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Review of Internal Audit mechanism in DOP (Department of Posts) | Post Office Internal Audit Mechanism

 F. No 1-2/2021 -IA Ministry of Communications Department of Posts (Internal  Audit Division) PA  Wing: Dak Bhawan New  Delhi-110001 OFFICE MEMORANDUM Dated:      21/10/2021.

Sub: Review of Internal  Audit mechanism in Department of Posts.

Consequent  upon  induction  of technology  and  roll out of ERP application,  defining the role of Internal  Audit  and  the  method  of carrying  out  Internal  Audit  has  been  under  consideration. Rules. procedures and the Role of staff of PAOs for discharging duties in  proper accounting and apply  such  checks have been  categorically  defined  in the revised  Postal Accounts Manual  Vol I and  Vol  II.  Similarly,  the  manual  of Internal  Audit  questionnaire  was also  issued  to all Postal Accounts Offices in the month of Aug, 2021.

Further. in order to strengthen  the internal audit process and  to activate accounts inspection at units wherein  huge transactions occurs and also to set right the omissions on the spot as far as possible  by  providing  proper  guidance  to  end  users;  following  set  of  instructions  are  hereby issued for  information and compliance  by all concerned  effective from 1st Jan,2022.

1.       Detailed   role  of  Accountants   in  PA  section   has  been  defined   in  Chapter  III of  Postal Accounts  Manual  Vol  I  edition  2021 .  While  exercising  checks  on  various  accounts  vouchers and  systems returns,  any discrepancy  or inconsistency  is noticed; objections should  be raised and review   register  submitted   to  Branch  officer.    In  case.  the  same  is  not  attended  or  rectified, reference  should   be  issued   to  Head  of  Office  and  Regional   PMG/CPMG   concerned.   If,  the discrepancy.   omission   or   wrong   booking   etc   still   not   corrected   &   persists,   the   detail   of discrepancies/objections  shall  be  transferred   to  IA  section  of  PAO,  which  will  further  pursue such  objections  till  the end of following  month  of the objections  raised  and  thereafter  shall plan an audit  of the  unit concerned  nominating  the concerned  accountant  as a member of the Internal Audit  team.  

Such  teams shall  be  led  by  an  AAO. The IA team  visiting  the field  units shall  focus on  settlement  of maximum  irregularities on  the  spot  and  shall  include  the status of paras raised, settled  and  pending.  Such  team  shall  submit  special  report  of  work  done  by  them  at  units  and nature of action taken by them. These  visits will  be in addition  to normal  planned annual Internal Audit  Inspections of the PAO concerned.

Each  PAO shall  undertake  the  Internal  Audit  of DDOs/NCDDOs  and  other  administrative units  under  their accounts jurisdiction  once  in  a  year.  At  least  50% of the  units  under  the PAOs concerned  shall  be  audited  by  the  teams  from  outside  the  Circles  PAOs.  Out  of composition. 50% of team  shall  concentrate  on settling  the pending  paras. Circle PAOs & CPMG offices shall be audited  by  other nearby  Circle PAO as intimated  by Dte from  time to time.

2.  Internal  Audit  by the  AOs/AAOs  posted  in Circle Office  & Regional  offices:- In order to further  strengthen  the  Internal  Audit  mechanism,  the  Accounts  officers/AAOs  posted  in  the office  of  regional  PMGs  shall  also undertake  the  Internal  Audit of all those Sub Post  offices & MDGs  whose  monthly  business  is more than  Rs. 1 crore in a month.  While  inspecting such Sub Post   offices,   MDGs;   BO   transactions   shall   also   be  examined   by   the   regional   AO/AAO concerned.   Irregularities  noticed   should   be   settled   on   the  spot  as far  as  possible.  Those irregularities which could  not  be settled  should  be  included  in  the  Inspection  report  and  sent to the  Internal  Audit  section  of GM (PA F)/DAP  beside  reported  to regional  PMGs/CPMsG.  These irregularities  shall  be  monitored  by  the  IA  section  at  PAO  through  proper  

co-ordination  and monitoring.  The scope of  Inspection  and  Areas  to be looked  into  by  the AO/AAO,  Circle Office & Regional  Office will be as under:-

(i).    Cash & bank arrangements  and transactions  thereof.

(ii ).   Accounting  of BOs transactions and  closing  balance comparison  with     system  closing balance & Da ily account (DTRs) submitted  by BOs.

(iii).    CBS and  Insurance sector issues and  problem s. 

(iv ).    Cash  and cheque remittance  transactions.

(v ).      Accounting of IPPB transactions. 

(vi).    Sums kept out of account.

(vii).    Proper revenue depiction.

(viii),   Accounts receivables and settlements.

( ix).     E-billers and COD /BNPL customers account etc.

(x).     Franking Machine operations accounting & settlement. 

(xi).    Any  other duties assigned by Regional  PMG.

(xii).  Ann  specific  issues of importance  which affects revenue & expenses.

( I ). Similarly. AO (ICO  SB)  posted  at Circle or at  Regional  offices  irrespective  of CBS or Non CBS offices shall  look alter the following areas:-

i.        Checking  of operation  of SBCO  in  the Circle and  take  remedial  action  in  case of short- coming.

(ii)      Monitoring/Checking of various office accounts in Finacle.

(iii)     Monitoring  of status of minus balance  in the Region/Circle.

(iv)     Monitoring  of  status of SBCO objections and  its pendency.

(v)       Monitoring of FRMU  alerts  in the Region/Circle and  its pendency.

(vi)     Monitoring  of  A M L CFT alerts  in  the  Region/Circle  and  its pendency  as  well  as status of   compliance of A M L/CFT norms in the Region/Circle.

vii)    Status of number of accounts in POSB schemes in the Region/Circle.

viii)   Status of Jan Suraksha Schemes (APY/PMJJBY/PMSBY) in the Region/Circle,

(ix)     Bank reconciliation status in the various HOs in  the Region/Circle.

3.  Internal   Audit   by  the  IA  Division  of  Postal  Directorate.-The  internal  audit  of  Postal Accounts  Offices. Circle offices and  such  units as decided shall  be carried  out by  the nominated teams or drawn  from adjoining  Circle PAOs. The team so nominated  by the Circles shall  prepare Internal  Audit  reports  showing  to o components  i.e.  

1.  Fresh  Audit  report  


2. Pending  paras and  its settlement. On the last daj  of  Internal  Audit of Inspection, 

representative from DOP HQ either  ADD or  Director  (IA) along  with  status of pending  paras. recovery status etc. shall go for discussion  of the audit findings    of the Head office concerned.

4. Internal  Audit  of  different divisions  in DPP HQ:- DOP headquarter shall also be audited  by field  teams  other  than  PAO  Delhi.  Selection  or  teams for  Circle  level  offices  shall  be  decided central   but composition  of  the team shall  be decided  by the authorized  Circle  PAOs which  will depute  their  teams  for  audit.  The  Internal  Audit  report  will  be  submitted   by  the  team  to  the Sr.DDG  (PA F).  Director  (IA)  through  Internal  Audit  Division  will  monitor  the  settlement  of objections coordinating  with the concerned  Divisions.

• All  Reports  to  be  sent  to  DOP  Head  quarter  IA  Division  by  PAOs:-  ln  supersession  of  all earlier instructions.  following  reports should be sent  by all PAOs to Director (IA) :-

a.         A  monthly  report from  Director (IFA).

b.         A  quarterly   report  on  holding  of  Circle  Monitoring  Committee  meetings  with  showing number of  paras settled.

c.         A  quarterly  report  in  a  format  on  settlement  of  paras.  recovery  of  objected  amount  and pending  paras  and  amount  for  recovery   in  respect  of  field  units  shall  be  

sent  by  end  of  the following  month  of the quarter.  A separate annexure  showing  pending P&T Audit paras. settled. recovered  amount  and  remaining  pending  paras  and  outstanding  recovery  of  objected  amount which are shown  in the annual appropriation accounts shall also be furnished.

6.         The receipt of this OM may  please  be acknowledged  to Director (IA), DOP HQ . This  issues    with the approval of Secretary  (Posts).

Enclosures:-As above.

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