The mandate for carrying out Audit of Defence Services is derived from Article 149 to 151 of the Constitution of India. As per article 151, the reports of the Comptroller and Auditor General of India relating to the accounts of the Union shall be submitted to the President who shall cause them to be laid before each House of  Parliament. 

IA&AD carries out the statutory audit of receipts and expenditure of the Government of India in relation to Defence Services based on Auditing Standards, MSO (Audit) and other instructions issued by CAG from time to time.

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