Corruption Allegations Emerge at Rastriya Beema Company Over Flawed Audit

Kathmandu – Rastriya Beema Company, a state-owned enterprise, is under scrutiny for alleged financial irregularities and corruption. The company has reportedly prepared and approved an audit report for fiscal years 2073 to 2075 in violation of accounting standards, with Nepal Insurance Authority granting approval despite marking the report as “Kaifiyat”.

Sources reveal that the audit was approved under direct instructions from Finance Minister Bishnu Poudel, who issued a four-month ultimatum to finalize it, regardless of its accuracy. The Ministry of Finance also exerted pressure to pass the report, which highlights millions of rupees in unaccounted transactions and discrepancies.

The audit report reveals that Rastriya Beema Company accepted insurance risks worth millions without collecting premiums, a practice prohibited by the Insurance Act of 2049. Additionally, the company is accused of maintaining suspense accounts to adjust unexplained discrepancies. Reinsurance claims were not recorded promptly, leading to inaccuracies in exchange gains and losses.

In its financial records, the company allegedly overpaid claims by NPR 17.97 million for fiscal years 2070/71 to 2072/73, NPR 5.56 million in 2071/72, and NPR 12.41 million in 2072/73. Despite these irregularities, the audit report was finalized by Lalwani & Associates and PLRG Associates, with auditors stating they did not provide an opinion due to the pervasive issues—an action that violates Nepal Institute of Chartered Accountants regulations.

The audit further identifies NPR 526.5 million in unverified transactions and NPR 200 million in discrepancies related to reinsurance. Employee expenses, including salaries and allowances, were arbitrarily recorded, while some transactions lacked documentation.

Rastriya Beema Company’s financial malpractice has raised concerns about accountability. Despite the irregularities, the company has scheduled its second annual general meeting for January 8, where it plans to discuss and approve the financial reports for fiscal years 2073/74 and 2074/75.

The Insurance Authority’s decision to approve the flawed audit report has drawn criticism for potentially shielding those involved in corruption. The scandal, estimated to involve NPR 726.5 million, highlights systemic issues within the company and threatens the future of over a dozen employees.