During the year 2020 the Royal audit Authority (RAA) reported irregularities involving Nu 4,309.027-million (M) of which, audit findings involving Nu 2, 257.794-M representing 52.40 percent were either resolved and/or were not found material for inclusion in the Annual Audit Report (AAR) 2020.
The year 2020 saw unresolved irregularities amounting to Nu 2,051.233-M showing an increase of 44.95 percent as compared to the irregularities of 2019 amounting to Nu1,415.153-M.
The report states that most of the increases were noted in non-performing loans of the financial institutions, Northern East West Highway (NEWH) construction and fraud in four gewogs of Trashigang Dzongkhag.
The report further states that, Radhi, Phongmey, Shongphu and Bidung gewogs in Trashigang Dzongkhag saw elements of fraud, corruption and embezzlement cases amounting to Nu 11.357-M.
Auditor General of Bhutan, Tashi, during the press conference held on 18 July while officially declaring the AAR 2020 said that the report is a compilation of un-resolved significant issues from 507 audit reports issued during the year 2020.
From 510 audits carried out during the year, the RAA issued 507 audit reports comprising of 455 financial audit reports, 49 compliance audit reports, two performance audit reports and the joint audit report of Mangdechu Hydroelectric Project Authority (MHPA).
The increasing trend in irregularities could be indicative of the laxity on the part of management of the government agencies, corporations and NGOs in undertaking corrective actions, injudicious use of government resources and lack of due diligence.
The unresolved irregularities reported for the past five years which has been increasing except in 2017 revealing inadequacies in internal control, accountability and non-implementation of past recommendations provided in AAR.
Under the budgetary agencies, the report states that the highest amount of irregularities was reported under Ministry of Works and Human Settlements at Nu 345.813-M followed by Autonomous Agencies at Nu 288.788-M and Ministry of Economic Affairs at Nu 261.341-M.
Under non-budgetary agencies, Bhutan Development Bank Ltd. had irregularities amounting to Nu 311.023-M followed by Royal Insurance Corporation Ltd with Nu 183.445-M and Bank of Bhutan with irregularities amounting to Nu 160.442-M.
The major increase in the non-budgetary agencies was due to huge portion of non-performing loans.
In the process, the RAA recovered Nu 143.162-M from the various agencies excluding Nu 2.380-M pertaining to the audit recoveries from Corporations and Financial Institutions which are credited into the Audit Recoveries Accounts (ARA) maintained with the respective offices.
Meanwhile, the report further added that the joint-audit of MHPA was conducted by the RAA and the Office of the Comptroller and Auditor General (C&AG), India as per the project agreement signed between the two governments.
The audit revealed irregularities amounting to Nu 85.989-M of which observations amounting to Nu 79.61-M were either resolved as of 31January this year or did not qualify for inclusion in the AAR 2020.
Meanwhile, in accordance with Article 25 of the Constitution of the Kingdom of Bhutan and Chapter 6, section 115 and 116 of Audit Act of Bhutan 2018, AAR 2020 and the two performance audits were on ‘Implementation and Management of Broadband Fiber Network’ and “Ex-country Travels” of the RAA has been submitted to the His Majesty The King, the Prime Minister and the Parliament.
These reviews on mandates, management and operations were conducted with the overall objective of assessing the economy, efficiency and effectiveness in the delivery of public services and management of resources