CGMT PATNA IA SEPT 2010

8/7/2019 CGMT PATNA IA SEPT 2010

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ANNEXURE TO CIRCULAR NO.CA±241 (Letter No.700-55/2010-11/CA-III Dated 16 -11-2010

PROFORMA µC¶SCOPE OF WORK FOR INTERNAL AUDITORS OF BSNL

It has been observed that the Internal auditors of BSNL are simply pointing out the errors and mistakewithout rendering any assistance to the Units of BSNL for rectification of mistakes / which is totally againstthe idea of engagement of the internal auditor, by BSNL Management. The Internal Auditors aresupposed to take pro-active steps for rectification of defects as well as assisting the unit / circlesauthorities to bring about improvement in the quality of accounts. Moreover, the scope of work fixed byBSNL Management are not followed by the Internal Auditor as well as comments are made by theInternal Auditors which is against the Accounting Policy of BSNL. The main purpose of engagement of the CA firms as internal auditor by BSNL Management is not only to identify the areas of weakness butalso to get the defects rectified on the spot by active participation of both the Internal auditors as well asBSNL units so that BSNL accounts depicts true and fair picture.

The Scopes of work mentioned below are the guidelines for internal audit. The Internal Auditorsappointed by BSNL Management shall check all the points mentioned below in addition to other itemscovered by generally accepted accounting procedure but subject to BSNL accounting policy, and alsoensure that necessary entries are passed in the accounts (General Ledger) as well as in the sub-ledger /

register / statement in order to set right defects / shortcomings detected during internal audit. Audit Reportshall reflect not only the comments on all the points mentioned below but also the details of action takenby the internal auditor to set right the things. It is further mentioned that Internal Auditor must not functionas External Auditor i.e. Branch & Statutory Auditor. The performance of internal auditor will be judged bythe Management mainly based on pro-active action taken by the auditor to rectify any error, defects,omission etc so that all the financial transactions are correctly reflected in the accounts within the scopeof accounting procedure as well as accounting policy.

Sl No Scope of Work Findings, observations / comments

of Internal Auditor and details of

discrepancies if any

Pro-active steps action taken by

the Internal Auditors to set right

the discrepancy / shortfall i.e.

accounting entries passed / sub-

ledger & Register updated /

concerned official of BSNL trained.

1 FIXED ASSETS1.1 Whether Fixed Asset Register

(FAR) is maintained in 21-column format prescribed by theCorporate Office.

It is maintained and updated

till F.Y 2009-10, but not

updated for current Financial

year.

1.2 Whether each asset reflected inthe FAR is having all theinformation such as situation of assets, quantitative details etc.

Fixed Assets register is not


year, so we are not able to

comment on the same.

1.3 Whether asset number isassigned to the individual asset

and equipment.

No, it is not in practice at the

unit.

1.4 Whether the particulars of allassets acquired from vendors or constructed in house, which areput to use / commissioned / havestarted generating revenueduring the financial year inquestion, are reflected in theFAR.





1.5 Whether in case of acquisition of assets

from vendors, proper rules have been

followed.

Yes, it has followed the proper

rules.



1.6 Whether value of all the assetscommissioned / put to use /started generating revenueduring the financial year inquestion (the details of whichhave been entered in the FAR)has been booked to concernedaccodes for fixed assets bypassing necessary accountingentries, and whether suchaccounting entries has beenincluded in the Trial Balance.

Yes, all the assets have been

booked to concerned accodes

for fixed assets and included in

the trial balance.

1.7 Whether there is any fixed assetwhich is purchased / constructedduring the financial year inquestion or in any previousfinancial years but not yetcapitalized / not put to use andaccounted in Fixed Asset

Accounts of trial balance andreflected in FAR.

Yes, all the assets capitalised

and accounted in Fixed assets

Accounts of Trial Balance.

1.8 Whether the assets valued up toRs. 5000/- have been properlyentered in the FAR.





1.9 Whether the ATDs which arepending to be accepted at thebeginning of the financial year inquestion, and the ATD receivedduring the current financial year

for the assets transferred by theProject Circle / Installation Wingof same circle / other circles,have been accepted andaccounted for in the TrialBalance, and whether the detailsof such assets have beenentered in FAR.

ATDs received during the

current Financial Year for the

assets transferred have not

been accepted by the unit.

1.10 Whether proper records are keptregarding fixed assets addedduring the year in the category of less than 180 days, 180 days &above which is required for

calculation of depreciation as per Income Tax Act.

It will be made on year end.

1.11 Whether proper accountingentries have been passed andincluded in the Trial Balance,and ATDs have been raisedduring the financial year inquestion, in respect of assetstransferred from one accountingunit to another accounting unit of either same circle or differentcircle during the financial year inquestion. And whether suchATDs have been accepted bythe consignee unit/circle.

The unit has not transferred

any assets.



1.12 Whether the Circle / units haveundertaken the process for

identification of the assets foundto be obsolete / unserviceable asper rule

No such process undertakenby Unit during the FY for

identification of obsolete /unserviceable assets.

1.13 Whether the assets which arefound to be obsolete /unserviceable and identified assuch during the financial year inquestion, have beendecommissioned and declaredas obsolete / unserviceable inthe same financial year by thecompetent authority as per rule.

No such fixed assets declaredobsolete/unserviceable by theUnit during the FY.

1.14 Whether proper accountingentries have been passed totransfer the net depreciatedvalue of assets declared asobsolete & unserviceable, todecommissioned asset accodesby passing necessaryaccounting entry and includingthe same in the trial balance.

Not applicable.

1.15 Whether entries have beenmade in the FAR in respect of asset declared as obsolete /unserviceable.

Not applicable.

1.16 Whether provision has beenmade in respect of assetsdeclared as obsolete /unserviceable during thefinancial year in question, for thedifference between NRV & netdepreciated value of such assetsprovided the NRV is less thanthe net depreciated value.

Not applicable.

1.17 Whether the details of all assetsdeclared obsolete /

unserviceable i.e. description of assets, quantity, date of withdrawal of assets from use,net depreciated value, NRV,amount of provision made,physical location of such assets,sanction particulars regardingdeclaration of such assets asobsolete/unserviceable bycompetent authority, particularsabout disposal such obsolete /unserviceable assets etc. arecorrectly kept in the Obsolete /

Unserviceable Asset Register.

Not applicable.



1.18 Whether value of obsolete /unserviceable assets reflected inthe accounts (under decommissioned asset accode)are reconciled with the entriesmade in Obsolete /Unserviceable Assets Register and the difference if anybetween the two sets of recordsis settled.

Not applicable.

1.19 Whether obsolete &unserviceable assets lying under decommissioned asset head aredisposed off promptly under proper sanction of the competentauthority.

Not applicable.

1.20 Whether proper accountingentries have been passed for inrespect of obsolete /unserviceable assets disposedoff during the financial year inquestion i.e. provision made if any at the time of declaring suchassets asobsolete/unserviceable havebeen utilized / written back andproper accounting entries havebeen passed to account for salevalue.

Not applicable.

1.21 Whether there are any assets,which have been retired from

service forever, but not removedfrom Fixed Asset Accounts (TB)and FAR, and depreciation iscontinued to be charged on suchassets.

No such case noticed during

the period of audit.

1.22 Whether in case of addition or deletion of assets proper recordsare kept for the purpose of preparation of Fixed AssetSchedule (Proforma IIStatement).

The FAR is not updated for

current Financial year, so we

are not able to comment.

1.23 Whether the value of all the

assets reflected in the FAR isreconciled with the valuereflected in the trial balance andwhether the difference foundduring the financial year hasbeen settled in the samefinancial year .

The FAR is not updated for

current Financial year, so weare not able to comment.

1.24 Whether depreciation has beencharged correctly in respect allassets reflected in the FAR.

It will be charged at year end .

1.25 In case of assets i.e. put to use /

commissioned during thefinancial year in questionwhether depreciation has been

It will be charged at year end .



charged from the date of commission / put to use.

1.26 Whether depreciation has alsobeen charged in respect of assets which have been

decommissioned / dismantledtemporarily for utilization of thesame in some other location or for some other purpose

Not applicable.

1.27 Whether in respect of assetsdeclared as obsolete /unserviceable during the year,depreciation has been chargedin the accounts correctly i.e. upto last date of functioning of suchasset.

Not applicable.

1.28 Whether depreciation has alsobeen charged in respect of stand-by assets.

There is no stand by assets.

1.29 Whether full depreciation hasbeen charged on assets valuedup to Rs. 5000/- in the 1

styear of

installation/commissioning asper instructions issued bycorporate office.

There is no asset, valued up to

Rs 5000/- commissioned /

installed.

1.30 Whether fixed asset have beenphysically verified as per order of Corporate Office.

Fixed assets have not been

physically verified.

1.31 Whether detailed record of

physical verifications has beenprepared in the formatprescribed by Corporate Office.

No any detailed record of

Physical verification has been

made.

1.32 Whether all the assets, whichare physically available as per physical verification, arereflected in the FAR.

Physical verification has not

been carried out.

1.33 Whether there is any differencebetween the assets, which arefound on physical verification,and as reflected in FAR, and if

so whether the difference hasbeen reconciled and rectificationentries have been made in FAR.

Not applicable.

1.34 Whether the value of assetsfound on physical verificationhave been reconciled with thevalue of the asset reflected inthe FAR as well as in the trialbalance and whether differencein value if any has been set rightby passing necessaryaccounting entries.

Not applicable.

1.35 Whether replacement of assetshas been accounted as per

There is no any replacement of



instructions issued by CorporateOffice.

assets.

1.36 Whether intangible assets havebeen properly accounted andamortized as per order of the

Corporate Office.

The unit has no intangible

assets.

1.37 Whether all the lands inpossession of the units / circleshave been analysed andcompletely bifurcated asfreehold and leasehold.

The unit has no land either

freehold or leasehold.

1.38 Whether initial lease value of leasehold land is properlyamortized over the lease period

on straight-line method.

The unit has no land either

freehold or leasehold.

1.39 Whether proper action has beentaken by the Unit / circleauthorities to renew the leaseperiod of the leasehold landwhose lease period has alreadyexpired / to be expired verysoon.

Not applicable.

1.40 Whether any leasehold land inpossession whose lease periodhas been expired, but not yetrenewed.

Not applicable.

1.41 In case of theft of assets / loss of asset due to natural calamity,fire etc whether proper accounting entry has beenpassed to relieve the FixedAsset Account (General Ledger)& FAR and whether provision for the net depreciated value of assets lost has been made

There are no any such cases.

1.42 In case of loss of asset due tonatural calamity whether the net

depreciated value of such assetshas been written off by thecompetent authority andprovision made earlier if any,has been utilized and adjusted inthe accounts.

There is no such case.

1.43 In case of loss of asset due to

theft and other reason whether

action has been taken by the

authority for recovery of asset.

Whether provision has been

made for the net depreciatedvalue of such asset. In case of




non-recovery of such asset or

partial recovery of such assets

whether competent authority

has written off the net

depreciated value of such assets

and provision made earlier has

been utilized / written back.

1.44 Whether obsolete andunserviceable assets asreflected in Register of Obsolete/ Unserviceable assets havebeen verified physically anddifference if any has beenreconciled and settled.

Not applicable.

1.45 In case of misclassification of fixed asset / components i.e.fixed asset / component hasbeen booked to wrong accodes,whether rectification of misclassification has been doneproperly as well as depreciationcharged earlier has beenadjusted correctly.


1.46 Whether the amount of assets,CWIP, AccumulatedDepreciation, Sundry Debtors,Sundry Creditors etc. relating toMSC based CDMA service

which were earlier reflected inBasic Segment has beentransferred to CMTS Segmentby passing proper accountingentries.


2. Capital Work In Progress

(including Civil & Electrical works

of capital nature)

2.1 Whether the competent authority

has sanctioned the project and

detailed estimate for the works

under execution.

Not applicable

2.2 Whether any cost overrun inrespect of each work completed/ under execution has occurredand whether such cost overrunhas been sanctioned by thecompetent authority.

Not applicable

2.3 Whether CWIP register / WorksRegister / Sub-ledger has beenmaintained by the units for eachof the works under execution.

It is maintained and updated

till F.Y 2009-10, but not

updated for current Financialyear.



2.4 Whether details of each workunder execution have beenreflected in the CWIP Register /Works Register / sub-ledger.

CWIP register is not up to date.

hence, unable to comment.

2.5 Whether CWIP register / WorksRegister / sub-ledger in respectof each work has been updatedwith the transactions occurredduring the financial year inquestion i.e. services availed

from contractor for execution of work, payment is made for suchservices to the contractor,material is purchased andutilized in works



2.6 Whether Measurement Book hasbeen maintained for recordingthe details of works executed bythe contractor

No

2.7 Whether the project executingauthority have recorded the

details of work executed by thecontractor and services providedby the contractor during theyear, in the Measurement Book.



2.8 Whether based on entries madein the measurement bookexpenditure / payment has beenapproved and paid to thecontractor. Whether Measurement book has beenupdated in respect of paymentmade to the contractor

Not applicable

2.9 Whether ATDs for material /stores received from StoreDepots of BSNL / other units of BSNL for execution of works,have promptly been acceptedand booked to concernedaccode of CWIP account.Whether necessary entries havebeen made in CWIP Register /Works Register / sub-ledger inrespect of such storesimmediately.

Not applicable

2.10 Whether the stores / equipments CWIP register is not up to date.



issued to the Contractor /turnkey project executing vendor for execution of works / turnkeyprojects have been accounted toaccode for ³Material / stores withcontractor´.


2.11 Whether material / equipmentactually utilized by the contractor / turnkey project executingvendor in the works, have beenbooked to CWIP accode bygiving credit to accode for

³Material / stores withcontractor´.



2.12 Whether necessary entriesabout utilization of stores by thecontractor / turnkey projectexecuting vendor have beenmade in CWIP Register / WorksRegister / sub-ledger.



2.13 Whether on completion of worksthe un-utilized / surplus materialshave been taken back to store

Depot and accounted toinventory head by giving credit to³Material / equipment withcontractor´.



2.14 Whether amount booked toaccode for ³Material / equipmentwith contractor´ have beenreviewed from to time andproper adjustment has beenmade about utilization of thematerial / equipment in theproject and / or return of un-

utilized items to Store Depot.



2.15 Whether material issued tocontractor / turn-key projectexecuting vendor but remainedun-utilized at the close of thefinancial year, have beenphysically verified and talliedwith value of the materialreflected under accode for ³Material / equipment withcontractor´.



2.16 Whether overheads have beencharged to capital works as per policy of BSNL i.e. on actual

CWIP register is not up to date.hence, unable to comment.



basis i.e. whether salary of staff who have actually been engagedin execution of concernedproject work has been chargedas overhead to the projectestimate / account of the saidwork, and whether administrativeexpenditure, which are directlyattributable and identifiable to aparticular capital work, havebeen charged as overhead tothe project account / estimate of the said work.

2.17 Whether depreciation of testinginstruments, motor vehicle etc.which have been utilized for execution of a project work, hasbeen charged as overhead tocapital account / estimate of thesaid work.



2.18 Whether necessary accountingentries have been passed andincluded in the trial balance for transferring the overhead fromµRemuneration¶, µAdministrativeExpenditure¶ & µDepreciation¶Schedules by giving debit toCWIP accode of concernedproject work / estimate andcredit to accodes for µDeductExpenditure¶ available inconcerned µRemuneration¶,

µAdministration¶ & µDepreciation¶schedules.



2.19 Whether expenditure of revenuenature has been charged toProject works / CWIP and if sowhether rectification entries havebeen passed in the trial balanceto withdraw such revenueexpenditure from CWIP as wellas necessary rectification entryhas been made in the CWIPRegister / Works Register / Sub-

ledger



2.20 Whether liability has beencreated in the accounts for thevalue of services provided by thecontractor for execution of worksduring the financial year inquestions particularly for theservices provided by thecontractor at the fag end of thefinancial year for which either billhas not been received or nopayment has been made within

the close of the financial year.





2.21 In respect of project workcompleted during the financialyear in question whether all theliabilities for executing the saidworks (cost of stores utilized,cost of services of contractor utilized, overhead i.e. salary of staff engaged in execution of work & administrative overheaddirectly attributable to concernedwork, and other liabilities if any)have been taken into account for transferring the total cost of thesaid completed project work tothe consignee circle / consigneeunit of same circle and for capitalization of the saidcompleted projects by theconcerned custodian / owner of the assets.



2.22 Whether payment made tocontractor for execution of project has been debited toaccode for µliability¶ / µprovision¶where the amount of liabilitywhich was created earlier for thesaid work either on actual basisor on estimated basis, isreflected.



2.23 Whether reconciliation of entriesmade in the CWIP Register /

Works Register / sub-ledger inrespect of expenditure incurredon capital work has been carriedout with the entries made in theCWIP Account of General ledger and whether the difference foundif any between two sets of figures has been settled bypassing necessary entries either in the accounts or in the CWIPRegister / Works Register / sub-ledger during the same financialyear



2.24 Whether Telecom Project Circles/ Civil & Electrical wing /installation wing of territorialtelecom circles have transferredthe capital cost of all the workscompleted during the financialyear in question to theconsignee i.e. Maintenancecircles / other Circles / units of same circle, through ATD alongwith all related documentsimmediately after the work hasbeen completed / commissioned.



2.25 Whether Telecom Project Circle CWIP register is not up to date.



/ Civil & Electrical Wings /Installation wing of territorialtelecom circles have takenproper steps to get all the ATDs(raised by it) accepted by theconsignee circles i.e.Maintenance Circles / Other circles / units of same circlewithin the financial year inquestion in which the ATDs havebeen raised.


2.26 Whether there are instances of handing over all thecompleted works and raising

of huge number of ATDs onlyat the close of the f inancialyear by Project Cir cles andother installation wing including Civil & Electr icalwings. In such cases whataction taken by the Inter nalAuditor .



2.27 Whether there are project workswhich have been completedduring the financial year inquestion by the Telecom ProjectCircles / Installation wing of Territorial Telecom Circles / Civil& Electrical Wings, as well asput to use / started generatingrevenue, but could not becapitalized due to non-issue of completion report / managementcertificate regarding completionby the Project executingauthority; or completed projectworks have not been handedover to the concerned circles /units; and value of such

completed works has not beentransferred to consignee circles /units by Telecom Project Circles/ installation wing / Civil &ElectricalWings through ATD.

No

2.28 Whether consignee circles /units have accepted thecompleted works received fromTelecom Project Circles /Installation wing of TerritorialTelecom Circles / Civil &Electrical Wing during thefinancial year in question,

capitalized the same in the samefinancial year, entered the

Works has not been completed

during the year.



particulars of such assets inFAR, and accounted the cost of the asset in asset accode of general ledger on acceptance of the ATD in the same financialyear.

2.29W

hether consignee circles havereceived the completed worksbut could not accept, capitalizeand account for the cost of completed projects due to non-receipt of completion report /management certificate, other relevant details, or due to receiptof partial information / data etcfrom the Project Executingauthority.

Works has not been completedduring the year

2.30 Whether project sanctioning andproject executing authority havereviewed all the pending CWIPparticularly the old outstandingprojects, whether age-wiseanalysis of all pending projectworks has been done by theproject sanctioning and projectexecuting authority, whether project sanctioning & projectexecuting authority have takenappropriate steps for completionof old project work particularlythe projects which are pendingfor more than one year, whether

the project sanctioning andproject executing authority havereviewed the pending projectworks from the angle of costoverrun and time overrun andwhether appropriate action hasbeen taken by the projectsanctioning and projectexecuting authorityManagement to complete eachproject within the time framefixed for completion and withinthe sanctioned cost.



2.31 Whether Project ExecutingAuthority has completed theCWIP during the financial year inquestion for which provision wasmade in previous financialyear(s) based on the Branch andStatutory Auditor¶s observations(being an old project) andwhether the provision created inprevious financial year(s) for such old projects has beenwritten back due to completion of such project works in the currentfinancial year.





2.32 Whether any project works hasbeen abandoned during thefinancial year in question by thecompetent authority.



2.33 Whether appropriate accounting

entries have been passed andincorporated in the CWIPaccount of General Ledger andprovision has been made for theestimated loss in respect of project work, which has beenabandoned under the sanction of the competent authority.



2.34 Whether entries have beenmade in the CWIP Register /sub-ledger in respect of projectsabandoned during the financialyear in question.



2.35 Whether serviceable stores /equipments recovered from suchabandoned projects have beentransferred to Store Depots /other works and necessaryaccounting entries have beenpassed



2.36 Whether damaged /unserviceable stores /equipments recovered fromabandoned projects have been

disposed off and necessaryaccounting entries have beenpassed for the sale value etc.

Not applicable

2.37 Whether necessary write off sanction for the actual loss(worked out after taking intoaccount the amount to berealized on disposal of equipments / stores, value of serviceable items / storesreturned to the Store Deport /other works) has been issued by

the competent authority inrespect of project worksabandoned by the competentauthority. In case provisionexists for such abandoned CWIPwhether it has been utilized andexcess provision has beenwritten back.


hence, unable to comment

2.38 Whether physical verification of CWIP has been carried out bythe authorities of Circle / unit asper instructions of the Corporate

Office.

Physical verification has not

been carried out during the

year.

2.39 Whether details of physicalverification of CWIP are

Not applicable.



recorded in the formatprescribed by Corporate Office

2.40 Whether reconciliation of CWIPfound on physical verification,has been made with the

particulars of concerned CW

IPas available in the CWIPRegister / Works Register / sub-ledger and the difference if anyhas been settled by passingnecessary entries in the CWIPRegister / Works Register / Sub-ledger.

Not applicable.

2.41 Whether value of CWIPphysically available has been

reconciled with the valuereflected in CWIP account of General ledger and difference if any has been settled by passingnecessary accounting entries.

Not applicable.

2.42 Whether stores found surplus atworksite in respect of completedworks have been sent back tostores depots or transferred toother works (where required)and necessary accountingentries have been made by thedebiting the Inventory Account(in case stores sent to storedepot) / debiting the worksaccount (in case storestransferred to other work) bygiving credit to CWIP accode for concerned Project work.

Not applicable.

2.43 Whether surplus stores lyingwith contractor in respect of completed works have beentaken back from the contractor and transferred to stores depotsor to other works (where

required) and necessaryaccounting entries have beenmade by the debiting theInventory Account (in casestores sent to store depot) /debiting the works account (incase stores transferred to other work) by giving credit to accodefor µmaterial issued to contractor where value was earlier bookedat the time issue of such storesto contractor.

Not applicable.

2.44 Whether diversion of inventory /equipment from one project work

Not applicable.



to another project work has beenproperly accounted.

3. Inventory

3.1 Whether Wholesale Depot,Circle Telecom Store Depots

and Store Dumps havemaintained the bin cards andPriced Store Ledger.

It is not practice to maintain

Bin cards and Price Store

Ledger in the store.But,

quantitywise Stock Register is

maintained.

3.2 Whether all the stores / materialreceived from Vendor / supplier during the financial year inquestion or in any of the

previous financial years, havebeen recorded in the Bin Card,Priced Store Ledger (quantityand other details) immediatelyon their receipt and acceptanceby the consignee. (Stores /material received must not bedirectly charged to CWIP but tobe routed through InventoryAccount).

The same is recorded in Stock

register immediately on their

receipt.

3.3 Whether full liability for storesreceived in good condition fromsupplier/vendor as per terms and

conditions of purchase order during the financial year inquestion, has been created,whether accounting entries for such liability has been passedand included in the InventoryAccount of General Ledger,whether necessary entry for thevalue of such stores has beenmade in the Priced Store Ledger immediately on acceptance of the material by the consignee incase the accounting unit of theconsignee is the paying authorityof the stores received. Andwhether payment made tovendor / supplier subsequentlyagainst such stores has beendebited to accode where theamount of liability / provision hasbeen credited at the timecreating the liability (on actualbasis) / provision (on estimationbasis).

Yes, Necessary entry is made.

3.4 In case the paying authority for the stores received, is a different

accounting unit whether thevalue of the stores has been

No Such Case.



accounted in the Inventoryaccount of general ledger immediately on receipt of ATD or from the information / data of ATDs uploaded by the payingauthority in IBTMS Package andwhether necessary entry aboutvalue of such stores has beenposted in the Priced StoresLedger immediately.

3.5 In case of stores / materialreceived during the financial

year in question or any of theprevious financial years fromother units of BSNL whether entries about quantity and other information of the stores havebeen made in the Bin card &Priced Stores Ledger immediately on receipt of Stores.Whether value of such storeshas been accounted in theinventory account of generalledger immediately on receipt of ATD or from the information of

ATDs uploaded by theaccounting unit of consignor (BSNL unit) in IBTMS Packageand whether necessary entryabout value of such stores hasbeen made in priced storesledger immediately.

No Such Case.

3.6 Whether valuation of inventoryhas been made taking intoaccount all cost including cost of stores paid to the supplier /vendor, transportation cost ±primary distribution cost andexcluding the CENVAT portionfor excise duty & CVD. Whether the amount of inward freight,taxes and duties (not eligible for CENVAT), octroi etc in questionhave been merged with thevalue of inventory and notbooked separately to accodeswhich had been allotted earlier but deleted latter on. Whether store-keeping charges have notbeen taken for valuation of inventory.

Not applicable

3.7 Whether weighted average rateof each item of store has been

Weighted average rate is notcalculated.



calculated at the time receipt of new consignment. Whether weighted average rate has beenentered in the Priced StoreLedger.

3.8W

hether stores have beenissued on the basis of approved(by the competent authority)indent placed by the consignee /indenter.

Yes, Stores are issued on theapproval of DGM.

3.9 Whether particulars of stores

issued during the financial year in question have been noted inthe Bin Card, Priced StoresLedger immediately on issue of the stores to theconsignee/works.

Such particulars are maintained

in Stock Register.

3.10 In respect of stores issued fromthe Store Depot / units of BSNLto works during the financial year in question whether ATDs for thevalue of stores worked out atweighted average rate prevailing

at the time of issue, have beensent along with all document of issue to the accounting units of consignee immediately thestores are issued, whether corresponding entries for suchissue have been made in thePriced Stores Ledger, whether accounting entries have beenmade in inventory account of General Ledger and whether particulars of ATDs have beennoted in IBTMS package so thatconsignee can account for thesame.

Not applicable

3.11 Whether entries in Bin Cardabout receipt and issue of storeshave been reconciled with theentries available in the Pricedstores ledger and difference if any, has been settled promptly.

Bin Cards and Price Store

Ledger are not maintained.

3.12 Whether the value of the storesreflected in the Priced StoreLedger has been reconciled withthe value reflected in the

Inventory account of GeneralLedger and difference if any has

Not applicable



been settled immediately withinthe financial year in question.

3.13 Whether proper stock register has been maintained for thestores lying at work sites and

with the contractor.

Not applicable

3.14 Whether physical verification of inventory has been carried out atthe close of the financial year covering all items of inventory.

Physical Verification of

Inventory has not been carried

out in current financial year.

3.15 Whether proper documents of physical verification of storeshave been prepared in theformat prescribed by CorporateOffice (Circular No. 132 dt.17.04.2008 & Circular No. CA-240 dt. 15.11.2010)

Not applicable

3.16 Whether the quantity of storesfound on physical verificationhas been reconciled with thosereflected in the Bin card & PricedStore Ledger and whether the

difference if any has been sortedout / settled immediately bymaking necessary entries.

Not applicable

3.17 Whether value of stores foundon physical verification has beenreconciled with the value of stores reflected in Inventoryaccount of General Ledger andPriced Stores Ledger andwhether difference if any hasbeen settled within the financialyear by passing necessary

accounting entries.

Not applicable

3.18 In case of stores found shortduring physical verification ascompared with the quantityreflected in the Bin card / pricedstores ledger and such shortage/ difference could not be settledwithin the financial year inquestion, whether provision hasbeen made for the value of theshortage and necessaryaccounting entry regarding suchprovision has been incorporatedin the accounts i.e. in thegeneral ledger.

Not applicable



3.19 In case of stores found shortduring physical verificationconducted in previous financialyear(s) and such shortage couldnot be settled in previous

financial year(s), whether suchshortage has been totally settledduring the current financial year and whether the provision if anymade in previous financialyear(s) for such shortage, hasbeen fully adjusted in the currentyear¶s account by passingnecessary accounting entry.

Not applicable

3.20 Whether physical verification hasbeen carried out as per order of Corporate Office in respect of inventory lying unutilised with thecontractor and lying un-utilizedat work site at the close of thefinancial year and whether difference if any, has beensettled immediately.

Not applicable

3.21 In case of loss of stores due tonatural calamity, fire etc whether proper accounting entry has

been passed to relieve theInventory Account of GeneralLedger, whether entries hasbeen made in Bin Card andPriced Stores Ledger for suchstores, whether provision for thevalue of such stores has beenmade, whether the value of suchstore has been written off by thecompetent authority and whether provision for such stores madeearlier, has been adjusted bypassing necessary accountingentry in the general ledger.

No Such Case

3.22 In case of loss of inventory dueto theft and other reasonwhether proper accounting entryhas been passed to relieve theInventory Account of GeneralLedger, whether entries hasbeen made in Bin Card andPriced Stores Ledger for suchstores, whether provision for thevalue of such stores has beenmade, whether the value of suchstore has been written off by the

competent authority due to non-recovery / partial recovery of

No Such Case



such stores and whether provision for such stores madeearlier has been utilized /adjusted by passing necessaryaccounting entries.

3.23 Whether inventory has been

totally verified by the StoresScrapping Committee to identifythe obsolete / unserviceable /non-moving inventory and slowmoving.

Such identification has not

been made.

3.24 Whether report of the Storescrapping committee and thedetails of stores identified asobsolete and unserviceable hasbeen submitted to the competentauthority for declaring suchstores as obsolete /unserviceable.

Not applicable.

3.25 Whether NRV has beenascertained for the storesidentified as obsolete /

unserviceable

Not applicable.

3.26 Whether proper provision hasbeen made for the differencebetween the NRV and bookvalue of stores declared asobsolete / unserviceableprovided the NRV is less thanbook value of the stores.

Not applicable.

3.27 Whether the stores declared asunserviceable / obsolete by thecompetent authority have been

accounted to accode for µunserviceable/obsolete stores¶by crediting to inventory account.

Not applicable.

3.28 Whether the details of allinventory declared obsolete /unserviceable i.e. description of stores, quantity, book value,NRV, amount of provision made,physical location of suchinventory, sanction particularsregarding declaring such storesas obsolete/unserviceable by

competent authority, particularsabout disposal of such obsolete /unserviceable stores etc. have

Obsolete / Unserviceable StoreRegister is not maintainedseperately.



been kept in the µObsolete /Unserviceable Store Register¶.

3.29 Whether obsolete /unserviceable stores reflected inthe accounts have been

reconciled with the entries madein µObsolete / UnserviceableStore Register¶ and thedifference if any between the twosets of records has been settled.

Not applicable.

3.30 Whether obsolete &unserviceable stores lying under obsolete/unserviceable inventoryaccode has been disposed off promptly under proper sanctionof the competent authority,whether provision made if any atthe time of declaring the storesas obsolete/unserviceable hasbeen utilized / written back,whether proper accountingentries has been made toaccount for sale value, andwhether loss occurred ondisposal of such obsolete /unserviceable stores has beenwritten off by the Competentauthority.

Not applicable

3.31 Whether appropriate action hasbeen taken by the Circle Heads /

Planning Section to utilize theslow moving and non-movingitems of inventory either in worksof the Circle or works of other circle

No such action has been

undertaken.

3.32 Whether stores lying unutilisedwith contractor at the close of the financial year has beentaken to inventory account bypassing accounting entries andat the beginning of the nextfinancial year such entry hasbeen reversed.

Yes

3.33 Whether storage arrangementfor keeping inventory isadequate, proper and safe.

Yes

3.34 A status report regardingcomputerization of inventoryrecords must be given in theInternal Audit report

3.35 Whether the quantity of inventory which have beenprocured during the currentfinancial year are actually

required i.e. whether decision for procurement of quantity of storesin question during the current

Not applicable.



financial year has been takenbased on the total quantity of stores required for execution of already sanctioned projects; andtaking into account the quantityof such stores which are alreadylying in stock of the Circle andquantity of such stores which areon the pipeline at the time of deciding procurement of suchfresh quantity in question duringthe current financial year, andwhether the conditionsmentioned above have beenconsidered before takingdecision of procuring thequantity of stores in question.

3.36 Whether obsolete andunserviceable inventory asreflected in Register of Obsolete/ Unserviceable inventory havebeen verified physically anddifference if any has beenreconciled and settled.

Not applicable.

3.37 Whether proper accounting of tradable equipments has beendone as per instructions issuedby CA Section through Circular No. CA-218, CA-218A, & CA-218B

No Such case.

4 Bank & cash transaction

4.1 Whether cashbook andbankbook are properlymaintained and updated on dailybasis with all transactions takenplace during the day.

Yes, Cash book and Bank book

are properly maintained and

updated on daily basis.

4.2 Whether cash collected during aday has been remitted to bankon the same day and there is nodelay in the remittance

Yes, it is remitted to bank on

the same day.

4.3 Whether amount collected onthe last working day of thefinancial year has been remittedto bank on the same last day of the financial year.

Yes, it is remitted to bank on

the same day.

4.4 Whether bank has credited thecash remitted by the unit incollection bank account of theunit on the date of remittance, if not what action the unit has

taken to get the credit.

Yes, the bank has credited the

cash remitted by the unit in

collection bank account of the

unit on the same day.



4.5 Whether the unit has reconciledthe amount transferred by theBank from the Escrow Account.

The unit has not any Escrow

account.

4.6 Whether cheques has beenremitted to bank on the date of

their receipt and there is nodelay in remittance

Yes, cheques have been

remitted to bank on the date of

their receipt.

4.7 Whether cheques / DD receivedon the last day of the financialyear have been remitted to bankon the same last day of thefinancial year.

Yes, it has been remitted to

bank on the same last day of

the financial year.

4.8 Whether all the cheques / DDsreceived on the closing day of the financial year but could notbe remitted to bank on the sameday due to circumstance beyondcontrol, have been treated aspart of cash balance anddisclosure in this regard hasbeen given in the annualaccounts.

Yes, it has been treated as part

of cash balance.

4.9 Whether all the cases of cheques deposited but notcredited by bank (as reflected inthe Bank reconciliationstatement), have been analysedage-wise, and whether matter has been properly pursued withthe bank authorities for earlycredit to BSNL account.

Yes, it has been analysed andmatter has been properly

pursued with the bank

authorities.

4.10 Whether in respect of dishonored / stale cheques theinstruments have been timely

forwarded by the banks alongwith consolidated list, whether the accounting unit has reversedthe amount of such dishonoredcheques in the Bank Book andbilling system and whether appropriate action has beentaken by TRA Branch and other concerned branch of unit for realization of such amount fromdebtors.

Yes, the instruments have been

timely forwarded by the banks

along with consolidated list.

4.11 Whether there are instances thatcash / cheques / DDs have been

remitted / deposited to / withbank but not accounted for by




the Accounting unit in theaccounts.

4.12 Whether the banks havetransferred the money from theCollection Account of Units to

Circle IFA and in turn from IFA toCorporate Office without anyfloat. In case of delay intransferring the money by bankwhether accounting unit and IFAhave recovered interest for thedelay as per terms andconditions of agreement enteredwith the banks.

Yes, the banks have transferred

the money from the CollectionAccount of Units to Circle IFA

without any float.

4.13 Whether TT sent by the units toIFA collection account havebeen credited by bank to IFA¶scollection account correctly andpromptly and there is nodifference between the amountaccounted by the remitting unitto concerned originating accodefor bank transfer & IFA toconcerned responding accodefor bank transfer.

Yes.

4.14 Whether all the cases of TT sentby the Units to Circle IFA and byCircle IFA to Corporate Office,but not credited to IFA collectionaccount / Corporate officeaccount or wrongly credited or

credited short, have beenanalyzed age-wise and whether the Unit and Circle office havevigorously pursued the case withthe bank authorities to get thecredit and to settle all suchcases.

Yes.

4.15 Whether all the accounting unitshaving bank account havecarried out bank reconciliation inrespect of each and every bankaccounts of units and

reconciliation has been done inrespect of all transactionsoccurred up to the close of thefinancial year, whether bankreconciliation statements haveproperly been prepared showingall the pending items and sent tothe banking cell at circleheadquarters.

Yes, the unit has carried out

bank reconciliation in respect of

each and every bank accounts of

units and reconciliation has been

done in respect of all transactions

occurred .

4.16 Whether details of each andevery item pending in the Bankreconciliation statement are

available in the unit, whether Unit has reviewed thoroughly allsuch pending items pending in

Yes, the details of each and

every item pending in the BRS

are available in the unit and the

unit has reviewed thoroughlyall such pending items .



the Bank ReconciliationStatement of each bank account,whether segregation of varioustypes of items have been done,whether the unit has made age-wise analysis of the pendingitems in the range of > 6 monthsbut < 1 year, >1 year but < 2years, > 2 years.

4.17 Whether the unit and SSA havetaken appropriate action to settlethe wrong / excess / short / debitand credit afforded by bankswhich are reflected in Bankreconciliation statement and howmany old wrong / excess / shortdebit and credit items (bothquantity and value involved)which were pending at the

beginning of the financial year inquestion, have been settled bythe Unit / SSA during the currentfinancial year.

Yes, the unit has taken

appropriate action to settle the

wrong / excess / short /debit

and credit afforded by Banks

which are reflected in BRS and

annexure 1 is attached for

details.

4.18 Whether SSA / accounting unithave taken proper action to clear the unlinked debit and creditreflected in the BankReconciliation Statement andhow many old un-reconciledunlinked debit and credit items(both quantity and value

involved) have been settled /cleared by the SSA / unit duringthe current financial year.

No Such Case

4.19 Whether the amount recoverablefrom bank which will be reflectedunder accode 1130816 has beentallied with the details of individual amount recoverablefrom bank kept in subsidiaryrecords, whether appropriateaction has been taken to settlethe cases, how many caseshave been settled during the

current financial year (amountinvolved) and what are thependency.

Not applicable.

4.20 Whether proper accountingentries have been passed inrespect of cheques issued butnot presented to bank by partyand has become time barred,whether full details of all the timebarred cheques have been keptin the register of Time-barredcheques, whether details of allthe time barred cheque as

available in the register of timebarked cheques have beenreconciled with the amount

Yes, proper accounting entries

have been passed in respect of

cheques issued but not presented

to bank by party and has become

time barred and full details are

available and it has been

reconciled.



reflected in the accode for µTimebarred cheque and whether anypayment made subsequentlyagainst such time barredcheques, has been routedthrough the Register of timebarred cheque and debited toaccode for µtime barred cheque¶where the amount was creditedearlier when the cheque becametime barred, and necessary entryabout such payment has beenmade in the Register of timebarred cheque against thecorresponding entry..

4.21 Whether there is any un-identified difference / un-reconciled balance / un-confirmed balance in thecashbook and bankbook andwhether the same has beensettled promptly by the units.


4.22 Whether sweeping facility hasbeen availed by the units in

respect of operation bankaccount and whether interestafforded / to be afforded by bankin such cases has beenaccounted by the units onaccrual basis.

Yes, the unit has availed

sweeping facility.

4.23 Whether interest afforded by thebank on account of sweepingfacility or delay in remitting themoney of collection bankaccount to IFA and IFA toCorporate Office is correct. If not

correct whether appropriateaction has been for recovery of the same from the bank.

Yes, the interest afforded by the

bank on account of sweepingfacility or delay in remitting themoney of collection bankaccount to IFA is correct.

4.24 Whether charges debited bybank to operation / collectionbank account are as per agreement with the bank, if notwhether all such cases has beenvigorously pursued by units andsettled by the bank authorities.

Yes, the charges debited by

bank to operation / collectionbank account are as per agreement with the bank.

4.25 Whether higher officers haveverified the cash and imprestbalance during the currentfinancial year.

Yes, higher officers have verified

the cash balance.



4.26 Whether the units havemaintained authorized cash andbank balance and there is noholding of abnormal cash andbank balance in the operationaccount.

Yes, higher officers have verified

the cash balance.

4.27 Whether bank contra & cashcontra has been tallied and nodifference is left at the end of each month and also at theclose of the financial year.

Yes.

4.28 Whether insurance policy hasbeen taken in respect of cash inchest and cash in transit.

No, there is no insurance policy

has been taken in respect of

cash in chest and cash in

transit.

4.29 Carry out surprise check of cashat least twice once before 31

st

December and another before31

stMar ch and ensure that

certificate of cash in hand andcash on bank are correct.

Surprise check has been carried

out as on 28/12/2010.

4.30 Whether payment through cashhas been made as per rule andacknowledgement of receipt of cash by the receiver has beenobtained by the cashier.

Yes, it has been made as per

rule and acknowledgement of

receipt has been taken.

4.31 Whether revenue stamp hasbeen affixed as per applicablerules.

It is not in practice at the unit.

4.32 Whether the accounting unit hasobtained the confirmation of balance in the bank account atthe close of the financial year and the same has been talliedwith balance as per bankbookmaintained by the unit.

Yes

4.33 Whether booking made to inter bank transfer accode i.e.19801xx (originating), 19802xx(responding),49801xx(originating) and49802xx (responding) i.e.originating and responding for transfer of fund from Circle IFAto SSA / Accounting of Circleand vice versa have been totallyreconciled and whether thebalance under originatingaccode has been totally tallied

with balance under corresponding respondingaccode.

Yes, The same has been tallied.



4.34 Whether amount booked to inter-current bank transfer originatingaccode 19701xx and 49701xx bythe Circle IFA for transfer of fundof IFA¶s collection bank account

to Corporate Office as well asthe amount booked toresponding accode 19702xx &49702xx to acknowledge theamount received from CorporateOffice has been tallied with thebooking made by CorporateOffice to accode 19702xx &49702xx

Yes, The same has been tallied.

4.35 Internal Auditor should reviewthe control procedure availablefor cash, cheque managementand suggest better system andmake detailed mention aboutthis in their report.

Yes, cash & cheque

management is adequate and

proper at the unit.

4.36 In case of fake notes received,whether provision has beenmade for the amount of fakenotes and whether appropriateaction has been taken to recover the amount from the officials /external entity and in case of non-recovery whether the losshas been written off as per sanction of the competentauthority.

The unit has not received any

fake notes.

4.37 Whether proper accounting hasbeen made in respect of depositmade as per order of the Courtand in respect of amountwithdrawn by statutory authorityfrom BSNL Bank Account.

Yes, proper accounting has

been made in respect of

deposit made as per order of

the court.

5 Sundry Debtors

5.1 Whether there is difference ason 1

stApril of the current

financial year between the total

amounts of all type of debtors asreflected in sub-ledger of debtorsand debtors as reflected inaccodes of debtors under General Ledger. If so thequantum of difference shall bementioned.

There is no any difference.

5.2 Whether difference as on 1st

April of current financial year,between all types of debtorsincluding debtors for leased andVPN circuits as reflected in the

sub-ledger and the total amountof debtors as per General

Not applicable.



Ledger has been thoroughlyanalysed and reconciled. Thedetails of such difference of debtors settled / cleared duringthe current financial year shallbe furnished.

5.3 Whether the debtor s bookedin the general ledger from 1

st

Apr il of current f inancial year to 31

stMar ch has been totally

reconciled with sub-ledger of debtor s and no differenceexist in respect of suchdebtor s at the close of thecurrent f inancial year. If thereis any difference the sameshall be reported.

Yes.

5.4 Whether ageing analysis of sundry debtor pending at theclose of current financial year inthe range of < 6 months, >6months but <1 year, > 1 year but< 2 years and >2 years has beencorrectly worked out.

Ageing analysis of sundry

debtor will be done at the close

of financial year.

5.5 Whether appropriate action hasbeen taken to collect the

outstanding bills particularly theold outstanding from the debtorsand out of such efforts howmuch recovery against theoutstanding bills has been madeduring the financial year?

Such effort has not been taken.

5.6 How much recovery of oldoutstanding has been madeduring the financial year through projects / schemes launched as per recommendation of M/s BCGand against such collection how much cost has been incurred in the form of incentives, TA & DA etc apartfrom the salary of staff andwhether such scheme andproject are cost effective.

Not applicable.

5.7 Out of the old outstandingcleared during the financial year how much old outstanding have been cleared throughactual collection of cash andhow much by cancellation &wr ite off . The break up in this

regard shall be indicated in thereport.




5.8 Whether all the paymentreceived against the billedamount, which remainedunadjusted due to variousreasons, have been thoroughly

reviewed, linked to concerneddebtors and adjusted. Thedetails of such adjustment shallbe mentioned in the report


5.9 Whether the bills, which havebeen cancelled during thecurrent financial year, are proper as per rules and whether suchcancellations have been adjusted against revenue andnot against provision for doubtful debt.


5.10 Whether debts, which have beenwritten off during the financialyear, are proper as per rules andsupported by sanction given bythe competent authority as per financial powers.


5.11 Whether the debts, which havebeen written off during the year,

have been charged to P&L A/cand not to provision for doubtfuldebt as per the instructionsgiven in Circular 118 dt.06.02.2008.


5.12 Whether provision for doubtfuldebt at the close of the financialyear is done as per policy of BSNL and according to Circular 118 dt. 06.02.2008 & 137 dt.15.05.2008.

Provision for doubtful debt is to

be made at the close of the

financial year.

6 Loans & Advances given to

employees (including unabsorbed

employees who are either working

in BSNL or presently working in

DOT, DOP, MTNL)

6.1 Whether proper Register of loans

and advance / Recovery Register

has been maintained by the units to

record all types of interest bearing

& non-interest bearing loans and

advances (including pay advance,

TA Advance, medical advance,

excess payment etc) given by BSNL

to its employees and unabsorbed

employees who are presently either

Yes, it has maintained proper

Register.



working in BSNL or in DOT / DOP /

MTNL

6.2 Whether proper entries have been

made in the Register at the time of

disbursing such loans and advances

(including other advance, excess

payment etc) to such employees.

Yes, it is updated at the time of

disbursement of loan and

advances.

6.3 Whether recovery of principal

amount of loans and advances and

other advances, excess payment etc

wherever applicable, has been

made on regular basis as per rule

and noted in the Register.

Yes, it is updated at the time of

recovery of loan and advances.

6.4 Whether the details of balance of

each type of loans and advances

pending to be recovered as

reflected in the Register of

employees loans & advance have

been reconciled with those

reflected in the General and no

difference exists between two sets

of figures.

Yes.

6.5 Whether the difference between

the amount of loans and advances

as reflected in the Register of loans

and advances and the amount of

loans and advances as per General

Ledger which was pointed out by

the Branch Auditors and C&AG in

previous financial years, have been

fully settled during the current

financial year.


6.6 Whether interest on loans and

advances wherever applicable has

been correctly calculated, interest

has been recovered and noted in

the Recovery Register.

Yes, interest on loans and

advances have been correctly

calculated, interest has been

recovered.

6.7 Whether loans and advances given

by DOT to absorbed employees and

employees on deputation in BSNL

has not been booked as current

assets of BSNL. (Only the recovery

of such loan and advances will be

remitted to CCAs of DOT)

Yes, it has not been booked as

current assets and recovery of

such loan will be remitted to

CCAs.

7 Various type of deposits made by



BSNL units with different

authorities / local bodies / others

and advances given to vendors /

contractors / Govt. companies &

organization etc.

7.1 Whether proper sub-ledger /

Register has been maintained for

various types security deposits /

other deposits such as deposit with

Electricity Board / local authorities

made by BSNL units

Yes, it has maintained.

7.2 Whether proper sub-ledger /

Register has been maintained for

advances given to supplier /

contractors / Govt. companies &

organization etc.

Yes, it has maintained.

7.3 Whether proper entries have been

made in the sub-ledger / Register

for security deposits and Register of

advances at the time of givingSecurity deposit / other deposits

and advances.

Yes.

7.4 Whether recovery of amount of

advances given to vendor / supplier

/ contractor / Govt. companies &

organization and interest thereon

has been made as per terms and

conditions of giving advance and

such recovery has been noted in

the concerned Register

Yes.

7.5 Whether the balance of security

deposits / other deposits and

advances as reflected in the

concerned Register / sub-ledger has

been reconciled with entries made

in the general ledger and no

difference exists between two sets

of figures.

Yes, it has been reconciled.

7.6 Whether the difference between

the amount of security deposits /There is no such difference.



other deposits and advances as

reflected in the Register of Security

Deposits / other deposits and

Register of advances and the

amount of security deposits /

deposits and advances as reflected

in the General Ledger, which waspointed out by the Branch Auditors

and C&AG in previous financial

years, have been fully settled

during the current financial year.

8 EMD, SD given by BSNL Units and Bank guarantee given byBSNL Units to other s

8.1 Whether proper sub-ledger /Register has been maintainedfor keeping details of EMD & SDgiven by BSNL Units.

Yes, it has been maintained.

8.2 Whether refund of EMD & SDhas promptly been obtained onfulfilment of all the terms andconditions related to it and samehas been noted in the EMD/SD

Register.

Yes, the EMD/SD register has

been maintained and refund is

noted properly in the same.

8.3 Whether the details of EMD &SD as reflected in the EMD &SD register / sub-ledger havebeen totally reconciled with thebooked figure of EMD / SDreflected in the General Ledger and difference if any, betweentwo sets of figure has beensettled.


8.4 Whether Register for Bank

Guarantees given by BSNL Unithas been maintained and detailsof all such bank guaranteeshave been kept in the saidRegister.


the year.

8.5 Whether BSNL units have got the

bank guarantees released promptly

on fulfillment of terms and

conditions.


the year.

9 Temporary advance & Imprest



9.1 Each and every expendituremade from temporary advanceand the Inter nal Auditor mustscrutinize imprest frompropr ietary angle.

Yes, the expenditure made

from temporary advance has

been scrutinized.

9.2 The genuineness of at least25% of voucher s of temporaryadvance and imprest for itemsprocured / services availed mustbe checked by the Inter nalAuditor. The findings of suchchecking should be reported inthe Internal Audit Report.

The vouchers of temporaryadvance have been vouched

and it is found to be correct.

9.3 Whether there are incidence of taking temporary advanceinvolving huge amountfrequently / within shortinterval by selective group of off icer s and whether there is justif ication for suchtemporary advance in view of the fact that repair &maintenance of most of assets are done through annualmaintenance contract andmost of other works of recurr ing nature are carr iedout through contractor selected through establishedprocedures. The InternalAuditor to the Circle IFA mustreport any abnormality in this

respect. The f indings shouldbe given in the inter nal auditreport.


9.4 Whether there are instances of granting temporary advancewithout adjusting the previous one. If so, what action has beentaken by the IFA / Head of theUnit to prevent such type of irregularities must be indicatedby the Internal Auditor in theAudit Report.


9.5 Whether there are instances of non-submission of bills againsttemporary advance within thescheduled time frame for adjustment of temporaryadvances. In case of delaywhether interest has been recovered for the delay as per order from the concer nedoff icer who has defaulted, andcredited to BSNL Account.The Internal Auditors in the Audit

Report shall indicate theremedial action taken by theManagement in this regard.

Yes, interest has been

recovered for the delay.



9.6 The Internal Auditor in the Audit

Report shall indicate what action

has been taken by the Head of Unit

and IFA of the Circle to control the

expenditure from TemporaryAdvance and Imprest.

The head of the unit has

implemented a system to not

sanction any further temporary

advance until the first one is

settled (i.e. bill & invoicesubmitted and balance is

settled)

10 Amount recoverable from DOT,

DOP, MTNL

10.1 Whether Control Registers /Sub-ledgers have beenmaintained for various type of amount recoverable from DOTsuch as GPF advance/finalwithdrawal given by BSNL to its

absorbed staff, salary of BSNLstaff working in DOT, leavesalary paid to BSNL employeesworking in DOT on deputation.

Yes, Control Registers have

been maintained for varioustype of amount recoverablefrom DOT such as GPFadvance.

10.2 Whether proper entries havebeen made in the Register /Sub-ledger at the time of

disbursement of such amount toconcerned staffs, which arerecoverable from DOT.

Yes, proper entries have been

made in the Sub-ledger at thetime of disbursement of such

amount to concerned staffs,which are recoverable fromDOT.

10.3 Whether Register / Sub-ledger ismaintained for amountrecoverable from DOP such asrent of BSNL buildings occupiedby DOP, house keeping chargesof such buildings, servicesprovided by BSNL to DOP etc.

Not applicable.

10.4 Whether claim bills supported by

detailed schedules for each typeof claim have been preferred toDOT & DOP promptly, noted inthe Register, and activepersuasion has been made for recovery of such claimparticularly the old claim bills.

Not applicable.

10.5 Whether payment received fromDOT & DOP has been noted inregister.

Not applicable.

10.6 Whether balances which are

pending to be recovered fromDOT & DOP as reflected in theRegister / Sub-ledger have been

Not applicable.



reconciled with the balances asreflected in the General Ledger and difference if any has beensettled.

10.7 Whether details of amount

recoverable from DOT onvarious account have beenuploaded in Web based systemand the same has been talliedwith booked figure reflected inGeneral ledger.

Not applicable.

10.8 Whether claim bills supported bydetailed schedules for recoveryof principal amount of loans andadvances (including payadvance, medical advance, TAadvance) which have been givenby BSNL to unabsorbedemployees who are presentlyworking in DOT, DOP & MTNL,have been preferred to DOT,DOP & MTNL


the year.

10.9 Whether claim bill for recovery of interest on loan & advances(wherever applicable) given by

BSNL to unabsorbed employeeswho are presently working inDOT, DOP & MTNL, have beenpreferred to DOT, DOP & MTNL

Not applicable.

10.10 Whether the Unit has activelypursued and taken proper stepsfor recovery of principal amountof such loan and advances andinterest thereon (wherever applicable) from DOT, DOP &MTNL and whether the details of principal and interest amountrecovered from DOT, DOP &

MTNL have been noted in theRegister of loans & advances asmentioned Sl. 6.1 above.

Not applicable.

11 Various deposits taken from the

subscribers / other operators

11.1 Whether there is any bookingunder the accode for ³Beforeconnection deposit´. If so,whether all the details of all suchdeposits are available in³Register of Before connection

deposit´.

Not applicable at the unit.



11.2 Whether refund / adjustment of µBefore Connection Deposit¶ hasbeen routed through the sub-ledger / register of Beforeconnection Deposit and suchrefund / adjustment has beencorrectly noted in the Register of Before Connection Deposit.


11.3 Whether before connectiondeposit reflected in Register of µBefore Connection Deposit¶ hasbeen reconciled with the waitinglist and the difference if any hasbeen settled.


11.4 Whether the total balance of µBefore Connection Deposits¶ asreflected in the Register / Sub-ledger are tallied with thosereflected in General Ledger anddifference if any has beensettled.


11.5Whether details of all After connection Deposits have

properly been maintained inµRegister of after connectionDeposit¶.


11.6 Whether refund / adjustment of µAfter Connection Deposit¶ hasbeen routed through theRegister of After ConnectionDeposit and such refund andadjustment have been correctlynoted in the Register of After Connection Deposit.


11.7W

hether the balance of µAfter Connection Deposit¶ as reflectedin the Register of After Connection Deposit¶ have beenreconciled with the booked figurein General Ledger and differenceif any between two sets of figurehas been fully settled. Whether the details of after connectiondeposits have been reconciledwith the working connection andthere is no difference.


11.8 Check whether proper details of

all other deposits (other thanbefore connection and after

Yes, it has been maintained.



connection deposit) taken fromsubscribers / other operators /service providers have beenmaintained in the Sub-ledger /Register of other deposits.

11.9W

hether refund / adjustment of other deposits has been routedthrough the Register / Sub-ledger of other deposit and suchrefund and adjustment havebeen correctly noted in theRegister of other Deposit.

Yes.

11.10 Whether the balance of all suchother deposits as reflected inRegister of other deposits arereconciled with those reflected inthe General Ledger anddifference if any has been fullyadjusted.


11.11 Whether liability for interest onsubscribers deposit wherever applicable, has been createdand accounted.

No interest has been charged

on other deposits.

12 EMD, SD, Bank Guarantee

taken by BSNL from other s

12.1 Whether details of EMD & SDtaken by BSNL Units have beenproperly kept in sub-ledger /Register of EMD / SD.

Yes, it is maintained by the

unit.

12.2 Whether EMD & SD arerefunded promptly on fulfilmentof all the terms and conditionsrelated to it and same is noted inthe EMD/SD Register.

Yes.

12.3W

hether refund / adjustment of EMD & SD has been routedthrough the sub-ledger / register of EMD & SD and such refund /adjustment has been correctlynoted in the Register of EMD &SD.

Yes.

12.4 Whether the total balance of EMD & SD as reflected in theEMD & SD register/sub-ledger have been reconciled with thebooked figure of EMD / SDreflected in the General Ledger and difference if any, has beensettled.




12.5 Whether register has beenmaintained for bank guaranteetaken by BSNL Units from others

Yes, It is maintained by Unit.

12.6 Whether details of bankguarantee taken by BSNL units

have been kept in the Register.

Yes, It is maintained by Unit.

12.7 Whether bank guarantee takenby BSNL units has beenreleased promptly on fulfilmentof terms and conditions.

Yes, It is found in order.

12.8 Whether the Units has got thebank guarantee renewedwherever required as per termsand conditions, on expiry of validity period of the bankguarantee in question.

Yes.

12.9 Whether the Unit has encashedthe bank guarantee promptly asper terms and conditions relatedto such bank guarantees.


the year.

13 Sundry creditor s & provisions

13.1 Whether Sub-ledger / Register

for Creditors has beenmaintained for all types of creditors i.e. vendors, suppliers,contractors, service providers,other telecom operators etc andwhether the details all types of liabilities and provisions payableto such creditors have beennoted in the Sub-ledger /Register of Creditors at the timeof creation of such liabilities /provisions.

Yes,it is maintained by the unit.

13.2W

hether all the payment tocreditors has been routedthrough the Register for Creditors and debited toaccodes for liabilities / provisionswhere the amount of liabilities /provisions had been credited atthe time of creation of suchliabilities / provisions. Whether payment particulars have beennoted in Sub-ledger/Register for creditors.

Yes.

13.3 Whether details of all thepending liabilities / provisionsreflected in the Sub-




ledger/Register of Creditorshave been reconciled with thetotal amount of liabilities andprovisions as reflected in theGeneral Ledger and difference if any between two sets of figurehas been totally settled.

13.4 Whether liabilities / provisionsfound excess on review of thetotal liability / provision created,actual liability / provision andpayment already made, havebeen written back promptly andwhether the balance under accodes for liability / provision of general ledger and pendingitems of Sub-ledger / Register of Creditors reflect the actualliability / provision pending to be

disbursed.


13.5 Whether the circle has takenaction to obtain confirmation of the creditors at the close of thefinancial year.

No Such action has been taken

14 Payable to DOT / DOP

14.1 Whether proper liability /

provision has beencreated for pensioncontribution (for absorbed andunabsorbed employeesworking in BSNL) &leave salary contribution(for unabsorbedemployees ondeputation in BSNL)payable to DOT.

The unit sent schedule to circle

and circle make payment to

DOT.

14.2 Whether the detailed schedulesfor monthly pension contributionand leave salary contributionpayable to DOT has beenprepared and whether totalamount of such schedules hasbeen tallied with amount of liability as reflected in thegeneral ledger

Yes, the detailed schedules for

monthly pension contributionand leave salary contributionpayable to DOT have beenprepared and it has beentallied.

14.3 Whether detailed schedules for monthly recovery of principalamount of loans and advance(given by DOT to absorbed

employees of BSNL andunabsorbed employees ondeputation in BSNL) and interest

Yes, detailed schedules for

monthly recovery of principalamount of loans and advanceand interest thereon, monthly

GPF subscription & GPFadvance recovered fromabsorbed has been prepared.



thereon, monthly GPFsubscription & GPF advancerecovered from absorbed andunabsorbed employees, monthlyrecovery of CGEGIS in case of unabsorbed employees, hasbeen prepared and whether totalof such schedules has beentallied with monthly amount of recovery as reflected in theGeneral Ledger.

14.4 Whether Register for liabilitiestowards pension & leave salarycontribution, and Register for Recovery (GPF subscription &advance, CGEGIS, loans &advances given by DOT)payable to DOT has beenmaintained and whether entries

have been made in suchRegister as when liabilities havebeen created, recovery has beenmade, and subsequent paymentagainst such liabilities.

Monthly schedule prepared by

the unit and sent to corporate

office.

14.5 Whether amount of monthlypension & leave salarycontribution; monthly recovery of GPF Subscription, GPFAdvance, loans & advance,CGEGIS has been paid to CCAof DOT within due date and

whether payment has beennoted in the Register anddebited to the concerned accodefor pension & leave salarycontribution and accodes for recovery.

Yes.

14.6 Whether quarterly GR & AGRhave been calculated correctlyas per instruction of CorporateOffice, whether based on suchAGR quarterly License Fee,USO levy & Spectrum charges

have been calculated correctly,whether liability for LF, USO levyand spectrum charges has beencreated by debiting theexpenditure accodes 171 & 471schedules and crediting theprovision accodes of 120 & 420schedule and whether details of such liability has been noted inliability register for LF, USO levyand spectrum charges.

The same calculation is made

by circle.

14.7 Whether payment of license fee,

USO levy & spectrum chargeshas been routed throughprovision accodes of 120 & 420

The same calculation is made

by circle.



schedules and liability register,whether payment has beenmade within due date and detailsGR, AGR & details of licensefee, spectrum charges havebeen submitted to CCAs of DOTand whether the paymentparticulars have been noted inthe liability register.

14.8 Whether liability towards rent for space of DOP building occupiedby BSNL, house-keepingcharges for such DOP buildingoccupied by BSNL, postalservices provided by DOP toBSNL etc has been created andaccounted to concernedaccodes of liability as and whenthe liability accrues; whether

details of such liability has beennoted in the liability Register for DOP; and whether paymentagainst such liability has beenmade within due date and notedin the liability register.

Not applicable for the unit.

14.9 Whether the closing balance of various liabilities payable to DOT& DOP as reflected in theGeneral Ledger has beenreconciled with the details of pending liabilities as reflected inthe liability register for DOT &DOP and difference if anybetween two sets of figure hasbeen settled.


14.10 Whether principal amount of loans

& advances (given by DOP / MTNL

to absorbed employees of BSNL or

unabsorbed employee presently on

deputation in BSNL), and interest

thereon have been recovered by

BSNL from such employees through

pay bill, and paid to the DOT /

MTNL.


15 Salary payable & bills payableto employees

15.1 Whether Sub-ledger / Register of liabilities payable to employees

has been maintained for alltypes of liabilities towards salaryand other claims of the

Yes, Sub-ledger of liabilities

payable to employees has been

maintained for all types of liabilities towards salary and



employees and whether detailsof all sorts of such liabilities hasbeen noted in the said Register as and when such liabilities havebeen accrued and created bydebiting the relevant expenseaccodes for salary.

other claims of the employeesand register of liabilities has notbeen maintained.

15.2 Whether payment disbursedagainst such liabilities have beendebited / adjusted to concernedaccodes for liabilities payable toemployees where the amount of liability had been credited at thetime of creation of the liability,whether particulars of suchpayment have been noted insub-ledger / register of liabilitiespayable to employees.

Yes, payment disbursed against

such liabilities have beendebited / adjusted to concernedaccodes for liabilities payable toemployees.

15.3 Whether details of liabilitiespayable to employees reflectedin the sub-ledger / Register havebeen totally reconciled with theliabilities reflected in the GeneralLedger and difference if any hasbeen settled.


15.4 Whether the monthly salary hasbeen drawn for the staffs whoare covered by the sanctionedstrength of staff and who areworking or on leave sanctionedby competent authority.

Yes, the monthly salary has

been drawn for the staffs whoare covered by the sanctionedstrength staff and onsanctioned leave.

15.5 Whether total of monthly grosssalary drawn and booked toconcerned expense accodes hasbeen totally tallied with the (i)total amount of recoveries /deductions made from salary onaccount of loans & advances,GPF subscription & advance,EPF (employees share of contribution), Income Tax andother items of recovery whichhave been credited to variousaccodes of liabilities / credited toaccodes for recoverable ± under current asset / out of accountetc, plus (ii) the net amountpayable to employees which arebooked to liability accodes for

salary payable to employees.

Yes, it has been tallied.



15.6 Whether various other claims of employees (other than thesalary) i.e. TA & DA, medicalwith vouchers & indoor treatment, children educationallowance, reimbursement of expense on newspaper etc havebeen correctly worked out andsanctioned by competentauthority, whether liability wascreated by booking the expenseto concerned expenditureaccode and crediting to accodefor bills payable to employees,whether corresponding paymentor adjustment of such liabilityagainst some other recovery hasbeen debited to concernedaccodes for bills payable toemployees.

Yes, it has been correctly

worked out and sanctioned by

competent authority and

liability has been created.

16 Income / Revenue

16.1 Whether in respect of post paidconnections bills has beengenerated in respect of allworking connections

Bills are generated by EZBC,

Kolkata.

16.2 Whether telephone connectionsfor which billing has been madeas per billing cycle, has beenreconciled with the details of working connections as shown inMIS statements.

Not applicable.

16.3 Whether un-addressed bill hasbeen generated and alsowhether there are instances of un-addressed bill for consecutivetwo cycles in respect of sametelephone number.

Not applicable.

16.4 Whether the Management hasidentified customers in respect of all un-addressed bills, bills havebeen issued to such identifiedcustomers and the amount of bill

has been realized from thecustomer. Whether revenue inrespect of un-addressed bill hasbeen recognized only when thecustomer has been identified.

Not applicable.

16.5 What corrective action has beentaken by the Management toensure that bills in respect of allworking connections aregenerated with correct address?

Not applicable.

16.6 Whether the value of MCU

(except the MCU for free calls)has been tallied with the amount

Bills are generated by EZBC,

Kolkata.



of revenue booked as callcharges and there is nodifference between two sets of values.

16.7 In case of post paid servicewhether proper reconciliation

has been carried out in everybilling cycle between the amountof revenue billed for variousitems and the amount of revenuefor various items which has beenrecognized as income in theaccounts during the said billingcycle and whether the differenceif any between two sets of figurehas been properly explained.

Yes

16.8 Whether the µCategory¶ assignedto each connections (particularlythe connections to which thecategory of unlimited callfacility, concessional tar iff Plan, NI, service connection, RSTC, other concessionalfacility etc has been assigned)has been thoroughly reviewed,checked and found correct bythe competent authority in order to ensure that appropriate tariff is applied, charges to berecovered are correctlycalculated, there is no leakageof revenue due to assignment

of wrong category.

Yes

16.9 Whether OYT rebate has beenproperly monitored and whether the rebate has been stoppedimmediately after the prescribedperiod for rebate is over.

Not applicable.

16.10 Whether bills in respect of concessional telephoneconnections given to employeesas per terms and conditions of service has been issued,

accounted and realization of theamount of such has been made.

Not applicable.

16.11 Whether in respect of all servicetelephone connection (RSTC)bills have been generated, issued, amount of bill beyondthe concessional limit has been accounted and suchamount has been recoveredfrom the concer nedemployees.

Not applicable.

16.12 Whether in respect of

disconnected telephoneconnection, revenue has beenrecognized strictly as per

Not applicable.



existing rules and orders issuedby BSNL.

16.13 Whether appropriate portion(applicable to the current month /financial year) of the revenue

which was been received inadvance in previous financialyear(s) / month(s), has beenrecognized as income of thecurrent month / financial year bypassing necessary accountingentry.

Not applicable.

16.14 Whether revenue received in thecurrent month / current financialyear but applicable for futureperiod, has been accounted asincome received in advance bypassing necessary accountingentry.

Not applicable.

16.15 Whether all provisional billsissued in case of dispute and therebate given in respect of suchbills, have been verified byhigher authorities and foundcorrect as per their findings, andwhether all cases of provisionalbill has been settled promptlyand no delay occurs infinalization of such cases.

Not applicable.

16.16 In case of cancellation of billswhether the cancellation hasbeen done by the appropriateauthority and whether immediatehigher authorities haveexamined all such bills cancelledbills and whether as per their findings such cancellation iscorrect.

Cancellation of Bill are done by

AOTR.

16.17 Whether there are instances of delay in disconnection due tonon-payment and also instancesof delay in permanent closure of telephones and what action hasbeen taken by the Managementfor such delayed disconnectionand permanent closure.

There is no case of delay in

disconnection due to Non

payment. It is done

automatically by EZBC, Kolkata.

16.18 Whether in case of closedconnection accounts have beenfinalized within the time framefixed for the purpose, byadjusting the deposits against

the pending claim bills andwhether effective steps have

Yes



been taken to recover thebalance outstanding if any.

16.19 Whether the entire amount of revenue, which was booked, asaccrued in previous financialyear, has been totally reversed

in the beginning of the currentfinancial year.


16.20 Whether charges for all workingcircuits (leased & VPN circuits)details of which are availableTARIT-PLUS system, has beencalculated correctly, bills for such charges have been raised,such charges have beenrecognized either as revenue of the current financial year or asrevenue in advance, and theamount of claim has beenrealized. Whether reconciliationhas been carried out betweenthe amounts of bills raised andthe amount recognized asrevenue. Whether reconciliationof number of circuitscommissioned / working with thenumber of circuits billed hasbeen done and there is nodifference. Whether charges for circuits have been calculatedfrom the date of giving theconnection and accordingly

claims have been preferred.


16.21 Whether revenue from DSPTservice has been recognized,accounted and realized.


16.22 Whether USO subsidy for DSPTservice (one time at the time of installation of DSPT & annuallyequated subsidy for five years)has been recognized asrevenue, proper accounting hasbeen done, and subsidy has

been realized from CCAs.


16.23 Whether the claim for reimbursement of expense i.e.charges for diesel, electricity andother items from USPs who aresharing the USO Infrastructure(tower) installed & maintained byBSNL, as per terms andconditions of agreement withUSO Administrator and USPshave been correctly calculated,bills for such reimbursement

have been preferred to USPs,amount of bills has beenaccounted, and the same has




been recovered from USPs asper order of Corporate Office.Whether in the last month of each quarter the amount of expenditure to be reimbursed byUSPs for the said quarter, hasbeen neutralized i.e. credited toexpenditure accode where theexpenditure incurred has beendebited during the quarter.Whether a portion of suchexpenditure has beentransferred through ATD toCMTS vertical of BSNL for sharing the same USO tower bythe latter.

16.24 Whether fixed charges towardsdiesel generator set(s) and other items to be recovered from other USPs who are sharing the USO

infrastructure installed andmaintained by BSNL, has beencorrectly calculated, bills for such fixed charges have beenpreferred to USPs, amount of bills has been accounted asincome and charges have beenrecovered from USPs. Whether a portion of such fixed chargeshas been transferred throughinter-segment ATD to CMTSvertical of BSNL by recognizingthe same inter-segment income.


16.25 Whether the details of the claimsfor reimbursement of expenseand fixed charges, which arepending to be recovered fromUSPs and as reflected in thesub-ledger have been reconciledwith outstanding amount as per general ledger and there is nodifference.


16.26 Whether CMTS vertical haveaccounted the expense ondiesel, electricity and other items

by accepting ATD as well asrecognized the fixed charges asinter-segment expense byaccepting the inter-segmentATD.


16.27 Whether claims for USO subsidyfor USO Infrastructure (tower)has been correctly calculated asper agreement and order issuedby corporate office, claims for such subsidy have beenpreferred to CCAs of DOT,

amount of claim has beenrecognized as income on accrualbasis and the same has been




realized from CCA.

16.28 Whether claims USO subsidy inrespect of Rural wire-lineconnection n (i.e. rural household connection, VPT,

replacement of MARR systemetc.) installed on or after 01.04.2002 and RuralBroadband have been correctlycalculated, claims have beenpreferred to CCA, amount of claims has been recognized asincome on accrual basis and thesame has been realized fromCCA.


16.29 Whether outstanding claims for USO subsidy in respect USO

Infrastructure, Rural Telephony,Rural Broad band as per Sub-ledger have been reconciled withamount of such outstandingclaims reflected in the GeneralLedger and there is nodifference.


16.30 Whether IUC recoverable fromother service providers has beencorrectly calculated as per IOBAS data, claims for IUC havebeen preferred; amount of claims has been recognized as

income and realized from other telecom operators.


16.31 Whether charges for infrastructure (such as ports,space, tower) given on rent toother telecom service providersat point of interconnection (POI)level have been calculatedcorrectly, claims for suchcharges have been preferred toother telecom service providers,amount of claim has beenaccounted as income on accrual

basis and the same has beenrecovered from them.


16.32 Whether IUC recoverable fromMTNL has been got accounted,recognized as income, andrealized from MTNL throughNorthern Telecom Region.


16.33 Whether revenue share for inward traffic received fromSAARC countries during thefinancial year in question hasbeen correctly calculated, claims

for revenue share have beenpreferred to SAARC countries,




amount of claims has beenrecognized as revenue onaccrual basis and such revenueshare has been recovered.

16.34 Whether revenue to be

recovered from other ILDoperators / ILD service provider for incoming ILD traffic has beencorrectly calculated, bills hasbeen preferred, amount of billshas been recognized as incomeon accrual basis and realizedfrom such operators / serviceprovider.


16.35 Whether international roamingrevenue recoverable frominternational roaming serviceprovider has been correctlycalculated, claims for suchrevenue share has beenpreferred, roaming revenue hasbeen recognized as income ongross basis and realized fromsuch operators.


16.36 Whether outstanding claims for infrastructure, IUC, SAARCrevenue, revenue for incomingILD traffic, international roamingrevenue as per Sub-ledger havebeen reconciled with amount of such outstanding claims

reflected in the General Ledger and there is no difference.


16.37 Whether revenue generatedfrom various value addedservices provided to BSNLsubscribers through channelpartners / service providers hasbeen correctly segregated asrevenue of BSNL and revenueshare payable to channelpartners / service providers asper agreement, BSNL¶s portionhas been recognized as revenue

of BSNL, and liability has beencreated for the share of revenuepayable to channel partners /service providers.


16.38 Whether accounting of revenuefrom the subscribers registeredunder Free EPABX Scheme andaccounting of revenue share tobe given to the EPABXManufacturer / EmpanelledFranchisees has correctly beenas per Circular No. 113 dt.

30.11.2007.




16.39 Whether accounting of tradableitems (stand alone sale or saleof such items bundled withservice), and recognition of revenue has been done as per circulars issued by CorporateOffice (refer latest circular in thisregard).


16.40 Whether income for servicesprovided to MTNL (other thanIUC) has been recognized asper order of Corporate Office.

Yes

16.41 Whether net revenue has beenbooked wherever agreementwith franchisees, channelpartners, DSA, PCO holder is onµprincipal to principal¶ basis.

Yes

16.42 Whether revenue accrued anddue but not billed for has beencalculated on actual basis (i.e.fixed charges, usage charges &other charges for the period notbilled for up to 31st March) andnot on the basis of estimationand accounted as accruedrevenue.

Not applicable.

16.43Whether inter-segment incomehas been correctly calculated inrespect of traffic taken place

between Basic & CMTS of BSNLand vice versa during thefinancial year in question,recognized as inter-segmentincome in CFA & CM andcorresponding entry has beenmade to recognize the inter-segment expenditure by CM &CFA respectively. There shouldnot be any difference betweeninter-segment income and inter-segment expenditure.


16.44 Whether charges for servicesprovided by BSNL to DOP andfor infrastructure of BSNL sharedby DOP has been calculatedcorrectly, such charges havebeen recognized as income of BSNL, claims for such chargeshas been raised and realizedfrom DOP.


16.45 Whether charges for variousinfrastructure (such as space inadministrative and operativebuildings, residential quarters,inspection quarters, duct,

electrical installation etc) other than those given at POI location




and towers, given to externalentities as per new policy of BSNL, have been properlycalculated, bills for such chargeshave been raised, claims havebeen recognized as income of BSNL and realization has beenmade.

16.46 Whether charges for trainingservices provided by TrainingCentres of BSNL to externalentities have been correctlycalculated, bills have beenraised, the amount of bill hasbeen recognized as revenue andrealization of amount of claim billhas been done.


16.47 Whether all other sorts of income which are categorized /defined as ³Other Income suchas license fee for residentialquarters, charges for inspectionquarters, water charges, sale of waste papers, sale tender forms,examination fee, interest onshort term bank deposits /sweep in facility, interestrecovered from employees onloans & advance, interestrecovered from employees aspenalty, profit on sale of assets,RTI fee and related other charges recovered if any,

charges for water and electricityprovided to contractor, chargesfor usage of BSNL assets bycontractor etc have beencorrectly recognized in theaccounts.


16.48 Whether revenue meant for afinancial year has beenaccounted as income in the saidfinancial year and no excessrevenue has been accountedand no revenue has been left tobe accounted.

Yes.

16.49 Whether revenue has beenbooked to correct head of account.

Yes.

16.50 Whether the revenue generationand recognition throughout theyear is more or less uniform andnot concentrated on the last fewmonths of the financial year.

Yes, the revenue generation

and recognition throughout theyear is more or less uniform.

16.51 Whether revenue billing packageused by the Circle has been got

audited.




16.52 Whether credit limit given tosubscribers has beencontinuously monitored andaction has been taken to getrecoupment from the subscriberspromptly and service is restoredimmediately on getting therecoupment.

Yes, Credit limit is monitored

on Daily basis.

16.53 Whether continuous monitoringhas been done in case of connection like µJODI¶, µTricon¶etc in order to stop theconcerned concessional facilityas and when the subscribershave failed to observe the termsand conditions of suchconnection.


16.54 Whether accrued revenue hasbeen calculated correctly at theclose of the financial year basedon actual meter reading andaccordingly the accrued revenuehas been recognized.


16.55 Whether Tatkal deposit (after connection) has beenrecognized as revenue per order issued by Corporate Office.


17. Revenue from prepaid items

17.1 Whether Register for all types of pre-paid items such as SIMCard, Recharge coupon,CELLONE Vouchers, E-Pin,VCC, ITC, Internet card etc hasbeen maintained at all levels of BSNL Units.

Yes

17.2 Whether proper entries of alltypes of pre-paid items havebeen made in the Registers of prepaid items / softwarefunctioning for the purpose (i.e.(i) opening stock of prepaiditems at the beginning of thefinancial year, (ii) receipt of prepaid items from vendors /telecom factories during thefinancial year, (iii) issue of prepaid items to various sellingpoints / CSCs of BSNL duringthe financial yea, (iv) actual saleeither bulk sale or retail sale of

prepaid item to subscribers,direct selling agent, franchisees

Yes



and others, (v) extension of validity of expired prepaid itemsunder the sanction of thecompetent authority; (vi) prepaiditems destroyed under thesanction of the competentauthority, (vii) closing balance of prepaid items), and whether reconciliation of such entriesmade in the Register / softwarehas been carried out with thephysical items of such prepaiditem and relevant records i.e.bill-cum-delivery challans for consignment received, issuevoucher / slips, sale voucher,sanction memo of the competentauthority for extension of validityperiod, sanction memo for destruction of prepaid items etc.

17.3 Whether closing stock of SIMand various other prepaid itemsas reflected in the Registers /software functioning for thepurpose, has been reconciledwith the physical stock of prepaid items which areremaining unsold at all levels of BSNL units from time to timeand at the end of the financialyear no difference existsbetween physical stock and

book stock.

Yes

17.4 Whether total value of prepaiditems actually sold tosubscribers, direct selling agent,franchisees and others byvarious selling units of BSNL asreflected in Register / softwarehave been reconciled with theamount of revenue recognized inthe accounts as income plus thevalue of prepaid items given freeor given as gift, incentive, trade

discount, commission etc and nodifference exists between thetwo.

Yes

17.5 Whether proper accounting of CELLONE vouchers sold in bulkto Solution Providers (SP) hasbeen done; utilization of suchvouchers by CELLONEcustomers for payment of CELLONE bills as well asutilization of such CELLONEvouchers by wire-line customersfor payment of their wire-line billshas been correctly accountedand the amount of such utilizedCELLONE vouchers i.e. credit

Yes



has been transferred toconcerned circles / units for adjusting the sundry debtors of Post paid & wire-line service,and required reconciliation hasbeen carried out at every stageas per instructions issuedthrough Circulars having No 110and 187 by CA Section.

17.6 Whether correct accounting of

has been done in respect of

Online Recharge of BSNL pre-

paid Mobile through BSNL Portal

and necessary reconciliation has

been done as per instructions

issued through Circular No. 187

Yes

17.7 Whether revenue from top-up,CellOne vouchers etc. soldthrough channel partners,franchisees and others areproperly recognized and there isno leakage of revenue.

Yes

17.8 Whether the total value of alltypes of prepaid items i.e. SIM, rechar ge voucher s, e-PIN, CTOP UP etc; rechar ge madeonline through BSNL Portal; CELLONE Voucher s etc whichhave been activated in INplatform dur ing a f inancialyear , have been reconciledwith the (i) total amount of prepaid revenue from var ious prepaid items which has been recognized as income fromprepaid service dur ing thesaid f inancial year , plus (ii) thevalue of prepaid items given as free and/or given as gift, incentives, trade discount, commission etc, dur ing the

said f inancial year , plus (iii)total value of CELLONEvoucher s utilized for paymentof CELLONE bills & wire-linebills dur ing the f inancial year which has been accounted byrespective units as credit toSundry debtor s for Post paidCMTS and Basic service, andno difference exists between two sets of f igures.

Yes

17.9 Whether prepaid items given as

free or gift has the sanction of competent authority and the

Yes



same is supported by policy of BSNL.

17.10 Whether prepaid items given asincentives, trade discount,commission etc are as per policy

of BSNL and has the sanction of the competent authority.

Yes

17.11 Whether the payment receivedthrough Bill Desk, online, creditcards etc. has been properlyreconciled, classified andadjusted.

Yes

17.12 Whether the details of distributors, DSA, Franchisees,channel partners and relatedterms and conditions have beenproperly maintained in aRegister.

Yes

18 Expense

18.1 Whether expense in respect of pay & allowances of staff,pension contribution, leavesalary contribution (for unabsorbed staff), employer'sshare of contribution to EPF,administrative charges towardsEPF etc related to the financialyear has been recognized inaccounts of the said financial

year by debiting the concernedexpense accode as and whenthe liability has accrued, andcorresponding liability has beencreated by crediting toconcerned liability accode.

Yes.

18.2 Whether expense in respect of all types of employees benefits(other than pay & allowances of staff, pension contribution, leavesalary contribution (for unabsorbed staff), employer's

share of contribution to EPF,administrative charges towardsEPF) i.e. expense on TA & DA,medical (medical allowance,outdoor treatment with voucher,indoor treatment), CEA, Tuitionfee, newspaper etc related to thefinancial year in question hasbeen has been correctlycalculated and recognized inaccounts of said financial year by debiting the concernedexpense accode as and when

the liability has accrued, andcorresponding liability has beencreated by crediting to

Yes.



concerned liability accode.

18.3 Whether expense in respect of

(i) various types of services

availed by BSNL during the

financial year in question i.e.

repair & maintenance service,

professional service, transport

service, security service,

insurance service, postal service,

courier service, technical service

(for processing CDR, IOBAS, TAP

IN TAP OUT etc) etc provided

contractors, professionals,

transporters, insurer, courier

companies, post offices, various

other service providers etc and

(ii) material / stores and officestationery, raw material of

telecom factories received

against purchase order during

the financial year in question,

has been recognized in the

accounts of the said financial

year as and when the liability

has accrued, has been

recognized by debiting the

concerned expense accode and

corresponding liability has been

created by crediting the

concerned liability accode, and

whether subsequent payment

or adjustment of liability has

been debited to concerned

accode for liability / provision.

Yes.

18.4 Whether expense in respect of IUC related to the financial year in question payable to other telecom service provider hasbeen correctly calculated andrecognized in the accounts of

said financial year by debitingthe concerned expense accodeand corresponding liability hasbeen created as and when theliability has accrued and actualpayment made for IUC has beenadjusted against the liability.

It is maintained at circle level.

18.5 Whether expense towards IUCpayable to MTNL related to thefinancial year in question hasbeen recognized and accountedin the accounts of the said

financial year through NTR andcorresponding liability has been




created.

18.6 Whether expense towardsoutward traffic originated fromBSNL Subscribers andterminated in SAARC countries

during the financial year inquestion has been correctlycalculated and recognized in theaccounts of same financial year and corresponding liability hasbeen created.


18.7 Whether expense related to thefinancial year in question inrespect of international roamingcharges payable to other Operators has been calculatedcorrectly and recognized in theaccounts of said financial year by debiting the expense accodeby Nodal circle andcorresponding liability has beencreated and paid.


18.8 Whether expense in respect of outgoing ILD traffic originatedduring the financial year inquestion has been correctlycalculated and recognized in theaccounts of said financial year by Nodal circles andcorresponding liability has been

created and paid.


18.9 Whether expense on all types of bandwidth and related servicetaken by BSNL from others for the financial year in question hasbeen correctly calculated andrecognized by nodal circles inthe said financial year andliability has been created.


18.10 Whether expense ontransponder taken by BSNL fromAntrix Corporation for the

financial year in question hasbeen correctly calculated andrecognized by nodal circle in thesaid financial year and liabilityhas been created.


18.11 Whether expense towards leasecharges for various types of assets taken on operating leaseby BSNL for the financial year inquestion has been correctlycalculated and recognized by theunits in the said financial year

and liability has been created.




18.12 Whether expense pertaining tothe financial year in question onmaintenance of sub-marinecable has been correctlycalculated by nodal circle andrecognized in the said financialyear and liability has beencreated.


18.13 Whether expense for infrastructure / USOinfrastructure which are ownedby other operators / organizationbut shared by BSNL, has beencalculated as per agreement for the period of use related to thefinancial year in question, andrecognized in the accounts of the said financial year andliability has been created.


18.14 Whether expense on negativesubsidy payable to USOAdministrator for provision of mobile service through USOtowers for the financial year inquestion has been correctlycalculated and recognized in thesaid financial year and liabilityhas been created.


18.15 Whether expense in respect of discount & commission which

are applicable for the financialyear in question and payable tofranchisees, retailers, PCOs,post offices, banks, collectionagents etc. as per agreemententered by BSNL with theformers, has been calculatedcorrectly and recognized in theaccounts of the said financialyear and liability has beencreated.

Yes

18.16 Whether expense for the worksperformed by the contractor

during the financial year inquestion has been correctlycalculated and recognized in thesaid financial year andcorresponding liability has beencreated.

Yes.

18.17 Whether expense on rent for theaccommodation owned byothers but utilized by BSNL for the period of use pertaining tothe financial year in question hasbeen correctly calculated and

recognized in the said financialyear and corresponding liabilityhas been created.

Yes.



18.18 Whether expense on electricityand diesel consumed during thefinancial year in question hasbeen correctly calculated andrecognized in the said financial

year and corresponding liabilityhas been created.

Yes.

18.19 Whether the utilization of dieselin exchanges is reasonable withreference to power cuts as per records maintained. 20% testcheck shall be carried out fromElectricity authority about power cut.


18.20 Whether expense on rates andtaxes payable to local bodies,other authorities etc applicableto the financial year in question

has been correctly calculatedand recognized in the saidfinancial year and correspondingliabilities have been created.

No such types of expenses

incurred during financial year.

18.21 Whether expense on rent for postal building occupied byBSNL for the period of usepertaining to the financial year inquestion, and housekeepingcharges for the said period hasbeen calculated as per rate fixedby FRAC, and recognized in thesaid financial year and

corresponding liability payable toDOP has been created.


18.22 Whether expense on marketing,advertising etc for the financialyear in question has beencorrectly calculated andrecognized in the said financialyear and liability has beencreated.


18.23 Whether expense towardsamount payable to Ministry of

Health & FamilyW

elfare for extending the CGHS benefit toBSNL employees related to thefinancial year in question hasbeen correctly calculated,recognized in the said financialyear and liability has beencreated.

No

18.24 Whether quarterly GR, AGR hasbeen calculated as per orders(particularly the orders regardingcalculation of AGR as per judgement of Hon¶ble TDSAT)issued by Corporate Office andexpense on license fee, USOlevy and spectrum charges




payable to DOT, has beencorrectly calculated, recognizedand liability has been created.Whether the liability towardsLicense fee, USO levy &Spectrum charges has beenbooked to accodes allottedunder 120 & 420 schedule andpayment to CCA against suchliability has been routed throughthe concerned accodes of 120 &420 schedules. Whether spectrum charges for the 1

st

quarter of the financial year which is payable in advance i.e.on 25

thMarch of previous

financial year, has been properlyaccounted as paid in advanceand at the beginning of the nextfinancial year the same has

been recognized as expense onspectrum.

18.25 Whether there is no lapse increating the liability for servicesavailed and material / storesreceived up to the close of financial year so that pr ior per iod booking is totallyavoided.

Yes,

18.26 Whether all sorts of expenseshave been incurred on the basis

of approval accorded bycompetent authority.

Yes, all sorts of expenses have

been incurred on the basis of

approval accorded bycompetent authority.

18.27 Whether expenditure has beenincurred against the budgetallotment and variation has beencovered by supplementaryallotment.

Yes, expenditure has been

incurred against the budget

allotment and variation has

been covered bysupplementary allotment.

18.28 Whether procurement of services and material has beendone through tendering systemapproved by the Management.

Yes.

18.29 From propriety angle checking of the following types expenditure /items shall be carried by theInternal Auditor:a) the expenditure on cable

laying contracts right fromthe inception stage to thefinal execution.

b) the expenditure onrehabilitation and upgradation works right fromthe inception to completion

and physical retrieval of dismantled materials,

a) Not applicable.

b) Not applicable.



accounting the netdepreciated value toconcerned accode in theBooks and disposal of suchitems as per rules.

c) supplier¶s bill for supply of material / stores /equipments with referenceto total quantity ordered,total quantity supplied, totalpayments made, proof of receipt of stores / materialissued by the consigneeetc.

d) the expense incurred for advertisement / hoarding.

e) medical bills involvingindoor treatment.Observations andsuggestions in this regard

will be mentioned in themanagement summary.

f) vouchers pertaining toexpenditure incurred onprojects.

c) Not applicable.

d)yes same is followed as perapproval

e) yes.

f) Not applicable.

18.30 Whether in respect of traffictaken place during the financialyear in question between Basic& CMTS of BSNL and viceversa, inter-segment expensehas been properly calculated,recognized as inter-segmentexpense in the said financial

year and corresponding contraentry has been made in other segment towards segmentincome.

Yes, it has been properly

calculated and recognised as

inter- segment expenses.

19 CMTS

19.1 Check the procurement of equipments for CMTS throughtender; accounting of receipt of CMTS such equipment;accounting of issue of suchequipment to turn-key projectexecutor and utilization of such

equipments in project work byturn-key project executor;accounting of surplus equipmentlying with turn-key projectexecutor; accounting of entireturnkey projects; accounting of other projects of CMTS,capitalization of completedCMTS projects, creation of liability for such projects,disbursement of paymentagainst liability, accounting of payment against liability accodeetc.

No equipment has been

procured during this financial

year.



19.2 Check the procurement of maintenance services for CMTSthrough tender for CMTS,creation of liability, disbursementof payment against liability,accounting of payment againstliability accode etc

Not applicable.

19.3 Whether pay and allowances of staff & officer who are actuallyengaged for CMTS work /providing service to CMTS, arerecognised as expense in theaccounts of CMTS Segment.

It is to be done at year end.

19.4 Whether Administrativeexpenditure, which is actuallyrelated to CMTS Service, arerecognised as expense in theaccounts of CMTS Segment.

It is to be done at year end.

19.5 Whether IUC recoverable andpayable from / to other telecomservice providers in respect of CMTS traffic received andtransferred from / to other telecom service providerspertaining to the financial year inquestion has been correctlycalculated, recognized in theaccounts of said financial year as IUC income & expense andsundry debtors and liability for

such income and expense havebeen created.

Not applicable.

19.6 Whether Inter-segment expense& income in respect of traffictaken place during the financialyear in question between CMTS& Basic of BSNL and vice versahave been correctly calculated,recognized as inter-segmentexpense and income in CMTSsegment, reconciliation betweenincome & expense has been

made to see that no differenceexists between the bookingsmade to accodes for inter-segment transactions by Basic &CMTS unit.

Yes

19.7 Check the reconciliation of prepaid items as mentioned Sl.17 above.

Prepaid items has been

reconciled.

19.8 Check the reconciliation of E-pingenerated, prepaid voucher,SIM, CELLONE vouchers

printed etc.

All these has been reconciled

and found to be correct.



19.9 Check the revenue sharingarrangement with other contentproviders for VAS on CMTS,share of such revenuerecognized by BSNL, revenueshare to be paid to contentproviders, liability created for revenue share payable toconvent provider.

Not applicable.

19.10 Check the Post paid billing - ABFaccounting, paymentreconciliation, reconciliation of sundry debtors with generalledger as mentioned at Sl 5above.

Not applicable.

19.11 Check the complete revenueassurance activity for prepaidand post paid subscribers atzonal billing centre. (TheInter nal Auditor of the Cir clewhere the Zonal-billing centreis situated will do this job).

Not applicable.

19.12 Whether transfer of capitalexpenditure, revenueexpenditure and income of CMTS from one CMTS unit toanother CMTS Unit of samecircle or different circle (intra &Inter), transfer of CMTS income& expenditure by Basic Segment

to CMTS segment (both inter &intra), transfer of Inter-segmentIUC expense & income inbetween Basic & CMTS (onlyintra-segment) and transfer of BASIC income & expenditure byCMTS Segment to BASICsegment (both inter & intra) havebeen accounted and settledthrough remittance accodeallotted by Corporate Office.Whether reconciliation of suchInter-segment ATD & ATC (both

originating & responding) hasbeen done.

Not applicable.

19.13 Any other job related to CMTSas deemed fit by the Circleauthority and as specified in thescope of work.

Not applicable.

19.14 Whether claims for BSNLTowers which have been sharedby other operators, have beencorrectly calculated as per termsand conditions of the agreemententered into by BSNL with other

operators, bills for such claimshave been preferred to other operators, amount of claims

Not applicable.



have been accounted as incomeand claims have been recoveredfrom other operators. Whether outstanding claims as per Sub-ledger have been reconciled withamount of such outstandingclaims reflected in the GeneralLedger and there is nodifference.

19.15 Whether claims for USO Subsidyfor provision of mobile servicethrough USO tower by NE I, NEII & J&K circles have beencorrectly calculated as per agreement with USOAdministrator, claims bills havebeen submitted to CCA, theamount of claims has beenrecognized as income and

recovery of claims has beenmade.

Not applicable.

20 Intra & Inter cir cle Remittance

20.1 Check whether ATD and ATChas been raised immediatelyafter the remittance transaction(intra circle and inter circle inrespect of BASIC & CMTS, andinter-segment) has taken placeand the same is reflected in TrialBalance of the month in whichthe transaction has occurred as

well as the same has beenuploaded in IBTMS packageduly reconciled with bookedfigure. Whether all thesupporting details i.e. vouchersand other documents etc havebeen furnished by the originatingunits to responding units alongwith the ATD and ATC

Yes, it is tallied.

20.2 Check whether all types of ATDand ATC has been accepted bythe responding unit immediately

on receipt and accounted thedebit or credit in the trial balanceas well as the information aboutacceptance of ATD & ATC hasbeen uploaded in IBTMSpackage immediately the ATD &ATC have been accepted.

Yes.

20.3 Whether there has been anydelay in raising as well asacceptance of ATD & ATCparticularly the ATD for transfer of expenditure on completedprojects by Project Circles /Installation wing of circle to theconsignee circles / units and

Not applicable.



what corrective steps have beentaken by the Management toavoid the delay completely.

20.4 Whether in case of transfer of staff ATD/ATC for the

outstanding loans and advances(excluding those given by DOT)has been sent along with theLPC, such ATD / ATC has beenaccounted in the trial balance of same month and uploaded toIBTMS Package.

Yes.

20.5 Whether complete review of allthe ATD / ATC which remain tobe accepted by the respondingunit, has been carried outregularly by the originating unitand whether the originating unithas taken steps for getting thosepending ATD / ATC accepted bythe responding unit.

Yes.

21Payment to Central Excise &

other Departments

21.1 Whether payment of Service Tax& other Excise Duty has beenmade through E-payment facilitywherever it is mandatory.

Yes.

21.2 Whether units have remitted theservice tax collected on accountof output service, to Service TaxAuthority within the stipulateddates.

Yes.

21.3 Whether TDS has correctly beendeducted on items covered bySection 40(i)(a) of Income TaxAct and remitted to the taxauthorities within due date andthere is no case of non-deduction of TDS or less

deduction of TDS or delay indepositing TDS recovered or non-remittance of TDS deductedor less remittance of TDSdeducted (since in such casesthe expenditure will bedisallowed).

Yes, it has been correctly

deducted and in some cases

SHEC & EC has been ignored/

collected at lower rate.

21.4 Whether in cases of other items(not covered by Section 40(i)(a))whether TDS has been correctlydeducted and deposited withinthe due date and there is nocase of non-deduction of TDS or less deduction of TDS or delayin depositing TDS recovered or




non-remittance of TDS deductedor less remittance of TDSdeducted (since in such casespenalty & interest are chargedas well as BSNL has to pay theamount TDS from its ownpocket}.

21.5 Whether each individualpayment amounting to morethan Rs. 20000/- has been madeby BSNL unit through chequeonly.

There is no any payment of

more than Rs. 20000/- has

been made in cash.

21.6 Whether credit for Service Taxon input service, Excise duty /CVD etc on capital goods, inputshas been availed wherever applicable as per CENVATcredits Rules. Whether CENVATcredit has been availed only outthe credit lying as unutilised atthe end of immediate previousmonth.

Yes, credit for Service Tax on

input service has been availedby the unit as per CENVATcredits Rules.

21.7 Whether TDS certificate inrespect of TDS deducted bypaying authority of BSNL havebeen issued promptly within theprescribed time limit.

Yes.

21.8 Whether Service Tax Return /input service distribution return /

dealership return, and TDSreturns etc have been filed withindue dates.

Yes.

21.9 Whether ST-3A return has beenfiled within due date in caseswhere permission for payment of service tax on output service on provisional basis has beengranted by Service Tax authorityto BSNL unit.

The unit has filed such return.

21.10 In case of centralized

registration of service tax issuedby the Commissioner of CentralExcise whether all the premises(i.e. exchanges / BTS / MSCetc.) have been included in theservice tax registrationcertificate.

No.

21.11 Whether the amount of TDSdeducted by the other partiesfrom BSNL¶s claim has beenproperly accounted under relevant account head i.e. gross

amount of claim preferred byBSNL, have been booked toincome head and the amount of

Yes.



TDS has been booked to TDSaccode and the total amount of TDS accounted in general ledger has been tallied with the TDScertificates obtained. Whether TDS Certificates has been sentto Corporate Accounts Sectionof Corporate Office timely.

21.12 Whether information regardingwealth tax has been sent toCorporate Office.

No any information regarding

wealth tax is available at the

unit.

21.13 Whether employer's contributionto EPF, administrative chargesand employee contribution havebeen remitted timely to EPFOand monthly returns as well asannual returns have beensubmitted in time

Yes.

21.14 Whether reconciliation of booking under accodes for µService Tax Recoverable¶ andµService Tax Payable¶ has beencarried out and no differenceexists between two sets of figures.

Yes.

21.15 Whether monthly pensioncontribution, leave salarycontribution, GPF subscriptionand GPF advance recoveredfrom employees have been paid

to CCAs within the due date.

Yes.

21.16 Whether Telecom Factorieshave correctly accounted theexcise duty on raw materialpurchased, excise duty payableon finished product, excise dutypayable on scrap. Whether credit for excise duty paid on rawmaterial has been availed.Whether provision for exciseduty on finished product lying atstock at the close of the financial

year has been made by TelecomFactories.

Not applicable.

21.17 Whether the Units havecomplied with the provisions of Income Tax Rules / CENVATRules / Service Tax etc.

Yes.

21.18 The Internal Auditors will alsoassist the units in maintenanceof all documents and registersconnected with CENVAT. Theyshould also impart necessary

training to the staff/officersdealing with Service Tax /CENVAT matters. Internal

Yes, it has been done.



Auditors must guide and assetsthe units of BSNL so the unitscan avail 100% credit on inputservice.

22 Checking of tr ial balance

22.1W

hether there is unauthorisedaccodes in the Trial Balance. No such un-authorized accodsare used by Unit during the

period.

22.2 Whether there is adversebalance in any accode asreflected in trial balance andwhether such adverse balancehas been reviewed, reconciledand set right wherever required.

There is no any adverse

balance in any accodes and it is

reviewed.

22.3 Whether opening balanceintimated by Corporate Office /Circle office has been properly

incorporated in the TrialBalance.

Yes.

22.4 Whether reconciliation of themonthly booking in trial balancein respect of loans & advances,GPF subscription and recoveryof advance, Pension & leavesalary contribution, employeesshare of contribution towardsEPF and other items has beenreconciled with the detailedmonthly schedules of above

mentioned items.

Yes.

22.5 Whether detailed records /vouchers in support of thebooking made in the eachaccode as reflected in trialbalance are available andreconciliation has been made.

Vouchers are available in

support of the booking made in

the each accode but detailed

records are not available .

22.6 Whether in respect of any fixedasset reflected in a fixed assetaccode is having the booking for accumulated depreciation anddepreciation under the accodefor accumulated depreciationand depreciation, which arerelevant to such asset accode.

It will be done at the year end.

22.7 Whether in respect of provisionfor obsolete & unserviceableasset and obsolete &unserviceable inventory reflectedunder accodes for provisionthere are booking for obsolete &unserviceable fixed assets andinventory in the accodes whichare relevant to




22.8 To certify that the trial balance issupported by the correctschedules. No Internal Auditor can certify the trial balance withthe remarks 'that it is subject toqualifications' in their report

22.9 Whether circles have compiled all

the information for disclosures as

per Schedule VI requirements

Not applicable.

23 Action taken in respect of qualif ication of Branch &Statutory Auditor & C&AG

23.1 The internal auditor must gothrough all the observations andcomments of Branch Auditors,Statutory Auditor and C&AG onthe accounts of the Circles

pertaining to previous financialyear(s).

Yes.

23.2 Whether SSAs / AccountingUnits of circles / Circleauthorities have taken action inthe current financial year inrespect of all the observationsand comments made by theBranch Auditors & StatutoryAuditors on the accounts of Circles pertaining to previousfinancial years(s), andrectification / adjustment entrieswherever required, have beenpassed and incorporated in thecurrent financial year accountsto settle concernedqualifications. Whether SSAs /Accounting units / circleauthorities have taken action inthe current financial year inrespect of other qualificationssuch as proper maintenance of sub-ledgers, fixed asset register,other register, priced stockledger; reconciliation of sub-

ledger with general ledgers;carrying out physical verificationof assets and inventory, andproper records of physicalverification; bank reconciliation;unlinked debit and credit, excessdebit & credit, wrong debit &credit relating to banktransactions; promptcapitalization of completedworks; charging of overhead;valuation of inventory; creationof proper liability; payment of

statutory dues within dues datesetc.

Yes, rectification/adjustment

entries have been passed and

incorporated in the current

financial year, but the unit has

not taken proper action in the

current financial year in respect

of other qualification such as

proper maintenance of fixed

assets register, carrying out

physical verification of assets,proper record of physical

verification.



23.3 Whether SSAs / AccountingUnits of circles / Circleauthorities have taken action inthe current financial year inrespect of all the observation &comments made by C&AG whilecertifying the audited annualaccounts of previous financialyear(s).

We have not received any

records relating to the same.

23.4 Whether decision taken by theAudit Qualification ReductionCommittee, has beenimplemented by the concernedaccounting unit within the timeframe fixed.

We have not received any

records relating to the same.

23.5 Whether action has been by theCircles to set right thediscrepancies pointed out by theAudit Committee.

Not applicable.

24. Additional Duties of LeadAuditor The additional duties of the leadauditor will be to coordinate theactivities of other Internal AuditCA firms, to give guidance, tohave constant interactions withBSNL officers, to ensure thatother firms also complete thework as per appointment letter within the time stipulated and

finally act as the interfacebetween branch auditors andBSNL officers.

Not applicable.

25. Audit Report & ManagementSummaryAudit report must cover all theitems mentioned at Sl 1 to Sl 23above and pro-active taken bythem to set right the defects andshortcomings if any, should bementioned in column 4.All Auditor s shall attach amanagement summary to their report. In the managementsummary inter nal auditor s willbe required to give detailedcomments on the inter nalcontrol system.

It is annexed in Part -B of Report.



(Arundati Panda)

Sr. GM (CA)

Documents

CGMT PATNA IA SEPT 2010