KARACHI: A major financial irregularity scandal has emerged within the Karachi Water & Sewerage Corporation (KWSC) after the Local Fund Audit Department revealed that official checks are being issued without mandatory pre-auditing. In an official correspondence addressed to the Director of Local Fund Audit, Government of Sindh, the Assistant Director highlighted that issuing checks without prior audit explicitly violates the Sindh Local Government Act 2023, Rules 69 & 70 of the Sindh Local Councils Accounts Rules 1983, and standard government directives.
Despite multiple formal warnings and reminders—including notices issued on December 9, 2025, as well as January 22, January 29, and August 6, 2026—the KWSC management has consistently failed to provide essential financial records, such as check registers, general cash books, and original bills required for legitimate verification. Audit authorities warned that bypassing pre-audit procedures severely compromises financial discipline, making it nearly impossible to determine the legality and proper utilization of public funds. Consequently, they have requested immediate intervention from the Sindh Finance Department, Local Government Department, and Habib Bank Limited (HBL)—where KWSC maintains its accounts—demanding that the bank be strictly instructed to clear no checks or payments without prior pre-audit authorization.
Meanwhile, senior officials within the utility expressed grave concerns, stating that privately inducted officers are completely ignoring state regulations, which risks plunging the institution into a severe administrative and financial crisis. When contacted for clarification, KWSC’s Chief Financial Officer (CFO) dismissed the audit department’s letter as unimportant, maintaining that all disbursements are already audited by the corporation’s designated Chief Internal Auditor, thereby making a secondary external pre-audit redundant.
