The 55th Annual Report released by the Office of Auditor General exposes dubious accounting practices and amounts embezzled by corrupt government officials at various levels of the local units of the provinces.

The first ever audit of the local bodies shows Province 2 performing poorly in financial discipline followed by Province 3. Of the Rs26.58 billion audited in local bodies of Province 2, 13.27 percent (Rs3.53 b) was spent without following the due procedure.

“The highest percentage of arrears is in the local bodies of the Province 2 while the lowest is of Province 7,” the report says. The report shows local governments of Province 3 spent 11.19 percent of their budget without following the procedure. According to the report that the OAG released after submitting it to the President on Thursday, lack of documents showing financial transactions, payments without receipts, issuing frequent advances, embezzlement of social security pay, and non-freezing of budget are some of the major irregularities in the operations of local governments across the country. A total of 278 local units have spent Rs228.1 million in total without any bills.

“Our audit shows there is problem both in revenue and expenditure of local bodies,” said Deputy Auditor General Baburam Gautam. The report shows officials of local bodies,  mainly the secretaries, have embezzled funds.  Secretary of Pokhara VDC, now part of Purbi Chauki Rural Municipality, Doti, embezzled Rs3.84 million meant for development activities, social security allowances and reserve from the previous fiscal during the mid-July 2016 to March 10, 2017 period.

Secretary from Jijodaman-dau VDC, now part of Shikhar Municipality, Doti embezzled Rs3 million meant for social security allowance, recurrent and capital budget and last fiscal’s reserve.

“Anomalies have taken root due to frequent political changes,” said Auditor General Tankamani Sharma.