ISLAMABAD: The Pub­lic Accounts Committee on Wednesday ordered two-year performance audit of the Utility Stores Corpora­tion as the Auditor General of Pakistan informed the PAC that audit of subsidies to the USC during Covid-19 and report of the last financial year were ready for laying before parliament.

USC managing director Umer Lodhi briefed the PAC on the losses and sale of substandard edible oil.

The auditors pointed out that under the Pakistan Standard and Quality Control Authority (PSQCA) rules, it was mandatory for the USC management to get quality control certification before displaying the eatables and edible oil on shelves for onward sale.

USC secretary Afzal Latif said the PSQCA certification was required for the manufacturers, and not for the retailers. Being a retailer, he added, the corporation was not under any obligation to get certification.

In response to the audit observation regarding quality test, Mr Lodhi said there was no tradition or rule of quality test for a retail outlet. He, however, said that in case of any complaint by a user, the USC management could ask the manufacturer for a replacement of substandard goods.

The report pointed out that the USC management did not replace the expir­­ed items which cost the exchequer Rs353 million.

The USC management said the provision against slow-moving and obsolete items was made in accordance with the international accounting standard and in the light of approval of the board of directors. It said the USC had entered into agreements with the vendors/suppliers under which they were legally bound to lift back the slow moving and damaged/expired items.

The PAC directed the audit officials to get the replacement of the expired items verified with the USC.

PAC chairman Rana Tanveer Hussain also asked Auditor General Javed Jahangir to conduct USC’s performance audit of two years and submit a report in a month.

Published in Dawn, February 25th, 2021