Top auditor finds 'problematic funds' in budget

China's top audit office on Monday revealed that it had about 24 million yuan ($3.89 million) of "problematic funds" while implementing the 2012 budget.

The National Audit Office published a review of 57 departments under the central government, including the office itself, concerning how they implemented their 2012 budgets.

The NAO found that it has about 4.47 million yuan of funds that have violated budget regulations, and has another 19.57 million yuan of problematic funds in other financial revenues and expenditures.

Expenditure of another 3.61 million yuan for computer maintenance and equipment updating was not included in the budget, according to the NAO report.

The office also said that it prepaid 643,100 yuan in 2012 for software products but did not receive the products until March 2013.

The NAO planned to spend 216,000 yuan to renovate office security and fire systems, but the plan was not carried out, according to the report.

The NAO's Shenyang agency did not turn over 10.33 million yuan of its house rental income to the central government and planned to use the money to cover medical insurance for employees and retired staff, said the report.

The audit also revealed large sums of "flawed funds", including against-regulation government purchases and excessive spending on staff receptions and overseas trips, in many ministries and commissions.

The National Council for Social Security Fund allocated about 1.52 billion yuan of trust loans to two projects in Guizhou and Yunnan provinces in 2011 and 2012, but 275 million yuan of the loans were used on other projects, said the NAO report.

The Energy Research Institute of the National Development and Reform Commission spent about 1.79 million yuan on official receptions, which exceeded the budget by 1.3 million yuan, the NAO said. The former ministry of railways, which was dismantled in March, spent about 1.57 billion yuan in problematic funds against its budget, and also shows some 805.8 million yuan of flawed funds in other financial revenues and expenditures.

The Ministry of Education did not include its 78.25 million yuan of bank interests' income into last year's budget, the NAO said.

Du Xiangqian, an economist and researcher, said that the auditing processes of government agencies have become more detailed and efficient in recent years.

"The public might feel that more large sums of problematic funds were revealed by the NAO," he said. "It reflects the fact that the audits have become more thorough and more professional."

After revealing the problematic funds, the NAO will issue a guideline that will require departments to rectify misbehaviors within a given period, and grave violations will be transferred to the anti-graft authorities, Du said.

Premier Li Keqiang urged auditors on June 17 to exert tight control over power and help build a clean government when he inspected the NAO.

"Auditing plays an irreplaceable role in building a clean and honest administration, and no one should disrupt an auditor's work with one's power and influence," Li said.