IMF raises alarm over 600,000 pending audit cases in state institutions

The International Monetary Fund (IMF) has expressed serious concerns over delays in the audit process of state institutions, with nearly 600,000 audit paras related to ministries and institutions still pending, Auditor General of Pakistan (AGP) Ajmal Gondal informed the Public Accounts Committee (PAC). 

During the PAC meeting on Wednesday, chaired by MNA Junaid Akbar Khan, the AGP highlighted that the IMF has urged an early resolution of audit cases linked to various ministries and government departments. 

He revealed that over 30,000 audit objections remain unresolved within the PAC itself, while key institutions lack essential internal financial oversight mechanisms. Despite parliamentary directives, no chief internal accountant has been appointed in ministries and government bodies, leading to flaws in the financial audit system.

The committee also reviewed audit reports for the Atomic Energy Commission, Pakistan Nuclear Regulatory Authority, and the Federal Board of Revenue (FBR). 

It was revealed that out of Rs807 billion in audit objections against the FBR, only Rs7 billion has been recovered. FBR officials explained that many of these objections relate to routine expenditures, but the committee questioned the lack of transparency and slow progress.

A Rs312 billion tax fraud case was also discussed, with the FBR chairman clarifying that the actual amount was Rs68 billion, of which Rs28 billion had been recovered while Rs40 billion remains outstanding. The FBR also disclosed an attempted Rs340 billion fraud, which was limited to Rs64 million after intervention. FIRs have been registered against individuals involved in the scams.

The committee raised concerns over irregularities in the Common Pool Fund, which allocates 40% of funds to officers under Section 202B of the Customs Act. Committee members questioned the lack of accountability mechanisms, prompting the FBR chairman to propose a separate account for GD fees, ensuring future transparency.

In the energy sector, the PAC examined Rs217 billion in electricity sales by the Pakistan Atomic Energy Commission (PAEC) to the Central Power Purchasing Agency (CPPA). While Rs162 billion has been recovered, Rs340 billion remains outstanding. The committee also questioned over Rs1 billion in emergency spot purchases by PAEC, with officials citing National Command Authority permissions for urgent procurements. The PAC deferred discussions on the non-recovery of Rs62 billion by CPPA, scheduling a separate session to address the issue.

With the IMF pressing for audit transparency, the PAC has directed ministries and institutions to submit CFO appointment details within a month and has called for systemic reforms to clear the backlog of pending audit cases.