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
7 Fuel expense review:-
We have observed following
irregularities;
M
‣ There is no monthly reporting of the
mileage status. Lack of proper reporting of
the mileage and purpose of the use may
cause unauthorized use and additional fuel
expenses for the purpose not for the
business.
‣ On our review of monthly fuel
expenses we have identified 16 vehicles
with abnormal fuel consumption pattern.
The one to be noted separately is the card
number 24610200470000413 issued to a
double cabin pickup has been used for
OMR.584.111 and OMR. 584.768 in the
months of August and September 2015.
The details of the vehicles have been
provided as Annexure 6
‣ During our audit, the logistic
department had replied that the invoice
values for the above vehicle are correct,
however the procurement was under two
fuel cards. One set of procurement through
the card allotted to the vehicle and the
balance through the open fuel card. The
open fuel card consumption against any
vehicle shall affect the internal control as
the consumption vs mileage analysis is not
possible.
‣ There is no periodical consumption
report for the open fuel card to monitor the
consumption and procurement through the
open cards.
‣ On our review of monthly fuel
expenses, we have observed that around
32 fuel cards have not been used in last 9
months. The monthly charges of 300 baiza
are being charged by the company. The
details of the instances have been given as
Annexure 7
Impact:-
• Revenue loss to the company
• Absence of proper internal controls of
the monthly consumption and mileage
reporting of the open fuel cards leading
to possibility of unauthorized use of the
card for purpose other than official
work.
A monthly report from the department
must be implemented with details of
kilometer driven, fuel filled and the
confirmation that the vehicle has been
used for the business purpose. This
statement should be prepared for open
cards as well as dedicated cards
A detailed fuel expense review must be
carried out and the responsibility for all
the irregularity must be fixed and
necessary corrective action such as
recovery of loss to the company must
be made from those who are
responsible
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