Public Accounts Committee was set up first in 1921 under the provision of the Government of India Act of 1919.
Presently, it consists of 22 members (15 from the Lok Sabha and 7 from the Rajya Sabha).
The members are elected by the Parliament every year from amongst its members.
It is done according to the principle of the single transferrable vote.
The term of office of the members is 1 year.
Also, a minister cannot be elected as a member of the committee.
The chairperson of the committee is appointed from amongst its members by the Speaker.
Since 1967, a convention has developed in which chairman of the committee belonged to the Opposition. Hence option 3 is the appropriate answer.
The committee examines annual audit reports of CAG which are laid before the Parliament by the President.
The committee examines Public expenditure, accounts of state corporations, accounts of autonomous and semi-autonomous bodies etc and all the audit reports conducted by the CAG.
The committee is assisted by the CAG which acts as a guide, philosopher and friend of the committee.