The audit of Railways is conducted under the authority of the Comptroller and Auditor General of India (CAG) in accordance with Articles 148 to 151 of the Constitution of India and the CAG’s (Duties, Powers and Conditions of Service) Act, 1971.
The scope of audit conducted by the Office of the Principal Director of Audit includes examination of:
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Revenue from passenger, freight, parcel and other commercial activities
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Expenditure on works, procurement, establishment and pension
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Works and Projects, including new lines, track renewals, electrification and infrastructure development
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Stores and Inventory Management, including material accounting and disposal of scrap
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Contracts and Tenders to ensure compliance with rules and procedures
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Performance of schemes and programmes to assess economy, efficiency and effectiveness
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Information Technology systems and internal controls
Audit is carried out through compliance audit, financial audit and performance audit with a view to ensuring financial propriety, transparency and accountability in the functioning of Railways.