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This Report contains observation on Panchayati Raj Institutions (PRIs) and includes three chapters. Chapter-I includes ‘An overview of the Functioning, Accountability Mechanism and Financial Reporting Issues of Panchayati Raj Institutions’. Chapter-II comprises of Perfomance Audit on ‘Implementation of Border Area Development Programme’ and ‘Functioning of Member of Legislative Assembly Local Area Development Scheme’. Chapter-III comprises of four paragraphs noticed during Compliance Audit.