Telecom sector suffered Rs80m loss, says report: Lack of record maintenance
By Our Staff Reporter
ISLAMABAD, March 25: The telecommunications sector suffered a loss of Rs80 million during the year 2001-02 due to lack of maintenance of permanent monetary records, Auditor General of Pakistan report stated.
The audit report for 2001-02, which was placed before the National Assembly, said the required level of competence was not maintained in different entities of the telecom sector.
These entities consist of National Telecommunication Corporation (NTC), Pakistan Telecommunication Authority (PTA), Frequency Allocation Board (FAB), Special Communications Organization (SCO) and National Radio Telecommunication Corporation (NRTC).
The auditor general has also suggested to these entities to adhere to sound financial management by complying with the directives of the finance division to avoid losses.
Entities like the PTA, the FAB and the NTC were required to frame their own rules and regulations, and submit them for approval by the finance division, but they failed to do so despite a lapse of seven years, the report stated.
Qualified personnel were not posted in the SPO branches requiring specialized work, the report said and added that personnel not well-acquainted with accounts were posted in its accounts branches, which resulted in financial mismanagement.
Similarly, the record of cash/account transactions was being maintained in the NTC and the PTA without authentic hard copies. The report said the entities pursued a rather liberal policy, yet displayed a slack attitude when it came to recovering outstanding dues in respect of both the PTA and the NTC till as recent as June 2002. A proper and timely system for recovery of outstanding dues must be developed by the respective managements, the report suggested.
In some cases, it said, there was a marked deviation from the aspects of financial regularity, legality and propriety. Actions were taken in violation of financial rules and procedures as laid down by the finance division.
The report had also pointed out that independence of internal audit was not being maintained in the NTC, where the internal audit was not under the direct control of the chairman, but was being monitored by the member finance.
It also suggested to the NTC to follow the practice as adopted by other entities so as to ensure transparency and impartiality in the internal auditing process.
Referring to the PTA, the report said financial irregularities to the tune of Rs37.68 million were detected in the authority's financial statement of 2001-02, of which Rs35.312 million was accrued because of non-recovery of outstanding dues on royalty against 13 cases relating to year 1999 to 2000. This irregularity was also pointed out to the PTA chairman in June 2001, it said.
Similarly, the authority faced losses of Rs2.37 million due to non-recovery of license renewal fee from 23 licensees during 1999-2000 in violation of terms and conditions of the contracts.
Financial irregularity of Rs25.3 million was also detected in the NTC accounts, of which the corporation paid Rs12.59 million to its employees on encashment of leave, utility and washing allowances without the approval of the finance division.
Whereas, the report said, the pay and allowances of public sector corporations, autonomous/semi-autonomous bodies could not be changed without prior approval of the finance division.
Similarly, Rs12 million was paid by the corporation as reward/bonus without the approval of the finance division. The report also detected irregularity of Rs8.1 million in the accounts of the SCO, of which Rs5.56 million was due to the non-recovery of outstanding telephone dues, while an expenditure of Rs2.5 million was incurred on the purchase of equipments without any open tenders. In the FAB and the NRTC, financial irregularities of Rs2.39 million and Rs6.58 million, respectively, were detected.
