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Audit Reports
Financial
Himachal Pradesh
Report of 2010 - Financial Audit on Commercial of Government of Himachal Pradesh
Date on which Report Tabled:
Date of sending the report to Government:
Government Type:
State
Sector
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Overview
Audit of Government companies is governed by Section 619 of the Companies Act, 1956. The accounts of Government companies are audited by Statutory Auditors appointed by CAG. These accounts are also subject to supplementary audit conducted by CAG. Audit of Statutory corporations is governed by their respective legislations. As on 31 March 2010, the State of Himachal Pradesh had 21 working PSUs (18 companies and three Statutory corporations) and three non-working PSUs (all companies), which employed 38,043 employees. The working PSUs registered a turnover of Rs. 4,642.23 crore for 2009-10 as per their latest finalised accounts. This turnover was equal to 10.98 per cent of State GDP indicating an important role played by the State PSUs in the economy. However, the working PSUs incurred overall loss of Rs. 21.95 crore in 2009-10 and had accumulated losses of Rs. 760.34 crore.
As on 31 March 2010, the investment (Capital and long term loans) in 24 PSUs was Rs. 4,620.83 crore which declined by over 6 per cent from Rs. 4,938.28 crore in 2004-05. Power sector accounted for over 74 per cent of the total investment in 2009-10. The Government contributed Rs. 661.38 crore towards equity, loans and grants/subsidies during 2009-10.
During the year 2009-10, out of 21 working PSUs, seven PSUs earned profit of E 37.28 crore and nine PSUs incurred loss of Rs. 59.23 crore. Four working PSUs had not started commercial activities and in respect of one working PSU, excess of expenditure over income was reimbursable by the State Government. The major contributors to profit were Himachal Pradesh State Electricity Board(Rs. 32.31 crore) and Himachal Pradesh State Civil Supplies Corporation Limited(Rs. 2.87 crore). The heavy losses were incurred by Himachal Road Transport Corporation (Rs. 37.50 crore) and Himachal Pradesh Tourism Development Corporation Limited (Rs. 6.75 crore) and Himachal Pradesh State Handicrafts and Handloom Corporation Limited (Rs. 6.21 crore). The losses were attributable to various deficiencies in the functioning of PSUs. A review of three years Audit Reports of CAG shows that the state PSUs losses of Rs. 1,004.88 crore and infructuous investment of Rs. 6.87 crore were controllable with better management. Thus, there is tremendous scope to improve the functioning and minimize/eliminate losses. The PSUs can discharge their role efficiently only if they are financially self-reliant. There is a need for professionalism and accountability in the functioning of PSUs.