The auditor general of Pakistan (AGP) has pointed out that weak internal financial controls in Pakistan Army, like other public sector institutions, resulted in the loss of Rs 3 billion to the national exchequer during the financial year 2009-10.
The audit report of 2010-11 on the accounts of Pakistan Army for financial year 2009-10 exposes weak internal controls in the army, mentioning that a case of non-recovery of rent and allied charges resulted in a loss of Rs 39.877 million. “It was noticed from the record held with under mentioned Garrison Engineers (GE) that a sum of Rs 39.877 million was lying outstanding on account of rent and allied charges. This indicated that GEs and Unit Accountants (UAs), Local Audit Officers (LAOs) concerned were not performing their duties efficiently,” the report says. It says further that weak internal controls thus resulted in accumulation of huge amount of outstanding rent and allied charges. “It was pertinent to mention that electricity and sui gas bills were paid to supply agency from Government budget but recovery from the consumers was not effected timely,” it adds. According to Para-442 of Defence Services Regulations for MES, “the GE is responsible for making demands for payment of all revenue, and for taking steps for its prompt realisation”. Further MES Local Audit Manual Reprint – 1982 stipulates that the object of inspection and audit of local audit officer is to “see that the Unit Accountant posted by the CMA discharges his duties satisfactorily and is up to the mark”. The LAO will also conduct scrutiny of water and electricity bills in respect of consumer paying direct to MES and that proper action is being taken to clear all outstanding dues.
UNNECESSARY PROCUREMENT: In another case pointed out by audit authorities, unnecessary procurement and inappropriate storage conditions resulted in blockage of funds amounting to Rs 3.049 billion. “As per record of Vehicle Supply Depot (VSD) of Central Ordnance Depot (GOD) Karachi, it was observed that 1,385 new vehicle units having financial worth of Rs 3,049.640 million were lying idle since the last 3 years. Out of above total, 900 vehicles worth Rs 2,520.861 million were lying in open space rendering these government assets to the high risk of obsolescence, deterioration, corrosion due to local climatic conditions and pilferage of parts,” the AGP has pointed out. The audit report further points out another loss to the government amounting to Rs 1.271 million due to non-recovery of Sales Tax from the Bazaar Supply contractor. “During the scrutiny of record of GE (Army)-1 Malir Cantonment for the year 2009-2010, it was noticed that Additional Chief Engineer (ACE) 5 Corps concluded two Bazaar Supply contracts with M/S Aman Developers for a sum of Rs 11.008 million. The contractor attached Sales Tax Invoices with the bills for a sum of Rs 1.435 million by showing Sales Tax Registration No 12-05-9999-080-73. On verification through Internet website of Sales Tax Department on 15th December, 2010, it was observed that the said Sales Tax Registration number did not exist,” the report reveals.