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Audit Report on the Accounts of District Government Nankana Sahib Audit

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Audit Report on the Accounts of District Government Nankana Sahib Audit AUDIT REPORT ON THE ACCOUNTS OF DISTRICT GOVERNMENT NANKANA SAHIB AUDIT YEAR 2017-18 AUDITOR GENERAL OF PAKISTAN TABLE OF CONTENT ABBREVIATIONS & ACRONYMS ..................................................... i PREFACE .............................................................................................. ii EXECUTIVE SUMMARY ................................................................... iii SUMMARY TABLES & CHARTS ...................................................... vi Table 1: Audit Work Statistics ........................................................... vi Table 2: Audit observation regarding Financial Management ............. vi Table 3: Outcome Statistics ............................................................... vii Table 4: Table of Irregularities Pointed Out ..................................... viii Table 5 Cost-Benefit ......................................................................... viii CHAPTER-1 .......................................................................................... 1 1.1 District Government, Nankana Sahib..................................... 1 1.1.1 Introduction of Departments .................................................. 1 1.1.2 Comments on Budget and Accounts (Variance Analysis) ...... 1 1.1.3 Brief Comments on the Status of Compliance on MFDAC Audit Paras of Audit Report 2016-17 .................................... 3 1.1.4 Brief Comments on the Status of Compliance with PAC Directives .............................................................................. 3 1.2 AUDIT PARAS ................................................................... 4 1.2.1 Non-production of Record ................................................. 5 1.2.2 Irregularity / Non-compliance ........................................... 6 1.2.3 Performance ..................................................................... 33 ANNEXURES....................................................................................... 35 Annexure-A .......................................................................................... 36 Annexure-B .......................................................................................... 48 Annexure-C .......................................................................................... 49 Annexure-D .......................................................................................... 50 Annexure-E .......................................................................................... 55 Annexure-F ........................................................................................... 56 Annexure-G .......................................................................................... 58 Annexure-H .......................................................................................... 59 Annexure-I ........................................................................................... 60 Annexure-J ........................................................................................... 61 Annexure-K .......................................................................................... 62 Annexure-L .......................................................................................... 63 Annexure-M ......................................................................................... 64 Annexure-N .......................................................................................... 66 Annexure-O .......................................................................................... 68 Annexure-P ........................................................................................... 69 ABBREVIATIONS & ACRONYMS B&R Building & Road BHU Basic Health Unit CCB Citizen Community Board DAC Departmental Accounts Committee DCO District Coordination Officer DDO Drawing and Disbursing Officer DGA Director General Audit DHQ District Headquarters EDO Executive District Officer FD Finance Department F&P Finance and Planning HRA House Rent Allowance IPSAS International Public Sector Accounting Standards LP Local Purchase MS Medical Superintendent MSD Medical Store Depot MRS Market Rates System NAM New Accounting Model OFWM On-Farm Water Management PAC Public Accounts Committee PAO Principal Accounting Officer P&D Planning and Development PFR Punjab Financial Rules PDG & TMA Punjab District Governments & Tehsil Municipal Administration PLGO Punjab Local Government Ordinance POL Petroleum Oil and Lubricants PPRA Punjab Procurement Regulatory Authority RHC Rural Health Center SAP System Application Product THQ Tehsil Headquarter TS Technical Sanction i PREFACE Articles 169 and 170 of the Constitution of the Islamic Republic of Pakistan, 1973 read with, Sections 8 & 10 of the Auditor General's (Functions, Powers and Terms and Conditions of Service) Ordinance, 2001 as well as Section 115 of the Punjab Local Government Ordinance 2001, require the Auditor General of Pakistan to audit the accounts of the Provincial governments and the accounts of any authority or body established by, or under the control of, the provincial government. Accordingly, the audit of all Receipts and Expenditures of the District Government Fund and Public Account of District Government is the responsibility of the Auditor General of Pakistan. The report is based on audit of the accounts of various offices of the District Government, Nankana Sahib for the financial year 2016-17. The Directorate General of Audit District Governments, Punjab (North), Lahore, conducted compliance audit during 2017-18 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 significant audit findings. Relatively less significant issues are listed in the Annexure-A of the Audit Report. The Audit observations listed in the Annexure-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 observation will be brought to the notice of the Public Accounts Committee through the next year’s Audit Report. The Audit results indicate the need for adherence to the regularity framework besides instituting and strengthening internal controls to prevent recurrence of such violations and irregularities. The observations included in this Report have been finalized after issuing three reminders for written responses of management and holding of DAC meetings, no response was received till the finalization of this report. 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 to cause it to be laid before the Provincial Assembly of Punjab. Islamabad (Javaid Jehangir) Dated: Auditor General of Pakistan ii EXECUTIVE SUMMARY The Directorate General Audit (DGA), District Governments, Punjab (North), Lahore is responsible to carry out the Audit of District Governments, Tehsil / Town Municipal Administrations and Union Administrations of three City District Governments and sixteen District Governments. Its Regional Directorate of Audit, Lahore has Audit jurisdiction of District Governments, TMAs and UAs of one City District Government i.e. Lahore and four District Governments i.e. Kasur, Sheikhupura, Okara and Nankana Sahib. The Regional Directorate has a human resource of 20 officers and staff having 5271 man-days and the annual budget of Rs 28.982 million for the Financial Year 2017-18. It has mandate to conduct Financial Attest, Regularity Audit and Compliance with Authority & Performance Audit of entire expenditure including programmes / projects & receipts. Accordingly, RDA Lahore carried out audit of accounts of District Government, Nankana Sahib for the Financial Year 2016-17. The District Government, Nankana Sahib conducts its operations under Punjab Local Government Ordinance, 2001. It comprises one Principal Accounting Officer (PAO) i.e. the District Coordination Officer (DCO) covering six groups of offices i.e. Agriculture, Community Development, Education, Finance & Planning, Health and Works & Services. The financial provisions of the Punjab Local Government Ordinance, 2001 require the establishment of District Government fund comprising Local Government Fund and Public Account for which Annual Budget Statement is authorized by the Nazim / Council / Administrator in the form of budgetary grants. Audit of District Government, Nankana Sahib was carried out with a view to ascertaining whether the expenditure was incurred with proper authorization and in conformity with laws / rules / regulations for economical procurement of assets and hiring of services etc. Audit of receipts / revenues was also conducted to verify whether the assessment, collection, reconciliation and allocation of revenues were made in accordance with laws / rules, resulting into leakage of revenue. a. Scope of Audit Out of total auditable expenditure of Rs 2,645.579 million of the District Government, Nankana Sahib for the financial year 2016-17 covering one PAO and 246 formations, the Directorate General Audit, audited an expenditure of Rs 1,390.828 million iii which in terms of percentage was 52% of auditable expenditure. The Directorate General Audit planned and executed audit of 23 formations i.e. 100% achievement against the planned audit activities. Total receipts of the District Government Nankana Sahib for the financial year 2016-17, were Rs 16.90 million, whereas Directorate General Audit conducted
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