Audit Report on the Accounts of Local Governments District Nowshera
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AUDIT REPORT ON THE ACCOUNTS OF LOCAL GOVERNMENTS DISTRICT NOWSHERA AUDIT YEAR 2019-20 AUDITOR GENERAL OF PAKISTAN TABLE OF CONTENTS ABBREVIATIONS AND ACRONYMS ............................................................. i Preface ..................................................................................................... iv Executive Summary ............................................................................................ v Chapter 1 ...................................................................................................... 1 Public Financial Management ……………. …………………………………………. 1 1.1 Sectoral Analysis ..................................................................................... 1 1.2. Audit Paras ............................................................................................... 6 Chapter 2 ...................................................................................................... 7 District Government............................................................................................ 7 2.1 Introduction .............................................................................................. 7 2.2 Comments on Budget and Expenditure (Variance Analysis) ..................... 8 2.3 Classified Summary of Audit observations................................................ 9 2.4 Comments on the status of compliance with DAC................................... 10 2.5 AUDIT PARAS ...................................................................................... 11 2.5.2 Irregularities ........................................................................................... 12 HR/Employees related irregularities ........................................................ 12 Procurement related irregularities...................................................................... 15 Management of Accounts with Commercial banks ............................................ 21 2.5.4 Others ..................................................................................................... 25 Chapter 3 .................................................................................................... 31 Tehsil Municipal Administration ....................................................................... 31 3.1 Introduction ............................................................................................ 31 3.2 Comments on Budget and Accounts (Variance Analysis) ........................ 32 3.3 Classified Summary of Audit Observations ............................................. 33 3.4 Comments on the status of compliance with TAC ................................... 34 3.5. AUDIT PARAS ...................................................................................... 35 3.5.1. Irregularities ........................................................................................... 35 Procurement related irregularities ........................................................... 35 3.5.2. Others ..................................................................................................... 39 Chapter 4 .................................................................................................... 46 AD LGE & RDD .............................................................................................. 46 4.1 Introduction ............................................................................................ 46 4.2 Comments on Budget and Accounts (Variance Analysis) ........................ 48 4.3 Classified Summary of Audit Observations ............................................. 49 4.4 Comments on the status of compliance with Village ............................... 50 4.5 AUDIT PARAS ...................................................................................... 51 4.5.1. Irregularities ........................................................................................... 51 Management of Accounts with commercial banks ................................... 51 4.5.2. Others ..................................................................................................... 52 Annexures .................................................................................................... 53 Annex-1 MFDAC ...................................................................................... 53 Annex-2 Detail of non-deduction of HRA/Conveyance Allowance ............ 62 Annex-3 Detail of irregular expenditure on purchase of medicine............... 66 Annex-4 Detail of profit on bank accounts ................................................. 67 Annex-5 Detail of overpayment due to inclusion GST in the cost ........... 68 Annex-6 Detail of overpayment due to allowing higher rate of Shingle ..... 69 Annex-7 Detail of non-imposition of penalty by TMA Nowshera ............... 71 Annex-8 Detail of outstanding Government dues and Non-Recovery ........ 72 Annex-9 Detail showing non deduction of sales tax by TMA Jehangira...... 74 Annex-10 Detail of non deposit of Bank Profit by VCs/NCs Nowshera ........ 77 Annex-11 Detail of undue retention of Government Revenue by VCs .......... 81 ABBREVIATIONS AND ACRONYMS AA Administrative Approval ADP Annual Development Program AG Accountant General AIR Audit and Inspection Report AD LGE & RDD Assistant Director Local Government Elections & Rural Development Department AP Advance Para AG Accountant General BISE Board of Intermediate and Secondary Education BHUs Basic Health Units B.P. Blood Pressure CCTV Close Circuit Tele Vision CDs Civil Dispensaries C&W Communication and Works DAO District Accounts Office DGA Director General Audit DPO District Police Officer CPWA Code Central Public Works Account Code CPWD Code Central Public Works Department Code DAC Departmental Accounts Committee DAC District Accounts Committee DC Deputy Commissioner DDEO Deputy District Education Officer DDO Drawing and Disbursing Officer DEO District Education Officer DHO District Health Officer DO District Officer GGMS Government Girls Middle School GHS Government High School i KPPRA Khyber Pakhtunkhwa Public Procurement Regulatory Authority LCB Local Council Board LGA Local Government Act MCC Medicine Coordination Cell MFDAC Memorandum for Departmental Accounts Committee M&R Maintenance and Repair M&T lab Maintenance and Testing Laboratory MPA Member Provincial Assembly NC Neighborhood Council NBP National Bank of Pakistan NIT Notice Inviting Tender NSI Non Scheduled Item PAC Public Accounts Committee PAO Principal Accounting Officer PCC Plain Cement Concrete PEC Pakistan Engineering Council PESCO Peshawar Electric Supply Company PHE Public Health Engineering PPHI People Primary Healthcare Initiative PTC Parent Teacher Council PVC Poly Vinyl Chloride RCC Re-in forced Cement Concrete RHCs Rural Health Centers SDEO Sub Divisional Education Officer SDO Sub Divisional Officer SOPs Standard Operating Procedures SS Subject Specialist SST Senior Science Teacher TAC Tehsil Accounts Committee TMA Tehsil Municipal Administration TMO Tehsil Municipal Officer ii TS Technical Sanction UC Union Council VC Village Council WAPDA Water and Power Development Authority XEN Executive Engineer iii Preface Articles 169 and 170 of the Constitution of the Islamic Republic of Pakistan, 1973 read with Sections 8 and 12 of the Auditor General’s (Functions, Powers and Terms and Conditions of Service) Ordinance, 2001 and Section 37 of Khyber Pakhtunkhwa Local Government Act 2013 require the Auditor General of Pakistan to conduct audit of the receipts and expenditure of Local Governments of each District of the Khyber Pakhtunkhwa. The report is based on audit of the accounts of offices of the District Government, Tehsil Municipal Administrations, Assistant Director (Local Government Elections and Rural Development) and Village Councils and Neighborhood Councils in District Nowshera for the financial year 2018-19. The Director General of Audit, District Governments, Khyber Pakhtunkhwa conducted audit during 2019-20 on test check basis with a view to report significant findings to the relevant stakeholders. The main body of the audit report includes systemic issues and significant audit findings. Relatively less significant issues are listed in the Annex-1 of the Audit Report. The audit observations listed in Annex-1 shall be pursued with the Principal Accounting Officers at the DAC level. In all cases where Principal Accounting Officers do not initiate appropriate action, the audit observations will be brought to the notice of appropriate forum 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. Some of the observations included in this report were finalized in the light of written replies of the departments whereas in most cases the departments did not submit written replies till the finalization of this report. DAC meetings were also not convened despite repeated requests. The Audit Report is submitted to the Governor, Khyber Pakhtunkhwa in pursuance of Article 171 of the Constitution of the Islamic Republic of Pakistan, 1973 read with Section 37 of Khyber Pakhtunkhwa Local Government Act, 2013 for laying before the appropriate legislative forum. Islamabad (Javaid Jehangir) Dated: Auditor General of Pakistan iv Executive Summary The Directorate General Audit District Governments, Khyber Pakhtunkhwa carries out the audit of Local Governments in 27 districts