Strategic Plan ‐2020 for IAAD – 9th September 2010
1. Setting the Context
1.1 Institution
of the CAG and the Indian Audit and Accounts Department
The
Comptroller and Auditor General of India (CAG) is an independent Constitutional
functionary, who derives his authority from Articles 148 to 151 of the
Constitution. His duties, powers and conditions of service have been amplified
in the CAG’s DPC Act, 19711.
The
Indian Audit and Accounts Department (IAAD) under the CAG is the instrument
through which his Constitutional and legal functions are discharged. Our
current vision, mission, and core values are as follows:
Vision Mission
We strive to be a global leader and initiator of national and
international best practices in public sector auditing and accounting, and
renowned for independent, reliable, balanced and timely reporting on public
finance and governance.
As mandated by the Constitution of India, we
promote accountability, transparency and good governance through high quality
auditing and accounting and provide independent assurance to our primary
stakeholders – the Legislature, the Executive and the Public – that public
funds are being used properly, and for the intended purposes.
Our Core Values
Independence Transparency
Objectivity Innovation
Integrity Knowledge‐centric Organization
Credibility Constructive Approach
Professional Excellence
1.2 Existing/
Previous Plans
1 In addition, certain other Central Acts e.g.
The Companies Act, 1956 also assign additional responsibilities to the CAG.
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Strategic Audit Plan
A Strategic Audit Plan for 2002‐08 was
prepared for the Department as a whole, setting forth the Organisation’s
strategic perspective for the six year period. The priorities adopted for the X
Plan of the GoI by the Planning Commissionby the key drivers for this Strategic
Audit Plan.
The Plan identified five key themes having a
critical bearing on the Indian economy and the quality of life of people –
human development; economic liberalization; infrastructure modernization;
technology upgradation; and national security. It also identified 21 strategic
objectives under these five themes, in respect of which detailed performance
goals for audit were set.
Currently, IAAD does not have a Strategic
Audit Plan, which cuts across all functions/wings/ offices; the last Strategic
Audit Plan for the IAAD covered the period from 2002‐2008.
We need a single Strategic Audit Plan for
Central Government Audit (typically for a five year period), covering all
functions/ wings – Civil, Commercial, Defence, Railways, P&T, Autonomous
Bodies, Revenue
– and also covering performance and compliance
audit by the State PAGs/ AGs of implementation of Centrally Sponsored Schemes
(CSS)/ Central Sector Schemes through grass‐root level implementing agencies.
The key themes/ focus areas for this Strategic Audit Plan will be driven by the
priorities spelt out in the XI Plan and its Mid‐Term Appraisal, the Finance
Commission Report etc. Such a plan has to be necessarily adopted/ approved at
the level of IAAD top management and the CAG, as its implementation would
require commitment and support from all wings and functions. A similar approach
has to be adopted in respect of each State, covering all wings – civil, works,
commercial, autonomous bodies, local bodies, revenue.
However, drawing up such a Strategic Audit
Plan is a distinct exercise from this document, and would require a
separate task force.
Perspective Plans – 200308 and 201015
Two sets of perspective plans, setting out
Department‐wide perspectives on differentareas for the next five years, have
been prepared. The first Perspective Plan was for the period 2003‐08, while the
Perspective Plan for 2010‐15 was finalized recently. A summary of the key goals
of the Perspective Plan 2010‐15 is given in Annexe‐1.
There is substantial congruence between the
goals and objectives set out in the latest
Perspective Plan and the
strategic objectives indicated in this document, although the time
horizon of this Strategic Plan is longer. A
mapping between key goals in these documents has 
been prepared and is indicated in Annexe‐2.
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Discussions and
Recommendations of Conferences of Accountants General
The Conferences of Accountants General (in
particular the last two Conferences) have dealt with several strategic issues
in different areas, through preparations of theme papers on areas of concerns
and discussions/ recommendations thereon. Many of the issues discussed in this
document have featured in the recent XXV AsG Conference.
Audit Plans of Individual Offices
Individual field audit offices prepare their
Annual Audit Plans, which detail the allocation of audit resources across
different categories/ sub‐categories of audit, the themes for performance audit
and units for compliance audit etc. In addition, some field offices also
prepare Strategic Audit Plans for performance and compliance audits, which
detail the key focus areas to be covered during the next 3‐5 years.
1.3 Changing
Focus of Governance in 2020
Over the next ten years or so, webelieve that
the following patterns in governance are likely to emerge:
·
Delivery of Basic Services will continue to remain Government’s
responsibility –
Despite the high trajectory growth of the
Indian economy in the last few years and the increasing contribution of the
private sector to the Indian economy, the Government (Central, State and Local)
will continue to retain responsibility for providing most basic services to the
common citizen e.g. health, education, employment support, rural infrastructure
etc.
·
Public Private Partnerships (PPP) will become the predominant
mode for delivering infrastructure and other economic services – The Government has recognized
PPP to be the preferred mode for provision
of infrastructure services, both on account of the limited resources available
to Government (which would be better utilized for delivery of social services)
as well as increased efficiency in delivery of services; this trend will
accelerate further to go beyond national highways, ports and airports to cover
other infrastructural services. The Government will step in only in situations
where such services are inherently uneconomical, either through viability gap
funding or through direct provision of services. Also, in other economic
services (particularly those involving exploitation of natural resources e.g.
oil and gas, minerals etc.), private sector participation through appropriate
revenue sharing arrangements will become the norm. The role of Government in these
areas is likely to become more and more facilitative and regulatory, focusing
on aspects like ensuring a level playing field, protecting the interests of the
citizens/ users, and ensuring Value For Money to the Government.
·
Devolution and Decentralisation will increase substantially – The trend towards devolution of powers not only to the State
Governments (e.g. the proposed GST) but also PRIs and
9th September,2010 Strategic Plan‐2020 prepared by Group of Officers Page3
ULBs
will gain momentum. Also, decentralization of programme implementation (through
NGOs, civil society organizations, as well as quasi‐ government organizations,
Govenrment/ NGO partnerships) will continue2 to gain
pace.
·
Information Technology will be used in an integrated fashion to
drive governance and empower the citizen – Although IT has made considerable inroads into many
Government Departments and Ministries, it has
been implemented, by and large, in a fragmented fashion and provision of
e‐governance services to citizens has been very limited in scope. IT is still
not as critical to or integrated into Governmental operations, as in the Indian
corporate sector. Over the next ten years, with the implementation of various
e‐governance initiatives/ missions, introduction of Unique Identification for
citizens, leveraging of GIS and other technologies, and better integration with
mobile technology (which represents the most accessible technology for the
common citizen), we expect that IT driven governance in 2020 will reach at
least the current levels prevalent in developed countries, if not surpassing
them. Citizens – rich and poor – will be far more empowered to hold Governments
and Government officials accountable for delivery (or non‐delivery) of mandated
services.
·
Sustainable Development and the Rights of Underprivileged Groups
will become larger concerns – With the increased role for private players, conflicts
between the rights of
private parties as well as those
of society will continue to increase (as is to be expected in a vast, diverse
and yet democratic nation like India). Ensuring sustainable development (while
minimizing the adverse impact on environment) and protecting/ promoting the
interests of underprivileged groups in society will become larger concerns, and
the role of NGOs and civil society organizations in promoting greater public
debate on these issues will increase. Governments will have to play an
increasingly sensitive role in managing these conflicts, and balancing the
interests of all parties.
·
Fraud, Corruption and Waste will continue to remain key concerns
– Notwithstanding projections of economic growth and
improved governance structures, fraud, corruption, waste and other financial
irregularities (which have been longstanding concerns of not only the IAAD but
also the CBI and CVC) will continue to remain key concerns.
These trends in governance will have serious
and long‐term implications for our strategic audit approach, which will have to
adapt to newer methods of programme and service delivery, while at the same
time retaining our focus on fraud, corruption and related issues.
1.4 Need for a
separate Strategic Plan 2020 for IAAD
2 Notwithstanding our concerns on the weakened structures for
accountability and financial management
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In this context, there is a need for an
overarching framework which would provide direction and guidance on all
significant areas for a longer time horizon (10 years or more). For example,
the changes proposed in terms of Human Resources management as well as audit
integration will take longer than a 3‐5 year time frame (which is the normal timeframe
for other plans)for being fully operationalised, and for benefits to be derived
from such changes to be fully achieved. This Strategic Plan‐ 2020 for IAAD
seeks to fulfil this need.
Hierarchy of Plans
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2.1 Terms of
Reference
In March 2010, the CAG had indicated that the
vision and mission statements for the IAAD were being revisited, and a
Strategic Plan was necessary in order to realize the vision and elaborate on
the activities that would flow from the mission. The Strategic Plan is expected
to provide direction to the Department for the next ten years, and would cover
both audit and accounts/ entitlement functions. A working group, consisting of Shri KR Sriram, Shri RG Viswanathan, Ms. Rebecca Mathai,
Shri YN Thakare (Convenor), Shri
Anadi Mishra, and Ms. Vidhu Sood, was
constituted to come up with a Strategic Plan
that was in consonance with the existing/
proposed legislative mandate.
2.2 International
Practices
In
order to consider the international practices followed in corporate planning,
the group reviewed the strategic / corporate plans of several SAIs – USA, UK,
New Zealand, Canada, Australia,South Africa, and Ireland. The practices
followed by different SAIs for corporate planning varied widely, as summarized below:
·
The US
GAO’s Strategic Plan was predominantly a strategic audit plan – three out of
four top‐level strategic plans were “external” goals, while only one goal was
an internal goal focused on “achieving results that are unmatched by any other
accountability organization in the world”. The corporate plans of the other
SAIs did not, however, spell out their audit focus areas in detail.
· Most of the strategic plans were for periods ranging from three to six
years.
·
The mix of
performance and financial audit in the corporate plan varied from SAI to SAI.
The US GAO is predominantly performance audit oriented, while UK and New
Zealand are financial audit focused (New Zealand allocates 87 per cent of its
resources to financial audit). None of the developed country SAIs had anything
similar to our transaction/ compliance audit – they had either financial audit
or performance / VFM audit.
·
Most SAIs
conducted formal periodic surveys of their stakeholders (Legislature/
Executive) to take into consider their requests for audits, and also obtain
feedback about the quality of their audit products. In fact, between 86 to 94
per cent of GAO’s programme audits were undertaken in response to legislative
requests.
·
Other SAIs
treat all their outputs (audit opinions on financial statements, VFM/ program
evaluation reports, legislative testimonies, briefings to Congressional
assistants etc.) as audit products. In contrast, our general position is that
Inspection Reports represent only a set of preliminary audit findings, rather
than a stand‐alone audit product.
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·
All SAIs
used their Annual Performance Report (or equivalent document) as a tool for periodic
reporting of progress vis‐à‐vis the goals and targets stipulated in the
Corporate/ Strategic Plan.
2.3 Scope and
Coverage of Strategic Plan – 2020 for IAAD
The Strategic Plan ‐ 2020 should form the
overarching framework for planning in the IAAD. This will have to be supported
by detailed functional plans over a fiveyear time horizon ‐ a Strategic Audit
Plan; a Strategic Plan for Accounts and Entitlements; HR and Infrastructural
Support Plan etc. Annual Plans for different offices will have to be derived
from these detailed functional plans, and should be in consonance with the
overall Strategic Plan.
2.4 High Level
Strategic Goals
The high‐level strategic goals indicated in
this Strategic Plan are summarized below:
Goal 1
|
–
Integrating audit efforts
|
Goal 2
|
–
Promoting professionalism in public
|
sector
auditing
|
|||
Goal 3
|
–
Improving communication with
|
Goal 4
|
–
Enhancing audit effectiveness and impact
|
stakeholders and ensuring higher visibility
|
|||
Goal 5
|
–
Improving delivery of accounting and
|
Goal 6
|
–
Improving HR management
|
entitlement functions
|
|||
2.5 Mechanism for
Implementation and Monitoring
For
operationalising the Strategic Plan‐2020 (after its approval), a full‐time
Strategic Planning Group (headed by a DG/PD, and with two Directors) needs to
be created. This group will be responsible for finalizing the detailed
implementation (for approval by the competent authority), and monitoring its
roll‐out in a phased manner.
For ensuring effective monitoring of
implementation of the Strategic Plan ‐20203, formal
mechanisms for monitoring are essential:
·
Performance
measures for each goal, along with associated timelines, need to be finalized.
An indicative set of performance measures and timelines is indicated in
Annexe‐3; these will need to be firmed up and approved.
· An annual review by IAAD top management of
implementation of the goals and objectives should be conducted, with decisions
on corrective measures to be taken.
3 As well as the Perspective Plan 2010‐15
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·
The Annual
Performance Report should be re‐oriented from reporting activities in different
areas (auditing, accounting, budget, personnel) to reporting performance
vis‐à‐vis the laid down goals and objectives; this can be supported by internal
half‐yearly reports.
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