Saturday, April 15, 2023

Lack of accounts update hampering clearance of arrears: AG Office

Kathmandu, Apr. 14

The Office of the Auditor General (OAG) has found that the concerned government authorities have not well-kept and updated the record of the arrears incurred in their accounts, impacting the clearance of arrears and audit works.

In its annual report, 60th for the Fiscal Year 2021/22, the OAG concluded that the implementation of the provisions of the Fiscal Procedures and Financial Accountability Act-2020 in public institutions was poor as they failed to update the records of their arrears and present the up-to-date details of the cleared accounts.

As a result, the size of arrears has been inflated over the years, which means poor record keeping as well as the misappropriation of the public funds. In the past 18 years (from FY 2003/04 to 2021/22), the arrears has reached Rs. 587.33 billion, of which Rs. 296.13 belongs to the offices of the federal government, Rs. 24.3 billion to provincial offices, Rs. 172.6 billion to local bodies and Rs. 94.2 billion to other organisations and committees.

In the last fiscal year, only Rs. 15 billion arrears of the total Rs. 483.59 billion were cleared, which is just 3.10 per cent. According to the OAG, it has conducted audit for Rs. 7138.17 billion of 4,068 offices of the federal government, 1,218 offices of provincial government, 751 local governments and 75 public organisations.

"From the audit of Rs. 2356.33 billion of federal agencies and offices, Rs. 56.31 billion has remained as arrears which is 2.39 per cent). Provincial audit of Rs. 312.73 billion showed arrears of Rs. 7.20 billion (2.30 per cent)," Auditor General Tanka Mani Sharma said in his message.

Likewise, the OAG found Rs. 42.88 billion (4.18 per cent) in arrears from the audit of Rs. 1104.1 billion from the accounts of the local bodies. It pointed out that since the municipal assembly has the sole authority to formulate policy and laws, announce budget, implement budget and clear the arrears, there is the conflict of interest. The OAG suggested that the laws related to the auditing and operation of the local governments should be amended to create an independent body to discuss and monitor the accounts and reports of the local bodies.

The OAG had held multiple discussions with the chief secretary of the government and account officers and issued directives to make reforms in clearing arrears but the progress has not been encouraging.

It has suggested to implement the same provisions in the federal and provincial elections as practiced in the local polls which bar the individual that has not cleared arrears in his/her name and advance due to clear from contesting the election. 

Published in The Rising Nepal daily on 15 April 2023.

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