Summary

SAI India completed an audit of several state-owned mining companies. The audit of Central Coalfields Limited revealed misuse of funds totaling 21.22 crore rupees (or USD 2.2 mln), which resulted from land purpose transfers without the approval of competent authorities and violations of forest management regulations. During the audit of Mahanadi Coalfields Limited, auditors found that Mahandi had failed to align its coal production and congestion management targets with the mine's established capacity regulations. The audited company also failed to develop guidelines and standards defining the factors to be considered when setting targets. The audit also found that Mahanadi's heavy earthmoving equipment remained inoperative for extended periods, negatively impacting production targets and congestion management. Furthermore, SAI identified IT vulnerabilities. For example, a discrepancy was identified between the IP addresses of bidders in Mahandi's e-tenders and the IP addresses on the server, as well as a lack of verification mechanisms in the tendering system. SAI India recommended that Mahandi prepare guidelines outlining the methodology and parameters to be considered when assessing workload and setting targets. To ensure transparency in the e-tendering process, it recommended implementing an appropriate monitoring mechanism and improving the control and verification system.