Endorsement of Pre Audit Cheques by DDOs-AG-16.12.2022
In an effort to streamline financial operations and ensure the integrity of government transactions, the Accountant General has addressed concerns regarding the endorsement of pre-audit cheques by Drawing and Disbursing Officers (DDOs). This directive comes in response to a letter from the State Bank of Pakistan, which highlighted procedural discrepancies in the endorsement process. This article delves into the necessity of these measures, the current procedures, and proposed changes to safeguard government funds.
State Bank of Pakistan’s Observations
The State Bank of Pakistan, through its letter dated 18th January 2022, raised concerns over certain District Accounts Offices affixing stamps on cheques with the statement, “Payable after endorsement of concerned DDO.” The State Bank clarified that such unilateral endorsements are not mandated by government instructions such as STR/FTR. As such, the State Bank cannot acknowledge these actions without explicit provision in the rules.
Current Procedure for Cheque Issuance
Presently, DDOs submit expenditure claims for vendors to the Accountant General Punjab (A.G.Pb) or District Accounts Offices (DAOs) using Contingent Bill Form (STR-30). This submission includes the sanction of expenditure by the competent authority and related vouchers, with instructions to issue a cheque in the vendor’s name. Once the cheque is prepared, the DDO or an authorized representative collects it from the cheque counter, makes an entry in the cash book, and delivers it to the concerned vendor against proper acknowledgment.
Need for Endorsement by DDOs
The inquiry into the necessity of DDOs endorsing cheques revealed that this additional step ensures the involvement of DDOs post-issuance, thereby authenticating the payment. Instances of fraudulent withdrawals have occurred where DDOs denied their signatures on bills submitted at the pre-audit counter. This led cheque signing officers to seek endorsements from DDOs to validate the transactions further.
Proposed Changes to Existing Rules
Despite the revision of Rule 4.49 of STR Punjab via Notification No. SO(TT)12-2/2014.PI-II dated 24.08.2022, the concerns of DAOs remain unaddressed. The revised rule did not mitigate the risk of fraudulent transactions as anticipated. Consequently, the following amendment is proposed for Rule 4.49(1)(c):
Existing Rule: After collection of the cheque, deliver it to such vendor, against proper acknowledgment.
Proposed Rule: After collection of the cheque, deliver it to such vendor, after endorsement, against proper acknowledgment.
Rationale for the Proposed Change
The proposed amendment aims to enhance the security and authenticity of financial transactions involving government funds. By requiring DDOs to endorse cheques before delivery to vendors, an additional layer of verification is introduced. This measure is expected to deter fraudulent activities and ensure that all transactions are duly authorized and traceable.
Implementation and Compliance
The Accountant General’s directive emphasizes the importance of compliance with the new procedure. DAOs are instructed to ensure that the endorsement process is strictly followed to maintain the integrity of financial transactions. This measure will be monitored closely, and any deviations will be subject to scrutiny and potential disciplinary action.
Conclusion
The endorsement of pre-audit cheques by DDOs is a crucial step in safeguarding government funds and preventing fraudulent withdrawals. The proposed amendment to Rule 4.49(1)(c) is a proactive measure to ensure that all transactions are authenticated and transparent. Compliance with these guidelines will enhance the credibility of financial operations within government departments and foster a culture of accountability and integrity.
Call to Action
The government is urged to consider the proposed changes to Rule 4.49(1)(c) as a vital control measure for protecting public funds. Immediate action and clear communication regarding the adoption of these rules will mitigate risks associated with financial transactions and reinforce the government’s commitment to financial prudence and accountability.
By adhering to these revised procedures, the government can ensure that its financial operations are both secure and efficient, thereby maintaining public trust and upholding the highest standards of fiscal responsibility.
