Audit on Ease of Doing Business in MSMEs
The Comptroller and Auditor General of India (CAG) is conducting an audit to assess the ease of doing business specifically within the Micro, Small and Medium Enterprises (MSMEs) sector. This initiative is part of the CAG's strategy to move beyond traditional financial and compliance audits to evaluating the outcomes and effectiveness of government reforms.
- The audit report is scheduled for submission in the monsoon session of Parliament in 2026.
- Objective: To assess the implementation of reforms aimed at improving the business environment for MSMEs across states and Union territories.
- This audit aligns with India’s vision of becoming a developed country by 2047, recognizing MSMEs as a vital growth engine.
- MSMEs contribute approximately 45% to India’s exports and 30% to its GDP.
- Key areas of evaluation include:
- Simplification of regulations
- Digitization of processes
- Decriminalization of minor offenses affecting businesses
- Effectiveness of major MSME schemes and resource utilization
- The audit aims to enhance policy-making at both central and state levels for the MSME sector.
Uniform Expenditure Reporting Format
The CAG has established a common list of expenditure heads for central and state governments to promote transparency in financial reporting.
- State governments are expected to adopt this harmonized list by 2027-28 at the latest.
- Current variations in expenditure reporting hinder comparative analysis across states and time periods.
- The harmonized format is intended to improve the accuracy of public spending assessments.
