Fin Secy Somanathan bats for change in CAG's performance audit culture

In a bid to restore confidence in decision-making among bureaucrats, Finance Secretary TV Somanathan advocated for a change in the performance audit culture of the Comptroller and Auditor General (CAG) of India.

Mandated by the Constitution of India, CAG conducts auditing and accounting of a government's balance sheet to provide information to the legislature, the public and the executive on whether public funds are being collected and used effectively and efficiently.

"In performance audit, the auditor has the benefit of hindsight, which the executor of the project did not have. This is a source of a lot of internal second-guessing in government because people do not want their names to appear in that CAG report. We need to change our audit approach so that whether a thing was done properly or not must be evaluated against the information, technology, the knowledge available to the decision maker at the time of taking the decision. With that knowledge, with that information was the decision reasonable or unreasonable?" he said at an event on February 27.

The finance secretary said, If through such a process, a decision is found to be unreasonable, it should certainly be criticised, but if it was reasonable in the facts and circumstances then probably that should not figure as a criticism of a decision taken.