ISLAMABAD: The Cabinet Committee on State-Owned Enterprises (CCoSOEs) has given its approval for conducting the forensic audit of Pakistan International Airlines (PIA) and its subsidiaries.
The development came during a meeting of the Economic Coordination Committee (ECC) chaired by Federal Minister for Finance, Muhammad Hammad Azhar, here on Wednesday.
During the meeting, Secretary Finance presented revised Terms of Reference (TORs) for the forensic audit of the State-Owned Enterprises (SOEs) by the AGP Office and private Audit firms to identify gaps and suggest improved procedures for quality assurance and cost minimisation.
It may be mentioned here that the Pakistan International Airlines Corporation Limited (PIACL) had informed the Ministry of Finance of already have undergone a forensic audit by the AGP; therefore, it was decided that the latest audit would be carried out with the help of a well-reputed private sector firm after following Public Procurement Regulatory Authority (PPRA) rules.
The forensic audit will also identify circumstances leading to losses incurred by SOEs, besides identifying suspicious and fraudulent transactions, if any, for fixing responsibility.
Meanwhile, the national carrier was able to pass the IATA Operational Safety Audit (IOSA) for the resumption of flights to the European Union, the UK and the US.
However, the European Union Aviation Safety Agency (EASA) has extended travel restrictions imposed on the national carrier for an indefinite period and has directed the Pakistan Civil Aviation Authority (PCAA) to get its safety audit done by the International Civil Aviation Organisation (ICAO) in July.
Responding to the PCAA and PIA’s request to lift the ban on flights, the EASA maintained that their offer to use services of flight crew and engineers that do not hold Pakistani licences does not fully mitigate all concerns regarding oversight capabilities of the authority.
Moreover, the federal government has approved a restructuring plan for PIA worth Rs457 billion worth for making it financially viable.
The government has decided to lay off about 25 per cent of the existing workforce or 3,500 employees of the national flag carrier, shut its non-profitable routes and share international routes with other airlines.
It is pertinent to mention here that the plan has been approved without a business plan, which would not be ready in the next six months. “The IATA Consulting firm has also started working on a business plan for the airline, which is expected to be finalised by September this year,” the ECC was informed.