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Army objects as CAG draws up plan to audit canteens

admin's படம்
Submitted by admin on செவ், 15/09/2015 - 22:16
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Vijay Mohan

Tribune News Service
Chandigarh, September 14
While the Comptroller and Auditor General (CAG) has drawn up plans to audit the functioning and accounts of the Canteen Stores Department (CSD), the move is being resisted by the armed forces on the ground that most issues that CAG wants to examine are outside its jurisdiction.
 
In a letter written to Defence Secretary Mohan Kumar recently, the CAG Director Audit, Defence Services, has given out the department’s rationale and proposed programme to conduct a performance appraisal of the CSD, which would cover its headquarters, 11 depots and 37 unit-run canteens (URCs).
 
The detailed instructions, circulated to army formations concerned by the branch dealing with canteen services at Army Headquarters, say that while the audit of records pertaining to quantitative discounts (QD) can be audited by CAG, audit of records, accounts, procedures and functional aspects of URCs do not come under the purview of the CAG, for which the case has been taken up with the Defence Accounts Department.

CAG going beyond its purview: Army

  • The armed forces say most of the issues that the Comptroller and Auditor General wants to examine are outside its jurisdiction
  • Though the audit of records pertaining to quantitative discounts can be audited by the Comptroller and Auditor General, audit of records, accounts, procedures and functional aspects of unit-run canteens do not come under its purview
 
The CAG intends auditing CSD records up to the year ending March 2015 and, while explaining its rationale for the exercise which is expected to be complete by this year end, has requested the Defence Secretary to issue appropriate directions for making the pertinent records available for scrutiny.
 
The CSD earns two kinds of profits from sale of goods. The first is the differential between the wholesale and retail price, which is 10 per cent for liquor and five per cent for grocery items. The other is the QD, which is incentive paid in kind by the vendors and is based on the volume of goods of that particular company sold by the CSD outlet. The total proceeds of the goods received as QD is profit over and above the profit from goods that were received on demand indent.
 
As per existing Army instructions, profit for CSD is credited into regimental funds and are supposed to be spent on welfare activities for troops, and paying civilian employees hired by URCs. Up to 33 per cent of the profit can be spent on the unit’s officers’ mess. Some officers claim that Regimental funds being a private fund do not come under the purview of the CAG.
 
A few years ago, QD profits were converted into public funds after questions were raised over their actual utilisation and potential for misuse.