auditor-general of pakistan report 2003-04.pdf · auditor-general of pakistan . ii . iii ......

AUDIT REPORT

ON

THE ACCOUNTS OF

MINISTRY OF FOREIGN AFFAIRS

AUDIT YEAR 2003-04

AUDITOR-GENERAL OF PAKISTAN

iii

Table of Contents

Pages No.

Abbreviations and

Acronyms v

Preface vii

Executive Summary ix-x

Recommendations x-xi

Section-I

Audit Report

Part-I

1. Ministry of Foreign Affairs 1-20

2. Ministry of Commerce 21

3. Ministry of Defence 22

Part-II

4. Ministry of Religious Affairs 23-33

5. Ministry of Information 34-36

6. Ministry of Education 37-38

Section-II Comments on Internal Controls 39

v

Abbreviations and Acronyms

Abbreviations Word

CAO Chief Accounts Officer

DA Daily Allowance

DAC Departmental Accounts Committee

DG Director General

DMJM Daniel Mann Johnson Mendenhall

EMDF Export Market Development Fund

FA Foreign Allowance

FIGOB Fund for Improvement of Government Owned

Buildings

FMMA Financial Management at Missions Abroad

FTR Federal Treasury Rules

GFR General Financial Rules

HOC Head of Chancery

HOM Head of Mission

HQ Headquarters

LAN Local Area Networking

MOFA Ministry of Foreign Affairs

MORA Ministry of Religious Affairs

NADRA National Data Base Registration Authority

OM Office Memorandum

PAC Public Accounts Committee

PC-I Planning Commission Form-I

PC-II Planning Commission Form-II

PCW&EF Pakistan Community Welfare and Education Fund

POL Petroleum, Oils and Lubricants

PPWD Pakistan Public Works Department

PWF Pilgrims Welfare Fund

SR Saudi Riyal

TA Traveling Allowance

vii

PREFACE

Article 169 of the Constitution of the Islamic Republic of Pakistan read with

Section 8 and other relevant provisions of the Auditor-General’s (Functions, Powers

and Terms and Conditions of Service) Ordinance, 2001, requires the Auditor-General

of Pakistan to conduct audit of receipts and the expenditure from the Federal

Consolidated Fund and Public Account.

This report is based on the audit of the accounts of Ministry of Foreign Affairs

and allied wings of various ministries based in Missions abroad for varying periods

from 2001-02 to 2002-03. It includes findings of compliance with authority audit. The

audit was conducted, on a test check basis, by the Directorate of Foreign Audit during

2004-05, with a view to report significant findings to the stakeholders.

The findings indicate the need for adherence to the regulatory framework. In

case of Ministry of Foreign Affairs, the institutional arrangements and the

professional capacity of the Chief Accounts Officer (MOFA) need to be supported so

that similar occurrences are avoided year after year.

Audit observations included in Part-I of the report were discussed with the

concerned Principal Accounting Officers in the Departmental Accounts Committee

meetings and have been finalized in the light of the written responses and discussions.

However, observations included in Part-II of the report could not be discussed with

the Principal Accounting Officers despite efforts.

The Report is submitted to the President of Pakistan, in pursuance of Article

171 of the Constitution of Islamic Republic of Pakistan.

Sd/-

Islamabad MUHAMMAD YUNIS KHAN

Dated: 22.11.2005 Auditor-General of Pakistan

ix

EXECUTIVE SUMMARY

The Directorate of Foreign Audit carried out audit of the accounts of Ministry

of Foreign Affairs, its 13 local formations and 48 Pakistan Missions abroad, including

allied wings of Commerce, Defence, Labour and Manpower, Information and

Broadcasting, Science and Technology, Ministry of Religious Affairs (Directorate

General Hajj, Saudi Arabia) during 2004-05. The accounts audited related to the

period from 2001-02 to 2002-03.

The observations included in the Report contain:

1. Seven cases of unauthorized hiring/payment of rent of accommodation for

Hujjaj in Saudi Arabia - Rs.233.434 million;

Paras [4.1, 4.2, 4.3, 4.4, 4.5, 4.7 and 4.9]

2. Four cases of irregular payments to the architect and construction manager

for construction of Chancery Building at Washington, D.C., USA -

Rs.93.749 million; Paras [1.18, 1.20, 1.21 and 1.22]

3. Eleven cases of non-adjustment of advances/excess payment to

Government employees - Rs.42.546 million;

Paras [1.1, 1.5, 1.8, 1.11, 2.1, 3.1, 4.6, 5.1, 5.3, 6.1 & 6.2]

4. Two cases of expenditure incurred on purchase of furniture/fixture and

machinery/equipment without the benefit of competitive rates - Rs.37.035

million; Paras [1.4 and 1.19]

5. One case of unauthorized expenditure out of Pakistan Community

Welfare and Education Fund - Rs.14.900 million; Para [1.2]

6. One case of unauthorized payment of inadmissible medical claims (Dental

Crowning and Infertility treatment) - Rs.3.721 million; Para [1.6]

7. One case of expenditure on rent of vacant residences - Rs.1.921 million;

Para [1.7]

In addition to above, certain other cases pertaining to unauthorized

expenditure, non-reconciliation of accounts and non-accountal of stock etc. were

observed during the course of audit.

The report also highlights cases where management could not enforce the

necessary controls relating to issuance of passports and consular receipts. The

x

consular sections need immediate attention in terms of documentation of required

record, particularly numerical registers.

The nature, frequency and the extent of above mentioned violations/

irregularities clearly suggest that the Principal Accounting Officer do not have the

adequate institutional capacity required to attend the financial management and

control issues.

Recommendations

1. Principal Accounting Officers should take necessary steps to evaluate,

institute and strengthen the management, budgeting and accounting controls to

achieve the following control objectives:

i) to get the maximum help and assistance from the professional capacity

and services of the full fledged office of the Chief Accounts Officer;

ii) adherence to the regulatory framework and canons of financial

propriety which require the public officers to exercise the same

vigilance in respect of expenditure incurred from public money as a

person of ordinary prudence would exercise in respect of expenditure

of his own money;

iii) prompt recovery of Government dues, wherever applicable, and their

credit in the Government Treasury;

iv) proper and timely issuance of passports and timely deposit of consular

receipts;

v) compliance to the policy directives of the Government regarding

construction, repair, buying and selling of real estate abroad and at

headquarters.

2. The concerned Principal Accounting Officers should take immediate steps to:

i) strengthen the budget management system at headquarters and

Missions abroad;

ii) effect recoveries of Government dues as pointed out in the report;

xi

iii) get the expenditure on irregular payments, as pointed out in this report,

regularized from the Ministry of Finance;

iv) ensure maintenance of numerical registers at Missions abroad;

v) ensure that Pakistan Community Welfare and Education Fund

(PCW&EF), Fund for Improvement of Government Owned Buildings

(FIGOB), Pilgrims Welfare Fund (PWF) and Export Market

Development Fund (EMDF) are utilized for the purposes intended and

the variations pointed out in this report are addressed;

vi) ensure that there is no mismanagement in the hiring of buildings for

Hujjaj in Saudi Arabia to specifically address the weaknesses

identified in the report.

The PAC while discussing this report on 10.08.2011, 10.09.2012, 24.08.2012

& 19.05.2015 issued directions out of which nine were complied with and action

taken. Besides an amount of Rs. 200,324 was recovered. The PAC directives are

attached as Annexure A.

Ministry of Foreign Affairs

1.1 Non-adjustment of advances of Rs.26.913 million from Government

employees

As per the provisions of para 269 of GFR, Vol.-I, the adjustment of advances drawn

by Government employees is required to be made upon return of the Government

servant to headquarters or 30th

June whichever is earlier. Similarly, as per Rule 668 of

FTR, Vol.-I, advances granted under special orders of competent authority to

Government officers for departmental or allied purposes are subject to adjustment by

submission of detailed accounts supported by vouchers or by refund, as may be

necessary.

In the following seven cases advances amounting to Rs.26.913 million on account of

TA/DA, purchase of gifts, transportation charges and purchase of air tickets were paid

to 66 officials during the period from 2001-02 to 2002-03 by the Ministry of Foreign

Affairs at HQ and Missions abroad. However, the advances had neither been adjusted

nor recovered from the officials by the time of audit despite lapse of considerable

period as shown in the following table:

(Rs. in million) S.

No.

Formation Payment

period

Purpose of

Advance

No. of officials Amount

1. MOFA(HQ) 9/2002 to

6/2003

TA/DA 27 officials 2.791

2. MOFA(HQ) 7/2002 to

6/2003

Purchases of gifts,

DA and Tips

2 officials 3.728

3. MOFA(HQ) 10/2002 to

4/2003

Air tickets and

training expenses

10 officials

17.408

4. C.G. Los

Angeles

Air ticket and

transportation

charges

2 officials 1.241

5. New Delhi Purchase of electric

items

1 official 0.385

6. MOFA (HQ) 9/2002 to

6/2003


7. MOFA (HQ) 5/2002 to

6/2003


Total 66 officials 26.913

2

Non-recovery of advances despite the lapse of the permissible period and in violation

of laid down procedures tantamount to undue favour to the individuals. Historically

the Ministry has been showing indifference towards the issue which has led to the

accumulation of unadjusted advances.

The issue was discussed in DAC meeting held on 8th

June, 2005 and the viewpoint of

Audit was upheld. DAC decided that recovery process be expedited, and recoveries

be verified by the Chief Accounts Officer (CAO), Ministry of Foreign Affairs.

1.2 Unauthorized expenditure of Rs.14.900 million out of Pakistan

Community Welfare and Education Fund

As per para 10.11 of Financial Management at Missions Abroad (FMMA) Vol.-I, the

Head of Mission is competent to authorize expenditure from Pakistan Community

Welfare and Education Fund (PCW&EF) for the following purposes:

i. Welfare schemes for Pakistani Schools

ii. Improvement of Pakistani Schools

iii. Any legitimate expenditure on the maintenance of destitute Pakistanis

iv. Provision of legal aid through local lawyers to protect Pakistani

workers abroad from exploitation by foreign employers

v. Financial assistance for projection of Pakistani culture, and

vi. Expenditure on consular visits to different parts of the country of their

accreditation

It was, however, noted during the audit of the following 8 Missions that the

management irregularly incurred expenditure out of PCW&EF for the purposes not

specified in the FMMA, Vol.-I during July, 2001 to June, 2003 as detailed below:

S.

No.

Mission Purpose Amount

(LC)

Amount in

Rs.

1. Doha Printing QR.2,538 42,004

2. C.G. Dubai Payment of salary to clerk Dhs.4,000 64,320

3. Madrid Salary to Security Guard Pts.523,740 175,257

4. Abu Dhabi Purchase of Furniture 236,562 contd.

3

from pre-page 5. C.G. Los

Angeles

Salary of staff, Painting of

Reception area, Purchase of

Furniture.

US$28,186 1,634,788

6. Tokyo Misc. charges JP¥.2,285,000 11,182,790

7. New Delhi Expenditure on

improvement of Embassy

building and employment

of support staff

I.Rs.1,139,868 1,564,811

Total 14,900,532

The issue was discussed in the DAC meeting held on 8th

June, 2005 and it was

decided that the Ministry should regularize the unauthorized expenditure.

1.3 Purchases of Rs.16.293 million not taken on charge/stock

According to para 148 of GFR, Vol.-I, all materials received should be examined,

counted, measured or weighed as the case may be and taken on charge in the stock

register by a responsible officer. Furthermore, as per para 154 of GFR, Vol.-I an

inventory of the dead stock should be maintained in all Government offices in a form

prescribed by competent authority, showing the number of items received, number of

items disposed off and the balance in hand for each kind of article.

Audit noted that the Ministry of Foreign Affairs at Headquarters and Missions

Abroad purchased various durable items valuing Rs.16.293 million during July, 2000

to June, 2003 as detailed below: (Rs. in million)

S.No. Formation Items Period of

Purchase

Amount

1. MOFA(HQ)

2002-03

Micro Film Reader/Printers, Carpets,

Craft File Boxes, Table & Chairs, Steel

Almirahs, Sofa Sets, Folding Beds, Air

Conditioners, Telephone Sets, Curtains

9/2002 to

6/2003

4.843

2. New Delhi

2000-2003

Furniture and Fixture 7/2000 to

6/2003

1.735

3. SAARC

Summit 2004

at Islamabad

MOFA (HQ)

Computers, Printers, Laptops, Scanners,

Projection Screens, Photocopiers,

Multimedia and Shredders

12/2003 9.715

Total 16.293

4

However, these purchases were not accounted for in the relevant stock registers in

contravention of the above mentioned rules. This is also indicative of the poor

inventory management system in the Ministry. The issue of non-accountal is pointed

out almost every year to the Ministry but there appears to be no change in the

inventory management and control position.



decided that the Special Secretary, Ministry of Foreign Affairs (MOFA) will verify

the facts and place the position before the PAC.

1.4 Irregular and uneconomical purchase of furniture and equipment

amounting to Rs.9.665 million

According to para 144 & 145 of GFR, Vol.-I, open tenders are required to be invited

to achieve the benefit of competitive rates. Furthermore, in accordance with para 96

of GFR, Vol.-I, it is contrary to the interest of state that money should be spent hastily

or in an ill-considered manner merely because it is available or to avoid the lapse of

grant. A rush of expenditure particularly in the closing months of the financial year

will be regarded as a breach of financial regularity.

It was noted during the course of audit that expenditure of Rs.9.665 million was

incurred by the M/o Foreign Affairs on account of purchase of furniture, fixtures,

machinery and equipment, during June, 2003 without inviting tenders, and obtaining

sanction of the competent authority. Details are as under:

(Rs. in million)

S.

No.

Formation Item Amount

1. MOFA(HQ) Equipment for Local Area Networking

(LAN)

3.929

2. MOFA(HQ) Printers, Laptops, VCR, Computers,

Scanners, Photo copiers, Projection Screens,

Projectors, Shredders,

5.736

Total 9.665

5

The expenditure of Rs.9.665 million incurred without fulfilling the requirements of

rules is, therefore, held as irregular.



decided that the Ministry will provide evidence that all codal formalities have been

fulfilled and explain reasons for rush of expenditure in the month of June. No

evidence to this effect was, however, provided till finalization of this report.

1.5 Payment of Rs.4.600 million in excess of the entitlement of officials at

headquarters and Missions abroad

According to para 11 of GFR, Vol.-I, each Head of Department is responsible for

enforcing financial order and strict economy at every step. He is responsible for

ensuring observance of all relevant financial rules and regulations by all disbursing

officers.

During the audit of the accounts of Ministry of Foreign Affairs for the period 2001-02

and 2002-03 it was observed that the Ministry at Headquarters and in Missions

abroad paid a sum of Rs.4.600 million to gazetted and non-gazetted officers/officials

on account of traveling allowance/daily allowance and pay and allowances over and

above their entitlement in violation of rules in the following cases:

In 4 Missions abroad, a sum of Rs.52,433 was paid on account of incidental

charges to 14 officials during October, 2000 to June, 2003 for which they

were not entitled.

In 6 Missions, an amount of Rs.961,135 was paid as full Daily Allowance to

24 officials during July, 2001 to June, 2003 without production of hotel

receipts in support of their claims.

In 3 Missions, a sum of Rs.376,217 was paid in foreign currency to 3 officials

on account of 70% transportation charges beyond their entitlement during

April, 2002 to June, 2003.

In 5 Missions and 2 local formations, 19 officials were paid a sum of Rs.1.247

million on account of pay and allowances in excess of their entitlement during

July, 2001 to June, 2003.

6

In 4 Missions, a sum of Rs.699,445 was paid as joining time DA to 4 officials

during April, 2002 to June, 2003 without their joining the duties at the place

of their posting.

In 7 Missions and 2 local formations a sum of Rs.1.123 million was paid as

hotel/room rent charges to 141 employees in excess of their entitlement during

December, 1999 to June, 2003.

In 3 Missions, a sum of Rs.141,351 was paid as 30% DA to 7 individuals in

excess of their entitlement during January, 2002 to April, 2003.

The payments made in excess of the entitlements were unauthorized and were not

recovered in the currency in which the payments were made.

The matter was brought to the notice of the management but the Ministry stated that

the accountants and employees who made the overpayments were not aware of the

rules. Plea of the Ministry regarding ignorance of rules by accountants and employees

is not acceptable. Awareness of rules and their implementation is the responsibility of

all the individuals and organizations.



decided that the Ministry will get the recoveries expedited and regularize/adjust the

amounts in minimum possible time. However, no recovery was got verified from

Audit till finalization of this report.

1.6 Unauthorized re-imbursement of Rs.3.721 million on account of medical

charges

Audit observed that Pakistani Mission in Montreal, Canada irregularly reimbursed a

sum of Canadian $15,138 to four officials on account of inadmissible dental treatment

in violation of the provisions of para 6.9 of FMMA, Vol.-II.

Similarly, in another case a sum of US$53,187 was irregularly reimbursed to an

officer by the Pakistan Mission at Los Angles on account of infertility treatment

during the period from July, 2001 to September, 2003 although there is no provision

in the FMMA for treatment of infertility at Government expense.

7



decided that the Ministry will obtain details of treatment, provide evidence to Audit

and to obtain Health Division’s clarification whether “Infertility” and “Sterility”

treatment are synonymous and further direct the Missions concerned to retrieve the

amount covered under the contract from the Insurance Company.

1.7 Unauthorized payment of Rs.1.921 million on account of rent of vacant

residences

As per provisions of para 10 of GFR, Vol.-I, every public officer is expected to

exercise the same vigilance in respect of expenditure as a person of ordinary prudence

would exercise in respect of his personal expenditure.

It was, however, noted that the following two Missions retained vacant buildings

hired for residences and paid an amount of Rs.1.921 million on account of rent of the

vacant residences during September, 2002 to June, 2003 without any justification.

(Rs. in million)

S.

No.

Formation

Period for

which

houses

remained

vacant

Amount

involved

(Foreign

currency)

Amount

1. Muscat 10.05.2003 to

9.5.2004

RO.5500 0.827

2. Madrid 6.10.2002 to

1.7.2003

EU.15629.49 1.094

Total 1.921

The expenditure incurred on retention of vacant buildings was unauthorized and

resulted in unjustified loss to the government. This is one of the chronic issues

pointed out to the Ministry every year but the problem persists with the same

intensity.


June, 2005. Discussions in

the meeting remained inconclusive and it was decided to place the matter before the

PAC.

8

1.8 Non-recovery of Rs.792,281 on account of telephone charges paid over

and above the ceiling for officers

Cabinet Division has fixed ceiling for residential and office telephones in respect of

authorized officers in Pakistan vide O. M. No.1/2/98-GC, dated 08th

September, 2000.

Similarly, Ministry of Foreign Affairs has fixed Mission-wise telephone ceilings for

official and residential telephones in respect of the employees working in Pakistan

Missions abroad.

It was, however, noted that in the following three Missions and certain formations of

Ministry of Foreign Affairs in Pakistan an amount of Rs.792,281 was paid on account

of telephone charges over and above the prescribed ceiling on residential telephones

during the period from July, 2001 to June, 2003:

S. No. Formation Excess involved in

Foreign Currency

Amount in

Rs.

1. UN Geneva CHF 1615 98,000

2. Doha QR.3,557 58,869

3. Athens €.351 22,496

4. MOFA(HQ) - 396,844

5. Deputy Chief of Protocol,

Karachi - 193,631

6. Foreign Service Academy,

Islamabad - 22,441

Total 792,281

The amount was required to be recovered from the officials concerned but was not

recovered from them even after the lapse of more than two years. The expenditure

incurred over and above the prescribed ceilings of officers is, therefore, held as

unauthorized.



decided that the recoveries of outstanding amounts from the concerned officers be

effected within 30 days. However, the Ministry could not provide any evidence of

recovery till finalization of this report.

9

1.9 Irregular expenditure of Rs.688,000 on repair of official vehicles

According to Serial No.8(5) of powers delegated by the Ministry of Foreign Affairs

vide letter No.Rules-6/1/2000 dated 14th

December, 2000 Heads of Missions are

empowered to incur expenditure on repair of official vehicles upto US$700 at any one

time on one or any number of vehicles used by the Missions.

It was noted that the following three Missions incurred an expenditure of Rs.688,000

on repair of three official vehicles during July, 2001 to June, 2003 beyond the

financial powers delegated to the Heads of Missions. The expenditure incurred over

and above the financial powers was, therefore, irregular.

S. No. Formation

No. of

Vehicles

Amount involved

(foreign currency)

Amount

1. UN Geneva 01 CHF 9829 502,000

2. Doha 01 QR.8,525 141,000

3. London 01 £.497.18 45,000

Total 03 688,000

The matter was discussed in the DAC meeting held on 8th

June, 2005 and viewpoint

of Audit was upheld. The DAC decided that regularization action will be completed

within 30 days. However, no intimation regarding regularization of expenditure was

provided to Audit till finalization of this report.

1.10 Non-reconciliation of the difference of Rs.423,000 in cash book and bank

statement

As per Rule 77(v) of FTR, Vol.-I, para 3(c) of New System of Financial Control and

Budgeting and Chapter VI of FMMA, Vol.-I (Appendix-D), the Head of Mission is

responsible for ensuring that the departmental accounts are reconciled every month.

Review of the accounts of Pakistan Mission at Madrid revealed that there was a

difference of Euro5,885 and US$197 in balances as per cash book and bank statement

in October, 2000. However, neither these differences had been investigated nor

adjusted even after the lapse of more than three years.

10

Similarly, in Pakistan High Commission, New Delhi reconciliation with the Bank was

not carried out from 2001 to 2003. The authenticity of the accounts cannot be

confirmed without reconciliation/adjustment.



decided that the Ministry will get the reconciliation verified from the Chief Accounts

Officer (MOFA) and report compliance to Audit. This was, however, not done till

finalization of this report.

1.11 Non-recovery on account of utility charges Rs.358,939

As per para 8.20 of FMMA, Vol.-II, the Head of Mission is required to pay 25%

share of utility bills (electricity, gas, water) and as per para 8.22 of FMMA, Vol.-II,

other officers and members of the staff are required to pay services and other tenant’s

charges themselves in cases where house rent bill in respect of the accommodation

rented for officers and staff includes services and other tenant’s charges for heating,

electricity and water. Recovery should be made from the occupant concerned @ 2%

each of monthly rent for heating, lighting and water charges.

Audit observed that in the following two Missions, recovery on account of utility

charges was not made from 11 officials during the period from January, 1989 to

October, 1999 and from July, 2001 to October, 2003 in violation of rules.

S. No. Mission Amount (LC) Amount (Rs.)

1. Doha QR.14,208 235,142

2. Pyong Yong €1769 123,797

Total 358,939



decided that the recoveries be effected within 30 days. The Ministry, however, did not

produce any evidence of recovery till finalization of this report.

11

1.12 Non-recovery of Rs.353,100 on account of cost of unutilized air tickets

As per provision of para 20 of GFR, Vol.-I, any loss of public money, departmental

revenue or receipts which is discovered should be immediately reported by the officer

concerned to his immediate official superior as well as to the Accountant General,

even when such loss has been made good by the party responsible for it.

The Ministry of Foreign Affairs incurred an expenditure of Rs.353,100 on account of

purchase of return air tickets for the nominees of different countries to attend the 14th

Advance Diplomatic Course. The nominee Mr. John Twepaliza Kalaghe did not

attend the course. The tickets bearing No. 21444076189 and 21444076190

respectively for Rs.174,980 (each costing Rs.87,490) were returned by Pakistan

Mission at Harare on 14th

April, 2003 but the cost of ticket was not recovered from

the concerned Travel Agent.

Similarly, return air tickets No. 214-2403041168 and No.214-2403041454 costing

Rs.129,070 and Rs.49,050 respectively were purchased in respect of Mr. Peter

Kobina Taylor, the nominee of Ghana for the 22nd

specialized diplomatic course vide

letter No. EC (22nd

FSA-123/2002, dated 01st January, 2002. The nominee did not

attend the course but the amount of Rs.178,120 was not recovered from the travel

agent.



decided to effect the recoveries from the travel agents within 15 days. The evidence

of recovery was, however, not shown to Audit till finalization of this report.

1.13 Non-deposit of Rs.409,897 into consular receipts account

According to Rule 7 of Federal Treasury Rules (FTR), Vol.-I, all moneys received by

or tendered to Government officers on account of revenues of the Federal

Government shall be paid in full into a treasury or into the Bank without undue delay.

Such receipts shall not be appropriated to meet Departmental expenditure, nor

otherwise kept apart from the Federal Consolidated Fund of the Federal Government.

No Department of the Government may keep any revenue of the Federal Government

received out of the Federal Consolidated Fund.

12

Scrutiny of monthly cash accounts, cash control register and bank statements for the

years 2001-02 and 2002-03 pertaining to Consulate General, Hong Kong revealed

that an amount of Rs.409,897 (369,729+29,688+10,480) was short-deposited in the

Government account in violation of the above rules. The receipts were retained

outside Federal Consolidated Fund from July, 2001 to June, 2003 due to lack of

effective financial management and internal controls.



decided that the Ministry will conclude findings of the ongoing inquiry within 60

days and intimate to Audit the outcome and any action being taken.

1.14 Non-maintenance and improper maintenance of Passport and Visa

record

All Passport and Visa issuing authorities have to maintain records and registers

according to the instructions contained in paras 84, 85 and 162 of the Passport and

Visa Manual issued by the Director General, Immigration and Passports, Islamabad.

Contrary to the above mentioned instructions, the following Missions either did not

maintain record of Passports and Visas at all or the record was not maintained in the

prescribed form.

S. No. Mission Record not Maintained Record Improperly

Maintained.

1. Manchester No record of Visa & Passport is

maintained except Numerical & Stock

Register.

-

2. -do- Numerical register for Emergency

Passport.

-

3. -do- - Numerical & stock register

4. Brussels - Numerical register

5. -do- - Consular fee register

6. Bradford - Numerical register of Visa &

passport

7. Muscat Passport issue register and Visa

register.

-

13

Non-maintenance of visas and passport record is a serious violation of Government

instructions.


June, 2005 but the

discussions remained inconclusive. It was, therefore, decided that the matter will be

placed before the PAC.

1.15 Non-maintenance of cash receipt books control register and missing of

cash receipt books

As per the provisions of Rule 85 of FTR, Vol.-I, the number of forms contained in a

Receipt Book should be counted and recorded in the book over the signature of the

officer-in-charge.

It was observed that Pakistan Mission at Bangkok did not maintain Receipt Books

Control Register in violation of the provisions of above mentioned rule. Therefore,

the exact position of stock and issuance of Receipt Books to consular section could

not be ascertained. A sequence of serial numbers from 16401 to 16500 was not found

in the record which meant that 100 cash receipts (2 books bearing Serial No. 329 and

330 of 50 pages each) were missing. The following remarks dated 11th

July, 2001

recorded on receipt book No. 328 by Consular Assistant also confirmed that books

No. 329 and 330 were missing.

“This book No. is 328 next two books, 329 & 330 not provided by the then

Accountant and next book in use will be 331”.

The possibility of misuse of funds collected on missing receipts, therefore, cannot be

ruled out.



decided that the Ministry will conclude investigation within 21 days and convey its

findings to Audit. This was, however, not done till finalization of this report.

1.16 Issuance of Passport on bogus Identity Card

Pakistan Mission at Athens issued passport to Mr. Imran Fazal son of Mr. Fazal who

applied for fresh passport on the basis of Identity Card No. 302-80-682721. The

14

Mission sent the ID card to District Registration Office (DRO), Sialkot vide No.

Cons-1/8/2003 dated 09th

April, 2003 for verification. In response, DRO, Sialkot

intimated that the card under reference was “Bogus”. However, despite verification

by the DRO, Sialkot, the applicant was issued Passport No. KB469118 dated 1st July,

2003 with validity upto 30th

June, 2005.

Thus, action of the management to issue the passport on bogus identity card was a

serious lapse.


June, 2005. The Ministry

could not give a satisfactory explanation and it was decided that the matter may be

placed before the PAC.

1.17 Irregularities in the construction of Chancery building at Washington,

D.C.

The construction of a Chancery building at Washington was approved by the Prime

Minister of Pakistan out of loan of US$15 million from the National Bank of Pakistan

in 1997. The building was completed at a total cost of US$17.613 million on a piece

of land measuring 46,982 Sft purchased for US$728,212 in 1988. It was observed in

audit that the requisite codal and legal formalities were not completed contrary to the

assurance contained in the summary for the Chief Executive wherein the Ministry of

Foreign Affairs had stated that all the legal, procedural and other formalities for the

construction of the Chancery building have been completed by their embassy at

Washington, D.C.

During the course of execution of the project, the Head of Mission at Washington,

D.C., incurred an expenditure of US$17.613 million (Rs.1026.310 million) on the

recommendation of a Supervisory Committee without seeking the formal sanction of

the Ministry. As per S. No.8(3) of Finance Division O.M. No.F.3(4)Exp-III/2000,

dated 30th

June, 2000, Head of a Mission is not empowered to incur such expenditure

as no such dispensation was specifically made for this project by the Ministry of

Finance. These powers vest in the Ministry of Foreign Affairs.



decided that the Ministry will establish a Committee headed by the Special Secretary

15

and comprising of Director General, Pakistan PWD (PPWD) and Financial Advisor to

verify facts, and submit its report to Audit for further discussion.

1.18 Award of architectural contract to M/s Daniel Mann Johnson

Mendenhall without pre-qualification of architect

The architectural contract for the Chancery building at Washington was awarded by

the Embassy to M/s DMJM on 9th

March, 1998 for US$925,000 at the rate of

US$19.69 per SFT. The scope of work of M/s DMJM, as contained in Article 2 of

agreement signed between Embassy of Pakistan, Washington, D.C., USA and the

Architect M/s DMJM was as under:

i. Programme designing activity

ii. Prepare schematic design and design development

iii. Prepare construction documents

iv. Prepare bidding documents.

The contract was awarded to M/s DMJM in violation of the provisions of para 144 of

GFR, Vol.-I, as tenders were not called for and no pre-qualification of Architects was

done by the Embassy of Pakistan to have the benefit of competitive rates and to select

the appropriate Architect.



decided that the Ministry will establish a Committee headed by the Special Secretary

and comprising of Director General, Pakistan PWD and Financial Advisor to verify

facts, and submit its report to Audit for further discussion.

1.19 Irregular expenditure of US$469,712 (Rs.27.370 million) on purchase of

new furniture out of project money

The Embassy of Pakistan at Washington, D.C., awarded contract to M/s Washington

Group Sales Inc. for supply of furniture for US$469,713 (Rs.27.26 million). It was

observed that payment was made out of project money in a non-transparent manner.

In contravention of the laid down procedure the Embassy incurred the expenditure on

replacement of furniture without observing the provisions of para 144 of GFR, Vol.-I

which requires that tenders be called through advertisement in the press and without

seeking the approval of the Ministry of Foreign Affairs. Details are as follows:

16

(Amount in US$) i. M/s Kim Ball (Sub-Contractor) 355,112

Voucher No.70 of 06-02-03 194,260

Voucher No.99 of 08-05-03 160,852

ii. M/s Washington Group Sales Inc. 93,407

Voucher No.75 of 24-02-03 14,700

Voucher No.93 of 02-05-03 14,700

Voucher No.110 of 26-08-03 63,431

Voucher No.114 of 27-08-03 576

iii. M/s Southern Office Supplier 20,744

Voucher No.80 of 20-03-03 10,000

Voucher No.94 of 05-05-03 9,691

Voucher No.100 of 14-05-03 1,053

iv. M/s Carpet Land (Sub-Contractor) 450

Voucher No.95 of 07-05-03 450

Total 469,713


June, 2005. It was decided

that the Ministry will establish a Committee headed by the Special Secretary and

comprising of Director General, Pakistan PWD and Financial Advisor to verify facts,

and submit its report to Audit for further discussion.

1.20 Payment of US$360,215 and US$75,296 (Rs.25.377 million) on account of

additional fees to Architect and Construction Manager respectively for

designing inadequacies

Embassy of Pakistan Washington, D.C., USA while approving the design of

Chancery building did not consider some important features which were included at a

subsequent stage. This act of the management not only increased the cost but also

resulted in additional fees of US$360,215 and US$75,296 to the Architect and

Construction Manager respectively. Some of the features which were not included in

the original design but were later on included are enumerated below:

i. Fencing/Gate, Surveillance Camera and Intercoms

ii. Sprinkler Fire Protection System

iii. Fire Alarm System

iv. Telephone/Data System.

17

The agreement with the Construction Manager M/s DMS International specified vide

clause 13.3.11 that the owner shall compensate the construction manager @

US$10,000 per month for extension of construction phase beyond 18 months, but the

agreement with the Architect M/s DMJM was silent about this compensation.

Moreover, approval for these additional features/facilities was not obtained from the

Ministry of Foreign Affairs. Instead, the Supervisory Committee approved the

modifications although it was not competent to do so.

Had the above features/aspects been taken into consideration at the time of initial

designing of the project, the Embassy would have saved US$435,511 as additional

fees of Architect and Construction Manager. Furthermore, inclusion of these features

without approval of the Ministry of Foreign Affairs rendered the payment

unauthorized.






1.21 Irregular payment of US$9,324 (Rs.543,309) to M/s DMJM on account of

developing computer model of proposed Chancery building

As per local requirements of the Commission of Fine Arts, USA and National Capital

Planning Commission, USA, the model of a building was required to be prepared and

presented for approval to the Governmental authorities having jurisdiction over the

project. According to Article 2.4.4 of the agreement between Embassy of Pakistan,

Washington, D.C., and M/s DMJM, the architect was under obligation to prepare and

present the requisite model to the concerned authorities.

It was observed that an amount of US$9,324 was irregularly paid to M/s DMJM for

developing computer model of the building although the same was part of the original

contract.






18

1.22 Faulty design of canopy (dome) of Chancery building Rs.13.920 million

The construction of a canopy (dome) to house different facilities including reception,

Jamshed Marker Hall etc. in the Embassy of Pakistan, Washington, D.C., USA was

awarded to the contractor M/s Structure Tone. The dome was completed at a cost of

US$240,000 equivalent to Rs.13.920 million. M/s Structure Tone expressed serious

concerns about the canopy support system in a letter dated 17th

September, 2003

addressed to M/s DMS International, the Construction Contractor. They showed their

concern about the anchorage of the support brackets to the pre-cast concrete panels.

They warned that there was a possibility of the support system failing due to

unanticipated wind loading. They also advised not to allow any pedestrian or

vehicular traffic in the area beneath the canopy. Thus, due to the defective design by

the Architect the building has been declared dangerous and unsafe for the life and

property of its users.






1.23 Inadequate facilitation in the new Chancery building for expatriate

community requiring consular services

According to Chapter VI, (Para 1) of Standing Orders for the Administration of

Pakistan Missions Abroad (15th

March, 1981), issued by the Ministry of Foreign

Affairs, a large number of Pakistani nationals are working overseas. Apart from being

a national asset, by virtue of their significant contribution towards strengthening the

country’s economy through substantial home remittances, they are entitled to help

and sympathetic consideration from our Missions in their own right. It is, therefore,

incumbent upon our Heads of Missions/sub-Missions to re-order their priorities and

regard care and welfare of overseas Pakistanis as no less important than the

diplomatic and allied activities.

This aspect of provision of facilities was ignored while designing and constructing the

consular services section frequently visited by expatriates in the newly constructed

Chancery building, on the plea of cost savings. The community has contributed

$2.613 million directly to FIGOB and PCW&EF which has been utilized in the

19

construction of the Chancery. In spite of the instructions of the Ministry of Foreign

Affairs and significant contributions of the expatriates, non-provision of essential

facilities have resulted in the following short comings:

i) In the newly constructed Chancery building, facilities which are

mandatory for users have not been provided thus depriving the visitors of

the essential services. For instance, the consular section which is located

on the first floor is a place where expatriate Pakistanis and visitors of all

ages come for getting consular services such as Passports, Visas, National

Identity Cards etc. It was noticed that the consular section was at a

considerable height from the road and was therefore accessible only

through an uncovered staircase having 23 steps more than one storey high.

It is logical to believe that the handicapped, the sick and the old shall find

it difficult and even dangerous to reach the consular section for essential

consular services particularly during winters.

ii) The consular section is inadequate as it can accommodate only 6-8 visitors

at a time. The entire building with a covered area of 80,000 Sft has no

segregated toilets and in the only common toilet for both ladies and

gentlemen there is no provision of bidet and ablution.

iii) There are no proper signs/indications to guide the visitors to the consular

section. The Architect, vide their letter dated 20th

March, 2002 had

advised the Embassy to arrange Urdu signage for designated areas to

facilitate Pakistani people, but the advice was not considered.

Thus the lack of essential facilities/features has reduced the usefulness of the new

Chancery building.






20

1.24 Irregular award of contract to M/s Data Link for supply and installation

of telephone/data system

Para 144 of the GFR, Vol.-I, requires procurement of goods and services through

open competitive bidding.

It was noted that the services of M/s Data Link were engaged in August, 2003 for

supply and installation of Telephone/Data System for US$118,975 (Rs.6.9 million) in

the new Chancery building, Washington, D.C., without observing the provisions of

GFR. The work was awarded by the Supervisory Committee who had no powers to

award such works. Thus the award of contract without calling of open tenders as

required under GFR was irregular.






1.25 Non-maintenance of stock registers

In terms of the provisions of para 154 of GFR, Vol.-I, the Embassy of Pakistan, at

Washington, D.C., was required to maintain up-to-date stock registers of stores. It

was, however, noted that the Embassy was maintaining stock register/inventory in the

form of loose sheets instead of the prescribed bound format. It was also noted that

many items of furniture, fixture, machinery and equipment purchased during the

period under audit were not added to the inventory. For example, furniture worth

US$470,063 was purchased but the inventory showed the record of furniture worth

US$183,766 only. Non-maintenance of stock register in the prescribed format is an

irregularity.






21

Ministry of Commerce

2.1 Unauthorized drawal of Daily Allowance for 15 days amounting to

US$6,025 (Rs.351,077)

According to para 10.71 of the FMMA, Daily Allowance (DA) on joining a Mission

or on relinquishing a post abroad has been restricted to six days joining time only.

The facility of additional 15 days DA in lieu of non-provision of Government

accommodation was discontinued vide Ministry of Foreign Affairs O.M. No. Dir

(P-I)1/98, dated 10th

August, 1998.

It was observed that Pakistan Mission at Tokyo paid a sum of US$10,260 on account

of 15 days DA as overlapping period in addition to 6 days DA on joining the Mission

to a Commercial Counsellor in violation of the rule. The actual excess for 15 days

less Foreign Allowance and House Rent Allowance comes to US$6,025 (US$10,260 -

4,235).


August, 2005 and it was

decided to recover the amount within four months.

22

Ministry of Defence

3.1 Overpayment of DA for 5 days overlapping period US$3,940 (Rs.229,584)

According to para 10.71 of the FMMA, Daily Allowance (DA) on joining a Mission

or on relinquishing a post abroad has been restricted to six days joining time only.

The facility of additional 15 days DA in lieu of non-provision of Government

accommodation was discontinued vide Ministry of Foreign Affairs O.M. No. Dir

(P-I)1/98, dated 10th

August, 1998.

It was observed that Embassy of Pakistan, Beijing paid five days DA for overlapping

period in addition to six days joining time DA to the following officers irregularly:

(Amount in US$)

S.No. Vr.No. Designation Amount

1. 19/Sept.2002 Attache Defence Procurement 2,240

2. -do- Air Attache 1,700

Total 3,940


July, 2005 and it was

decided to effect the recoveries from the concerned officers. No evidence of

recoveries was produced to Audit till finalization of this report.

23

Ministry of Religious Affairs

4.1 Unauthorized payment of SR13.860 million (equivalent to Rs.215.800

million) due to hiring of accommodation over and above the admissible

lodging capacity

The Kingdom of Saudi Arabia has fixed 3 square metres space per pilgrim for hiring

Hujjaj accommodation at Makkah and Madina. The Tasreeh contains lodging

capacity, number of rooms and floors and provision of all necessary services to the

Hujjaj by the owners of the building. The buildings are hired on the basis of laid

down criteria given in Tasreeh and Hajj Policy. Payment cannot be made for the

pilgrims who are accommodated over and above the Tasreeh i.e. approved allocation

plan of the buildings, rooms and floors vide Tasreeh, Policy and Plan for Hajj 2003.

It was observed during audit scrutiny that in violation of the provisions of the law of

host country and Pakistan’s Hajj Policy, floors and rooms were hired in excess over

those given in the Tasreeh in 196 cases. Furthermore, while approving another 20

cases, the Hiring Committee did not keep in view the aspect of one bath-room for

twelve persons, less/non-availability of kitchens etc. This not only resulted in

overpayment of SR13.860 million but the Hujjaj were also subjected to hardships and

discomfort.

The matter was brought to the notice of the management but neither any reply was

furnished nor the meeting of the DAC was convened till finalization of this report.

4.2 Unauthorized payment of SR464,400 (Rs.7.231 million) on account of

capacity of hired buildings utilized for medical mission

In terms of item No.15 of the building hiring agreements, it was obligatory for the

building owner/Mustajirs to allow residence-cum-offices for the Hajj Medical

Mission in the same building free of cost.

In violation of the above clause of agreement, capacity of 242 persons in ten

buildings was utilized for the establishment of medical mission/dispensaries and rent

of SR464,400 was unauthorizedly paid. The details are given as follows:

24

(Amount in SR)

S.

No.

Bldg. No. A/C

No.

Total hired

capacity

Rent per

Person

Capacity

Utilized for

Medical

Mission

Amount

of Rent

paid

1. 001 219 1,962 2,150 145 311,750

2. 054 168 131 1,725 8 13,800

3. 055 73 81 1,700 5 8,500

4. 140 209 256 2,025 12 24,300

5. 186 44 567 1,800 8 14,400

6. 293 205 425 2,150 15 32,250

7. 355 191 725 1,000 14 14,000

8. 362 224 381 1,000 12 12,000

9. 364 255 387 1,000 10 10,000

10. 290 109 6,808 1,800 13 23,400

Total 242 464,400



4.3 Unauthorized hiring of accommodation and payment of advance rent of

SR273,000 (Rs.4.251 million)

As per para 8.18 of FMMA, Vol.-II, the Ministry of Religious Affairs has been

empowered to sanction rent of residential buildings in Saudi Arabia. The Director

General, Hajj, Jeddah is not empowered to sanction the same and sanction of the

Ministry of Religious Affairs is necessary for fixing/increase in the ceiling.

On scrutiny of cash account of Directorate General, Hajj, Jeddah for October/

November, 2002, it was noted that the rent assessing committee recommended five

residential buildings for officers/staff and the case for hiring of these buildings was

sent to the Ministry of Religious Affairs, Islamabad for approval. The buildings were,

however, irregularly hired, occupied and payment of advance annual rent amounting

to SR273,000 was paid vide voucher Nos. HS 9 of October, 2002 vide voucher Nos.

HS 5, 6, 7 & 10 of November, 2002 without waiting for approval of the Ministry.

25



4.4 Excess deduction of rent of SR157,625 (Rs.2.454 million) from Hujjaj

Two hundred and ninety five Hujjaj were originally put up in the buildings having

rents according to their entitlement. Subsequently, they were shifted to other

buildings having lesser rental value than the previous ones but were charged with

original higher rent. In this way, excess rent to the tune of SR157,625 was charged

from them, as detailed below:

Particulars of Building from

which pilgrims were shifted

Particulars of Building to which

pilgrims were shifted

Difference

in rent

per

pilgrim

(4-8)

Excess

recovery

of rent

from

Hujjaj

Bldg.

No.

A/C

No.

Pilgrims Rent

per

pilgrim

Bldg.

No.

A/C

No.

Pilgrims

shifted

Rent

per

pilgrim

1 2 3 4 5 6 7 8 9 10

69 153 125 1,650 40 303 125 1,000 650 81,250

140 209 2 2,025 -do- -do- 2 1,000 1025 2,050

128 170 8 2,150 -do- -do- 8 1,000 1150 9,200

28 99 15 1,475 -do- -do- 15 1,000 475 7,125

379 271 145 1,000 83 299 145 600 400 58,000

Total 295 295 157,625



4.5 Non-recovery of rent for the space provided to Maktabs amounting to

SR98,100 (Rs.1.527 million)

The scrutiny of list of hired buildings revealed that some space was provided to

Maktabs from the following buildings:

Bldg.

No.

A/C No. Space provided to Maktabs Rent per Pilgrim

075 72 25 persons of Maktab No. 51 1,500




26

It was noticed that out of above four Maktabs, the rent amounting to SR98,100 was

not recovered from Maktab Nos. 19 & 42 for the space provided to them. Details are

as under:

Bldg. No. Space provided Rent per Pilgrim Amount recoverable from

Maktabs

207 38 persons 1,475 56,050

319 29 persons 1,450 42,050

Total 98,100

As per reply of the Ministry, rent was not recovered from the two Maktabs in lieu of

tentage accommodation provided at Mina. The reply is self-contradictory as out of

four cases, recovery from two Maktabs had been made. The recovery of SR98,100

due from remaining two Maktabs may be effected.

4.6 Unauthorized payment of daily allowance of SR91,160 (Rs.1.419 million)

to medical mission/seasonal staff

The Ministry posts a large number of seasonal staff of various categories with

Director General, Hajj, Jeddah during the Hajj season. Daily allowance at the

prescribed rates is paid to the seasonal staff.

Audit noticed that seasonal staff working with medical mission was retained beyond

Hajj season and an amount of SR91,160 on account of daily allowance was paid to

them without obtaining sanction for extension, in the period of their stay, from the

Ministry. The details are given below:

Vr. No. No of Staff Officer Period

involved

No. & date of

medical mission’s

claim.

Amount

Paid

27 of

3/2003

(i) 88

(ii) 76

1/3/03 to 5/3/03

1/3/03 to

10/3/03

HMM/2003/Gen

HMM/2003/Gen

dt.6/3/03

27,550

47,970

28 of

3/2003

(i) 1

(ii) 7

(iii) 6

6/3/03 to

17/3/03

1/3/03 to

18/3/03

6/3/03 to

17/3/03

Bill dt. 12/3/2003

Bill dt. 12/3/2003

Bill dt. 12/3/2003

960

10,000

4,680

27

Total 91,160



4.7 Excess payment of rent of SR87,900 (Rs.1.369 million) in respect of

buildings hired beyond the prescribed distance

In terms of item No.15 of the Policy and Plan for Hajj 2003, buildings situated at a

distance of more than 600 metres from Haram Sharif in Makkah Mukarramah were to

be hired at a rent of SR1,800 per pilgrim.

During audit scrutiny it was noticed that in disregard to the above policy, building

No. 297 (A/C No.197) situated at a distance of 624 metres from Haram was hired at a

rent of SR2,100 per pilgrim instead of SR1,800. This caused excess payment of

SR87,900 to the owner as computed below:

1. Rent per pilgrim actually due SR1,800

2. Rent per pilgrim paid SR2,100

3. Excess payment per pilgrim (2-1) SR300

4. No. of Pilgrims for whom capacity hired 293

Total Excess payment to the owners (300 x 293) SR87,900

It was replied that 10% distance relaxation was allowed by the hiring committee

headed by Consul General whereas relaxation powers rest with the Ambassador in

terms of “Note” given below para 15.2 of Hajj Policy, 2003.

The Principal Accounting Officer did not hold the DAC meeting till finalization of

this report to discuss the matter despite issue of numerous letters.

4.8 Unauthorized incurrence of expenditure of SR59,791 (Rs.930,945)

pertaining to previous years 2001-02 out of budget grant for 2002-03

In terms of the provisions of Rule 289 of FTR, Vol.-I and para 2.2 of FMMA, Vol.-II,

all charges actually incurred must be paid and drawn at once and under no

circumstances they should be allowed to be carried forward for payment in another

financial year.

28

In violation of above provisions, it was noticed that POL charges of SR32,373

pertaining to 2001-02 and medical charges of SR27,418 for 2000-02 were made from

the budget grant for 2002-03 without approval of the Ministry of Finance. The details

are given as follows:

a) POL Charges

(Amount in SR)

S.

No.

Description Voucher No. Amount

1. POL charges 10 of 10/2002 13,149

2. POL charges 05 of 12/2002 19,224

Total 32,373

b) Medical Charges

(Amount in SR) S. No. Voucher No. Name of claimant

Hospital’s

names

Reference to

hospital bills

Amount

1. HS-6 of 8/02 Qurban Ali Shah Saudi German

Hospitals

Jeddah

J 315022

dt. 08-12-01

13,000

604312

dt. 14-11-01

1,300

603972

dt. 11-12-01

100

592685

dt. 03-11-01

100

2. HS-9 of 8/02 Capt. Muhammad

Yousaf (Dir)

-do- 97328

dt. 13-05-01

136

3. HS-9 of 8/02 Muhammad Akbar

(Asstt).

-do- 87327

dt. 13-05-01

1,069

4. HS-10 of

8/02

Muhammad Idrees

D.D.

-do- 1007866

dt. 16-04-01

5,269

5. PD-9 of 4/03 Muhammad Idrees

D.D.

-do- S.No.1 of the bill

dt. 03-06-01

166

6. -do- Muhammad Yousaf

(Dir).


dt. 03-06-01

137

7. -do- Fatima Ahmad -do- S.No.4 of the bill

dt. 03-06-01

55

8. -do- Muhammad

Akbar(Asstt)


dt. 04/2001

895

9. DP-10 of

4/03

Muhammad Idrees

D.D

-do- S.No.3&4 of the bill

dt. 24-06-01

745

10. -do- Basher Ahmed Tarar,

S/Typ


dt. 05/2001

80

11. -do- Muhammad Idrees

D.D


dt. 05/2001

510

29

12. -do- -do- -do- S.No.3 of the bill

dt. 05/2001

130

13. DP-11 of

4/03

-do- -do- Inv. 1008849

dt. 03-06-01

3,725

Total 27,417

Audit point of view was accepted in reply to the initial audit observation respecting

POL charges while no reply was given for unauthorized medical claims. The

payments made on the time-barred claims may be justified.



4.9 Unauthorized payment of SR51,500 (Rs.801,855) due to hiring of

accommodation over and above the Tasreeh

Kingdom of Saudi Arabia and Government of Pakistan have fixed 3 square metres

space per pilgrim in Tasreeh and Hajj Policy for hiring Hujjaj accommodation at

Makkah. The Tasreeh contains lodging capacity, number of rooms and floors whereas

Hajj Policy contains, among other provisions, bath rooms/kitchen facilities.

Buildings are to be hired on the basis of these documents. In terms of para 24 of

agreements, payment, cannot be made for the pilgrims who are accommodated in

excess of the Tasreeh.

Contrary to above an amount of SR51,500 was paid for accommodation over and

above the Tasreeh on the one hand and the Hujjaj were subjected to hardships and

discomfort on the other.

It was informed that an amount of SR6,500 on account of excess capacity of 206

Hujjaj @SR250 per Haji was recovered from the contractors but no documentary

evidence was provided.

S.

No.

Group

Name

Name of

Building

Capacity for pilgrims Excess

capacity of

pilgrims As per

Tasreeh

Hired in cycle

1st 2nd 3rd 4th 5th 6th

1 Al

Andlus

Dar

Ramih

145 154 Nil Nil Nil Nil Nil 09

2 -do- Dar-ul-

Ahad

459 455 Nil Nil 172 281 Nil

3 Tehana Qasre Al 139 137 Nil Nil 138 120 Nil Nil

30

Taiba Tahani

4 Taavun Ali

Rajab

190 195 Nil Nil Nil 175 190 08

contd.

31

from pre-page 5 -do- Dar

Lolo

Zam

Zam

170 168 Nil Nil Nil 177 175 12

6 -do- Al-

Amri-I

154 159 Nil Nil Nil 156 153 06

7 -do- Bait

Rizk

132 133 Nil Nil Nil 128 132 01

8 Saeed

Makkey

Dar

Moarej


9 Sabir

Group

Al-

Basati

402 404 402 Nil Nil Nil Nil 02

10 -do- Dar

Noor


11 Sanabal

Taiba

Dar

Khalood


12 -do- Johratul

Madina

287 313 291 Nil Nil 264 256 30

13 -do- Dar

Hajeeli

183 183 Nil 182 Nil 187 187 08

14 Al Ziafa Al

Abeedi

No.1

90 84 Nil Nil Nil 90 90 Nil

15 -do- Dar

Rawan

Farooq

158 165 Nil Nil Nil 79 86 07

16 -do- Ali

Hussain

Madni

155 159 149 222 Nil 156 Nil 09

17 Ameen Manazal

Taba

222 226 225 159 222 Nil 211 07

18 -do- Dar

Shareef

194 199 200 222 Nil 148 183 11

19 -do- Dar

Ziafa


Total excess capacity of pilgrims 206

The excess capacity of 206 Hujjaj @SR250 per Haji remained unutilized which

resulted into an excess payment of SR51,500 as per Tasreeh.



32

4.10 Unauthorized expenditure amounting to SR34,079 (Rs.530,610)

During audit scrutiny, it was noticed that in order to hire following two buildings,

agreements were made with the owners and first payment of 15% was made to them

as detailed below:

(Amount in SR)

Bldg

No.

A/C No. Name of

Owner

Date of

agreement

Total

payable

amount

15%

amount

paid

Cheque

No. and

Date

25 133 Niza Janit

Ahmed Siraj

22-7-1424

29-9-2002

79,875 11,981 6777765

dt 5.10.02

26 132 -do- 22-7-1424

29-9-2002

147,325 22,098 677764

dt 5.10.02

Total 227,200 34,079

Subsequently, both the buildings were not booked for hiring on the advice of Deputy

Director, Hajj, Makkah vide letter No. 4(71)Hajj 2003 dated 7th

January, 2003.

However, the aforesaid 15% advance payments made to the owner were not

recovered from them. It was intimated that the owners of the buildings disappeared

and suits against the owners had been filed in the court.



4.11 Excess expenditure of SR7,992 (Rs.124,435) over the prescribed ceiling

for repair of vehicle

In terms of item No.8(5) of Ministry of Finance O.M. No.3(4)Exp-II/2000 dated 30th

June, 2000, Head of Mission may incur a sum of US$700 at a time on repair of one or

any number of vehicles.

It was noticed during scrutiny of voucher No.8 of 8/2002 that in violation of above

rule, a sum of US$2,131 (SR7,992) was incurred at one time on the repair of vehicle

No.CC-1311 which was in excess of prescribed limit.

33



4.12 Unlawful hiring of buildings at a distance of more than prescribed limits

of 2,000 metres from Haram Sharif

As per Para 15.2 of the Plan and Policy for Hajj, 2003, buildings situated beyond the

distance of 2,000 metres from Haram, were not to be hired for Hujjaj.

It was observed that in violation of above Policy, 35 buildings situated at a distance

ranging from 4,000 to 8,500 metres, were hired as detailed below:

Distance from

Haram

Sr. No. of Buildings Hired Total

Buildings

4000 to 5000 Metres 352, 353, 354, 373, 4

5001 to 6000 Metres 355, 356, 357, 360, 362, 366, 368, 7

6001 to 7000 Metres 361, 363, 364, 365, 367, 370, 371, 372, 374,

383

10

7001 to 8000 Metres 385, 359, 369, 376, 377, 378, 379, 380, 382,

384, 385, 3596

12

8001 to 8500 Metres 375, 381 2

Total 35

The above position was not only against the Hajj Policy, 2003 but it had also caused

hardships to the pilgrims. However, the Ministry of Religious Affairs, taking no

cognizance of the above situation, vide its memo No. 4(3)/2003-HP dated 17th

October, 2002, had relaxed the condition of distance respecting buildings situated in

Aziziah buildings from Haram Sharif.

It is pointed out that the Policy was approved by the Cabinet and the same could not

be relaxed by the Ministry of Religious Affairs without the prior approval of the

Cabinet. The hiring of aforesaid buildings was, therefore, irregular.



34

4.13 Deviation from the Pakistan Hajj policy and Rules of Kingdom of Saudi

Arabia regarding space of 3 square metres per pilgrim

The Kingdom of Saudi Arabia has fixed space per pilgrim for hiring Hujjaj

accommodation at Makkah and Madina.

During examination of accommodation file of Building No. 290 (Account No. 109), it

was noticed that while carrying out Tamteer, the hiring committee had approved the

hiring capacity @ 2.80 square metres per pilgrim instead of three square metres. The

same was hired accordingly by the Hajj Office. The Committee’s decision not only

violated the provisions of Pakistan Hajj Policy but also rules of the host country. The

deviation from the prescribed parameters fixed by the Cabinet had benefited the

owners/Mustajirs and undoubtedly caused hardships to the pilgrims.



35

Ministry of Information

5.1 Unnecessary expenditure of JP¥11 million (Rs.5.790 million) on account

of pay and allowances

During the course of audit of Pakistan Mission at Tokyo for the period from 2001-02

to 2002-03 it was observed that the post of Press Attache was retrenched 3 years ago.

The post of his PA/Stenographer in the Information Section, however, still exists

against which a Pak based stenographer has been working for the last seven years.

The cost of pay and allowances of the stenographer for the audit period works out to

JP¥11 million.



5.2 Irregular cash payment of Rs.1.945 million

According to S. No.4.25 of FMMA, Vol.-I, payments of Rs. 200 or above to private

persons or parties should be made through crossed cheques drawn in favour of firms

or private persons. Rule 157 (2) of FTR, Vol.-I also requires that payments be made

through crossed cheques.

Contrary to above rules, cash payments were made to individuals/organizations

amounting to Rs.1.945 million by Pakistan High Commission, New Delhi, India

during the period from 2000-01 to 2002-03. Thus the mode of payment adopted by

the Mission was in violation of rules. Details of cash payments are as under:

Sr.No. Vr.No. Date Indian Rs. Remarks

1. 212 28.09.2000 825,000 Hiring of house @Rs.75,000 per month

for Mufti Jamil-ud-Din Ahmed

Minister (Press) w.e.f.1.7.2000 to

31.05.2001(one month rent for 6/2000

already paid).

2. 18 03.08.2001 99,000 Guest house No.D-3/5 Apartment No.3

Vasant Vehar for Nasir Mehmood

Second Secretary (press) @ Rs.99,000

P.M.(No evidence)(8/2001). contd.

36

from pre-page

3. 216 28.08.2001 825,000 House No.5 Panshed park new Delhi

hired for Mr. Kamran Ali Khan ,

Minister(Press) for the period July

2001 to May 2002 @ Rs.75,000 P.M.

as per President sanction vide MIMD

(External Publicity Wing) No.4(22)/89-

Ep(LSA) dated 15.08.2001

Rs.1,100,000.

4. 9 07.05.2001 49,500 Guest House No.D-3/5 Apartment No.3

Vasant Vehar for Nasir Mehmood,

Second Secretary (Press) @Rs.99,000

w.e.f. 16-30/04/2001.

5. 10 07.05.2001 99,000 Guest House No.D-3/5 Apartment No.3

Vasant Vehar for Nasir Mehmood,

Second Secretary for May 2001 @

Rs.699,000.

6. 14 08.05.2001 47,895 Room No.304 Hotel Vasant

Continental w.e.f 1-15/4/2001 for Nasir

Mehmood, Second Secretary

Total 1,945,395



5.3 Non-adjustment of TA/DA advances amounting to Rs.723,903

As per the provisions para 269 of GFR, Vol.-I, the adjustment of advances drawn by

Government employees is required to be made upon return of the Government servant

to headquarters or 30th

June whichever is earlier. Similarly, as per Rule 668 of FTR,

Vol.-I, advances granted under special orders of competent authority to Government

officers for departmental or allied purposes are subject to adjustment by submission

of detailed accounts supported by vouchers or by refund, as may be necessary.

Scrutiny of the record of Pakistan High Commission, London, however, revealed that

TA/DA advances amounting to Rs.723,903 drawn by Minister (Press) during 2000-01

on his posting to the Mission had not been adjusted even after the lapse of three years.



37

5.4 Irregular expenditure of £1,570.79 (Rs.166,022) on account of repair and

maintenance of staff car No. 227-D-413

As per S. No.5 of Finance Division O.M. No.F.3(4)Exp-III/2000, dated 30th

June,

2000 Head of Mission is empowered to incur expenditure upto US$700 on repair and

maintenance of Government owned vehicles at any one time to one or any number of

vehicles used by the Mission.

Contrary to above, Information Wing at Pakistan High Commission, London

irregularly incurred an expenditure of £1,570.79 (US$2,356.19) on repair and

maintenance of official car No. 227-D-413 as per details given below:

(Amount in £ Stg.)

Cheque No. & Date Paid to Amount

011557/30-06-2002 M/s T.J. Auto Spares Ltd. 359.91

011556/30-06-2002 -do- 466.95

011558/30-06-2002 -do- 460.98

011545/30-06-2002 M/s General Auto Spares &

Accessories

282.95

Total 1,570.79



38

Ministry of Education

6.1 Irregular payment of hotel charges amounting to €12,240 (Rs.856,800)

A Scholar was posted against Quaid-e-Azam Studies Chair at Barcelona University,

Spain. She stayed in a hotel from 15th

April, 1999 to 15th

April, 2000 and claimed

hotel charges amounting to Pesetas 3,053,531 (Rs.994,473). Due to abnormal stay of

one year in hotel and claim of heavy amount after a year, the case was sent by the

Mission to the Ministry of Education for clarification. The Ministry referred the case

to the Finance Division for decision regarding admissibility of hotel room rent.

Finance Division (Regulation Wing) vide letter No.2 (2) R-S/2000/Pt dated 27th

August, 2001 conveyed its inability to accede to the reimbursement of hotel room rent

charges in lieu of residential accommodation as hotel accommodation is permissible

for very limited period upon joining or leaving the station of posting.

Ministry of Education conveyed approval for release of fund for payment of hotel

room rent vide letter No.F.18/97-IC.IV dated 9th

March, 2002 through Deputy

Financial Advisor (DFA) Education without approval of Finance Division

(Regulation Wing) irregularly.

It was further noticed from Ministry of Education letter No.F-18/97-IC.IV dated 12th

June, 2002 that on posting of the scholar, Ministry invited quotations for one way

economy fare and the lowest rate of Rs.45,500 was approved but she purchased ticket

@ Rs.59,273 incurring extra expenditure of Rs.13,773. The payment made despite

rejection by the Finance Division (Regulation Wing) needs justification.



6.2 Non-adjustment of TA/DA advances amounting to Rs.511,102

As per Government instructions laid down at S. No. 20 of Annexure to the Finance

Division O.M. No. F.3(4)/Exp-iii/2000 dated 30th

June, 2000, TA/DA advances are

required to be adjusted through TA adjustment bills/expenditure statement within one

year of the completion of journey failing which entire amount becomes recoverable

in lump sum.

39

Contrary to the above rules, TA/DA advances amounting to £507.64, US$4,515.80

and Rs.194,313 drawn by a former “Allama Iqbal Fellow” during 1997-98 on his

posting to Pakistan High Commission, London had not been adjusted by the time of

audit i.e. April, 2004.



40

Comments on Internal Control

Internal control system is the most effective tool of management for good governance

and for effective use of available resources. The internal control mechanism in the

Ministry of Foreign Affairs and allied formations abroad is primarily regulated

through the instructions prescribed in the Manual of Standing Orders 1981, and the

Financial Management at Missions Abroad, Vol-I and II.

The ineffectiveness of some of the controls has become apparent as a result of an

evaluation exercise conducted during certification audit and as also evident from the

following indicators:

1. Construction of Chancery building at Washington, D.C., USA

without approval of appropriate forum;

2. Hiring/payment of rent of accommodation for Hujjaj in Saudi

Arabia;

3. Non-recovery of Government dues;

4. Payment of allowances to the employees not authorized to

receive these allowances;

5. Misuse of financial powers by the subordinate authorities;

6. Incurrence of expenditure out of PCW&EF for unspecified

purposes;

7. Procurement of stores in non-transparent manner.

The concerned Principal Accounting Officers are advised to:

1. Ensure capacity building of officers and staff at the Ministry

level as well as in the Missions abroad so that all concerned are

aware of the relevant and existing rules and regulations relating

to management and financial procedures;

2. Ensure that failure to follow established procedures will be

detected and appropriate action taken;

3. Make arrangements for prompt recovery of Government dues,

wherever applicable, and their credit in the Government

Treasury.

41

ANNEXURE-A

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