AUDIT REPORT ON THE ACCOUNTS OF DISTRICT GOVERNMENT TOBA TEK SINGH AUDIT YEAR 2016-17 AUDITOR GENERAL OF PAKISTAN TABLE OF CONTENTS ABBREVIATIONS AND ACRONYMS .............................................................. i Preface ................................................................................................................... iii EXECUTIVE SUMMARY .................................................................................. iv SUMMARY TABLES & CHARTS .................................................................... ix Table 1: Audit Work Statistics ............................................................................... ix Table 2: Audit Observations Classified by Category ............................................. ix Table 3: Outcome Statistics ..................................................................................... x Table 4: Irregularities Pointed Out ......................................................................... xi Table 5: Cost Benefit .............................................................................................. xi CHAPTER 1 .......................................................................................................... 1 1.1 District Government Toba Tek Singh ......................................................... 1 1.1.1 Introduction ................................................................................................. 1 1.1.2 Comments on Budget and Accounts ........................................................... 2 1.1.3 Brief Comments on the Status of Compliance of MFDAC Audit Paras of Audit Report 2015-16 .................................................................................. 4 1.1.4 Brief Comments on the Status of Compliance with PAC Directives .......... 5 1.2 AUDIT PARAS .......................................................................................... 6 1.2.1 Irregularities and Non-Compliance ............................................................. 6 1.2.2 Performance .............................................................................................. 63 1.2.3 Internal Control Weaknesses ..................................................................... 66 ANNEX ................................................................................................................. 71 Annex-A ................................................................................................................ 71 Annex-B ................................................................................................................ 89 Annex-C ................................................................................................................ 90 Annex-D ................................................................................................................ 92 Annex-E ................................................................................................................ 94 Annex-F ................................................................................................................. 96 ABBREVIATIONS AND ACRONYMS AASHTO American Association of State Highway and Transportation Officials AEO Assistant Education Officer BHU Basic Health Unit B&R Buildings & Roads CCTV Close Circuit Television CCU Coronary Care Unit CNIC Computerized National Identity Card C&W Communication & Works DAC Departmental Accounts Committee DCO District Coordination Officer DDC District Development Committee DDO Drawing and Disbursing Officer DDWP Divisional Development Working Party DEO (EE-M) District Education Officer (Elementary Education-Male) DEO (EE-W) District Education Officer (Elementary Education-Women) DGA Directorate General Audit DHQ District Headquarters DO District Officer DST Double Surface Treatment DTL Drug Testing Laboratory EDO Executive District Officer FD Finance Department FESCO Faisalabad Electricity Supply Company FTF Farogh-e-Taleem Fund F&P Finance & Planning HPA Health Professional Allowance HSRA Health Sector Reform Allowance ICU Intensive Care Unit INTOSAI International Organization of Supreme Audit Institutions IPSAS International Public Sector Accounting Standards LED Light Emitting Diode MFDAC Memorandum for Departmental Accounts Committee i MOU Memorandum of Understanding MNA Member National Assembly MRS Market Rate System MSD Medicine Store Depot NSB Non Salary Budget NPA Non Practicing Allowance OFWM On-Farm Water Management PAC Public Accounts Committee PARCO Pak Arab Refinery Company PCA Practice Compensatory Allowance P&D Planning & Development PDG Punjab District Government PEC Punjab Examination Commission PFR Punjab Financial Rules PLGO Punjab Local Government Ordinance POL Petroleum Oil and Lubricants PSI Pound per Square Inch PPRA Punjab Procurement Regulatory Authority RDA Regional Directorate of Audit RHC Rural Health Center RR&MTI Road Research & Material Testing Institute SAP Systems, Applications and Products S&GAD Services and General Administration Department SST Single Surface Treatment SMO Senior Medical Officer SSE Secondary School Educator TA Travelling Allowance THQ Tehsil Headquarters TMA Town / Tehsil Municipal Administration TST Triple Surface Treatment TTS Toba Tek Singh WAPDA Water & Power Development Authority W&S Works & Services WMO Women Medical Officer WUA Water Users Association ii Preface Articles 169 and 170 of the Constitution of the Islamic Republic of Pakistan, 1973 and Section 115 of the Punjab Local Government Ordinance, 2001 require the Auditor General of Pakistan to conduct audit of Receipts and Expenditure of the Local Fund and Public Account of District Governments. The report is based on audit of the accounts of various offices of the District Government, Toba Tek Singh for the financial year 2015-16. The Directorate General of Audit, District Governments, Punjab (South), Multan conducted audit during 2016-17 on test check basis with a view to reporting significant findings to the relevant stakeholders. The main body of the Audit Report includes only the systemic issues and audit findings carrying value of Rs 1 million or more. Relatively less significant issues are listed in the Annex-A of the Audit Report. The Audit observations listed in the Annex-A 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 the need for adherence to the regularity framework besides instituting and strengthening internal controls to avoid recurrence of similar violations and irregularities. The observations included in this report have been finalized in the light of written responses of the management concerned and DAC directives. The Audit Report is 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 Assembly. -Sd- Islamabad (Rana Assad Amin) Dated: 07.03.2017 Auditor General of Pakistan iii EXECUTIVE SUMMARY The Directorate General Audit (DGA), District Governments, Punjab (South), Multan, is mandated to carry out audit of the City District Governments and District Governments in Punjab (South). The Regional Directorate of Audit (RDA), District Governments, Faisalabad, a Field Audit Office of the DGA, District Governments, Punjab (South), Multan carries out audit of District Governments Faisalabad, Jhang, Toba Tek Singh and Chiniot. The Regional Directorate has a human resource of 16 officers and staff, constituting 4,529 mandays and the budget amounting to Rs 19.960 million was allocated in Audit Year 2016-17. The office is mandated 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 RDA Faisalabad carried out audit of the accounts of various formations of District Government, Toba Tek Singh for the financial year 2015-16 and the findings are included in the Audit Report. The District Government, Toba Tek Singh conducts its operations under Punjab Local Government Ordinance, 2001. The District Coordination Officer (DCO) is the Principal Accounting Officer (PAO) of the District Government and carries out functions of the District Government through group of offices as notified in Punjab Local Government Ordinance. According to the Ordinance, the District Government Fund comprises District Local Fund and Public Account. Due to delay of electoral process, Zila Nazim / Zila Council was not elected. Therefore, the Annual Budget Statement was authorized by the DCO, who has been notified as Administrator by the Government of the Punjab in February, 2010. District Toba Tek Singh is administratively divided into three tehsils namely Toba Tek Singh, Gojra and Kamalia. iv Audit Objectives Audit was conducted with the objective to ensure that: 1. Money shown as expenditure in the accounts was authorized for the purpose for which it was spent. 2. Expenditure was incurred in conformity with the laws, rules and regulations framed to regulate the procedure for expending of public money. 3. Every item of expenditure was incurred with the approval of the competent authority in the Government. 4. Public money was not wasted. 5. The assessment, collection and accountal