The SIKKIM LOCAL FUND AUDIT ACT,2012

SIKKIM
'GOVERNMENT GAZETTE
EXTRAORDINARY
PUBLISHED BY AUTHORITY
Gangtok Saturday 30th June, 2012 No. 312
GOVERNMENT OF SIKKIM
LAW DEPARTMENT
GANGTOK
No. 221LD/P/12 Dated: 21.6.2012
NOTIFICATION
The following Act passed by the Sikkim Legislative Assembly and having received the assent of the
Governor on 3rdday of May, 2012 is hereby published for general information:-
THE S/KKIM LOCAL FUND AUDIT ACT, 2012
Act No. 22 of 2012
Arrangementof Sections
1. Short title, extent and commencement.
2. Definitions.
3. Appointment of Director.
4. Audit ofaccounts.
5. Power of audit of accountsof certain authorities,bodies, lnstitutions or funds.
6. Audit of accounts of stock and stores and verificQtionofcashbalance.
7. Ma~ner in which audit is to be conducted.
8. ~udl.t?r to be deemed to be public servant.
9. gablhtlY ?flocal authorities to prepare and present accounts for audit
10. ornp etion of audit of accounts. .
11. Power of auditor to require product' f
12. Audit reports to be sent to ce . IO~0 accounts and attendance of persons
13. Contents of audit report. rtaln officers and bodies as Government may dir~ct.
14. Procedure to be followed after gettin the . .
15. Powers and Duties of the Director g report of the Director under section 13.
16. Delegation .Ofpowers and functions.
17. Power t<?dispense with detailed audit
18. Def~lcatlon or loss in money or store~ to b
19. Laylng of audit report. e reported by the Executive authority.
20. Prote.ction o~~ction taken in good faith,
21. Special prOVISIonfor pending audit
22. Power of Government to make rul .23 P t es.. ower 0 remove difficulties
24. Savings. .

--' -..:
Appointment of
Director
Audit of accounts
Power of audit of 5.
Accounts of certain
Authorities, bodies
institution or funds
3.
. t may by notification in. th Government, , ,
(ii) any other fund which e t be a local fund tor the purpose
the Official Gazette, declare 0
of this Act; ib d by rules made under this Act;
(i) 'Prescribed' means preSCrl e nded to this Act;
(j) 'Schedule' means the Schedule tPP;ounts pertaining to a specified
(k) 'Special Audit' means an aU.~lt0 a~rou h examination, and includes
items or series of items requiring th. d glreadY covered by audit as
re-audit of the accounts for a peno a
specified by the Director; . .
(I) 'State' means the State of Slkklm.
Notification in the Official Gazette,
(1) The State Governme~t Sh:~I~~y ualifications as may be prescri~ed,
. appoint a person, haVing q d A dlt In-charge of the Audit of
to be the Director of Local ~un u ~ cal Fund included in the
Accounts of a Local Authority or a 0
Schedule.
int such other officer in the Loc~1
(2) The State Government may appol o' ctor in the exercise of hls
.Fund Audit Directorate to assist. thfe I~i~ns and duties under this
d the disCharge of rus uncpowers an
Act .
. (3) All officers and staff of the Local Fund AuditDirectorateshallbe
sub-ordinate to the Director who shall have genera.1supenntendenCQ
and control over them in the performance of their functions under
this Act or therules made there under.
(1) Notwithstand'ing anything containQd in any other Ia.wforthetime
being in force, but subject to the provisions of the ComptroliQr and
Auditor General, (Duties, Powers and Conditions of Service) Act,
1971the Director shall, in the manner provided by or under this
Act, conduct the audit of accounts of a local authority or a local fund
included in the Schedule.
4.
(2) The State Government may, by notification in the Official Gazette
and for reasons to be specified therein, add any other authority,
body, institution or local fund to the Schedule referred to in
sub-section (1) and on the publication of the notification, such
authority, body, institution or local fund shall be deemed to have
been added to the Schedule.
(3) No authority, body, institution or local fund included inthe Schedule.
referred to in sub-section (1) shall be omitted there from except by
the authority of a law made by the State Legislature.
The Director may, with the previous sanction of the State Government,
and without prejudice to the provisions of sub-section (1) of section 4,
audit the accounts of any authority, body, institution or fund not included in
the Schedule subject to such terms and conditions as may be agreed
upon between thQDirector and the person responsible for the administration
of such authority, body, institution or fund.
3

Laying of audit
report
Protection of action
taken in good
faith
Special provision
for pending audit
Power of the State 22.
Government to
make rules
(2) On receipt of a report under sub-section (1), the Director shall
immediately conduct or cause to be conducted a special audit of
the accounts of that local authority as he considers necessary
depending upon the magnitude of such defalcation or loss:
Provided that nothing in this section shall prevent the loca!
.authortty from taking criminal proceedings against any person
suspected of, or involved in, any defalcation or loss of money or
stores, where such a course is considered expedient.
19. The Director shall send to the Government annually a consolidated report
of the accounts audited by him containing such particulars which he intends
to bring to their notice and the Government shall within a period of three
months after the receipts of the same; cause it to be laid before the
Legislative Assembly.
20. No suit, prosecution or other legal proceedings shall lieagainst the Director
or any officer acting under the provisions of this Act for anything which is,
in goodfaith, done or intended to be done under this Act or rules made
there under.
21. All audit of accounts pending at the commencement of this Act in respect
. of any local authority or local fund included in the Schedule shall,
notwithstanding anything contained inthis Act, be continued and completed
by the Director, within such time as may be prescribed, in the same manner
in which such accounts were being audited by him, as if this Act had not
been enacted.
(1) The State Government may, by notification in the Official
Gazette, make rules for the purpose of carrying into effect
of this Act.
(2) In particular, and without prejudice to the generality of the
foregoing power, such rules may provide for all or any of
the following matters, namely:-
(a) the manner and the form in which the accounts of a
local authority whose accounts are subject to audit
under this Act, shaff be kept and presented;
(b) the powers and duties of auditors and the procedure
tobe followed by them for conducting an audit and the
period at which such audit may be conducted;
(c) the manner in which the matters required to be
published under- this Actshaff be published; and
(d) all other matters, which may be or are required to
be prescribed.
(3) Every rule made under this Act shall be laid as soon as
may be after it is made before the Legislative Assembly
while it is in session and if, the Legislative Assembly makes
any modification in the rule or decides that the rule should
not be made, the rule shall thereafter have effect only in
such modified form or be of no effect, as the case may be;
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