In gross violation of the provisions of the Companies Act, 1956, out of 99 working Public Sector Undertakings (PSUs) in the state, only 21 PSUs have finalised their accounts up-to-date.
The report of the Comptroller and Auditor General (CAG) has strongly criticised the callous attitude of the PSUs.
The backlog of accounts in the PSUs has been brought to the notice of the Kerala Chief Secretary and the Finance Department, by the CAG.
“The accounts of the companies for every financial year have to be finalised within six months from the end of the relevant financial year. Only 21 PSUs had finalised their accounts by this date. In the remaining PSUs, accounts were in arrears from 1998-99 onwards. The progress in finalisation of the accounts, which were in arrears, was poor. For example, 22 working PSUs did not finalise even a single account during 2011-12,” the CAG report said.
The CAG pointed out in the report that in view of the heavy backlog in finalisation of the accounts, the actual performance of the PSUs could not be ascertained.
“Hence the performance of the PSUs were assessed on the basis of the their latest finalised accounts. However, the performance of major PSUs such as the Kerala State Beverages Corporation Limited, Kerala State Civil Supplies Corporation Limited, Travancore Titanium Products Limited and Travancore Cements Limited could not be commented due to non-finalisation of even a single account during the year,” the CAG report said.
The CAG made it clear in the report that further delay in finalisation of the accounts might also result in risk and leakage of public money apart from violation of provisions of the Companies Act, 1956.
“Of the PSUs that finalised their accounts from one to four years during 2011-12, 44 PSUs earned profit of Rs 645.36 crore and 29 PSUs incurred loss of Rs 477.88 crore,” the report said.
A test check of records of PSUs revealed that their losses were mainly attributed to deficiencies in financial management, planning, implementation of projects, running their operations and monitoring.
“A review of the latest audit report of the CAG for the period 2009 to 2012 indicated that the PSUs incurred losses to the tune of Rs 1,337.37 crore and infructuous investment of Rs 123.38 crore which were controllable with better management. The actual controllable losses would be much more,” the report said.