SAI is established under a constitution. SAI's head is appointed by His Majesty on the recommendation of the Constitutional Council. Constitutional Council is headed by the Prime Minister and other members, which consisted of Chief Justice of Supreme Court, Speaker of the House of Representative, Chairman of the National Assembly i.e. Upper House and Leader of the main opposition party in the House of Representative.
Head of SAI can be terminated as follows :
Qualifications for the appointment of the Head of SAI are :
SAI's head is appointed for a fix tenure of 6 years or upto the age of 65 years.
The Various conditions of service of the head of SAI to secure independence are
The SAI's relationship with other branches of Government is as the Auditor and Auditee. The constitution has articulated that all expenses of the AG/N are borne from the Consolidated Fund (not votable by the parliament). The head of SAI can be removed by passing a resolution with a two-third majority of total number of members of The House of Representative against his incompetence, misbehavior or failure to discharge the duties of his office in good faith and resolution is approved by His Majesty
SAI's Jurisdiction extend to the following:
There are no limitations imposed in SAI's jurisdiction. SAI has jurisdiction over the following:
SAI has powers of requisitioning all records of the auditee departments/organizations to discharge its mandate, as per article 100 (3) of the Constitution of Kingdom of Nepal 1990. SAI has power to enforce or initiate enforcement action to secure access to needed records, which are not produced. As per Audit Act 1991 (clause 9), the Auditor General may, subject to the Constitution of the Kingdom of Nepal 1990, As per Section 19(1), (2) and (3).
SAI has power to seal , search & seize documents & other related items where it is considered necessary for its audit and inspection. SAI has powers to seek testimonials of the persons concerned under the article 100 (3) of the Constitution of Kingdom of Nepal 1990. SAI does not have powers to seek co-operation of persons other than the agencies subject to audit and inspection for presenting materials or provide testimonials necessary for its audit and inspection. SAI has no powers of instructing government investigating agencies to perform activities considered necessary. If the Auditor General feels necessary, he could instruct Department of Special Police and also he could advise Commissioner of Commission for Investigation of Abuse of Authority for carrying out necessary investigation.
Auditor General deserves all rights to re-examine the irregularities and discrepancies. However, such re-examination process will be done after settlement of irregularities/discrepancies upon the request of auditee with the inclusion of relevant documents along with decision, which satisfies the Auditor General or his assistance. SAI has no powers to decide on claims of interested persons in connection with official actions, duties and behaviors of persons subject to audit and inspection. SAI has the authority to dispense with, in whole or part, the audit of Federal, Provincial and local Governments accounts and other related matters. The auditor General may conduct final audit of the financial activities and other activities. SAI can not take punitive action and/or impose surcharges.
SAI has powers to access the computer systems of the auditees and the power to download and use electronic date either in site or off site. SAI has powers to review the development of computer systems by auditees and suggest/enforce any controls.
SAI prescribes Financial audit, Compliance audit, Performance audit and EDP audit as its scope of audit. The powers to perform various types of audits are mandated in the Constitution of Kingdom of Nepal 1990, article 100 and the Audit Act 1991. SAI conducts Concurrent audit and Special audit about special issues, agreements, decisions etc.
SAIs basic methodology/procedure for the audit comprised of the following steps:
Execution Stage: In this stage, a detailed examination will be conducted testing transactions, various aspects of the issues/entity that identified as MOPS. In this stage, supervisions will also be made by the Assistant Auditor General and thereby the Deputy Auditor General.
Reporting Stage: Upon the completion of the above stage, preliminary report will be prepared which will be ratified reveiwed and ratified by the Assistant auditor general before sending the Management letter. After receiving the management comments, the report will be finalized.
SAI does not discharge judicial functions. Follow-up improvements in audit findings will be done by the Auditor General and the auditee management takes necessary actions. The Office of the Auditor General (OAG/N) is committed to promote the INTOSAI directives, standards and manuals. SAI can consult and/or collaborate with other countries/SAIs and international organisations on matters relating to audit. SAI can engage consultants and/or obtain professional services in conducting audit under the section 3 (2) of the Audit Act 1991. SAI can report on acts that infringe upon State economic interests like mass embezzlement of state assets, serous losses and wastes. The Audit Act 1991, section 8 has provided that the Auditor General may to submit the report at any time.
Generally, SAIs audit findings are reported in two phases.
Volume - II is report on performance audit.
Volume - III is reports on Corporate Bodies, Committees/Boards and Autonomous Bodies.
Executive Summary: Comprises essence of all volumes along with key findings and recommendations.
SAI Auditor General deserve the authority to disposal or settle the audit findings. SAIs Preliminary Report is issued to each concerned audit entity after concluding audit work, which contains detailed description of audit observations. SAI has power to share its audit reports with the public and media after submitting the report to His Majesty and tabling it in the Parliament.
SAI does not have the powers to amend accounts in the case of Financial Statement audits. SAI has an advisory role.
SAI constituted as an audit office with monocratic status i.e. with an Auditor General on equivalent as head. It is Board Of Audit. Auditor General is a constitutional body and treated equally as the Chief Commissioner for Commission for Investigation of Abuse of Authority, Chairman of Public Service Commission. SAIs main functions are to determine audit policy, plan and strategies, audit program, action plan and reporting. Also as the chief could also be involved in day to day functions of SAI.
SAI has jurisdiction over both Federal and Provincial governments with Organic links between the Central Audit Office and the Provincial Audit Office. SAI is empowered to engage external auditors/agencies/consultants as required.
SAI Can expend resources budgeted independently. SAI has full independence in forming its work-plan. Recruitment of employees is vested under the jurisdiction of Public service commission. The number of such employees shall not be reduced without the approval of the Auditor General. A separate cadre of officers and employees is constituted in the Office of the Auditor General. The recruitment and other conditions of services of the officers and employees within the cadre shall be as prescribed in the Rules to be framed under the audit act 1991 section 9.The SAI is not subject to an independent audit. SAI is required to submit a report on its activities to His Majesty the King.