Nepal's Federal Audit Arrears Rise 15.6% to Rs 10.68 Billion

Nepal's federal government recorded Rs 10.68 billion in unsettled financial transactions in fiscal year 2025/26, a 15.6% rise from Rs 9.24 billion a year earlier, according to figures from the Financial Comptroller General Office's latest consolidated internal audit reported on 5 November. The increase amounts to approximately Rs 1.44 billion.

The office's official website lists the consolidated annual internal audit report for fiscal year 2082/83 in the Nepali calendar. Republica and Nepali-language outlet Khabar Patro independently published accounts of its figures. The underlying PDF was linked from the official site but could not be retrieved in full during this review, so the breakdown below is attributed to those reports of the FCGO document rather than presented as a separate line-by-line audit by TFNOS.

The categories matter. Approximately Rs 3.42 billion was classified as requiring recovery, Rs 1.98 billion as needing regularisation of accounts or procedures, and Rs 5.27 billion as overdue advances. These categories describe accounting and compliance matters at different stages; the total is not an established criminal loss, and the figures do not mean Rs 10.68 billion was stolen or that officials were convicted of wrongdoing.

The Ministry of Physical Infrastructure and Transport accounted for roughly Rs 4.19 billion of the recorded unsettled amounts, followed by the Ministry of Energy, Water Resources and Irrigation at Rs 3.23 billion. Land Management, Cooperatives and Poverty Alleviation accounted for approximately Rs 1.32 billion; Urban Development for Rs 780 million; and Defence for around Rs 320 million. The figures are ministry-level accounting totals, not proof that each ministry lost the stated amount.

The audit covered transactions relating to appropriations, revenue, deposits and operational funds. The FCGO reported internal-audit work involving 3,985 offices, including federal government bodies and federal-authority transactions administered through provincial and local institutions. That does not mean the office conducted the separate legally mandated internal audits of every provincial and local government.

The FCGO attributed some increase in unresolved records to disruptions and damage to government property and accounting documents during unrest in the fiscal year, alongside procedural mistakes and administrative weaknesses. Those are the office's explanations, not independent findings that the disruptions caused each specific arrear.

The report also differs in scope from the Office of the Auditor General's external annual audit released earlier in 2026. Its totals should not be added to the external audit's arrears figures as though they measured distinct losses.

A useful next test of accountability will be the amount actually recovered, the overdue advances cleared, ministry-by-ministry reconciliations and the actions taken to address unsupported or improperly classified transactions. The present record supports the reported internal-audit totals and the need for follow-up, not allegations against any particular person or supplier.