Records of government investments worth nearly Rs 47 billion across various public institutions remain unverified, raising serious concerns over financial oversight and accountability.
According to the Ministry of Finance and the Public Debt Management Office (PDMO), long-standing records of share investments and loans do not match between the government and the recipient institutions. Discrepancies persist in reported investment amounts, utilization, and expected returns, leaving large gaps in the official accounting of public funds.
The PDMO told the state-run news agency RSS that investments worth Rs 26.34 billion in shares and Rs 20.53 billion in loans—totaling Rs 46.87 billion—could not be verified against institutional records. While government documents show higher investment amounts, many institutions have reported lower figures, making it difficult to determine responsibility for decades-old accounting inconsistencies. Weak internal control systems and inconsistent accounting practices have further worsened the issue.
Major public entities implementing large infrastructure projects—such as hydropower, airports, telecommunications, and drinking water supply—are among the largest recipients of these investments. Despite the introduction of the Share and Loan Investment Policy 2081, the lack of standardized accounting practices and integrated monitoring systems has prevented accurate verification of past investments.
Examples include the Nepal Electricity Authority’s rural electrification programs, where total government investment remains unclear due to mismatched accounting of foreign grants and loans. Similarly, records maintained by the Civil Aviation Authority of Nepal do not align with the assets transferred from the former Civil Aviation Department when the authority was established. The Kathmandu Valley Drinking Water Board also shows significant differences between loan disbursements and actual project expenditures.
The PDMO has identified several additional reasons for the discrepancies, including inconsistent interest rates, changes in loan repayment schedules, and confusion over adjusting loan terms when project timelines shift. Even when the government channels development partner loans to institutions through subsidiary loan agreements, delays in repayment or rescheduling requests continue to generate new accounting gaps. While institutions often cite construction delays, the central government must still repay external lenders on time, further widening discrepancies.
Despite total government investments amounting to Rs 930.88 billion in shares and loans across 159 public institutions—of which Rs 404.81 billion are share investments and Rs 526.6 billion are loans—returns remain extremely weak. Outstanding principal and interest have reached Rs 400.82 billion in FY 2024/25, undermining efforts to strengthen public financial management.
Regular audits, essential for transparency, are severely behind schedule. Only 21 institutions completed their audits for FY 2023/24. Others have multi-year backlogs, some dating as far back as FY 2007/08. Entities such as Udayapur Cement, Public Service Broadcasting Nepal, and Gorkhapatra Corporation have not completed audits in recent years, while several insurance and industrial institutions have audit backlogs extending more than a decade.
According to the PDMO, the absence of proper documentation, signed agreements, and complete records of past decisions has made it impossible to determine the exact status of government investments. Until institutions reconcile their accounts, the PDMO’s figures will remain the official record.
The office said discussions are ongoing with institutions such as the Kathmandu Valley Drinking Water Management Board and the Civil Aviation Authority of Nepal, with the aim of completing the reconciliation process by the end of the current fiscal month.
