Government to Implement Stricter Audit for NGO Funding

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May 17 – The Finance Ministry has announced measures that will strictly monitor government funding to non-profit organizations as part of efforts to stay within budget during the year.

“All ministries and departments of the Government of India should include in their annual report a statement showing the quantum of funds provided to each of those (non-government and private societies) organizations and the purpose for which they were utilized,” the expenditure department in the finance ministry said in an internal circular.

This circular could possibly disrupt government funding to NGOs and other private organizations. Government ministries are now required to submit a copy of their annual reports and audited accounts of private societies and organizations for all fund transfers of up to Rs.5 million a year.

“This will mean that sanctioning ministries will have to actively monitor the disbursements and actual spending by such organisations throughout the year,” a senior government official told The Economic Times.

The submitted reports will also be audited by the Comptroller and Auditor General of India for funding that includes grants given for research activities and development activities.