## Government Audit – Definition and Objectives

### What Is Government Audit?

Government Audit is an independent examination of financial transactions made subsequent to their execution, for the purpose of:

Evaluating and verifying those transactions
Presenting a report/comment on the accounts
Making recommendations for improvement
Expressing an opinion (in case of examination of Financial Statements)

> Key phrase: "subsequent to execution" — the audit happens after the transaction, not before.

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### Four Objectives of Government Audit

#	Objective	What It Means
i	Accounting for Public Funds	Provides a mechanism for public accounting of government funds
ii	Appraisal of Govt Policies	Provides public accounting of management, including programme and policy aspects
iii	Base for Corrective Actions	Audit observations highlight lapses of lower hierarchy; supervisory levels use this data to take corrective action
iv	Administrative Accountability	Ensures accountability of administration to Legislature; audit acts as an aid to administration

> Note on Objective iv: Government Audit is neither equipped to act as an Investigative Agency nor intended to do so. Its purpose is accountability, not prosecution.

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### Who Conducts Government Audit?

Audit is done by the C&AG (Comptroller and Auditor General of India)
C&AG is assisted by the Indian Audit and Accounts Department
Audit ensures accountability of the executive to Parliament

#### Legislative vs Executive — Simple Distinction

Body	Role
Legislature (Parliament)	Makes laws
Executive (Government)	Follows/implements those laws

Worked example

### Example 1

Q: In one line, how would you define Government Audit?

A: Government Audit is the independent examination of financial transactions after their execution, aimed at evaluating them, verifying them, and reporting on accounts with recommendations.

Examiner tip: The phrase "subsequent to their execution" is often tested directly in MCQs.

### Example 2

Q: Is the objective of Government Audit to investigate fraud?

A: No. Government Audit is not equipped nor intended to act as an investigative agency. Its objective is limited to ensuring accountability of administration to the Legislature, and to act as an aid to administration.

⚠️ Common exam mistakes

Students confuse 'subsequent to execution' with pre-transaction approval — Government Audit occurs AFTER transactions, not before.
Treating Government Audit as an investigative/fraud detection agency — the syllabus explicitly states it is neither equipped nor intended for that role.
Forgetting that C&AG is assisted by the Indian Audit and Accounts Department — both are part of the audit machinery.
Mixing up the accountability chain: audit ensures the Executive is accountable to Parliament (Legislature), not the other way around.

Reference:

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