Audit Report Highlights Rs 848 Billion Pending Receivable of Power Sector

The Auditor General of Pakistan’s (AGP) audit report of the Power Division for FY21-22 has highlighted a recovery of more than Rs. 848 billion, including accumulative power sector receivables of Rs. 642.9 billion.

The report confirmed the recovery of only Rs 1.63 billion effective from January to December 2021.

The total budget/expenditure and the receipt of 151 formations were Rs. 651 billion and Rs. 1,085 billion respectively for FY20–21.

The audit coverage relating to expenditure for the current audit year comprises 60 formations of the Ministry of Energy (Power Division) were covered with a total expenditure of almost Rs. 493 billion for FY20–21, of which the audited expenditure amounts to Rs. 204.40 billion (41.38 percent).

The power sector is diverse in its business activities, and the internal controls regulating these activities of the power sector are equally diversified. The report stated that a close audit review of the internal controls helped identify the weaknesses and ineffectiveness of these controls in different field activities.

The report detailed that a timely account of material was not being made by the field staff as per the procedure. Similarly, many reports that were specifically for the maintenance and monitoring of feeders were not populated, which resulted in the poor management of feeder losses.

The report also revealed that the internal controls in the important areas of cash reconciliation and revenue collection were unsatisfactory. Moreover, the AGP was dissatisfied with the use of foreign loans in the Power Division.

On the basis of the audit’s assertion regarding the unsatisfactory utilization of loans, the boards of directors of the companies were advised to address the existing inefficiencies, improve planning and supervision, and ensure the efficient utilization of donor-funded initiatives.