What are the Account Codes for the following Accounts in a Town Panchayat:

a) Devolution Fund Account - 1053

b) Project - in- Progress Account Grants - 3122
c) Project - in - Progress Account contribution - 3121
d) Accumulated surplus/Deficits - 4001
e) Depreciation Account - 2038
f) Specific Stock Account -3001
g) Interest on Loan Account - 2029
h) Interest Payable Account - 4051
i) Contribution from Government - 4013
j) Contribution from Town Panchayat - 4011
k) Project overhead appropriation account - Expenses - 1069
l) Other Fees -1044
m) Other Income -1045
n) Interest from Banks - 1068
o) Prior Year Income - 1088
p) Other expenses - 2020
q) Provision for doubtful collection - 2022
r) Irrecoverable Revenue Items written off - 2023
s) Town Panchayat Contribution to Capital works - 2040
t) Maintenance Charges to TWAD Board - Metro Water Board/Water Cess to TN Pollution Control Board -
2129/4057
u) Specific Grant Receivable - 3023
v) Other Advances - Recoverable - 3055
w) Deposits - Recoverable - 3056
x) Grants from the Government - 4014
y) Tender deposits - contractors- 4016
z) Security Deposit - Staff- 4019
aa) Income tax (Contractors) Payable Account - 4035
bb) Vat tax payable account - 4037
cc) Library Cess- payable - 4043
Expansion of the Abbreviation:
1. A.S. - Administrative sanction
2. A.D. - Assistant Director
3. A.G. - Accountant General
4. A.G.A.M.T - Annaithu Grama Anna Marumalarchi Thittam
5. I.A.Y - Indira Aawas Yojana
6. KVVT - Kalaignar veedu valangum thittam
7. DRD Director of Rural Development
8. PAC Public Account Committee
9. DCRG Death cum Retirement Gratuity
10. HRA House Rent Allowance
11. CCA City compensatory allowance
12. CJV Contractor journal voucher
13. FAJV Fixed Asset Journal Voucher
14. BPV Bank Payment Voucher
15. UEL Unearned Leave
16. EOL Extraordinary Leave
17. EMD Earnest Money Deposit
18. ASD Additional Security Deposit
19. SD Security Deposit
20. FR Fundamental rule
21. FTA Fixed Travelling Allowance
22. TTA Transfer travelling allowance
23. TNFC Tamilnadu Financial code
24. TNBM Tamilnadu Budget Manual
25. TNPC Tamilnadu Pension Code
26. FBF Family Benefit fund
27. GPF General Provident Fund
28. GIS Group Insurance Scheme
29. HBA House building Advance
30. HF Health Fund
31. JD Joint Director
32. RDD Regional Deputy Director
33. SFC State finance commission
34. VAT Value added tax
35. ET Entertainment Tax
36. IT Income tax
37. PWD Public works department
38. MA & WSD Municipal Administration and Water supply Department
What are all the points to be seen in Budget:
1. Whether the budget is approved both by Administration and Council
2. whether the minimum working balance of 5% of gross estimated receipts of the Endowments> Government
Grants and debt heads had been provided.
3. Whether the Provision for the repayment of loan annuities together with inter made
4. whether there is any steep fall in revenue heads
5. whether the earmarked Funds have been diverted to work other than for which it is sanctioned
6. whether the amount received for capital items of expenditure is in accordance with rules
7. whether there is any provision for extraordinary item of expenditure which requires sanction of govt.

What are all the contributory clauses for unsatisfactory finances:

a. Expenditure in excess of receipts
b. Insufficient taxation
c. Slackness in Collection of taxes, fees etc
d. Generous remission and write off
What are all the items to be drawn by self Cheque in Panchayath Union Office:
1. Pay and allowance of the employees
2. Permanent advances
3. Festival advance of the employees
4. Travelling allowance of the employees
5. Meeting allowance of the members of the council
(W.r.t. Para 6 (iv) Chapter III, Manual of instructions for the Maintenance of Accounts to the Panchayath Unions)
What are the Funds operated in the Municipality:
1. Revenue Fund Account (Including Library cess and Devolution fund)
2. Capital fund Account(including Scheme Accounts)
3. Water supply and Drainage Fund Account
4. Education Fund Account
5. Other agency funds including PF and Special Provident Fund.
What are the registers and records maintained for Property tax in municipality:
a. Assessment list/particulars furnished by the owner of the property
b. Register of Demand and arrear demands
c. Quinquennial revision lists
d. Counterfoils of special notice
e. Register of appeal
f. Adjustment Slip
 g. Register of licenses issued for the construction,reconstruction of buildings
h. Register of receipt books
i. Chalan Registers/Cash collection Statement
j. Register of Cheques/Drafts/Money Order received
k. Cheque collection statement
l. Register of writes off and remission
What are the local bodies that maintain the Electric Licence Scheme :
1. Madurai Corporation
2. Coimbatore Corporation
3. Tanjavur Municipality
4. Pollachi Municipality
5. Karur Municipality
What are the registers Maintained for compost :
1. Deposit Register
2. Stock Register
3. Sales Register
4. Results of analysis
5. Measurement of manure
6. Instruction register
7. Permit books
Earmarked Funds :
(Para 87 of Municipal Manual Vol-I)
The Municipal Council Should not divert the following earmarked funds even temporarily for other purposes without prior
sanction of the govt.
I. Water and Drainage Fund
II. Deposits including P.F>
III. Lighting Tax
IV. Loan Funds
V. Special Provisional grant
VI. Elementary Education fund
VII. Capital receipts from the sale of capital assets
VIII. Endownments
Sinking Funds :
Sinking Fund is a fund to which was credit periodically and regularly certain fixed sum systematically accounts the
money with interest for the repayment of the whole loan in one amount when it falls to be repaid at definite further rate.
Development Charges/Betterment Contribution :
It may be levied and collected by the local bodies under Tamilnadu Town and Country planning Act. The levy and
collection of development charges should be formulated by local planning Authority constituted under the act.
Education Tax :
Education Tax is levied as an addition to the property tax within the rates prescribed in the Municipal Act. No
separate notification under Section 78 and 80 necessary for the levy of the tax when it is levied for the first time or when
the rate of levy of the tax is altered, on a direction issued by the State Government. Notifications under these sections
should be published in cases where Municipal Councils themselves take the initiative in regard to the levy of tax. The tax
shall be transferred to Elementary Education Fund. Education tax shall be utilized for the improvement of schools located
in the local body concerned.
Tax on Servants :
The tax is payable by persons employing private servants and domestic menials in hill station municipal limits. It
can be levied under sec 108 District Municipality Act 1920. The tax is levied monthly at the rate of not exceeding Rs. 2/-
per month for each servant on every employer who is into liable for profession tax/Property tax. Employment for not less
than 15 days in the aggregate out of every 30 days from the commencement of employment full monthly tax. Employment
less than 15 days but not less than 7 days in the aggregate tax during the above period. The Executive authority has to
serve demand notice requesting him to pay the tax within 3 days from the receipt of such notice ( Rule (26) under
Schedule (6) in the District Municipality ACT)
Timber Tax :
It is levied only in Madras corporation under section 129 of Madras Corp at the rate not exceeding Rs.5/- per ton
on Timbers brought into the city by canals, rails and roads. The tax is also leviable on Timber within the city for sales if the
commissioner reasonably believes that no tax has already been collected on transit to Madras city.
Pilgrim Tax :
It can be levied only with the sanction of the State Govt and the Govt of India. The tax is collected as a surcharge
on railway fares by the Railway administration by which the passengers are carried at the rates fixed by the Municipal
Council subject to the maximum prescribed in sec -116 in the District Municipality Act 1920. The tax after deducting the
cost of collection Charges for printing tickets, etc is credited to the Municipal Council by the Railway administration.
Register of Revenue Yielding Properties :
The income realized through lease of properties during the year. This register should be examined with a view to
see that the income from all revenue-yielding properties belonging to the municipality or from other sources have been duly
and correctly realized. If an property from which income is regularly derived is found omitted from the register, the auditors
should himself enter it in the register with regard to rent of buildings and lands.
Maternity & Child Welfare Grant :
The Govt have ordered that two - thirds of the total expenditure of maternity centres incurred by the panchayat
union (up to the limit specified) will be met by an annual grant to each panchayat union.The grant will be released by the
District Collector.
The maintenance of Maternity Child welfare centre by the panchayat union ceased with effect on 30/09/1982. The public
Health Staff of the panchayat union viz. Maternity Assistants, Auxilary Nurse and Mid - wives have been absorbed in Public
Health Dept to implement the Multi-Purpose health workers scheme. The Maternity ayahs have been treated as panchayat
union employees. The expenditure on rent, on current consumption charges and on employment of ayahs are met by the
panchayat union.
Dispensary Grant :
Under sec 65(b) of TN panchayat Act 1958, the establishment of maintenance of dispensaries is the responsibility
of the panchayat union councils. The panchayat union councils be eligible financial assistance from govt, by way of grant -
in - aid to cover 50% of the expenditure on the maintenance of one regular dispensary subject to a ceiling of Rs. 5000/- or
Rs.5400/- per annum as the case may be. In case a panchayat union maintains more than one dispensary the grant will be
paid in respect of one dispensary. Assistant Director (Panchayat) will release the grant in two half - yearly -installments.
On What case of work premeasurements are recorded : Defind the Scope of audit :
Premeasurements should be recorded in respect of the following cases of works.
a) Premeasurement for jungle clearance
b) Premeasurement of metal and gravel collection before spreading
c) Premeasurement of grill work of R.C.C. works
d) Premeasurement for deepening of the existing wells
e) Premeasurement for slit clearance
f) Premeasurement of patches for patch repair works
g) Premeasurement for dismantling works
h) Premeasurement of rocks in solid before removal
i) Premeasurement of low lying area before filling
j) Premeasurement of piles before erection in the pile foundation
k) Premeasurement of tank bunds before strengthening the bund
In audit, the correctness of the premeasurements should be checked and it should be seen whether the
premeasurements are got check measured. It should be seen whether a removal certificate was recorded and got verified
and certified by the check measuring officer,. It should be seen whether removed materials are stacked, got check
measured and accounted for the stock register and disposal pointed out.

Define the scope of audit in respect of deposit work :

 Deposit works are got executed through outside agencies. The estimated cost of work is deposited with the
agencies for execution. For example, Water supply works are got executed through water Board. The deposited amount is
debited to advances recoverable and advance is being adjusted on the receipt of monthly statement of expenditure from
the Executive Engineer. On completion of the Scheme or Work, the unspent balance if any with the agency for execution
should be got refunded with the interest accure3d there on from the date of deposit till the date of refund of the unspent
balance.
Define “ Works “
The works are classified as follows :
1. Ordinary repair works : It will cover maintenance work only (ie) periodical repairs of existing roads, white washing
in the case of building.
2. Special Works: It will include in the case of roads, spreading gravel or metal to the existing road on a large scale
due to damages in flood etc.
3. Original or Capital Works : It will cover works on new projects, remodeling the existing structure for the
improvement of the strength and stability and the like.
Explain the Various kinds of estimates :
There are three kinds of Estimates. They are Estimate, Supplemental Estimate and Revised Estimate.
a) Estimate :
For execution of all kinds of works, estimates are prepared in the first instance showing the details of work to be
executed and the cost of work. Abstract of quantities and value arrived at for each item of work.
b) Supplemental Estimate :
It is prepared when a development of project or work which is not fully contingent on the proper execution of the
existing work is thought of while the work is in progress and should be less than 5% of original Estimate.
c)Revised Estimate :
It has to be prepared when the provisions in the sanctioned estimates are likely to exceed 5% or when a material deviation
in execution has been necessitated.
What are the procedures to be followed while implementing KVVT (Kalaignar Veedu Valangum Thittam) in Villae
panchayats:
(G.O.MS.No. 62 R.D.L.A. and Panchayat Raj (PR 1) Dept date 27.05.2010.)
1. A separate Bank Account Should be opened and a separate cash book is maintained in village panchayats. This
account is called Account No.V
2. The receipts to be credited to the village panchayat KVVT account shall be the funds received under the KVVT
Scheme.
3. The funds credited to the KVVT Account will be spent for payment for the work pertaining to the KVVT scheme as
prescribed.
4. The KVVT Account shall be operated jointly be the president and the Vice- President of the village panchayat.
 5. The District Collector should instruct all the bank branches concerned to make a suitable ledger.
6. The Block Development officers should release the proceeding for payment.
7. On the basis of the proceeding of the B.D.O the village panchayat President and Vice president should sign and
issue the cheques to the beneficiaries.
8. Self - Cheque withdrawals are not allowed in this account.
What are the functions of the High level Committee for Municipality at District Level :
(G.O.Ms.No. 65/MA & W.S. Dept dt : 22.05.2007 and G.O.Ms.No.54/MA & W.S. Dept dt : 30.03.2009)
The Government have constituted high level committee for Municipality at District Level for settlement of long
pending objections. This committee is a non - statutory one intended to facilitate disposal of audit objections relating to
Municipal Councils. The Committee will meet atleast once in three months to dispose off the pending audit objections.
Functions of the District Level Committee :
1. The committee may direct the commissioners to appear before the committee for enquiries or additional
explanation.
2. The committee may examine in details regarding the reported irregularities and pass final orders on all audit
objections.
3. The committee may enforce a full or token recovery from the commissioner and other staff responsible for the
revenue loss.
4. It can waive recovery or excess payment
5. It is empowered to condone the irregularity on the merits of each case.
6. In the Case of an objection requiring Government condonation, the committee can recommend for the
condonation.
7. The committee may examine the irregularities reported by the Director of Local Fund Audit.
8. The committee can give suitable direction to the present commissioner to take action on the audit requirement.
9. The committee may also recommend and suggest to take further action by the Director of Municipal
Administration.
10. The Committee may not examine the audit objections raised by the Accountant General and the cases under
vigilance enquiry.
What are the onjectives of Annaithu Grama Anna Marumalarchi Thittam (AGAMT) :
(G.O.M.S.No. 115/R.D & P.R. Dept dt : 11.09.2006 and G.O.Ms.No. 97/R.D. & P.R. Dept dt : 13.06.2007)
1. Formation of cement concrete road
2. Installation of street lights and sodium vapour lights in village panchayat areas particularly in Adi Dravidar
Colonies and places where Group House are present.
3. Formation of tank for each Village, deepening the ponds, construction of bathing ghats and retaining walls in
village panchayat areas. The estimate amount should be from Rs. 300000 to Rs. 500000
4. Promoting inland fishing by culturing fish in ponds in villages. The estimate amount should not exceed Rs.25000/-
 5. Upgradation of burial / Cremation grounds by forming roads, building cremation sheds, providing drinking water
etc.
6. Improving the existing water supply schemes by desilting, deepening and extending pipelines. The maximum
estimate amount is Rs. 100000/-
7. Formation of play ground and recreation centres, renovation of play ground and recreation centres. The maximum
estimate amount is Rs. 50000/-. If this kind of work is executed in schools in village panchayats, the maximum
estimate amount is Rs. 1,50,000/-
8. Construction of community halls, Self Help group buildings reading rooms etc. The maximum estimate amount is
Rs. 100000/-. The furniture, books, racks etc required for a library should be got from donors only.
9. Construction of village shops and markets, providing drinking water facilities, building toilets, undertaking repair
work etc.
What are the audit checks to be made in AGAMT Account :
The auditore should check
1. Whether a separate Bank Account and the separate cash book are maintained for AGAMT
2. Whether only one cash book is maintained
3. Whether the grant received is credited in the Bank Accounts of Village Panchayats.
4. Whether the village panchayats have been selected on the basis of the guidelines from the government
(Village Panchayats with low income should be selected )
5. Whether three village panchayats have been selected in a year
6. Whether all the executed works are in the list of nine classified works.
7. Whether the Administrative sanction has been got from the District collector for the works other than the
nine classified works.
8. Whether all the executed works have been chosen by the Grama sabha
9. Whether estimates have been prepared, tenders have been invited, Administrative sanction and
technical sanction have been got, works have been assigned to the lowest tenderer, completion report is
available for works etc.
10. Whether the same work has been executed in parts by dividing it into small parts
11. Whether the newly created assets hae been handled over to the repective village panchayats and proper
entries have been made in the Assets register and certified by the comepetent authority.
12. Whether only Rs. 9500/- has been paid for each newly erected lamppost
13. Whether the value of cement road has exceeded the permitted maximum amount of Rs. 300000/-
14. Whether the length of the cement road laid is as per the norms specified.
The length of the cement road should be on the basis of the population of that area
a) Place with less than 500 people - 250 metres
b) 501 to 1000 - 750 metres
 c) 1001 to 3000 - 1500 metres
d) above 3000 - 3000 metres
What are the Registers and records to be seen in audit of final bill of a contractor for execution of road
work/building work :
Road Work :
a) Measurement book
b) Advance Recoverable Register for the recovery of road roller hire charges
c) Register of Roads
d) Materials at site statement(i.e) Metal account
e) Contractor’s Ledger
f) Register of works
g) Register of estimate and allotments
h) Completion Report
i) Reinvestment Register (when it is grant work)
j) Stock register of steel, cement and Tar for recovery of cost of materials issued departmentally
Building Work:
a) Register of Assets created out of Govt grants and loans
b) Measurement book
c) Stock Register of steel and cement for recovery of cost of materials issued departmentally
d) Register of Buildings
e) Immovable property Register
f) Contractor’s Ledger
g) Register of works
h) Register of estimates and allotments
i) completion Report
What are the sources of revenue to the panchayat union council :
The following items are the sources of revenue to the panchayat union council.
I. Sales of Tender Schedules
II. Avenue receipts
III. Tractor, cement mixure and power roller hire charges
IV. Revenue from Mines and minerals
V. Fishery rent
VI. Income from panchayat union Market
VII. Licence Fees for private markets
VIII. Fees for use of Choultries
 IX. Lapsed Deposits
X. Rent and sale proceeds of land and building, tools and plants
XI. Contribution from panchayats in respect of panchayat union markets
XII. Income from panchayat union shopping complex
XIII. Income from Panchayat union Thirumanamandabam
XIV. Godown Rent
XV. Marginal Profit on Materials like cement, steel and Tars
XVI. Interest from Treasury or Bank A/C of General fund
XVII. Interest from investments
XVIII. Local cess
XIX. Entertainment Tax

What are the Statements to be appended to the Annual Accounts of panchayat union General fund:
The following statements are appended to the Annual Accounts of Panchayat Union General Fund
a) Endowment Account
b) Special Government Grants account for capital works and other special purposes
c) Loan account
d) Loan statement
e) Investment account
f) Statement of Liabilities and Assets
g) Abstract of account of Deposits in cash
h) Abstract of account Security Deposit
i) Abstract of Provident Fund transaction of the Union Employees
j) Abstract of Transactions under Advances
k) The year wise balance of Advance pending
l) Abstract of permanent Advances
What are the malprcatices that are commonly noticed during the audit of Khadi Kraft and Agricultural Depots :
1. Cash receipts not remitted to Govt/Board account
2. Receipts not accounted for in the cash book/sold summary
3. Short totaling of daily totals and short carried over of amount in the cash book sales aummary
4. Short remittance
5. In cancelled bills ‘original’ is not forthcoming to audit
6. short accounting of stocks received through IT inboices(IT incoming)
7. Excess deduction of stocks more than that sent through IT Invoices(IT outgoing)
8. Unauthorised deduction of stocks
 9. Excess deduction of stocks
10. Double deduction of stocks
11. Short collection dueto incorrect adoption of sale price
12. Short collection due to wrong calculation
13. Striking of incorrect balance in the Stock Register
14. Short Carried over of Stocks
The Checks to be exercised while auditing the Cash/credit bills in a Khadi Kraft especially during the festival
season sales or sales:
It should be seen that.
1. Cash or credit bills are prepared for all sale
2. The sales are done during the ‘Period of rebate’ and the ‘rebates allowed’ are as per the norms of the Board.
3. For Crdit sales, the necessary applications and sanction order are readily forth coming
4. The amount exceeding the ‘basic pay’ of the individual has been billed immediately and cash collectd.
5. All the Sales (Cash/Credit) are recorded in the sales summary in chronological order
6. All Credit sales are readily forthcoming in the D.C.B. without omission
7. Separate bills books are maintained for cash and credit sales
8. All the stocks sold are deducted from the respective stock register.
The Principal records to be scrutinised in auditing the proforma Accounts in Khadi Kraft:
1. Whether it contains manufacturing account of P.L.Account and balance sheet containing assets and liabilities’
2. Whether figures posted in the statements agree with Register and records maintained such as (I) disbursing
officer(Expenditure) (II)Disbursing Officer Register for receipts.
3. Register of Special Advances
4. D.C.B. Register
5. Register of contingent expenditure
6. Cash abstract
7. Pass book showing the transactions in the P.D. Account Pertaining to deposit of spinners, Weavers, dhobis and
Carders.
8. Register of Security Deposit
9. Register of recurring expenditure
10. Adjustment register for transactions not involving cash
11. Adjustment register for transactions not involving cash
12. Stock Account of packing material and stationery
13. Implements sales register
14. Khadi cloth stock register
15. Khadi cloth sale register
 16. Stock register of silvers
17. Register of yarn purchasers, cotton sales and spinners deposits.
Completion Report(MFC-I Art 181)
1. As soon as a work in completed, a completion report showing the details of works provide in the estimate and the
works actually executed is prepared.
2. The value of the execution of the work is prepared and got approved by the competent authority
3. If there is any deviation in the work it should be explained in the completion report.
4. It the deviation is more than 5% a revised estimate should be prepared and got approved by the competent
authority.
2C Tree Tax:
2C Tree Tax should be credited to the panchayat Union treasury in respect of village panchayats, by the village officer and
2C tax may be collected and credited to the account of Town Panchayat. In the case of Town panchayat In the case of
prior of fasily 2C Tax was collected by the Revenue Department. Any default in payment of 2C Tree Tax should be
reported to the Thasildhar for effecting recovery under the Land Revenue Act.
Compost :
Rubbish night soil etc. are collected and transported to the compost yard. Tee raw materials of night soil and rubbish are
filled in the Compost pits or reaps in the proportion 1:3. The raw compost cipes after 6 months. 1/3 shrinkage of the raw
compost is sold to the public in units at the rates approved by the council.
Mutation Register:
All permanent Changes made in the assessment of Building, Land, lighting, water and drainage, Scavenging, Railway and
Education Taxes are recorded in the Register with reference to the Revision petition, appeals, construction and monthly
lists of outdoor subordinates.
Water Tax: (Sec.25 of Public Health ACT)
Any local authority with the prior sanction of the government, levy within its aea of any part there of any tax which may be
necessary for providing water supply in such area are parts. The rates of the tax should also be got approved by the
government. The revenue from the levy of such tax should be earmarked for expenditure on the execution, maintenance
and improvements of work of water supply.
Toll On Vehicle (Sec.118 of Public Health ACT)
The government or the Local Authority with the approval of the government may by notification levy toll on any vehicle or
any animal entering in a notified fair or festival centre for such period and at such dates as may be specified.
Sewage Farms :
The sewage farms are maintained by certain Municipalities. The Municipality cultivates grass and disposes it by sales. The
sale proceeds are remitted into Municipal Treasury. The proforma of income and expenditure are drawn up to verify the
working of the farms.
Estimate:
For the execution of all kinds of works, estimates are prepared in the first instance showing the details of work to be
executed and the cost of work. The estimate will be accompanied by detailed measurements of work, Abstract of quantities
and the value arrived at for each item of work.
Vacancy Remission :
Vacancy Remissions are granted only.
1. If a notice of vacancy is given at or about the time the vacancy occurred or the omission to give notice of vacancy
is condoned by the Commissioner to be recorded in writing.
2. If the house remained vacant for not less than 30 consecutive days in a half year and
3. If the refund is claimed not later than the end of the half year following that to which the remission relates.
That the particulars given in the notice have been verified by the tax collectors and assessors before they are
accepted.
That the reoccupation of the houses has been duly noted in the register
That the assessments agree with the entries in the Demand Register
That the amount to be given remission is proportionate to the number of days the building was vacant in a half
year subject to a maximum of the moiety of the tax in reopen of building only in a half year.

Security Deposit : (Art 276& 278)

Any person in the Government or local body who is entrusted either temporarily or permanently with the custody of cash
or stores or a person or a firm who has contacts with the government, Local body for supply o stores or to execute a work
is required to furnish security for the due fulfillment of discharge of duty or contract.
Earnest Money Deposit (EMD)
The EMD is a guarantee of the tenderer to deposit the requisite security and to enter into the required agreement on
intimation of the acceptance of his tender. It should be forfeited in case of default. It is also to be refunded to all
unsuccessful tenderers.
Causes for the minus balance in the Deposit Register:
The refund of deposit amount is in excess payment
The refund of Deposit amounts for more than once due to improper maintenance of the Deposit register.
The procedure to be followed when a contractor has abandoned a work in the middle :
1. The deposit (EMD) amount of the contractor shall be fortfeited.
2. The work so far done be fore the abandoned should be measured and the total value of work done is calculated.
3. The value of the materials supplied from the department should be recovered from the value of the work done.
4. The amount if any due to be paid to the contractor should be taken to the deposit.
5. A fresh tender should be called for the remaining items of work. The difference cost of amount if any should be
recovered from the first contractor.
 Duration period for the following items :
1. Black topping renewal - Once in 6 years
2. Water bound maccadum Once in 3 years
3. Colour and white washing Once in a year
4. Distempering Once in 3 years
5. Painting Once in 3 years
The circumstances under which audit can be suspended :
1. If the closing balance has not been written up and reconciliation has not been made.
2. If the demands have not been settled and not certified by the Executive Authority.
3. If the collections have been posted in the Demand Registers.
4. If the balance has not been arrived at and Arrear Demand Register have not been written up.
5. If the Deposit and the Advance Register have not been written up or closed.
6. If there is any non-co-operation to audit
7. If the records are not produced to audit
For the above lapses the audit can be suspended.
Indicate when Check measurement to be conducted for the following items of work and why :
Metal Collection : It should be check measured after the collection has been completed for a particular and specified
stretch of road and before spreading. The object is to ensure the meal collected and stocked is not carted and restacked at
another spot resulting in double payment.
Jungle Clearance : The check measurement is done before the jungle is actually taken up for clearance since the area to
be cleared can be ascertained and verified before clearance.
Slit Clearance : It can be check measured only by gathering the silt removed inconvenient heaps and arriving at total
cubic contents. The length of the area where the silt clearance is done can be ascertained at any time if the cubic content
are divided by the area, the depth up to which the silt has been cleared can be ascertained.
Earthwork for foundation: It has to be check measured after the digging has been completed and before it is refilled
with sand.
R.C.C. work for steel : Check measurement is to be done before RCC work is commenced.
R.C.C. work for cement : Check measurement is to be done before flooring or plastering
Deepening of well: It is to be measured before the work is commenced and after the completion.

The rules governing the refund of Lapsed Deposit in the Local Bodies :
The refund of lapsed deposits credited to a Revenue Head of Account should be refunded only with the sanction of the
council on application preferred by the person entitled to the refund such sanction shall be granted only it.
1. That the deposit was actually granted only it
2. That it was credited to a revenue head of account
 3. That it has not been refunded previously.
4. That the local body is satisfied with the identity of the claimants.
The Procedures to prepare the overdrawal of the Grant statement and take the necessary any actionto settle the
statement:
Audit should make a report to the government in the form of four statements.
1. Part I - Roads and Bridges
2. Part II Public Health
3. Part III - Education
4. Part IV - Development Schemes
It is further divided into two sections :
Section A : it shows clear cases of overdrawals
Section B: It shows non production of records and non utilization of grants/loans.
Aconsolidated Statement showing the irregularities will be prepared by the Director of the Local fund audit department and
communicated to A.G.RDLA and other Administrative departments.
It the case of objections included in Section ‘ A; six months time may be granted and in the case of objection included in
section B 12 months time may be granted.
After the expiry of the above periods show cause notice will be issued to the Executive Authority gibing two months time.
On expiry of two months time, the Director of L.F. Audit shall cause torecover by issuing Retrenchment slips to the
Treasury officers with instructions to deduct the grant overdrawal along with interest accrued by the L.F.Account I.

The percentage of voids and shrinkagefrom the following items :

1. Carted Eart 16%
2. Sand (shrinkage) 16%
3. Random stone (Undressed Stone) 40%
4. Blasted rocks 40%
5. Jungle clearance 40%

State Briefly whenvarious items of taxes fees and other items of revenues in Muncipality Town Panchayat will
become time - barred :
S.No. Nature of tax Half year Date of time barred
1 Property Tax 1 Hyr 12 years from 30th April
2 Profession Tax II Hyr 12 years from 30th October
I Hyr 12years from 30th May
3. Vehicle and Animal Tax I Hyr 6years from 16th April
II Hyr 6years from 16th October
4 Servant Tax --- 6years 7th day of an employment

5 Decreed amount ----- execution petition should be filed within 12 years

6 D&O Trade License fees ---- 30th June of the suceeding year

7 P.F.A. License fees ---- 30th June of the suceeding year

8 Encroachment fees --- 30th June of the suceeding year

9 excess water charges ---- 30th June of the suceeding year

10 Market License fees ------ 30th June of the suceeding year

11 Lease ------ I. If the agreement is executed 6 year from the date of first
default.
II. If the agreement is not executed 3 years from the date
of occupation
III) If the agreement is executed 3 years from the date of
occupation
IV) If the agreement is executed one year from the date of
occupation

The dates for the submission of the annual account to the audit office from the local bodies :
1 Special Grade, Selection 15th May of every year (G.O.1361/RDLA/31-7-69)
Grade, I Grade,II Grade Town
Panchayats
2 Special Grade, Selection 15th May of every year (Art 9-2 part I of Municipal Manual
vol.II)
Grade, I Grade,II Grade
Municipality
3. Corporation 1st July of succeeding year Rul;e 15 (a) under Part III of
schedule III of corporation
4. E.L.S. 1 July of succeeding year Rul;e 15 (a) under Part III of
st

schedule III of corporation

5. Panchayat Union 31 st May every year

The Preliminary Checks to be exercised before the commencement of audit:

I. Whether closing balance as shown in account is in agreement with the closing balance of cash book and bank
pass book, after deduction the uncased cheques.
II. Whether the loan statement has been prepared and closing balance as per loan statement is in agreement with
the closing balance of the loan register
III. Whether Deposit Register has been closed and the closing balance in Deposit Register is in agreement with the
closing balance in the Account
IV. Whether the Advance Recoverable Register has been closed and the closing balance is in agreement with the
closing balance of the Advance account
V. Whether all the subsidiary Registers have been closed and tallied with the account.
VI. Whether and endowment account had been prepared and the figures are in agreement with the Endowment
Register
VII. Whether Schedule of rates and taxes has been prepared as per the Government Instructions/Acts.
VIII. Whether the Demand Register has been closed and the D.C.B. in the Demand Register is in agreement with
account figures.
IX. Whether the closing balance in the Demand Register has been correctly carried forward as opening balance in
the Arrear Demand Register.
X. Whether the closing balance in the Deposit and Advance Recoverable Register is correctly carried forward as
opening balance in the next year register.
XI. Whether all the vouchers are readily forth coming for tracing.
The registers and Records to be verified in works audit:
I. Report to accompany the estimate
II. Estimate with date for rates adopted
 III. Revised estimate for major deviation
IV. Tender notice,Tenders, comparative statements and agreements
V. Materials at site account
VI. Stores indents
VII. Stock Account
VIII. Stores returns
IX. Measurement Books
X. Contractors bills
XI. Completion report
XII. Register of contractors
XIII. Register of Deposits
XIV. Register of tenders
XV. Register of works
XVI. Contractor’s Ledger
XVII. Register of immovable properties
XVIII. Register of roads, bridges, and culverts as the case may be.
The Theoretical requirement of cement in the following cases in bags:
1. PCC 1:5 :10 using 40mm jelly for F/B - 19-64cum
2. R.R. Masionary in CM 1:5 - 20.52cum
3. Brick work in CM 1:5 usingII class bricks of sixe 9x43/8x23/4 - 194.54cum
4. R.C.C. 1:2:4F and B - 218-02 cum
5. Plastering in CM 1:3’ 12mm thick - 1941-12 sqm

The theoretical requirement of cement bags

1 19-64m3x129-60 kg
2 20- 52m3 x 129-60 kg
3 194 - 54 msx 72-05 kg
4 218- 02 m3 x 324 kg
5 1941 - 14 m2x 6-72 kg
2545- 34 kg or (2545-34)/50 50-90 or 51 bags
2659 - 39 kg or (2659-39)/50 53-18 or 54 bags
14016 - 60 kg or (14016-60)/50 280-33 or 281 bags
70638 - 48kg oe (70638-48)/50 280-33 or 281 bags
13044 - 32kg or 13044 - 32/50 260-88 or 261 bags
The General Principle in the conduct of Audit Expenditure :
The objects of audit o expenditure are to ensure :
1. That there is provision of funds for the expenditure duly authorized by a competent authority.
2. That the expenditure is in accordance with proper sanction and expenditure incurred by an officer com petent
to incur it.
3. That the claims are made in accordance with rules and in proper form
4. That all prescribed preliminaries to expenditure are observed such as proper estimate prepared and
approved by competent authority for works expenditure etc.,
5. That expenditure sanctioned for a limited period is not admitted beyond that period without further sanction.
6. That the change is correctly classified and that if a charge is debitable to the personal account of a
contractor, employee or other individual or is recoverable from him under any rule or order it is recorded as
such in a prescribed account.
7. That the rates paid for work done or supplies made are in accordance with any sale or schedule prescribed
by competent authority and
8. That the payment have been correctly brought to account in the original accounts.
Ordinary Repair works, Special repair works and capital works:
1. The ordinary repair works will cover maintenance work only (i.e) periodical repairs of the existing of the
roads. White washing in the case of building etc.
2. Special works will include in the case of roads, spreading gravel or metal to existing road on a large scale
due to damages in flood etc and in the case of buildings replacement of roof.
3. Original or Capital works will cover works on new projects remodeling the existing structures to improve
strength and stability and the like.
The Registers and Records maintained in respect of Excess water charges
The following registers are to be maintained:
1. Register of House service connections
2. Demand Register for excess water supply (meter system) n(G.O.Ms.No.1935 RDD& LA de=t: 07.04.74)
3. Meter Ledger(G.O.Ms.No. 1064 Dt.20.04.73)
4. Water Meter reading card (G.O.Ms.No. 1066 RD&LA dt: 20.04.73)
5. Demand register in respect of water supplied through tap.
6. Arrear demand Register
7. Personal Ledger
8. (LFAD Manual - Volume II - Part I-Page No.138)
The Procedure to be followed when the contractor has abandoned the work in the middle:
1. Deposits(Earnest money deposits) the Deposits amount of contractor to be forfeited.
 2. The work so far done before the abandonment of the work should be measured and the total value of work
done is calculated.
3. The amount of any due to be paid to the contract or after deducting the value of materials supplied
departmentally should be taken to deposits.
4. A fresh tender should be called for, for the remaining items of work with current schedule of rates and
remaining work may be completed by entresting the work to the second contractor and the difference of cost
may be worked out and recovered from the first contractor.
Whose sanction is necessary for diversion of earmarked funds:
1. Panchyar - Collector
2. Municipality - Govt.
3. Municipal Corporation - No permission from Govt is required.
Ruling under accrual based Accounting system in recording debits and audits.
Personal accounts - Debit the receiver and credit the giver.
Asset or real accounts - Debit what comes in and credit what goes out.
Nominal or fictitious - Debit expensed and losses and credit gains and income.

What is Trial Balance:

Trial balance may be defined as a statement of debit and credit balances extracted from the ledger with a view
to test thearithmetical accuracy of the books forming a link between the ledger accounts and the income Expenditure
account and the balance sheet. It must be noted that the cash on hand at Treasury and balance with bank collection
account/ the Payment Account as indicated in the Receipts Book and payments book after taking into account
transfers out and transfers inthrough bank Transfer Book. should be included in the Trial Balance.

Register of Shortages
In G. O. Ms. N,.619. R.D. and L.A. Department, dt.3rd April 1981 the government have prescribed a Register of
shortages to be maintained all the Special, Selection and first grade Municipalities. The shortage reported by the
Stock verification organization in the Annual Physical verification reports should be entered in this register and the
Regularisation the shortages either by write off or recovery as the case may be watched though the register, retaining
at the same time the entries in the stock Register.
What are the Procedure to be followed for remittance through Triplicate Chalan system in a Municipality
In order to facilitates prompt issue of receipts to the parties making payments of miscellaneous dues into the
Municipal Treasuries triplicate chalan system has been introduced in all Municipalities.
 What are the points to be seen Budget in Muniucipality.
whether thebudget is approved both by admin and Council.
1. Whether the minimum working balance of 5% of gross estimated receipts of the year excluding En-
downmwnts, govt. grants and debt heads has been provided.
2. Whether the provision for the repayment of loan on securities together with interest has been mode.
3. Whether there is any step fall in revenue heads.
4. Whether the ear marked funds have been diverted other than for which it is sanctioned.
5. Whether the amount received for capital items of expenditure is in accordance with rules.
6. Whether there is any priovision for extradionary items of expenditure which requires sanctions of govt.

What is meant by depreciation? What are the types of depreciation? How are they calculated?
Due to use , wear and tear the life of assets are likely to diminish year after year. Such reduction in life is called
Depreciation. There are two types of Depreciation.
A. WRITTEN DOWN VALUE METHOD
Under this method , the rates of depreciation will be applicable at a fixed percentage on the diminishing balance
value of the asset.

B. STRAIGHT LINE METHOD

1. Under this method rate of depreciation will be applied at a fixed percentage on the original cast of the asset
at the end of the year.
2. No depreciation is chargeable on if the asset is purchased in March of a year.
3. If the peried of purchase is less than 6 months, full rate shall be applied.
4. In respect of water supply and drainage fund straight line method should be applied.

Briefly define the rules for debit and credit in the accrual based accounting system. State the various kinds of
journal vouchers passed through Municipal Accounts.

The rule for dedit and credit are PERSONAL ACCOUNT.

Debit the receiver and credit the giver ASSET OR REAL ACCOUNTS.
Debit what comes in and credit what goes out Nominal of Fictitious account.
Debit all expenses and credit all gains & income. For every debit there should be corresponding credit
GJV - General Journal Voucher
EJV - Expenses Journal Voucher
CJV - Contractors Journal Voucher
 PJV - Purchase Journal Voucher
FAJV - Fixed Asset Journal Voucher
BRV - Bank Receipt Voucher
BPV - Bank Payment voucher

What are the guidelines to be followed for sanctioning Rebate Grant to Khadi Board.
( G.O. M.s. No. 107/Handloom cloth, Khadar (F2) Dept. dt 31.08.2009)

1. khaddar Rebate Grant should be released on Quarterly basis.

2. Total demand of the Grant shold not exceed Rs. 5 crore.
3. Either the Rebate Grant Eligible or Rebate Grant Eligible after Auditing whichever is less should be sanctioned.
4. If the rebate amoun t exceeds the mazimum ceiling amount, the excess amount should be spent from the own
fund of the respective instiutions.
Post Audit
1. It is the auditing on expenditure already incurred and payment already made.
2. The legality and correctness of such payments and expenditure are examined in post audit.
3. Any excess payment or irregular payment are to be recovered after it is pointed out in audit.

Pre Audit
Auditing the expenditure proposed to be incurred prior to making or authorizing th payment and thereby ensuring its
legality and correctness is called as pre audit. In Government Treasury department pre audit is done. In municipality the
arrear claims due to Staff are pre audited by our department.

In madras University the final claims of PF are pre Audited