Financial Reporting and Audit Information
All the financial activities performed by the AEPC are guided by the Financial Procedure Act 1999 (2055 BS) and Financial Procedure Rules 2007 (2064 BS) of Nepal. AEPC should prepare budget and programs required by office for forthcoming year and submit it to the Ministry of Finance (MoF). The MoF provides the annual budget for various projects and all the activities are conducted within constraints of the budget. Any grants or loans received from donor agencies are also included in the budget. Fund management of all activities of GoN is done through a consolidated fund managed by Financial Comptroller General Office (FCGO). Periodic sanction is required from FCGO to utilize funds. Even after the transactions have been carried out and accounted for, it shall carry out, or cause to be carried out, internal examination of the transactions carried out and become confident of accuracy.
Chart of Accounts is based on Operation Directives 2014 (2070 BS). The directives provisions separate heads provided for revenue and expenditure with the annual budget provided under such headings. All revenue and expenditure will be booked under such respective headings. AEPC maintains accounts of all expenses on a Cash Basis through an accounting software used and prescribed by the GoN to record all the financial transactions and vouchers such that they are classified into separate files according to their budget heads. At the end of each month, AEPC sends the monthly expenditure statement to Finance and Account Controller Office (FACO) at end of each month and the trimester progress reports to the FACO and the line ministry after the end of each trimester.
As required by the Financial Procedure Act 1999 (2055 BS) and Financial Procedure Rules 2007 (2064 BS) of Nepal, the internal audit shall be performed by the FCGO while the final external audit is performed by the Office of Auditors General (OAG) in line with the Nepal Public Sector Accounting Standards 2013 (2070 BS) developed by the Auditing Standard Board of Nepal and Government Auditing Standards 1996 (2053 BS) respectively. The terms of audit for the internal audit function performed by the FACO is guided by the Internal Audit Procedure Directive, 2016 (2073 BS) while the terms of external audit function performed by the OAG is guided by the Audit Act, 1991 (2048 BS). In the case of programs implemented under the Joint Financing Agreement, a separate audit procedure could be prepared. However, for the final audit, OAG will be the ultimate auditing entity. For community projects, such as mini/micro hydro projects, if required by the Renewable Energy Subsidy Policy and respective delivery mechanism, a public audit of the project has to be done by the respective community.