NEW DELHI, July 28: The Comptroller and Auditor General (CAG) has come down heavily on public sector undertakings for unsatisfactory account keeping. The CAG has invoked the Department of Company Affairs for ensuring compulsory auditing on defaulting firms.The CAG report on review of accounts of the government, tabled in both houses of Parliament on Monday, states that of the 330 central PSUs, accounts of 18 could not be reviewed for want of their accounts and 38 had not presented their accounts for audit.The CAG has recommended that ``the power vested in DCA under the provisions of the Companies Act needs to be invoked to overtake the arrears in the compilation of accounts of government companies''.It has recommended similar action for PSUs under the state governments. The number of defaulters are far higher in this area. Of the 986 companies under states, accounts of 803 companies ``are in arrears for compilation, including 467 companies in arrears for three years or more''.The CAG pointed out that PSUs are largely dependent on administered price mechanism for earning profits and the dividend return on equity investment of Rs 58,532 crore worked out to a mere 3.8 per cent.Only 85 of the 156 profit-earning PSUs declared dividend and 65 units observed the minimum dividend of 20 per cent on equity shareholding as prescribed by the finance ministry. The dividend return was less than one per cent in 16 out of 38 ministries.Of the total profit of Rs 19,970 crore earned by 156 PSUs in 1995-96, 62 per cent was from those PSUs where administered price mechanism or assured profit-margin mechanism prevailed like those in the oil, power, telecommunications, coal, insurance and fertiliser sectors, the report states.However, the CAG noted that that the number of profit-making PSUs had increased during the last three years. In 1993-94, there were 132, 1994-95 the number increased to 141 and further to 156 in 1995-96. Correspondingly, the number of loss-making units decreased from 116 to 111 and 104. But net and accumulated losses showed an uptrend.The report says that of the 269 central PSUs, the equity investment in 87 units had been eroded by the accumulated losses.
