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CAG audit of RIL books yet to begin

business Updated: Oct 13, 2009 16:20 IST
CAG audit

Caught in a web of rules relating to vetting of books of private firms, the Comptroller and Auditor General has not been able to start scrutiny of Mukesh Ambani-led RIL's accounts, even after the company agreed to special audit of gas field expenses nearly two-months ago.

CAG was asked by Oil Ministry to audit the accounts of RIL, which is facing allegations of gold-plating gas field costs that has increased four-fold to USD 8.8 billion.

The auditor has so far sought from RIL only a list of relevant documents for KG-D6 fields, as issues like legal tenability of audit of Production Sharing Contract (PSCs) and enforceability of corrective steps are being debated.

CAG had earlier complained that it could not make any headway in the last two years in the absence of access to the books of private operators, including RIL.

According to an October 3 note signed by V K Dewangan, Director (Exploration) in Petroleum Ministry, the September 22 meeting between CAG's Principal Director of Audit (PDA), oil regulator DGH and RIL that was supposed to be the 'entry meeting' signifying beginning of audit, was later converted into a clarificatory meeting because of internal issues.

PDA has held three meetings to deliberate if the special audit of KG-D6 and other fields sought by the Oil Ministry was as per the provisions of PSC and who - RIL or the ministry -would be the auditee, it said.

While the ministry wanted special audit of accounts from 2003-04 fiscal, CAG wanted the scope of examination to records be restricted to 2006-07 and 2007-08 only.