Full Form of CAG

Updated on April 17, 2024
Article byWallstreetmojo Team
Edited byWallstreetmojo Team
Reviewed byDheeraj Vaidya, CFA, FRM

What Is The Full Form Of CAG?

The full form of CAG stands for “Comptroller and Auditor General of India.” Established by article 148 of the Constitution of India, CAG is an authority that audits the receipts and expenditures of the Indian government and the state government, including institutions, authorities, and bodies that the government majorly finances, also acting as an external auditor to government-owned companies and supplementary auditor of government companies and major subsidiaries of the government companies.


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The CAG has been instrumental in bringing out some of the most debated reports, including the 2G spectrum allocation report, the coal mine allocation report, and the Fodder Scam. These reports have led to numerous litigations, cancellations of licenses, and convictions of prominent figures in politics and business.

Key Takeaways

  • The CAG, “Comptroller and Auditor General of India,” is a constitutional body mandated by Article 148 of the Indian Constitution. 
  • It holds the responsibility of auditing government finances, serving as an external auditor for government-owned enterprises and significant subsidiaries.
  • Governed by the regulations of the Companies Act of 1956, the CAG conducts audits of government companies.
  • It plays a vital role in verifying the accuracy of financial records of both government bodies and organizations. Upholding stringent audit standards is essential to ensure the integrity of financial reporting.

Full Form Of CAG Explained

The full form of CAG is Comptroller and Auditor General, who is a constitutional authority and holds a high position in many countries. The position of a CAG is that of a government official who acts independently and also has the official responsibility of auditing and supervising the financial transactions and accounts and related operations of the government.

The full form of CAG audit functions are important in various ways. It is responsible for conducting the auditing of the different government departments, different government agencies and the various public sector undertakings so as to ensure that these organizations are complying with the rules, regulations and procedures that are to be followed as part of the government body. It plays a very important role in assessing whether the resources of the public and the government are properly utilized or not. To ensure optimum use and prevent any unnecessary wastage in the process, it supervises the government activities and programs to evaluate the efficiency level and the effectiveness of implementation of rules, regulations and adherence to the laws.

It also has the responsibility of making the reports based on the auditing done and submit it to the relevant authority like the legislative body or the parliament. The report highlights all the loopholes, frauds, mismatch, irregularities, financial mismanagement and any other inefficiencies that has come to light in the process. Thus, this position has the power and the right to hold the government responsible and accountable for its financial management decisions through the full form of CAG report and assess the situation independently and objectively.

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Duties And Powers?

The CAG has wide-ranging duties and powers, from compiling accounts to auditing and detecting fraud. Here are the major duties and powers.


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#1 – Compile Accounts of Union and States

The CAG is required to compile the Union and State governments’ accounts from the initial and subsidiary accounts. The initial accounts are kept with treasuries, offices, or departments of central and state governments, which are furnished to the Comptroller and Auditor General of India for compilation.

#2 – Prepare and Submit Accounts

After compiling, the CAG prepares and submits the accounts to the President, Governors of States, and Administrators of Union Territories having Legislative Assemblies, detailing the receipts and expenditure of the state and union government bodies.

#3 – Auditing Accounts

He is duty-bound to audit the accounts furnished to it by the government, government bodies, and companies to ascertain that the receipts and expenditures mentioned in the account are true to their nature. He audits whether the expenditures mentioned in the accounts have been disbursed for the applicable purpose and cause. Thus the full form of CAG audit function is very important.

#4 – Audit of Bodies or Authorities

The CAG audits receipts and expenditures of bodies or authorities majorly financed from Union or State revenues. These bodies and authorities get loans and grants from the State and Union fund and have to be audited to ensure the proper use of the funds granted.

#5 – Auditing powers of the CAG

The Comptroller and Auditor General of India have the authority to 1) inspect any office of accounts controlled by the Union or State government, including treasuries and offices responsible for the keeping of initial or subsidiary accounts, 2) call for accounts, books, paper, and documents concerning the audit to be furnished at his appointed place of inspection, 3) question the people in charge of preparing the initial accounts, or ask for more information to perform the audit.

#6 – Auditing the Government Companies

The CAG should perform the audit of government companies following the provisions of the Companies Act, 1956.

#7 – Furnish Reports to Concerned Governments

The CAG should furnish the audit reports on state and union finances and government companies to the concerned government (state or union) to be tabled in the parliament and respective legislative assemblies.

#8 – Audit of Accounts of Certain Authorities or Bodies

The CAG must audit certain authorities and bodies that have not been entrusted to it if requested by the President of India, union or state government, or other administrative bodies.

#9 – Power to make Rules and Regulations

The Union Government, after consultation with the CAG, can make rules for the maintenance of accounts by government bodies and authorities to be followed by their treasuries and accounting departments for appropriate furnishing of their accounts for compiling and auditing by the CAG. He is also authorized to make regulations concerning the applicability of the act under which it is governed.


The role is to ensure that the Union and State accounts are in order and free from misappropriations and errors.

  • The CAG audit provides the requisite credibility to the books of accounts of the governments and their organizations. The role is to ensure the highest standards of audits are applied to maintain the credibility of accounts.
  • The Comptroller and Auditor General of India can not ask for details on the secret service expenditure and has to rely on a certificate entailing that the expenditure has been incurred under the authority of a competent administration.
  • He can also perform a propriety audit to ascertain the relevance (wisdom, faithfulness, and economy) of the governments and their bodies’ expenditures and point out wasteful expenditures. This is a mere obligation and not a legal or regulatory requirement.
  • He also has a role in prescribing best practices in accounting and reporting for the authorities to represent these bodies’ best nature of receipts and expenditures.

Reports Filed

The Comptroller and Auditor General of India file the following three audit reports tabled before appropriate legislative assemblies, including the parliament.

  • The full form of CAG report concerning appropriation showing the grants and loans rendered from the state and union finances are used for the envisaged purposes by bodies and authorities.
  • Audit report on state and union finances, including their receipts and expenditures, furnished to the respective state governments and the central government.
  • Audit reports concerning the state of accounts of the companies controlled by the state and central government either jointly or in isolation.

What Is The Salary Of CAG?

Comptroller and Auditor General of India Salary

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The CAG is paid a salary equal to that of the Judge of the Supreme Court. They receive Rs. 3,00,000 as an annual salary (Rs. 25,000 per month). Additional perks are over and above the salary received by the CAG.

Who Is Currently The Comptroller And Auditor General Of India?

The current CAG of India is G. C. Murmu, appointed on August 8, 2020. He is the 14th Comptroller and Auditor General of India. Also, he serves as the external auditor of the Inter-Parliamentary Union.

Frequently Asked Questions (FAQs)

1. Is the CAG of India an IAS officer?

The CAG is typically a senior bureaucrat who holds a constitutional position and oversees the audit and accounting functions of the government. While some CAGs may have a background in the civil services, particularly the Indian Audit and Accounts Service, they do not necessarily hold an IAS degree specifically. The CAG is appointed independently and is not part of the bureaucratic hierarchy.

2. Who appoints the CAG of India?

The President of India appoints India’s Comptroller and Auditor General (CAG). The appointment is made based on the recommendation of the Prime Minister and is subject to approval by both houses of Parliament.

3. How can the CAG be removed?

The CAG of India can only be removed by an order of the President, similar to the removal process of a judge of the Supreme Court. However, this removal can only happen under specific circumstances, such as proven misbehavior or incapacity, and following a process that includes an inquiry by the Supreme Court.

Recommended Articles

This has been a guide to what is the Full Form Of CAG. We explain which are the reports, duties & powers, role and salary. You may refer to the following articles to learn more about finance –

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