The goverment activities are funded with taxes paid by the people. These valuable taxes must be spent effectively. The national budget, which is approved each year by the Diet, is executed by the Cabinet Office and Ministries, and other organizations. In order to secure the proper execution of the budget, we need a mechanism which supervises financial accounting from the viewpoint of whether public accounts are administered in conformity with the laws and regulations, and whether projects have achieved their planned goals.

The Board of Audit performs auditing of accounts of national administrative agencies, of state financed bodies, such as government-affiliated agencies, as well as of prefectural governments, municipal governments, various associations and Independent Administrative Insutitutions that are being granted subsidies, loans or other forms of financial assistance from the State. The Board conducts in-office document audits and field audits at the offices or project sites of the auditees by dispatching auditors. When the Board finds cases of improper financial accounting, the Board has the power to demand the auditees to take necessary measures to rectify and improve such improprieties by identifying the causes of those improprieties. The Board presents the results of these audits to the Diet in the form of the Annual Audit Report each year, and discloses the information in the report.