CAG flags serious lapses citing risk of ‘misappropriation’ and fund delays
Moa Jamir
Dimapur | September 13
The Comptroller and Auditor General’s (CAG) report on “State Finances for 2023–24” has flagged serious lapses in financial monitoring, highlighting a high pendency of utilisation certificates (UCs) and Detailed Countersigned Contingent (DCC) bills in Nagaland.
As of March 2024, a total of 250 UCs worth Rs 356.23 crore remain due for submission for periods up to 2023–24, highlighted the report presented during the seventh session of the 14th Nagaland Legislative Assembly on September 4.
Out of the total, 11 pending UCs were from the 2021–22 fiscal year, while 63 were from 2022–23, amounting to Rs 11.13 crore and Rs 54.91 crore respectively.
For 2023–24, there were 93 pending UCs, amounting to Rs 114.12 crore.
Major defaulting departments that had not submitted the UCs included the Planning & Coordination Department (Rs 131.94 crore); Industries & Commerce Department (Rs 50.20 crore); Youth Resources & Sports Department (Rs22.70 crore); Social Welfare Department (Rs 21.73 crore); Health & Family Welfare Department (Rs 20.12 crore); Rural Development Department (Rs 19.95 crore); and School Education (Rs 19.20 crore).
The CAG observed that such delays violate prescribed financial rules and directives and reflect a weak monitoring mechanism within the State Government. High UC pendency increases the risk of misappropriation of funds and could result in the State losing access to central funds or facing delays in the release of subsequent instalments by the Government of India, it added.
In the absence of UCs, it could not be ascertained whether the recipients had utilised the grants and, if utilised, whether it was for the intended purpose.
As per the CAG, during the Exit Conference on 16 December 2024, the Finance Department “assured to initiate steps to minimise the outstanding UCs.”
DCC bills against AC bills
Meanwhile, the report further noted that a total of 405 Abstract Contingent (AC) Bills amounting to Rs 699.87 crore were drawn up to 29 February 2024, including 323 AC bills worth Rs 554.76 crore that were already outstanding as of 31 March 2023.
Of these, DCC bills for only 72 AC Bills worth Rs 86.58 crore have been received.
This leaves 333 AC Bills worth Rs 613.29 crore pending for adjustment as of 31 March 2024, the CAG noted.
The Civil Police led the pending AC Bills with Rs 281.12 crore, followed by the Home Department (Rs105.70 crore), Election Department (Rs 53.11 crore), Youth Resources & Sports (Rs 30.70 crore), and the Animal Husbandry & Veterinary Department (Rs 20.89 crore).
Accordingly, the report highlighted that the non-adjustment of AC Bills is fraught with the risk of misappropriation and requires close monitoring by the respective Drawing and disbursing officers (DDOs) for ensuring submission of DCC bills.
Further, there is no assurance that the expenditure of the State Government reflected in the Finance Accounts is correct or final due to non-receipt of DCC bills to that extent, it added.
The CAG noted that compliance with prevailing rules and codal provisions are meant to ensure control and accountability in accounting and financial reporting. Non-compliance and deviations impact the quality of accounting and financial reporting adversely.
Specifically, non-timely submission of UCs against conditional grants, non-submission of DCC bills against AC bills, non-compliance with IGAS-1, IGAS-2 and IGAS-3, and non-supply of details of expenditure from State Nodal Agencies (SNAs) have adversely impacted the quality of accounts, it added.
