Ministry to respond to audit memos today

The authority has opened a can of worms vis-à-vis the accounting practices of MoIC

RAA: The ministry of information and communications (MoIC) will today respond to the 14 audit memos that the Royal Audit Authority (RAA) has issued with total financial implications aggregating to Nu 7.09M (million) last month.

Of the 14 memos, 10 were issued to the ministry’s secretariat and four to the department of information and media (DoIM) amounting to Nu 4.43M and Nu 2.66M respectively, after the RAA’s initial findings revealed some issues involving possible elements of fraudulent practices.

The RAA, while reviewing the account and operations of the ministry and department for three financial years from July 1, 2011 to June 30, 2014, unearthed issues indicating misuse of government money through violation of financial norms, non-accounting or short accounting for non-revenue receipts received, charging of fictitious expenditures, and improper documentation of accounting records.

At that time, MoIC’s deputy chief accounts officer, Ugyen Tshewang, and accountant Pema Chheney, were responsible for the management and maintenance of accounts, according to the preliminary audit observations report.  The latter was alleged to have misused government money through adoption of various fraudulent practices, and in violation of the budgetary and financial norms.

Some audit findings of the account of the secretariat from 2011 to 2014 included unauthorised and fictitious expenditures of Nu 2.23M without supporting documents/vouchers, payments amounting to Nu 1.11M were found made in cash in violation to the provisions of financial norms, non-accounting of cash withdrawals made through self cheque amounting to Nu 0.24M and Nu 0.65M were booked as personal advance in favour of Pema Chheney.

Auditors noted that Nu 0.65M was booked as personal advance without proper approval of competent authority and specifying the purpose of the advance.  The amount, however, was subsequently found recovered by cash in eight instalments without issuing non-revenue receipts.  The RAA pointed out that the ministry had not imposed a 24 percent penalty on refund from the date of availing unauthorised advances till the dates of adjustments effected in the books of accounts.

The preliminary findings also revealed irregular withdrawals of cheques amounting to Nu 0.24M against refund of security deposits to parties, possible misuse of Nu 0.44M through charging of expenditure without execution of activity and bills, temporary misuse of Nu 0.70M through delay in account for in the cash book, and another possible misuse of Nu 0.75M through non-accounting of money received.

Auditors observed that Nu 0.70M was paid as advance to the personal secretary of the former communications minister on November 23, 2011 for the purpose of meeting the expenditure during the proposed visit of the minister to Sarpang.  The advance amount was refunded on December 1, following the cancellation of the minister’s visit.  However, the refunded amount was found accounted for in the cash book only on June 30, 2012 after a lapse of almost seven months without valid reasons.

The report stated that the retention of huge amounts in cash was tantamount to temporary misuse of government fund.  The ministry had neither taken action against the concerned official(s) on the retention of the refunded amount and misuse of government money nor imposed 24 percent of Nu 96,197 from the date of receipt of the refunded amount till the date of account for in the books of account.

The RAA also observed that closing balance of Nu 0.25M for the fiscal year ended on June 30, 2013 and it was reflected as surrendered to the department of public account (DPA) in the receipt and payment statement.  But it was found that the closing balance was surrendered to the DPA only on June 20, 2014 indicating temporary misuse of cash for 359 days.

Similarly, for the fiscal years 2011-12 and 2013-14, the closing balances were found actually surrendered after a time lapse of 120 days and 21 days, respectively.

While auditing the accounts of DoIM for the fiscal year 2011-12, the RAA had found excessive grant of personal advances amounting to Nu 0.76M and another Nu 0.37M were paid in cash in violation to the financial norms.  A cheque of Nu 0.22M was issued and cash withdrawn from the bank was booked as advance without the knowledge of the payee and later adjusted.

The RAA, which also questioned the granting of a two-year extraordinary leave for Pema Chheney, despite uncovering transactions without supporting documents and other accounting irregularities, noted that such unhealthy practices indicated existence of a very weak internal control system vis-à-vis the lack of a supervisory and monitoring mechanism, particularly over accounting processes and procedures.

MoIC’s AFD head, Sonam Dendup, said that, as the audit report issued to them is a preliminary report, they could not construe it as misuse of government money. “We’re yet to conduct exit meeting with auditors,” he said.

Meanwhile, former MoIC deputy chief accounts officer, Ugyen Tshewang, is being tried at the Thimphu district court by the Office of the Attorney General for alleged misuse of government funds amounting to more than Nu 2M from the department of information technology and telecom (DITT).

By Rinzin Wangchuk 

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