Audit Reports on the Accounts of Town Municipal Administrations City District Governmentmultan
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AUDIT REPORTS ON THE ACCOUNTS OF TOWN MUNICIPAL ADMINISTRATIONS CITY DISTRICT GOVERNMENTMULTAN AUDIT YEARS 2009-2012 AUDITOR GENERAL OF PAKISTAN TABLE OF CONTENTS ABBREVIATIONS AND ACRONYMS ....................................................................... i PREFACE ....................................................................................................................... ii EXECUTIVE SUMMARY ...........................................................................................iii SUMMARY TABLES AND CHARTS ...................................................................... vii Table 1: Audit Work Statistics ....................................................................................... vii Table 2: Audit Observations .......................................................................................... vii Table 3: Outcome Statistics ...........................................................................................viii Table 4: Irregularities pointed out .................................................................................viii CHAPTER 1 ................................................................................................................... 1 1. TOWN MUNICIPAL ADMINISTRATIONS, CITY DISTRICT MULTAN ....... 1 1.1 INTRODUCTION .............................................................................................. 1 1.1.1 Comments on Budget and Accounts (Variance Analysis) ................................. 2 1.2 Town Municipal Administration, Shah Rukn-e-Alam ................................. 5 1.2.1 Irregularities & Non-compliance ....................................................................... 6 1.2.2 Performance ..................................................................................................... 11 1.3 Town Municipal Administration, Bosan ...................................................... 17 1.3.1 Non Production of Record ............................................................................... 18 1.3.3 Performance ..................................................................................................... 26 1.3.4 Internal Control weaknesses ............................................................................ 29 1.4 Town Municipal Administration, Musapak ................................................ 33 1.4.1 Irregularities & Non-compliance ..................................................................... 34 1.4.2 Performance ..................................................................................................... 38 1.4.3 Internal Control Weaknesses ............................................................................ 40 1.5 Town Municipal Administration, Sher Shah ............................................... 44 1.5.1 Frauds/ Misappropriation ................................................................................. 45 1.5.2 Irregularities & Non-compliance .................................................................... 47 1.5.3 Performance .................................................................................................... 51 1.5.4 Internal Control Weaknesses ........................................................................... 55 1.6. Town Municipal Administration, Jalal Pur Pir Wala ............................................ 58 1.6.1 Non Production of Record ............................................................................... 59 1.6.2 Irregularities & Non-Compliance .................................................................... 61 1.6.3 Performance ..................................................................................................... 68 1.6.4 Internal Control Weaknesses ............................................................................ 71 1.7 Town Municipal Administration, Shujaabad .............................................. 77 1.7.1 Non Production of Record ............................................................................... 78 1.7.2 Irregularities & Non-Compliance .................................................................... 81 1.7.3 Performance ..................................................................................................... 86 1.7.4 Internal Control Weaknesses ............................................................................ 89 Annexures ..................................................................................................................... 91 ABBREVIATIONS AND ACRONYMS ADP Annual Development Programme CCB Citizen Community Board DAC Departmental Accounts Committee FD Finance Department IPSAS International Public Sector Accounting Standards LG&CD Local Government & Community Development MFDAC Memorandum for Department Accounts Committee NAM New Accounting Model PAC Public Accounts Committee PDG Punjab District Government PLGO Punjab Local Government Ordinance PDSSP Punjab Devolved Social Sector Programme TAC Town Accounts Committee TMA Town Municipal Administration TMO Town Municipal Officer TO (F) Town Officer (Finance) TO (I&S) Town Officer (Infrastructure & Services) TO (P&C) Town Officer (Planning & Coordination) TO (R) Town Officer (Regulations) WHO World Health Organization i PREFACE Articles 169 and 170 (2) of the Constitution of the Islamic Republic of Pakistan, 1973 and Section 115of the Punjab Local Government Ordinance, 2001 require the Auditor General of Pakistan to conduct the audit of the receipts and expenditure of the Local Fund and Public Accounts of Tehsil / Town Municipal Administrations of the Districts. The Report is based on audit of Town Municipal Administrations of City District Multan for the years 2008-09, 2009-10 and 2010-11. The Directorate General of Audit District Governments Punjab (South), Multan, conducted audit during 2009-10, 2010-11 and 2011-12 on test check basis with a view to reporting significant findings to relevant stakeholders. The main body of Audit Report includes only the systemic issues and audit findings carrying value of Rs1 million or more. Relatively less significant issues are listed in the Annexure-I of the Audit Report. The Audit observations listed in the Annexure-I shall be pursued with the Principal Accounting Officer at the DAC level and in all cases where the PAO does not initiate appropriate action, the Audit observations will be brought to the notice of the Public Accounts Committee through the next year‟s Audit Report. Audit findings indicate need for adherence to the regularity framework besides instituting and strengthening internal controls to avoid recurrence of similar violations and irregularities. Most of the observations included in these Reports have been finalized in the light of written responses and discussion with the management. The Audit Reportsare submitted to the Governor of the Punjab in pursuance of Article 171 of the Constitution of the Islamic Republic of Pakistan, 1973 read with Section 115 of the Punjab Local Government Ordinance 2001, for causing it to be laid before the Provincial PAC. Islamabad (Muhammad Akhtar Buland Rana) Dated: Auditor General of Pakistan ii EXECUTIVE SUMMARY The Directorate General Audit, District Governments, Punjab (South), Multan, a Field Audit Office of the Auditor General of Pakistan is responsible to carry out the audit of all District Governments in Punjab (South) including Tehsil and Town Municipal Administrations. Its Regional Directorate of Audit Multan has audit jurisdiction of District Governments, TMAs and UAs of six Districts i.e. Multan, Lodhran, Vehari, Sahiwal, Pakpattan and Khanewal. Regional Directorate has human resource of 23 officers and staff constituting a total of 1,252 man days and the budget of about Rs 6.275 million per financial year. It has the mandate to conduct financial attest audit, audit of sanctions, audit of compliance with authority and audit of receipts as well as the Performance Audit of entities, projects and programs. Accordingly, R.D.A Multan carried out audit of the accounts of six TMAs of District Multan for the financial years from 2008-09 to 2010-11and the findings included in the Audit Report. Each Town Municipal Administration in City District Multan is headed by a Tehsil Nazim / Administrator. He/she carries out operations as per Punjab Local Government Ordinance, 2001. Tehsil Municipal Officer is the Principal Accounting Officer (PAO) and acts as coordinating and administrative officer, responsible to control land use, its division and development and to enforce all laws including Municipal Laws, Rules and By-laws. The PLGO, 2001, requires the establishment of Tehsil / Town Local Fund and Public Account for which Annual Budget Statement is authorized by the Tehsil Nazim / Tehsil Council / Administrator in the form of Budgetary Grants. The total Development Budget of six above mentioned TMAs in the City District Government Multan for the financial years from 2008-09 to 2010-11 was Rs 1851.464 million and expenditure incurred was of Rs 685.636 million, showing savings of Rs 1165.828 million in these years. The total Non- development budget for financial years 2008-2011 was Rs 1,192.027 million and expenditure was of Rs 884.630 million, showing savings of Rs 307.397 million. iii The reasons for savings in Development and Non-development Budgets are required to be provided by TMO and PAO concerned. Audit of TMAs of City District Government Multan was carried out with the view to ascertain that the expenditure was incurred with proper authorization, in conformity with