COMPTROLLER & AUDITOR GENERAL’S MANUAL OF STANDING ORDERS (AUDIT)

1. The responsibility of Comptroller and Auditor General in relation to compilation of

accounts of the Union and States is dealt in
a. Section 10 DPC Act
b. Section 12 DPC Act
c. Section 10 and 12 DPC Act
d. Section 22 DPC Act
2. The provisions relating to audit and accounts are embodied in
a. Section 13 DPC Act
b. Section 21 DPC Act Note below
c. Section 23 DPC Act
d. Section 24 DPC Act
3. The provisions relating to audit are embodied in
a. Section 13 to 21 DPC Act
b. Section 23 DPC Act
c. Section 24 DPC Act
d. All
4. The audit of expenditure is comprehensive and includes
a. Regularity Audit and Propriety Audit
b. Value for money audit and System Audit
c. Audit against provision of funds
d. All
5. The provisions for the audit of the accounts of authorities and bodies receiving financial
assistance in the form of grants or/and loans from the GOI or a State or Union Territory
a. Section 13 to 21 DPC Act
b. Section 14 and 15 DPC Act
c. Section 16 DPC Act
d. Section 23 DPC Act
6. The provisions in the Memorandum of Secret Instructions regarding the extent of audit
and quantum of audit derive their authority from
a. Section 18 DPC Act
b. Section 21 DPC Act
c. Section 24 DPC Act
d. Section 25 DPC Act
7. It is the function of the Executive Government to guard against misuse of public fund.
For this purpose they make
a. Financial rules and orders
b. Adequate internal control mechanism
c. A and B
d. Enforce economy in the expenditure
8. Enforcing economy in the expenditure of public moneys is the responsibility of the
a. Executive Government
b. Indian Audit & Accounts Department
c. Both
d. None

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9. Audit evidence may be gathered by
a. Physical observations including joint inspection by the auditors and executives and
interview with executives
b. Review of documents
c. Evaluation of the quality of internal control mechanisms
d. All
10.Audit evidence obtained from deliberations or interviews with executives should be
a. Documented
b. Documented and signed by the audit personnel
c. Documented and signed by the executives
d. Documented and signed by both the audit personnel and executives
11.Audit procedures that are commonly used to obtain audit assurances and applicable to
all types of audit fall grouped under
a. Two procedures
b. Three procedures
c. Four procedures
d. Six procedures
12.The commonly used analytical review techniques are
a. Comparisons involving a single component, Comparison across components
b. System analysis, Predictive analysis
c. Regression analysis and Business analysis
d. All
13.Develop an expectation, Define significant differences, compare the actual with the
expectations, investigate any significant differences between actual and expectations are
the steps involved in
a. Compliance testing
b. Analytical review
c. Directive substantive testing of transactions
d. All
14.Which of the following should be considered while identifying the departments,
institutions, programmes and issues for inclusion in the biennial audit plan?
a. The quantum of expenditure/revenue and vulnerability to serious financial irregularities
b. Socio-economic significance
c. Political and managerial sensitivity of their activities
d. All
15.The units that are not considered to be vulnerable or sensitive and have not been
audited for prolonged periods should be considered for coverage in the biennial plan
preferably in a cycle of
a. Four to five years
b. Six to seven years
c. Three to four years
d. Five and six years
16.Responsibility of scrutiny of all Rules and Orders which affect one or more of the State
Accountants General lies with
a. The Principal Director of Audit, Economic and Service Ministries
b. The Director General of Audit, Central Revenues

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c. The Accountant General of the State concerned
d. All
17.Audit of sanctions and orders is an important area of audit of expenditure. However no
audit scrutiny is required in respect of the sanctions issued by the
a. Ministries/Departments
b. State Government
c. A and B
d. Comptroller and Auditor General
18.Systems in force for budget formulations and expenditure control are required to be
audited and Audit scrutiny would be specially focused on
a. Existence of proper and adequate systems for budgetary controls
b. Availability of Budget Manuals
c. Adequacy of monitoring mechanism over the overall grants and appropriations
d. All
19.An expenditure is considered as unauthorized expenditure within the meaning of Article
114 (30 or 203 (3) of the Constitution and Section 29 (3) of Government of Union
Territories Act 1963, as the case may be, if the expenditure is
a. In excess of a Grant or Appropriation
b. Not falling within the scope of a Grant or Appropriation
c. Not falling within the intention as specified in the Schedule to an Appropriation Act
d. All
20.When any new financial, accounting or audit procedures are sought to be introduced in
the departmental manuals, the Accountant General concerned may advice whether these
are inta-vires and in accordance with correct principles; such advices should be confined to
a. Only individual rules
b. The manual in its entirety
c. Forms of accounts and new accounting procedure
d. All
21.In the audit of sanctions to expenditure, a sanction can be challenged by Audit
a. On grounds of propriety
b. If the disregard of the criteria expressed in a general form is considered so serious as to
make the sanction perverse
c. A and B
d. None
22.In the case of Union Government all financial sanctions and orders by a ministry or
department of that Government within its own financial powers should contain an indication
that the concurrence has been obtained from
a. Ministry of Finance
b. Internal/Integrated Financial Adviser
c. Controller of Accounts
d. All
23.It is an essential and inherent function of Audit to bring to light every matter which, in
its judgement, appears to involve improper expenditure or waste of public monies even
though the accounts themselves may be in order and no obvious irregularity has been
committed. This is achieved by conducting
a. Audit against sanctions to expenditure
b. Audit against regularity

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c. Audit against propriety
d. Audit against expenditure

24.It is not the duty of the Audit

a. To review a judicial decision
b. To review the judgment exercised by officers in individual cases
c. To substitute itself for the revenue authorities in the performance of statutory duties
d. All
25.The key areas of audit scrutiny of all receipts which are payable into the Consolidated
Fund of the Union and of each State and Union Territory having a Legislative Assembly
includes
a. Audit of effectiveness of rules and orders governing collection of receipts
b. Audit of periodicity of recoveries and examination of outstanding dues
c. Audit of Internal controls and Cross verification
d. All
26.The provisions relating to presentation of annual reports before the appropriate
Legislature contained in Section 619 A of the Companies Act are not applicable to
a. Departmental Undertakings
b. Deemed Government Companies
c. Statutory Bodies
d. Government Companies
27.Directions and Sub-Directions for conduct of audit under Section 619 (3) of the
Companies Act are issued by
a. Comptroller and Auditor General and Accountants General
b. Comptroller and Auditor General and Principal Directors of Commercial Audit
c. Comptroller and Auditor General
d. Comptroller and Auditor General and Principal Directors of Commercial Audit/
Accountants General respectively
28.The Governor of a State or the Administrator of a Union Territory having a Legislative
Assembly can entrust the audit of the accounts of a Corporation
a. Established by a State or Union Territory law
b. Established under a State or Union Territory law
c. A and B
d. None
29.Under Section 14 of DPC Act, it is obligatory for the CAG to audit all receipts and
expenditure of any body or authority substantially financed by grant or loan from the
Consolidated Fund of India or of a State or of a Union Territory having Legislative Assembly,
if the amount of grant or/and loan in a financial is
a. Not less than Rs.25 lakhs and less than 75 per cent of its total expenditure
b. Not less than Rs.25 lakhs and also not less than 75 per cent of its total expenditure
c. Not less than Rs.1 crore and less than 75 per cent of its total expenditure
d. B and C
30.Once an institution comes under the audit of Comptroller and Auditor General by virtue
of the provision of Section 14 of the DPC Act, such audit will continue for
a. Two years, even if the conditions prescribed are not fulfilled
b. Two years, if the conditions prescribed are not fulfilled

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c. Three years, even if the conditions prescribed are not fulfilled
d. As decided by Comptroller and Auditor General
31.The functions of Comptroller and Auditor General in the case of grants and loans given
for any specific purposes from the Consolidated Fund of India or of a State or of a Union
Territory having Legislative Assembly are described under
a. Section 14 DPC Act
b. Section 15 DPC Act
c. Section 14 and 15 DPC Act
d. Section 14 and 20 DPC Act
32.No audit reports need to be issued in the case of audit of bodies and authorities
a. Financed by grants or loan
b. Financed by grants or loan for specific purpose
c. Entrusted to Comptroller and Auditor General by the President/Governor/Administrator
d. B and C
33.The deposits may be classified broadly into
a. Two types
b. Three types
c. Four types
d. Six types
34.The deposits may be classified broadly
a. Interest bearing deposits, Civil deposits and Local Fund deposits
b. Civil Deposits, Revenue deposits, Civil court deposits and Criminal court deposits
c. Civil deposits, Local Fund deposit and Special deposit account of Government companies
d. A and B
35.Information system controls are broadly classified in to ‘General controls’ and
‘Application controls’. General controls includes
a. Control over data operation and System software acquisition and maintenance
b. Access security
c. Application system development and maintenance
d. All
36.Application controls that help to ensure
a. Proper authorization
b. Completeness
c. Accuracy, Validity of transactions and Data input
d. All
37.System Development Audit can be categorized into
a. Two classes
b. Three classes
c. Four classes
d. Five classes
38.The audit to determine whether the preliminary and detailed design accurately reflects
the functional data and systems specification, and incorporate adequate internal control is
known as
a. Monitoring Audit
b. Design review Audit
c. Post-implementation Audit

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 d. System Development Audit
ANSWERS

Question
Answer Rule
No
1 c Para 1.1.3
2 b Note below Para 1.1.4
3 d Para 1.1.4
4 d Para 1.1.5
5 b Para 1.1.7
6 c Para 1.1.20
7 c Para 2.1.5
8 a Para 2.1.6
9 d Para 2.1.10
10 d Para 2.1.10
11 b Para 2.1.11
12 d Para 2.1.15
13 b Para 2.1.22
14 d Para 2.1.26
15 b Para 2.1.26
16 a Para 2.2.5 (i)
17 d Para 2.2.8
18 d Para 2.2.17
19 d Para 2.2.18
20 a Para 2.2.32
21 c Para 2.2.37
22 b Para 2.2.44
23 c Para 2.2.46
24 d Para 2.3.2 and 2.3.4
25 d Para 2.3.7 to 2.3.12
26 b Para 2.5.22
27 d Para 2.5.15
28 a Para 2.6.2
29 d Para 2.6.5
30 a Para 2.6.5
31 b Para 2.6.6
32 a Para 2.6.31
33 b Para 3.1.2
34 c Para 3.11.2
35 d Para 3.22.5
36 d Para 3.22.6
37 b Para 3.22.29
38 b Para 3.22.29 (ii)

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