auditor General (CAG) of India. He assumed office on 8 August 2020.

2. What are the primary responsibilities of the Comptroller and Auditor General of India?

The CAG audits government finances, ensuring they are spent efficiently, economically, and in line with laws and regulations, contributing to accountability and transparency.

3. How is the Comptroller and Auditor General of India appointed?

The CAG is appointed by the President of India based on the advice of the Prime Minister and typically holds a senior position with a background in auditing or administration.

4. Who was the first CAG (Comptroller and Auditor General) of India?

Shri V.Narahari Rao was the first CAG (Comptroller and Auditor General) of India.

5. What types of reports does the CAG bring out?

CAG brings out reports, including the audit report on government accounts, providing an independent assessment of financial actions and promoting transparency in governance.

6. What is the role of the CAG in the Indian parliamentary system?

In the Indian parliamentary system, CAG’s role involves presenting audit findings to Parliament, facilitating oversight, and holding the government accountable for its financial decisions.

7. How does the CAG contribute to transparency and accountability in government spending?

CAG contributes to transparency by objectively assessing government spending, pointing out discrepancies, and suggesting improvements, thereby ensuring responsible and accountable use of public funds.