Modernization & Capacity Building of the Office of CAG, India The overall objective of the proposed Grant is to assist the Office of the Comptroller & Auditor General of India in efforts to continuously improve the efficiency and effectiveness of the public audit function in India.  The specific objectives of the Grant are: "   To build capacity in the financial attest audit function by providing global exposure, intensive training and attachment programs at a high profile sister supreme audit institution (SAI). "   To create a core faculty of experts in the department to lead the pilot audits and train the personnel "   To improve the audit tool kit introducing proven IT software and hardware support and train personnel in their application. The proposal envisages support for the following activities as part of a modernization and capacity building program for the C&AG Office : (a) Creation of operational capacity in financial attest audit to bridge the gap in assurance in the context of internal controls and internal audit prevalent in the public domain.  The capacity enhancement is also required in view of the changing economic scenario leading to more emphasis on regulatory functions and consequent increased expectations from audit. (b) Increased use of computers by the Government has necessitated development of capability in financial attest auditing through information technology.  This highlights the need to enhance capability of human resources and introduction of new audit software which would enhance the quality of audit assurance. The capacity building programme would mainly involve : (a) Acquisition of auditing skills and techniques in financial attest auditing by selecting a team (from across India) of about 20 young and dynamic officers of the middle level for intensive training with another SAI and to become a core group of trainers for line staff of the CAG in India. It would involve meeting with other comparable SAIs including deputation of CAG personnel to a globally recognized audit institution for training as well as field attachments.  Study tours for a group of up to ten officers to an SAI abroad for an understanding of best international practices in the operational area and the feasibility of their adoption to local conditions is also envisaged. These study tours would be designed in consultation with other SAIs and approved by the CAG of India. These ten officers (also selected from across India) would provide the senior level support for the required change in "mind set" for the proposed reforms - to be implemented across India. These officers will document their learning from such study tours and will participate in the dissemination of the learnings from the tours. The exposure to best practice is intended to allow consensus building on the "best fit" for India as well an understanding of the lessons learned by the more advanced SAIs during the implementation of reforms in their respective countries. The new methodology would be documented by the core group for dissemination across the country under their supervision and made available on the CAG's web site. The core group of officers would carry out pilot audits using the new improved methodology, adapt the methodology to local needs and act as trainers to disseminate audit skills and lessons learnt to others in the Department up to line staff.  The dissemination of the audit skills acquired by this core group to other members would be done through a series of training programmes to be organized in the premier training institutes of the department namely International Centre for information System and audit (iCISA) and National Academy Audit & Accounts (Shimla) along with the Regional Training Institutes (RTIs). Coverage would extend to the States and in due course the third level of government. The  performance of the core group of officers acting as trainers will be monitored by the CAG. b) This would involve procurement of audit software, understanding and training in use of the software and piloting the software in selected financial attest audits to start with.  Strengthening of computer hardware resources would also go hand in hand with acquisition and up-gradation of current audit software. Training of selected team of core faculty in the financial attest audit sector requires active participation of SAIs abroad having acquired consistent and considerable expertise and practice in the field. A country such as the UK has the necessary facilities to provide "on the job training" to CAG officers.  Such an SAI can be appointed as the provider of capacity building for providing practical exposure abroad for a reasonable time frame so as to acquaint the participants with international exposure with best practices available in the area. Special training programs aimed at developing specific skills required of auditors in the new areas identified would be designed by the core group of trained officers and courses run in the Regional Training Institutes to disseminate these skills on an institutional basis thus ensuring sustained capacity building within the organization.  International Training Programs for participants from the SAIs of developing countries are conducted regularly; a module or two on the financial attest audit function would also be introduced and training conducted as a part of the International Training Program of the Indian SAI, resulting in even wider dissemination. To assist the Comptroller and Auditor General of India (hereinafter also referred to as "CAG") in improving the efficiency and effectiveness of the  public audit (financial attest audit) through modernization and capacity building of CAG.