*qlarFvT&, It fciF - 110 002 Office of the Director General of Audit(Central Expenditure), (n Indraprastha Estate, New Delhi - 110 002 Telephone: 011-23454313, 23454135 (Fax :011-23702271,72) WW!RT V.VT.ý,.-V/4-11/3f[#.3¥TT/VTIP/2017-1 8/ /0 ø cise 17.04.2018 The Joint Seeretary Directorate General of Training Ministry of Skill Development and Entrepreneurship Shram Shakti Bhawan, New Delhi-110001 fkW-r -#2016-17 f4N,q tiFtg ir1ýn4444 2016-17 f ièlV World Bank assisted Vocational Training Improvement Project (VTIP) IDA No. 4319-IN Zk i-cIT3# q-T ÍNÙf&TDTW W,ý-1Sf% -fi i wl r "6 R zrw *f 3wR fITý ýffef 3 Eý 3-l-- 3d T ¯TWT ~- 3~Tr-d t ~‡w SU etql4T fl-tTT zfrtr tc i*u 4 3TT1~ 8t 3tTtT fkqT T[- fl -FW EtcIt- & i t iz "iTp enail ID amgydga_c@gmail.con T -ZEz-2TT I I ý. 근勺 ．《 ．· & - l [ l #Avfq VftC, at row#ff - 110 002 Office of the Director General of Audit(Central Expenditure), Indraprastha Estate, New Delhi - I 10 002 Telephone: 011-23454313, 23454135 (Fax: 011-23702271,72) %AW: 17.04.2018 The Joint Secretary Directorate General of Training Ministry of Skill Development and Entrepreneurship Shram Shakti Bhawan, New Delhi-110001 ANq - 44 2016-17 4; #wT* 0 4fk4PTvFAqiT #44 if i World Bank assisted Vocational Training Improvement Project (VTIP) IDA No. 4319-IN *t Z1* 2 016-17 *r AUT qt,9T - F -hi 4 M24 t fAftffuT -eW Z rW zf I f3M# #4'ftU AIM qtW WFPTq-5r 3iM4T -h 1 cl I #FJTiiT STW4 4ftw6 Iw wbw xRrwt T.1w.zft.-v) r ,�г � r i � iI ! 1 ,� Р. i , � г Э l Director General of Audit Central Expenditure, I.P. Estate, New Delhi-110002 spection Report on Accounts of the National Project Implementation Unit (Directorate General of Training, M/o Skill Development and Entrepreneurship) World Bank Assisted Vocational Training Improvement Project, TDA Credit No. 4319-IN for the year 2016-17 Part I (A) (1) Introduction The audit of the National Pro ect Implementation Unit (Directorate General of Training, M/o Skill Development and Entrepreneurship) World Bank Assisted Vocational Training Improvement Project (VTIP), IDA Credit No. 4319-IN for the year 2016-17 was conducted by an audit party comprising of Shri Vijay Kumar Gupta, Sr. Audit Officer, ShriDinesh Chand Mahawar, Assistant Audit Officer and ShriTripurariKumar,Sr Auditor of the Office of the Director General of Audit, Central Expenditure, New Delhi, from 09.03.2018 to 22.03,2018 (10 Working Days). VTIP is a nationwide programme being implemented with World Bank assistance w.e.f May 2007. Under the project 400 Industrial Training Institutes (ITIs) are to be upgraded. Out of 400, 100 ITIs were upgraded as Centre of Excellence (CoEs) commencing in August 2006; these are financed on a retroactive basis using International Development Association (IDA) funding from the project. Another 3 0 0 ITI's were to selected competitively based on their own plans for j oining the proj ect during the period 2007- 1 O.The closing date of the Project was December 2012 which has been extended with the approval of World Bank up to November 2014, up-to September 2016 and further up toSeptember 2018. The key objectives of the project are to produce high quality craftsmen from publicity funded ITIs, to enhance knowledge and skills of ITIs instructors and trainers, to promote innovations and to bring about systemic reforms. At the central level, the project is guided by the National Steering Committee (NSC) headed by the Secretary, Ministry of Labour & Employment, and now Ministry of Skill Development &Entrepreneurship. The NSC is supported by NPIU, headed by the National Project -Director-,- which -is--directly- responsible - and - accountable -for -project implementation, day-to-day management and coordination and for meeting the administrative and legal requirement of the government of India and World Bank. The cost of project was Z t581.00 crore, out of which Central Share of Z 1231.00 crore is funded by the World Bank and the remaining Z 350.00 crore is the State Share.Tbe ratio of cost sharing between Central and State Government is 75: 25(90:10 in case of NE States and Sikkim). The World Bank has sanctioned loan of USD 280 m. Disbursement by World Bank was made on the basis of quarterly Interim Unaudited Finance Reports JUFR) submitted by NPIU after consolidating IUFR received from States/Institution. As per decision of the Cabinet Committee on Economic Affairs (CCEA), Secretary (MSDE) is empowered to approve the enhanced cost of the scheme based on the fluctuations in the rate of US$ over the period of the project. Also NSC is empowered to add/modify minor components not envisaged, without changing the broad concept of the scheme 'but required for successful implementation of the scheme. (2) Budget and Expenditure The details of budget provision and expenditure incurred by NPIU during last three years are as under (Z in Crore) Year Budget Provision Actual Expenditure Plan Non- Plan -Plan Non-Plan 2014-15. 34.82 33.34 2015-16 24.87 24.87 2016-17 17,54 11.24 Page I of 11 (3) Incumbency The following officers have held charge of the respective posts in NPIU, DGT during the finan( 11 year 2016-17 SI Name & Designation Post held Period No. 01 Shri Sunil Kumar Gupta,Director Head of the Department 01.04.2016 to 31.03.2017 02 ShriArunKumar, US Head of the Office 01.04.2016 to 31.03.2017 03 ShriGaurav Malik, TO Office in Charge Adnn. 01.04.2016 to 31.03.2017 Cashier 01.04.2016 to 04 ShriPrem Singh Rawat, UDC Cashier 01.04.2016 to 31.03.2017 (4). Internal audit The internal audit of VTIP has not been conducted during the financial year 2016-17. (5) Persistent irregularities 1. Delay in receipt of Audit Certificates from states/UTs 2. Outstanding utilization certificates 3. Non- Preparation of annual accounts 4. Non- maintenance of Consolidated Asset Register Current Audit PART-II-A -NIL- PART-IL-B Para 01 Excess expenditure of Z 7,45,052/- The following hardware was purchased through NICSI for NCVT MIS portal in May 2012 under the project VTIP:- SI No. Description Quantity Amount( in Z) 01 Blade Server-4 Processor Based 10 @ t425532/- per unit 4255320 02 Blade Server-2 Processor Based 10@ T96808/- per unit 968080 03 Blade enclosure config-II(LOU) 2 @ Z 297872/- per unit 595744 04 Pass through switch module with 4. Z 28000/- per unit 1120000 minimum two FC up-link port Total 69,39,144 Page 2 of 11 The Original Equipment Manufacturer (OEM) of these hardwares was M/s Dell International Service India Pvt. Ltd. The five years warranty for these hardwares was expired in May 2017. NICSI nied to undertake the AMC of server after May 2017. Extension of warranty for hardware being used for NCVT MIS portal for two years i.e. from June 2017 to May 2019 was awarded to OEM i.e.M/s Dell International Service India Pvt. Ltd. at their quoted rate of Z 18,54,900/- +taxes. An amount of 7 22,35,1 55/-(full payment) was released to M/s Dell International Service India Pvt. Ltd. as advance payment vide sanction no. DGE&T-35(4)(1)/DC/201 l-NPIU(Vol-II), dated 28.03.2017. Audit scrutiny revealed that VTIP project is to be completed in September 2018. Hence payment of Z 7,45052/- (2235155/24 X 08) for the 08 month from October 2018 to May 2019 was paid in excess. Which is not allowed for claim from the World Bank. In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. Para02 Excess claim of Z 19,926/- (A) Scrutiny of Voucher no.5161 dated 17.03.2017 revealed that an amount of Z 22524/- was booked under OE head towards reimbursement of newspaper facility provided to the nine officers of the Ministry of Skill Development & Entrepreneurship. It was noticed that out of nine officers only three officers were attached to the World Bank project. The details of amount reimbursed to these three officers are as under:- SL. No. Name of designation of the officer Amount( in Z) 01 Sh, Rajesh Meena, Assistant Director of Training 4741 (ADT) 02- -Shri Pravee Kumar, ADT-- - - - -- -- - - 1296 - - - 03 Shri Amar Kumar, ADT 561 Total 6598 Remaining six officers were not attached to the project. Thus, an amount of T 15926/- (22524- 6598/-) was excess booked under the project expenditure which is not allowed for claim from World Bank. (B) Similarly, scrutiny of voucher no. 455 dated 05.09.2016 revealed that Z 26600/- Was booked under OE head towards reimbursement of briefcase/bags to the seven officers. It was noticed that out of these only one officer Shri Amar Kumar was attached to the Project and Z 4000/- was reimbursed to him. This has resulted in excess booking of 22600/- under OE head which was not allowed for claim from World Bank. In this regards, a Half Margin no. 02 dated 21.03.2018 was issued but reply of the department is awaited. Para 03 Excess expenditure of Z 17,72,981/- (A) Scrutiny of statement of expenditure of the VTIP for year 2016-17 revealed that the Department incurred an expenditure Z 2,32,72,981/- against the Sanctioned Estimate of Z 2,15,00,000/- under the "Professional Services" head. This has resulted the excess expenditure of Z 17,72,981/- In its reply department stated that VTIP is placed under Umbrella Scheme of the Ministry and the excess expenditure was met from the saving in relevant head under Umbrella Scheme. Reply is not Page 3 of 11 tenable as any diversion of funds under VTIP World Bank project was not permissible. World Bank Assistance should be utilized for specifically objective of the VTIP. t .: (B) It was also noticed that the following States made excess expenditure against total funds released to them. (t...in lakh) SI. Name of States Total funds Expenditure Excess No. released against allocation Expenditure 1 Haryana 7652.92 7821.86 168.94 2 Karnataka 13248.20 14103.59 855.39 3 Kerala 3208.56 3374.54 165.98 4 Manipur 334.01 339.10 5.09 5 Tripura 516.24 516.70 0.46 Total 24959.93 26155.79 1195.86 (C) Audit further, observed that in case of Kerala funds of Z 3208.56 lakh (including state share) was released up-to March 2017 which was excess of Z 167.88 lakh against total allocation of Z 3040.68 lakh. The figures may be reconciled and results there-of may be intimated to audit. In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. Para 04 Non- maintenance of separate object head for World Bank Assistance Scrutiny of records related to World Bank Assistant Project & information furnished by the Deptt. revealed that VTIP was placed under Umbrella Scheme of the Ministry and expenditure of VTIP are being booked with other scheme of the Ministry. There was no separate object head available to book the expenditure of VTIP. In a single voucher expenditure of VTIP was booked with the others schemes of Ministry and expenditure in respect of VTIP cannot be segregated. Thus, audit could not ascertain the actual allotted amount as well as actual expenditure related to VTIP. Audit suggested that separate object head may be maintained to book the expenditure related to World Bank Project. In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. Para: 05 Non-preparation of annual accounts/financial statements During the scrutiny of records of NPIU in respect of VTIP it was observed that the Unit was not preparing the annual accounts/financial statements as prescribed in Financial Management Manual of VTIP in respect of funds received and expenditure incurred by the NPIU. The annual accounts submitted for audit were, in fact, only Cumulative Expenditure statement up-to March 2017. Audit is being conducted on the basis of progressive Statement of Expenditure prepared and submitted to audit by the auditee unit. Due to non-preparation of annual accounts by the unit and non-reconciliation of cumulative amount, the details of expenditure could not be vouchsafed by audit. This practice was also being followed since its inception. This was also pointed out in the previous Inspection Report but no action was taken by the department. Page 4 of 11 In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. Para 06 Outstanding Utilization Certificates amounting to Z9521.04 lakhs As per GFR-212(1), the Utilization Certificate should be submitted within twelve months of the closure of the financial year by the institution or organization concerned. Receipt of such certificate shall be scrutinized by the Department concerned. Where such certificate is not received from the grantee within the prescribed time, the Department will be at liberty to black list such organization from any future grant, subsidy or other type of financial support from the government. This fact should also be put on the website of the organization. Further Financial Management Manual VTIP IDA Credit No.4319-IN also stipulates the State Government/UTs should submit Utilization Certificates for the total amount (both Central and State shares) in respect of the expenditure incurred while submitting proposals for release of subsequent instalment of funds. Scrutiny of records revealed that utilization certificates amounting to Z 9521.04 lakh from the following States were outstanding as on 31.3.2017. (Zin lakh) SL. No. Name of the State Amount for which UC is due up to 31.03.2017 01 Andaman & Nicobar 7.03 02 Arunachal Pradesh 0.03 03 Assam 19.25 04 Bihar 54.41 05 Chhattisgarh 339.34 .06_- Daman&-Diu-_ -_ _122 07 Delhi 65.92 08 Goa 421.51 09 Gujarat 591.41 10 Haryana 20.44 11 Himachal Pradesh 0.41 12 J&K 95.36 13 Jharkhand 53.28 14 Karnataka 476.91 15 Kerala 323.95 16 Lakshadweep 4.95 17 Maharashtra 3968.13 18 Manipur 9.92 19 Meghalaya 119.66 20 MP 350.70 21 Nagaland 20.65 22 Orissa 58.98 23 Puducherry 40.72 24 Punjab 1531.93 25 Rajasthan 77.99 26 Sikkim 14.04 27 Telangana 367.63 28 Tripura 2.39 29 Uttar Pradesh 60.47 Page 5 of 11 30 Uttarakhand 285.49 31 West Bengal 136.92 Total 9521.04 Immediate action may be taken to adjust/recover Z 9521.04 lakhs or obtain UC's from the respective State Government/UTs under intimation to audit. In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. Para: 07 Delay in receipt of Audit Certificates from States/UTs As per the Financial Management Manual of VTIP, Audit would be conducted by the State Accountant General and Audit Reports received from the state would be forwarded by NPIU to the World Bank within six months after the end of each fiscal year. Any non-compliance would result in suspension of disbursements by the World Bank and this may affect the project as a whole, leading to delays in completion of the project, in turn would necessitate extension of the project period. Further as per World Bank letter dated 02 March 2017 the timelines for submission of audit reports to World Bank is nine month of the end of the financial year (i.e December of each succeeding financial year). Scrutiny of records revealed that the Audit certificates had been received late for the financial year 2015-16 in respect of the eightstates and fourCentral Financial Institution (CFJ)period ranging from 25 days to more than 06 months and in the financial year 2016-17, fourstates and oneCFIperiod ranging from 15 days to more than 02 month as details given below: Sl. Name of the State Date of audit Late received Date of audit Late No. /Institute Report Report Received received Received for for the year the year 2015- 2016-17 16 01 Assam 22.03.2017 02 month 22 days 02 Bihar 23.03.2017 02 month 23 days 03 Delhi 22.03.2017 02 month 22 days 04 J&K 19.06.2017 05 month 19 days 05 Jharkhand 22.02.2018 01 month 22 days 06 Manipur 28.01.2017 28 days 05.02.2018 01 month 05 . _ days 07 Maharashtra - - 15.01.2018 15 days 08 Madhya Pradesh 18.01.18 18 days 09 Orissa 16.03.2017 02 month 16 days 10 Puducherry 07.07.2017 06 month 07 days 11 Tripura 10.02.2017 01 month 10 days 12 CTI-Chennai 04.01.2017 03 month 04 days 13 FTI Bangalore 25.10.2016 25 days 14 NIMI Chennai 04.01.2017 03 month 04 days 15 NVTI Noida 06.03.2018 02 month 06 16 NPIU 18,01.2017 01 month 18 days Page 6 of 11 It is suggested that in future efforts may be made to receive the audit certificates in respect of States and CFI at the earliest so that the same may be sent to World Bank within the prescribed ieframe. In this regards, a Half Margin no. 01 dated 21.03.2018 was issued but reply of department is awaited. ParaO8 Non maintenance of Consolidated Asset Register TheVTIPscheme was for upgradation of 400 ITIs with World Bank assistance is based on the on- going Central Sponsored Scheme with certain modification relating to the pattern of release of Central share in installment. ITIs located at places lacking industrial clusters can be selected for upgradation of existing so as to conform to world bank approved norms, and for the reimbursement claims to be submitted to the world bank to become eligible. As this is a world bank assisted scheme and the department released the funds to states as Central share, from which states procured fixed assets, assets etc. and entered it into assets register which is mandatory and on the basis of information received from states regarding fixed assets/assets, the Ministry/department had to prepare consolidated assets register which was not maintained by the department in respect of NPIU. This was also pointed out in previous Inspection Report but no remedial action was taken. In this regards, a Half Margin no. 02 dated 21.03.2018 was issued but reply of department is awaited. Part III Results of review of old outstanding Inspection Reports. At the commencement of aidit, 03 InspectionReports with7lparaswere bitsianding / pendimg for settlement. After the current audit 06paras were settled/taken afresh and 12paras remained outstanding. Details are as under:- Annexure A List of para settled/Taken Afresh SI Year of Para Brief description of objections Remarks/Audit No. IR No. comments 01 2015-16 01 Loss of Interest on unspent amount In view of reply para Part-I B is settled 02 2015-16 05 Blockade of funds amounting to 7 8.04 In view of reply para crore due to Improper planning is settled 03 2015-16 07 Outstanding UC's amounting to Taken Afresh Z 12342.57 lakhs 04 2015-16 08 Delay in receipts of Audit Certificates Taken Afresh from States/UTs 05 2015-16 10 Non-preparation of Annual Taken Afresh accounts/financial statements 06 2015-16 11 Non preparation of Consolidated Assets Taken Afresh Register Page 7 of 11 Annexure -B Details of Outstanding Paras S1. Year of Para No. Brief description of objections Remarks/Reply of U No. IR the Department 01 2013-14 01 of Blockade of funds of Z13.34 crore(ITOT) Reply is not Part-IIA furnished 02 2013-14 13 Non- furnishing replies Part II B 03 2013-14 11 Voucher not produced to audit Part II B 04 2014-15 03 Irregular expenditure 05 2014-15 01 (a)voucher not production to audit (b)Under statement of expenditure 06 2014-15 02 Excess expenditure of Z42293 1/- 07 2015-16 02 Excess expenditure of Z 90593/- Part II B 08 2015-16 03 Vouchers not produced to audit to the tune of Z 2.41 lakh 09 2015-16 04 Understatement of expenditure (b) booking of 31630/- under different head 10 2015-16 06 Release of grant at the fag end of year 11 2015-16 09 Physical verification of Assets/Stores 12 2015-16 12 Non-reconciliation of expenditure PART-IV BEST PRACTICES NIL PART - V Acknowledgement The Indian Audit and Accounts Department acknowledges the co-operation and assistance extended by the National Project Implementation Unit(VTIP), DGT, M/o Skill Development and Entrepreneurship) in providing necessary information and records to audit. Page 8 of 11 General The general condition of the accounts of National Project Implementation Unit (Directorate neral of Training, Ministry of Skill Development and Entrepreneurship) World Bank assisted Vocational Training Improvement Project, IDA Credit No. 4319-IN for the year 2016-17was found to be satisfactory subject to the observations in the Inspection Report. The Inspection Report has been prepared on the basis of information furnished and made available by the auditee. The Office of the Director General of Audit, Central Expenditure, New Delhi disclaims any responsibility for any misinformation and/or non-information on the part of auditee. Dy. Dir ctor (AMG-V) O/o Director G eral of Audit, Central Expenditure, Indraprasth Estate New Delhi 110002 Page 9 of 11 l ) (,, ｝户 } 1 } } … Audit Certificate Report of the Comptroller and Auditor General of India Shri Vijay Dev, Director General/Additional Secretary Vocational Training Improvement Project (VTIP), Directorate General of Training, I" Flo orj '_aushaffihawan Karol Bagh, New Delhi Report on the Project Financial Statements of National Project Implementation Unit (VTIP) Sir We have audited the accompanying financial statement (monthly statement) of the Vocational Training Improvement Project, IDA Credit No. 4319-IN for the year 2016-17. These statements are the responsibility of the Project's management. Our responsibility is to express an opinion on the accompanying financial statements (monthly statement) based on our audit. We conducted our audit in accordance with the Auditing Standards promulgated by the Comptroller and Auditor General of India. Those standards require that we plan and perform the audit to obtain reasonable assurances about whether the financial statements are free of material misstatement, our audit examines on a test basis, evidence supporting the amounts and disclosures in the financial statements (monthly statements). It also includes assessing the accounting principles used and significant estimates made by the management, as well evaluating the overall statement presentation. We believe that our audit provides- a- reasonable -basis for- our opinion. VTIP is- not- presenting annual- accounts-as pointed- out in Para 05 of the IR. In our opinion, the financial statements (monthly statement) present fairly, in all material respect, the sources and applications of funds of the Vocational Training Improvement Project from I"April 2016 to 3 I't March 2017 in accordance with Government of India accounting standards, subject to observations in Para 05 of the Inspection Report issued separately. In addition, in our opinion (a) with respect of SOEs, adequate supporting documentation has been maintained to support claims to the World Bank reimbursements of expenditures incurred except for ineligible expenditure as detailed in the audit observations appended to this audit report, expenditure are eligible for financing under Loan/Crodit Agreement.During the course of audit, SOEs/FMRs, amounting to Z 3,82,02,909/- and connected documents were examined these can be relied u on to support reimbursement of Z 3,74,3 7,93 1 /- Under Loan/Credit agreement as per Annexure. This reportis issued without prejudice to CAG's right to incorporate the audit observations in the Report of CAG of India for being laid before the Parliament/State of UT Legislature Dy. Dir >tor(AMG-V) O/o Director General of Audit, Central Expenditure, Indraprasth Estate New Delhi 110002 Page 10 of 11 卜卜1 场口 Annexure Details of amount inadmissible 71-otal Amount admissible Amount Reason Expenditure M inadmissible M M M 38402PO9 374 7,931 745052 Excess expenditure of Z 745052/- 19926 Excess claim of Z 19926/- Total 764978 Page 11 of 11 �, . .. .. . , ,'� ; +`r� р �}' �� �i � t��� ` �' ��. ' , . . - .. ' . . - . . .._ . , i. � _ ., "' . , � ' ��,I� � �" ,.i }.У t. _ , , � , . - '' ,'- _ лr �. � . , .. � . �s. i � I � ! l ' l�