KARACHI: The Auditor General of Pakistan (AGP) has detected serious financial irregularities of Rs158.7 million in Airport Security Force (ASF) Foundation, Karachi accounts.
In the latest audit report for the financial year 2021-22, several financial irregularities, including non-deduction of taxes and unjustified expenditures, were detected in the accounts of the ASF Foundation.
The audit report highlighted several instances where the ASF failed to comply with tax regulations and violated its bylaws. The report recommended fixing the responsibility and taking measures for tax recovery.
According to the details, the first irregularity noted in the report was the payment of advertisement charges in cash and the non-deduction of taxes.
The ASF paid Rs. 144.967 million to M/s. Cross Check Communication for advertising ASF housing schemes during 2016-17, but failed to obtain supporting vouchers/invoices of the print media.
Out of the total payment of Rs. 144.96 million, the ASF paid Rs. 97.154 million in cash instead of crossed cheques to avoid the deduction of taxes.
The report stated that income tax of Rs. 2,174,509 was deducted @ 1.5%, but neither proof of filer was available nor any sales tax invoice was submitted by the firm concerned to prove itself as a filer.
As such, income-tax @ 12% Rs. 17,396,073 being non-filer was required to be deducted at source, but the same still needs to be done, which resulted in less deduction of Rs. 15,221,564.
Similarly, the Sindh Sales Tax @ 13% Rs.7.809 million was not deducted from the payment made to the contractor on account of electronic media.
The audit report recommended initiating the inquiry regarding cash payment amounting to Rs. 97.154 million, fixing the responsibility in this matter, and taking measures to recover income tax and sales tax.
In another financial irregularity reported in the audit report, the ASF paid Rs. 8.513 million to M/s. Kohat Motors for hiring seven vehicles during the year 2019-20 without deducting sales tax at the rate of 10%. The audit report noted that this expenditure was incurred in the presence of 29 vehicles of the foundation without any justification.
Furthermore, the foundation vehicles were allotted to officers without any policy, rules, regulations or entitlement. The audit report recommended that the matter be inquired into, and responsibility needs to be fixed for the irregularity besides the sales tax recovery.
The audit report identified a third irregularity in printing works, which were granted to M/S M.H Printers without open competition. It said that the ASF paid Rs. 5.300 million to M/s M.H. Printers for printing brochures during the year 2015-16 without open competitive bidding.
Additionally, income tax at 12% was not deducted from the payment made to the contractor. The audit report recommended that responsibility should be fixed for the irregularity, besides recovery of income tax from the contractor.
Overall, the audit report identified several irregularities and non-compliances in the financial and procurement processes in ASF Foundation accounts, resulting in the deprivation of the government of its due taxes. It is recommended that the authorities take necessary actions to fix the responsibilities of these irregularities and for the recovery of taxes.
Copyright Business Recorder, 2023