LAHORE - The finance department of the PIA has written a letter to the chairman against the airline’s chief executive officer (CEO), alleging that the department is being forced to make payments worth millions of rupees in violation of rules.

"The CEO, Musharraf Rasool Cyan, is forcing finance department to make payments worth millions to different people in violations of rules".

The letter (copy of which is available with The Nation) says the management has little focus on operational results which are regularly shared with CEO every month. However, not even a single meeting has been held to deliberate over the financial performance.

“Once we submit the financial results, these are taken as a conspiracy by finance department against the current management. Even professional and positive feedback given by finance department is disregarded in front of everyone in daily morning briefing,” the letter says.

It says finance team was pressurised to make payments. The department raised certain objections on professional grounds, however, the same were not taken in good faith.

Payment of 'Markhore' was objected to by finance department on the basis of non-compliance of regulatory and procedural requirements.

Payments to legal counsel, on which comments were made by CFO, were made on weekend.

These examples, the letter says, reflected the biased behaviour towards finance department. The target is to deliberately weaken the finance department. To substantiate the allegation, the letter alleged, more than eight finance officers, who were professionally qualified accountants and were recently trained on ERP system, were transferred from finance department to other departments without any solid reason.

The letter further alleges that the department has been singled out on the issue of promotions, which is not the case in other departments.

Foreign posting board has not been convened for quite some time although there are more than 11 key foreign stations which are not adequately manned.

This is causing delays in reporting and impacting local regulatory requirements in addition to control weaknesses/ the matter has been held up with the CEO, CHRO since January 2018. The letter says, "We have time and again assured the management that we have never shared any information to media."

Special audit has been started on the instruction of Supreme Court of Pakistan and scope of audit is spread over last 10 years, therefore, human guess spreading over prior period has to be extracted to fulfill the specific requirement on the requisite formats of data to the satisfaction of auditors.

The finance team has been regularly working late hours and weekends as well to provide the data.

The current status of outstanding information has regularly been communicated to the auditors.

“The requirement of data is continuous and new requisitions are being issued and we are working very closely with the auditors to fulfill their requirements for the completion of audit on time. Moreover, it has been learnt that a statement was made by the higher management in the Supreme Court that the data is not being provided by finance department.”

“In response to that, it is submitted that such unbefitting statement was grossly biased and was made on the voice of the coordinator to the audit process Javed Jamil against whom many issues have already been highlighted for financial irregularities and other misrepresentations by auditors. We understand the importance of the audit and fully support the audit process which will definitely lead to the betterment of the company,” says the letter.

Finance department has been trying to manage the cash flow of the company in order to keep the operation afloat. The budget plan for the year 2018 approved by board of directors projected a substantial cash requirement of Rs111 billion for the year 2018.i.e average monthly financing requirement of Rs9.25 billions.

“Finance department is making efforts to meet this shortfall which prima facie appears to be quite impossible. Nevertheless, we have managed to arrange fresh loans amounting to the tune of Rs91.13 billion, during the period from September, 2017 to July 2018, including $115 million for B777 engine that will be disbursed during this month.

Whereas actual performance has been deteriorating day by day resultantly increasing cash flow deficit and it is expected that incremental operational loss should also be financed, concludes the letter.

When contacted, PIA spokesman expressed his ignorance over the issue and said any such letter should have been sent to the chairman office through management observing proper channel. He said he would be in a position to comment on the issue after chairman office reaction.