The government has initiated stronger enforcement measures to address long-standing unresolved audit irregularities, including mandatory court referrals for serious cases and the denial of Audit Clearance Certificates (ACCs) to agency heads who fail to take legal action within prescribed timelines.
The move follows growing concerns raised by the Public Accounts Committee (PAC) of the Parliament over the persistence of unresolved audit observations that continue to reappear in annual audit reports despite repeated deliberations and directives.
According to the PAC Review Report presented during the Fifth Session of the Fourth Parliament, the Cabinet Secretariat issued a directive on March 27, 2026, ordering the strict enforcement of Section 123 of the Audit Act of Bhutan 2018. The provision requires that any serious audit case remaining unresolved for more than 12 months after parliamentary deliberation be referred to the courts for adjudication.
Under the new measures, all ministries, agencies, autonomous bodies and local governments have been instructed to initiate legal proceedings against unresolved cases involving fraud, financial shortfalls, misappropriation and serious non-compliance that have remained outstanding beyond the statutory period.
Agencies requiring legal assistance have been directed to coordinate closely with the Office of the Attorney General (OAG) to ensure timely filing and prosecution of cases.
In addition, agencies have been instructed to submit comprehensive litigation status reports detailing audit cases referred to the courts, progress of legal proceedings and enforcement actions taken.
To facilitate implementation, the Cabinet Secretariat has requested the Royal Audit Authority (RAA) to compile and provide a consolidated list of ministries, dzongkhags and agencies with unresolved audit observations. The information will serve as a baseline for monitoring compliance and tracking the referral of cases to the judiciary.
A high-level coordination meeting involving the Cabinet Secretariat, RAA and OAG is also expected to be convened to streamline legal procedures, strengthen inter-agency coordination and mobilize the legal resources required to handle the growing caseload.
Among the most significant accountability measures introduced is the government’s decision to authorize the RAA to withhold ACCs from heads of agencies that fail to initiate legal proceedings within the stipulated timeframe.
ACCs remain an important administrative requirement for public officials and are often linked to appointments, promotions, training opportunities and other career-related processes.
The PAC noted that unresolved audit observations often remain pending for years, weakening public accountability mechanisms and reducing the likelihood of recovering public resources lost through financial irregularities.
The issue gained renewed prominence during parliamentary deliberations on the Annual Audit Report, where lawmakers expressed concern that numerous audit cases continue to remain unresolved despite agencies having exhausted available administrative remedies.
Among the cases highlighted by the PAC were 56 court judgments involving approximately Nu 266.7 million that have yet to be fully enforced. In addition, 24 cases involving absconding or missing defendants account for more than Nu 13.4 million in unresolved amounts.
Many of these cases have remained outstanding for years, prompting the Parliament to call for stronger intervention from the executive branch to ensure enforcement and recovery.
In response, the Cabinet Secretariat directed the OAG to establish a dedicated project to pursue pending court judgments and strengthen enforcement efforts.
While proposals to engage private lawyers were found to be impractical under existing public service and procurement regulations, the OAG has sought approval to recruit additional legal officers on a contract basis to reinforce its Property and Judgment Enforcement Division.
The Attorney General’s Office has also undertaken internal reforms aimed at improving efficiency. These include revising Standard Operating Procedures, updating Terms of Reference related to judgment enforcement and redistributing jurisdictions among legal officers to strengthen case management and improve follow-up on outstanding judgments.
According to the PAC, stronger legal enforcement is essential not only for recovering public funds but also for reinforcing accountability and deterring future financial irregularities across government institutions.
The broader audit picture suggests that although agencies have made progress in addressing audit findings, the scale of unresolved cases remains substantial.
Of the Nu 9.987 billion in audit irregularities reported to the Parliament in 2025, approximately Nu 536.99 million remained unresolved as of March 31, 2026.
While acknowledging improvements in the overall resolution rate, the PAC cautioned that prolonged delays and continued non-compliance undermine public confidence in governance systems and weaken efforts to promote transparency and responsible public financial management.
Nidup Lhamo, Thimphu
