Audit Report (Q1 2016)

Oman National Engineering & Investment Co. (SAOG)
Internal Audit Report (1 st Quarter, 2016)
Apr-2016
S.No Observation & Impact Recommendation Priority
4 Insurance coverage for disposed
Vehicles:-
A detailed reconciliation should be
M
On our review of the insured vehicles as carried out along with physical
per the details provided by the HR verification to make the master list of
department, following irregularities have vehicles actually exist to ensure the
been observed.
correctness of the insurance cover.
Noted 3 instances of vehicles insured while
those were disposed off as per the
disposal order document raised in the
system. One instance is disposed off in the
year 2010, however the same has valid
registration for the 2013-2014. The details
of the instance have been provided as
Annexure 2
Insurance has been renewed for 8 vehicles
those are beyond economical repair and
physically available Ghala workshop. On
our direct enquiry to the workshop in
charge, it has been explained that those
vehicles are to be disposed off and cannot
be repaired economically. The details of
the vehicles have been given as Annexure
3
Impact:-
• Additional cost of insurance to the extent
of insurance for vehicles not physically
available
• Additional cost of insurance for vehicles
that cannot be economically repaired
Management’s Response:-
HR:-
We strongly recommended to implement company policy with complete rules and regulations regarding
vehicles disposed
Finance:-
3(A) Vehicle Vehicle Vehicle Purchase COMMENTS
2827/DS
TOYOTA HILUX D/C
PICKUP
2002 8000.000 NOT INSURED
1129/WK
HYUNDAI COUNTY
BUS
2001 9700.000 NOT INSURED
2826/DS
TOYOTA HILUX D/C
Money for insurance on hold, as
2002 8000.000
PICKUP
wrongly issued policy.
Vehicles with valid registration should have insurance, else fine will be imposed.
3(B)
Internal Audit Response:-
Supporting papers could not be provided by Finance to justify their statement in 3 (A).
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