Just 15 auditors to look into numerous Central government units

A derelict auditing mechanism is said to have contributed to the sub-par performance of most Central PSUs (public sector undertakings) and Central autonomous enterprises located in Kerala.

While the Union government has invested over Rs 50,000 crore in the 17 Kerala-based CPSUs, 17 other CPSU major units, and 39 central autonomous bodies, the onerous task of conducting audit of these firms is left to three skeletal-staffed resident audit parties — comprising some 15-odd auditors at the moment — based at Cochin Shipyard, FACT and Cochin Port Trust.

The staff shortage is arbitrarily made up with auditors from offices of the Principal Directors of Commercial Audit (under the Comptroller and Auditor General of India) in Chennai, Delhi, Mumbai and Hyderabad who frequent the State on tour to conduct audit of these Central firms.

“There has been a clamour for opening at least a branch of the Principal Director of Commercial Audit (PDCA) in the State for a quarter century, but the move has been consistency stonewalled by vested interests. Patchy audit is what has rendered many of these firms loss-making,” said sources. “A branch office would mean the some 50 to 100 auditors will be available in the State to conduct audit of all CPSUs and autonomous firms.”

The only silver lining now is a communication from CAG in late January asking the PDCA office in Chennai, already entrusted with auditing 13 CPSUs and 39 autonomous bodies in Kerala, to examine the feasibility of launching a branch office in the State.

Sources said the offices of the resident audit parties in Cochin Shipyard and FACT were initially only mandated to audit these firms. “If the resident audit party in FACT with 16 members was previously doing the audit of FACT alone, with a shrunken staff of seven people it now conducts audit of several major units like Rubber Board, Spices Board and Marine Products Exports Development Authority besides FACT. A scrappy work that it often translates into fast track’s a company’s doom.”

To cite an instance, the audit party in Cochin Port Trust thinned several times over, boasting just about three people now, down from 24 members when the office was set up. “Such reduction in strength weakens the audit, keeping its scope to the minimum. While auditing of accounts invariably takes place in all these Central enterprises, audit of transactions, purchases and contracts is largely overlooked,” sources said.

More In: Kerala | National | Kochi