Despite notification of the draft of amendment to Kerala Cooperative Societies Rules (1969) on February 14, there is still room for problems in the auditing of the societies.

As three panels were proposed earlier for conducting the audit, the proposal to include retired auditors also has led to confusions on accountability.

While statutory audit by government auditors cover the administrative audit, the provision to include retired auditors have left many questions unanswered in the draft rules. Financial auditing, done by Chartered  Accountants, is the only one to be approved by the Legislature.

A major drawback cited in the case of engaging retired auditors is the lack of accountability.

As per Rules 64(10), the administrative audit fixes criminal and civil accountability. During the preparation of the Rules, the Registrar of Cooperative Societies had told Express that in case of audit done by retired auditors, the official concerned, who approves the audit, would be made accountable.But there has been no such provision in the draft rules. The draft rules are also silent about the KSR (156) posts.

It has been pointed out that following the provisions to fix a sealing on audit fee, many  cooperative societies had declined to bear the audit cost.

In case of societies with paid up capital up to Rs 10 crore, the audit cost fixed is Rs 50,000 .

For those societies having paid up capital above Rs 10 crore, the audit cost will be Rs 1 lakh. Though the societies will get a relief from the burden of huge audit cost, the auditors will not get sufficient time to conduct the audit (starting from June to September).

It might lead to lapses in auditing.

As per the new rules, the audit process has to be completed before September 30 every year. But the auditors will have to prepare the audit report by September 1 so that the managing committees of the societies can get it approved in the general body meeting. (New Indian Express)