An audit report has identified financial irregularities worth Rs 18.46 billion in the Khyber Pakhtunkhwa Economic Zones Development and Management Company (KPEZDMC) during the 2024-25 fiscal year. The findings raise serious concerns about financial management, land allocation, revenue recovery and administrative oversight within the provincial company.
The Auditor General of Pakistan attributed the reported issues to weak management, inadequate planning and failures to recover outstanding payments. Moreover, the report highlighted potential liabilities that could threaten the company’s financial sustainability and continued operations.
Audit Flags Unrecovered Dues and Land Management Issues
According to the report, the company failed to recover approximately Rs 2.08 billion in lease payments from industrial land allottees despite court orders. Auditors also identified a loss of around Rs 629.8 million linked to delays in renewing commercial land agreements in Peshawar Economic Zone.
Furthermore, the company reportedly paid approximately Rs 1.08 billion for land in Buner, Mohmand and Jalozai without completing acquisition and securing possession. The audit also identified a loss of Rs 174.1 million associated with the allocation of commercial land for industrial purposes in violation of applicable rules.
Another observation involved Al-Hadeed Engineering in Haripur, where four plots covering approximately 10 acres were allotted. According to the audit, outstanding payments of around Rs 497.8 million remained unrecovered, raising further questions about land allocation and revenue collection.
Potential Liabilities Raise Financial Sustainability Concerns
The report estimated the company’s contingent liabilities at Rs 14 billion, largely linked to disputes over land compensation. These potential obligations could place additional pressure on the company if legal proceedings result in unfavourable decisions.
Meanwhile, Khyber Pakhtunkhwa Governor’s Information Adviser Samar Haroon Bilour called for an impartial investigation into the findings. She stressed the importance of transparency, recovering public funds and determining responsibility through a comprehensive inquiry.
However, KPEZDMC Chief Executive Officer Shaharyar Gul stated that substantial reported liabilities relate to legacy land compensation disputes. He maintained that the company follows audit procedures and remains committed to transparency and compliance with applicable laws.
The audit findings now place the company’s financial controls and management practices under scrutiny. Further investigation and official responses will help establish responsibility and determine appropriate recovery measures.
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