The Comptroller and Auditor General of India (CAG) is set to revolutionize government auditing with the development of its own Large Language Model (LLM), aimed at harnessing decades of institutional knowledge to enhance audit efficiency, consistency, and analytical precision.
The AI-powered system, expected to be operational by November 2025, will be trained on historical inspection reports, enabling auditors to identify patterns, assess risks more accurately, and generate comprehensive reports with greater speed and reliability.
According to the CAG, the initiative is part of a broader move to strengthen institutional capabilities in handling large datasets, facilitating automated document generation, and improving the quality of audit outcomes. The system is also expected to support auditors in making more informed, evidence-based decisions.
Digitisation and Remote Audits: A Paradigm Shift
The push for digital adoption across central and state government departments will soon allow auditors to conduct remote or hybrid audits on a wide scale. Anchored in risk-based planning, secure access to government platforms, and the integration of geospatial tools such as PM GatiShakti, this transition aims to ensure evidence-backed and consistent audits across sectors.
Pilot studies of remote audits have already been conducted in several domains, with promising results. For instance, remote audits in receipt verification are progressing faster due to higher levels of automation and standardised datasets. The CAG cited a concurrent data-led GST audit executed across central and state offices using a uniform audit design matrix and centrally validated SQL queries as an example of this efficiency. Similarly, the remote compliance audit of Telangana’s Stamps and Registration Department by the Principal Accountant General (PAG) demonstrated effective office-based scrutiny with real-time coordination.
On the expenditure side, hybrid audits—which combine manual records with data-driven analysis—are being successfully piloted. The Public Works audit in Haryana, led by PAG (Audit), showcased this approach, while West Bengal’s Virtual Audit System integrated with AuditOnline is enabling paperless certification of Panchayati Raj Institutions (PRIs). Madhya Pradesh is also developing a roadmap for remote certification under the CAG’s Technical Guidance and Support, reflecting a growing trend of office-based, digitally supported audit processes.
Connect Portal: Transparent and Efficient Communication
The CAG has introduced the ‘Connect Portal’, scheduled for launch at the Annual Conference of State Finance Secretaries on September 19. This digital platform will provide nearly 10 lakh auditee entities with a unified interface to respond directly to audit queries, observations, and inspection reports. By enabling seamless communication and proper tracking of audit observations, the portal aims to make the audit process more transparent, accountable, and efficient for both the CAG and audited entities.
Strengthening Governance through Data and Collaboration
The conference will also focus on key issues such as enhancing reporting frameworks for centrally sponsored schemes, disseminating best practices in public finance management, leveraging IT systems for improved governance, and strengthening accounting and auditing of state public sector entities and autonomous bodies. Senior officials from the Union Finance Ministry, Reserve Bank of India, Controller General of Accounts, state finance secretaries, and heads of accounting services from railways, telecommunications, and defence are expected to participate, alongside the CAG’s audit and accounts office representatives.
In a first-of-its-kind initiative, the CAG will also unveil the “Publication on State Finances for Financial Year 2022-23.” Unlike annual state financial reports, this publication provides a comprehensive, inter-temporal, and inter-state analysis of fiscal information over a ten-year period, offering policymakers and auditors a richer understanding of fiscal trends and performance.
With these innovations—ranging from AI-powered audits and hybrid audit processes to digital communication platforms—the CAG is poised to usher in a new era of efficiency, transparency, and accountability in government oversight, reinforcing its mandate to strengthen public financial management across India.
