Ministry of Defence

ArmyAir Force

NavyCoast Guard

Ordnance FactoriesBorder Road Organisation

Defence Research & Development OrganisationIndian Defence Estates Services

Indian Defence Accounts ServicesDefence Secretariat Service

Department of Defence Production

Integrated Financial Advice and Control• Ministry of Defence and the Services have a full-fledged internal

financial control system in place headed by the Secretary (Defence Finance)

• This responsibility is discharged through the Defence Accounts Department with the Controller General of Defence Accounts as its head.

• Scrutinize all proposals involving expenditure from the Public Fund.

• Provide financial advisory services to Ministry of Defence and the Services at all levels

• Treasury control of the Defence expenditure.• The internal audit and accounting.

Financial Aspects and Budgetary Management• The budgetary allocations of the Ministry of Defence are

contained under eight Demands for Grants of which six grants are included under Defence Service Estimates and two under Civil Grants.

• Civil Grants – Demand No. 20 - Ministry of Defence (Civil) – Demand No. 21 - Defence Pensions.

• Defence Service Estimates– Demand No.22, Defence Service - Army– Demand No. 23, Defence Services - Navy– Demand No. 24, Defence Services - Air Force– Demand No. 25, Defence Ordnance Factories– Demand No. 26, Defence Services - Research & Development– Demand No. 27, Capital Outlay on Defence Services –Includes all Services

and Departments other than those covered above

Budget allocation and Actual expenditure (Rs. in Crore)

• Year Budget Provision Actual Expenditure

• 2008-09 1,25,414.04 1,18,006.03• 2009-10 1,48,499.26 1,45,781.04• 2010-11 1,56,126.83 1,58,723.20• 2011-12 1,78,891.06 1,75,897.94• 2012-13 1,98,525.90 1,87,469.00

Army Commands•HQrs Northern Command, Jammu•HQrs Western Command, Chandimandir•HQrs Eastern Command Fort William Kolkata•HQrs Southern Command, Pune•Central Command, Lucknow•HQrs South Western Command Jaipur•Army Training Command Shimla•Andman and Nicobar Command Port Blair•Each command is headed by General Officer

Commanding-in-Chief of the rank of Lt General

Army structure• Each Command has 3 Corps commanded GOC (Corps

Commander) - Lt General• Each Corps is composed of 3-4 Divisions commanded by GOC

(Div Commander) – Major General• Each Div has 3-4 Brigade consisting of 3000 combats

commanded by Brigadier• Each Brigade has three Bn each commanded by Colonel• Each Bn has four companies commanded by Major or Lt Col • Each Company has three platoon commanded by JCO• Platoon composed of three sections each of 10 personnel

commanded by Havaldar• Striking Corps 1,2, 21 (Pakistan facing) and 17 (China Facing)

Pannagarh at present at Ranchi•

Infantry Regiments

Brigade of the Guards, KamptiParachute Regiment, BangloreMechanised Infantry Regiment, Ahmed NagarPunjab Regiment, Ramgarh JharkhandThe Madras RegimentThe GrenadiersMaratha Light InfantryRajputana Rifles, Delhi CanttRajput RegimentJat RegimentSikh RegimentSikh Light InfantryDogra RegimentThe Garhwal RiflesKumaon Regiment Assam RegimentBihar Regiment

Mahar RegimentJammu & Kashmir RiflesJammu & Kashmir Light InfantryNaga Regiment1 Gorkha Rifles (The Malaun Regiment)3 Gorkha Rifles4 Gorkha Rifles5 Gorkha Rifles (Frontier Force)8 Gorkha Rifles9 Gorkha Rifles11 Gorkha RiflesLadakh ScoutsRashtriya RiflesArunachal ScoutsSikkim Scouts Ladakh Scouts, 

Artillery, and Armoured Regiments

Military Engineer ServicesArmy Medical CorpsMilitary Dairy FarmsArmy Ordnance CorpsDirectorate General ResettlementDirectorate General Defence EstatesDirectorate of Public RelationsCanteen Stores DepartmentArmy Purchase OrganisationServices Sports Control BoardDirectorate General Quality AssuranceArmed Forces Films and Photo DivisionHistory Division, Ministry of Defence

College of Defence ManagementBorder Roads Development Board/ Border Roads OrganisationArmed Forces Supply CorpsStation HQrsNCCArmy Education CorpsArmy Armoured CorpsArmy Corps of Signal

Auxiliary services

Education & Training

Armed Forces Medical College, PuneRashtriya Military School, Ajmer Rashtriya Military School, BangaloreRashtriya Military School, Balgaum Rashtriya Military School, ChailDholpur Military SchoolRashtriya Indian Military College, DehradunSainik School Amaravathinagar,(Tamil Nadu) Ambikapur, (Chatisgarh), Balachadi, Jamnagar BhubaneswarBijapur,(Karnatka) Chittorgarh, Ghorakhal, (Nainital) Goalpara (Assam), Kapurthala , Kazhakootam( Thiruvananthapuram), Kodagu(Karnatka), Korukonda (Vizianagaram AP), Kunjpura (Karral), Lucknow Manasbal, Nagrota, Nalanda, Punglwa (Peren, Nagarland), Purulia, Rewa, Sujanpur Tihra (Near Distt Harmirpur HP, Tilaiya (Jarkhand)

TriService Defence Services Staff College, Wellington National Defence Academy, KhadakwaslaNational Defence College, New Delhi

Indian Army Army Cadet College, (Siachen Battalion) DehradunArmy War CollegeCollege of Military EngineeringCounter-Insurgency and Jungle Warfare SchoolVairengte Mizoram High Altitude Warfare SchoolIndian Military AcademyMilitary College of Telecommunication EngineeringOfficers Training Academy

Air Force Air Force AcademyIndian Air Force Test Pilot School

ArmyLieutenant 15600-39100 5400

Captain 15600-39100 6100

Major 15600-39100 6600

Lt Colonel 37400-67000 8000

Colonel 37400-67000 8700

Brigadier 37400-67000 8900

Major General 37400-67000 10000

Lt. General 67000 (AI @ 3%)- 79000 Nil

Vice Chiefs/ Army Commander 80000 (Fixed)

Chief of Army Staff 90000 (Fixed)

Military Service Pay Rs.6000 upto rank of Brigadier

Pilot Officer

Flying Officer

Flight Lieutnant

Squadron Leader

Wing Commander

Group Captain

Air Commodore

Air Vice Marshal

Air Marshal

Air Chief Marshal

Airman

Leading Aircrafts man

Corporal

Sergeant

Junior Warrant Officer

Warrant Officer

Master Warrant Officer

AIR FORCE

Admiral

Vice Admiral

Rear Admiral

Commodore

Captain

Commander

Lieutenant Commander

Lieutenant

Sub-Lieutenant

Indian Navy

Four ServicesIndian Army Indian Air Force Indian Navy Coast Guard

Field Marshal Marshal of the Air Force Admiral of the Fleet

General Air Chief Marshal Admiral Director General

Lieutenant General Air Marshal Vice Admiral Additional Director General

Major General Air Vice Marshal Rear Admiral Inspector General

Brigadier Air Commodore Commodore Deputy Inspector General (Senior)

Colonel Group Captain Captain Deputy Inspector General (Junior)

Lieutenant Colonel Wing Commander Commander Commandant

Major Squadron Leader Lieutenant Commander

Commandant (Junior Grade)

Captain Flight Lieutenant Lieutenant Deputy Commandant

Lieutenant Flying Officer Sub-Lieutenant Assistant CommandantKodandera Madappa Cariappa and Sam

Maneksha Arjan Singh

Army Pay Band Grade Pay Air Force NavySepoy 5200-20200 1800 Airman Seaman II

Lance Naik 5200-20200 2000 Leading Aircraftsman Seaman 1

Naik 5200-20200 2400 Corporal Leading Seaman

Havaldar 5200-20200 2800 Sergeant Petty Officer

Nb Sub 9300-34800 4200 Junior Warrant Officer Chief Petty Officer

Subedar 9300-34800 4600 Warrant OfficerMaster Chief Petty Officer (2nd Class)

Sub Major 9300-34800 4800 Master Warrant Officer Master Chief Petty Officer (1st Class)

In addition MSP @ Rs. 2000/- pm

Comptroller & Auditor General of India

Defence AuditStates Audit

Post & Telegraph AuditRailway Audit

etc

Supreme Audit Institutions• Regularly reviewing the work of internal auditors

and helping improve the overall quality of the oversight function ƒ

• Cooperating with internal auditors in planning audit coverage and using the work of the internal auditor, wherever feasible, to reduce duplication and

• Impressing upon governments the criticality of the internal control function, including the role of internal audit therein

Authority for Audit• The authority for our audit is derived from Articles

149 and 151 of the Constitution of India and the Comptroller and Auditor General’s (Duties, Powers and Conditions of Service) (DPC) Act, 1971.

• We conduct audit of Ministries/Departments of the Government of India under Section 13 of the CAG’s (DPC) Act.

• Major Cantonment Boards are audited under Section 14 of the said Act.

• Principles and methodology of compliance audit are prescribed in the “Regulations of Audit and Accounts, 2007”.

Planning and Conduct of Audit• Risk assessment of the Organisation based on

– expenditure incurred,– criticality and complexity of activities, – level of delegated financial powers, – assessment of overall internal controls, and concerns of

stakeholders. – previous audit findings

Contd…

• Local Test Audit Reports (LTARs) containing audit findings are issued to the Head of the unit.

• Furnish of replies to the audit findings within a month

• Important audit observations arising out of these LTARs are processed for inclusion in the audit reports.

• The reports are submitted to the President of India under Article 151 of the Constitution of India.

• The primary purpose of the report is to bring to the notice of the legislature

•Important results of audit. •Commensurate with the volume and magnitude of transactions.

• Enable the Executive to take corrective actions as also frame policies and directives that will lead to

•Improved financial management of the Organisations, thus contributing to better governance and improved operational preparedness.

Five Tier Classification• Sectors

Major Heads (Sub-Major Head in case of Capital Outlay)Minor HeadsSub-HeadsDetailed Heads

Scrutiny and Certification of Appropriation Accounts of the Defence Services

• The number and/or nomenclature of the Grant/Appropriation have been mentioned correctly;

• The heads of account mentioned in the Accounts are authorised ones

• The sub-heads have been grouped separately in the ‘Revenue’ and ‘Capital’ Sections and ‘Charged’ and ‘Voted’ figures have been shown distinctly

• The original provisions, supplementary provisions and amounts re-appropriated or surrendered have been exhibited correctly

• Gross figures of expenditure have been adopted in cases where recoveries by debit to heads of account under a different Grant/Appropriation are adjusted in reduction of expenditure

Contd…• Excesses and savings have been explained in all cases

according to the monetary limits prescribed and wanting information, if any, has been called for

• The facts and figures mentioned in various “Notes” are correct• The grant-wise details of estimates and actual recoveries

adjusted in reduction of expenditure have been prepared correctly

• the amounts exhibited in the accounts tally with those shown in the Finance Accounts; and the amounts shown in the Grant Summary of Appropriation Accounts agree with grant-wise details of recoveries, and reconciliation of the expenditure in the Appropriation Accounts with that reflected in the Finance Accounts has been worked out correctly in the Grant Summary

Contd…• Whether all-important variations under the units of

appropriation have been explained• Whether any explanation requires modification or comment

as a result of audit• Whether the re-appropriation of money from one head to

another is as per rules in vogue• Funds should not be appropriated or re-appropriated to meet

the expenditure on New Services/New instrument of Services etc

• Whether there is any rush of expenditure in the March, i.e; the closing month of the financial year

• Surrenders have been made in time wherever foreseen without waiting till the end of the financial year to meet the requirements of possible future excesses

Contd…• All re-appropriations exceeding the limit of 25 per cent of

Budget Estimates or Re. 1 crore or more under a sub head, had the prior approval of Secretary (Expenditure)/Additional Secretary (Expenditure), Ministry of Finance

• Whether all such re-appropriations had been reported to the Parliament along with the last batch of Supplementary Demands for grants for their reflection in the Annexure to the last batch of Supplementary Grants

• In terms of Rule 56(3) of General Financial Rules, 2005, rush of expenditure, particularly in the closing months of the financial year, shall be regarded as a breach of financial propriety and shall be avoided.

• Rule 58(1) of General Financial Rules 2005 enjoins that a subordinate authority incurring the expenditure will be responsible for ensuring that the allotment placed at its disposal is not exceeded.

• Non-inclusion of Value Added Tax in the quote resulting in non recovery of Value Added Tax / Central sales Tax paid – Rs. 5.51 crore by BEML

• Non-recovery of Statutory duties (Excise Duty) of Rs1.31 crore from MoR by BEML. The duty was levied during period of supply

False claim of Dip MoneyAll qualified divers of the Indian Navy, belong to a specialised cadre, and are entitled to “Diving Allowance” and “Dip Money”. Indian Naval Diving Team (INDT), Delhi is equipped with one ReCompressed Chamber of a capacity of eight divers to facilitate practice diving. However, between September 2008 and July 2011, on more than one occasion, 9 to 65 divers simultaneously were indicated to have made practice diving in a chamber with a capacity of only eight divers. Weak internal controls, improper document maintenance and falsification of official records at INDT (Delhi) led to an incorrect payment of Rs.10.24 lakh as Dip Money.

Inadmissible payment of Bonus

Irregular payment of Field Service Allowances

Undue benefit of Rs.0.68 crore to private firms due to non-recovery of Service Tax by VRDE and payment of the same out of Resource Generation Fund

Irregular payment of interest on procurement of Bofors Guns/ Ammunition

Scale of AccommodationScale of Furniture

Ration ScaleAmmunition Master Key

Peace Establishment/War EstablishmentMilitary Service Establishment RegulationPay & Allowances Regulation for JCOs/ORsPay & Allowances Regulation for the Officer

Armed Forces Ordnance RegulationPurchase Manual

General Financial RulesDefence Account Code

Classification Hand Book Defence Services

Books