July 29, 2006	Saturday	Rajab 2, 1427

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MULTAN, July 28: An internal audit of the Board of Management of the Multan Industrial Estate has highlighted gross irregularities in finances and book-keeping.

The auditors have reportedly pointed out discrepancies in the purchase of fixed assets, expense statements and store maintenance.

Sources in the MIE’s BoM told Dawn that the auditing firm had reported that payments of some of the fixed assets were shown in the books without attaching the relevant vouchers while some of them even did not exist physically.

The auditors were not given the details of the fixed assets as these were in the beginning of the new fiscal year 2005-06. “A lack of information about the opening balance as on July 1, 2005 rendered the auditors helpless to map out the assets at the time of assessment,” they added.

Subsequently, the auditors had called attention of the authorities concerned in their report that fabricated add-ons and removals of the fixed assets might occur owing to unavailability of the evidences supporting the transactions recorded in the books. This would also lead to misuse and appropriation of the assets on the part of people at the helm of the BoM affairs and the staff.

It was also pointed out that some of the transactions had been recorded under irrelevant heads.

Under the rules an advance to the BoM secretary must be approved by the board president but the auditors found that in several incidents the same had been done either by some incompetent officials or the secretary himself. Similarly, no limit for cash withdrawal was defined for petty cash expenses. “The auditors have, therefore, observed that heavy amounts are drawn for petty cash expenses,” the sources revealed.

The report also pointed out that no book for the petty cash was maintained, physical verification of the cash by any official was not available and necessary approval of president, secretary or any other senior officer was not present on certain bank payment vouchers.

A donation of Rs200,000 was claimed to be made from the BoM resources on Oct 19 last year through a bearer cheque for the earthquake victims but there was no record as to whom the funds were given. Likewise, even the payments of more than Rs10,000 were made through the bearer cheques to the suppliers which is again a blatant violation of the section 21 of the Income Tax Ordinance, 2001.

Sources said the auditors had also taken note of what they termed haphazard record of the parties transacting with the BoM and found that many transactions were neither updated in the master files nor was the accounts department informed for proper accounting of these transactions. “The glaring shortcomings in the system may lead to fraud or error at the management level,” the sources quoted the auditors as commenting.

When contacted, MIE’s BoM president Tahir Zaidi declined to comment on the report, saying “it’s our internal audit and a confidential document.” He, however, said there were three stages of the BoM audit. Besides the internal audit, one was to be conducted by the Punjab Industrial Estate Development and Management Company and the other by an external auditor.

The management of the industrial estates in Punjab has been handed over by the provincial governments to the boards comprising industrialists in the name of public-private partnership for the last around two years. Some members of the MIE board had earlier also pointed out some irregularities in the state of affairs, especially about the allotment of plots and the award of contracts for infrastructure building.