MVR 3 billion in POs missing from Fenaka system, Auditor General says
Speaking at a meeting of the Parliament’s Finance Committee on Tuesday, Niyazi said the discovery caused delays in completing the audit.
Auditor General Hussain Niyazi has said that purchase orders worth MVR 3 billion were not included in Fenaka Corporation’s accounting system when the special audit of the state-owned utility company began in 2023.
Speaking at a meeting of the Parliament’s Finance Committee on Tuesday, Niyazi said the discovery caused delays in completing the audit.
According to the Auditor General, systemic issues such as weak governance, poor record-keeping, and lack of accountability are at the root of corruption and inefficiency within state-owned enterprises.
“Wastage and fraud cannot be prevented through a special audit alone,” Niyazi said. “These problems need to be addressed by strengthening corporate governance.”
He added that company management and boards of directors are responsible for ensuring accountability, noting that the Companies Act and relevant state ownership policies set out clear expectations for oversight.
“State-owned companies receive subsidies from the Ministry of Finance, and the Ministry must assess how these funds are managed. The Public Enterprises Monitoring and Evaluation Board (PEMEB) also plays a role in appointing company boards and managing performance,” Niyazi said.
The Auditor General noted that earlier audits had also uncovered corruption and theft, and his office would strengthen measures to prevent such issues in future.
“If a financial audit shows poor results, it means there are significant internal control and governance weaknesses. Proper accounting, transparency, and timely record updates are essential to prevent wastage and corruption,” he said.
Niyazi further stated that audit work is often delayed due to incomplete or missing project documentation, and that more special audits will be conducted across state-owned enterprises in the coming year.
A special audit report on Fenaka, published last week, highlighted widespread procurement and financial irregularities between 2021 and 2023. According to the findings:
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MVR 8.8 billion was spent on goods and services, with some purchases made outside the tender process and at inflated prices.
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The company awarded 674 contracts worth MVR 2.22 billion for materials and water and sewerage projects; 65% of these were issued without open bidding.
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Over MVR 1 billion was spent on 57 projects to build power plants and office buildings, 41 of which remain incomplete, requiring an additional MVR 241 million to finish.
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Power plant construction costs were estimated to be MVR 767 million above market rates.
The Audit Office has since called for stronger oversight of Fenaka’s operations and improved financial governance across state-owned companies.
