Audit report flags financial irregularities in Sindh public sector enterprises

KARACHI: The Auditor-General of Pakistan has flagged serious financial irregularities, weak internal controls, and governance shortcomings in public sector enterprises (PSEs) of the Government of Sindh in its Audit Report for the year 2023-24.

The report, prepared by the Directorate General Commercial Audit & Evaluation (South), Karachi, covers public sector enterprises that maintain their accounts on a commercial basis.

The findings point to significant gaps in financial discipline and internal control mechanisms within Sindh’s public sector enterprises.

However, the audit does not include comments on the annual audited accounts of eight PSEs for the financial year 2022-23, as their managements failed to submit the required accounts within four months of the close of the financial year — highlighting weaknesses in financial oversight and internal controls.

The audit office said it is mandated to examine 15 formations working under seven Principal Accounting Officers (PAOs)/departments.

Of these, only six formations provided financial data for the financial year 2021-22, reporting total expenditure of Rs22,835.464 million and receipts of Rs14,187.372 million. The remaining nine formations did not provide details of their expenditure and receipts.

The audit pointed out recoveries amounting to Rs4,694.571 million. However, the management concerned failed to recover the identified amount during the audit period.

The report highlighted several major irregularities, including irregular appointments in three cases involving Rs267.159 million, irregular procurements worth Rs1,018.038 million in three cases, and non-recovery of dues amounting to Rs4,658.037 million in four cases. It also noted non-preparation or non-finalisation of annual audited accounts in three cases.

Auditors observed that receivables management in most organisations requires immediate attention, as revenue was not being collected in a timely manner, leading to accumulation and potential risk of non-recovery.

The Auditor-General recommended that Principal Accounting Officers ensure transparent, merit-based appointments, strict compliance with government procurement and expenditure rules, timely recovery of outstanding government dues, and prompt preparation and submission of annual audited accounts.