Audit Uncovers Irregularities in PTA’s Contributory Provident Fund

A recent audit report has revealed significant irregularities in the Pakistan Telecommunication Authority’s (PTA) Contributory Provident Fund (CPF), sparking concerns over the management of employee benefits. The audit, conducted by the Auditor General of Pakistan, exposed discrepancies in the handling of the CPF, which is meant to provide financial security to PTA employees upon retirement. According to the PTA Employees Service Regulations (ESR) 2004, employees contribute 5 percent of their basic pay to the CPF, matched by an equal contribution from the PTA. However, the audit found that the PTA failed to distribute the accumulated profit of Rs. 70.5 million earned on the CPF during the 2022-23 financial year to employees or surrender it to the Public Account. The audit report highlighted that the PTA’s actions contravened the PESR 2004, which mandates the disbursement of profit on CPF to employees upon retirement. Furthermore, the PTA’s decision to consider the CPF profit as part of its other income was deemed untenable by the audit team. In response to the audit findings, the PTA management claimed that the profit was accounted for in the Financial Statements and surrendered to the Federal Consolidation Fund (FCF). However, the audit team argued that this was not permissible without a devised mechanism. The matter was discussed in the Departmental Accounts Committee (DAC) meeting on December 20, 2023, where the DAC granted six months to the PTA to rectify the accounting treatment and mechanism of the CPF profit. Unfortunately, no progress was reported until the finalization of the audit report. The Auditor General of Pakistan has recommended the implementation of DAC directives to address these irregularities and ensure transparency in the management of the CPF.