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Capacity Gaps in Local Government Audits Raise Accountability Concerns

  January 22, 2026 India’s top auditor has raised concerns over capacity gaps in local government audit institutions, warning that weak oversight undermines accountability. Speaking at a national review meeting, officials highlighted shortages of trained auditors, outdated methods, and limited use of technology. These issues affect audits of municipal corporations, panchayats, and urban development authorities. With cities managing expanding budgets, ineffective audits can allow financial irregularities to go undetected. The CAG called for enhanced training programs, standardized procedures, and greater use of digital tools. Strengthening grassroots audit institutions is seen as essential to improving transparency and ensuring that public funds are used effectively.
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CAG Flags Need to Strengthen Audits of Major Urban Local Bodies

 

CAG, Janaagraha sign MoU to strengthen ULG finances, digital audits | Economy & Policy News - Business Standard

September 19, 2025

The Comptroller and Auditor General highlighted the urgent need to strengthen audits of major urban local bodies, noting their growing role in India’s economic output. Cities such as Mumbai, Delhi, Bengaluru, and Chennai manage large budgets and deliver essential services to millions. The audit office emphasized that weak financial oversight can lead to inefficiencies and misuse of funds. Officials said improved audit capacity, better-trained personnel, and modern tools are necessary to handle complex urban governance challenges. The CAG also stressed performance audits, not just financial checks, to evaluate service delivery outcomes. The push reflects broader concerns over transparency and accountability as cities expand rapidly and take on greater administrative responsibilities.