Finance Ministry has opposed biannual audit of public sector development projects as directed by the Executive Council of the National Economic Council (Ecnec) to ensure transparency and timely execution of the projects, it was reliably learnt.
Sources said that delayed execution of development projects had been resulting in cost overrun and Ecnec on a summary moved by the Planning Commission had directed that all projects costing over one billion rupees must have programme audit.
The programme audit was considered critical due to financial crunch and for ensuring timely execution of public sector projects without cost overrun. An official in the Planning Commission, who does not wanted to be named, said that effective supervision through informal audit after six month would ensure quality and minimise pilferage. The Ecnec had also directed the Planning Commission to bring position paper in consultation with all the stakeholders, he added. Finance Division stated that six monthly programme audit is uncalled-for and recommended annual audit more appropriate.
Sources said that Finance Division had stated the experience and capacity of the Chartered Accountant Firms to conduct performance/programme audit of public sector projects in terms of knowledge of the regulatory framework would be limited. The knowledge of rules & regulations as well as that of performance auditing techniques is critical for conducting such audits. The performance audit of the public sector projects/programmes falls under the preview of the Office of the Auditor General Pakistan (OAGP) and Chartered Accountants focus on financial analysis which is only one of the many aspects covered under performance auditing. The projects do not have funds allocated for performance or performance audit.
Moreover, it also recommended that the projects which are already being audited by reputed Chartered Accountants Firms as required under the Companies Ordinance, 1984, no further audit is needed, as the requirements of formal audits would be met accordingly to ensure transparency, timely execution of projects and assurance of financial propriety.
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