The Karnataka government did not close the 78 personal deposit (PD) accounts with an unspent balance of ₹4,105.61 crore by the end of last fiscal as mandated under the Karnataka Financial Code, the Comptroller and Auditor General (CAG) has said.

In its audit of the financial accounts of the government, the CAG said such practices were not only violative of the legislative intent but also give room for misuse of public funds.

“At the end of March 31, 2022 there were 78 PD accounts with an unspent balance of ₹4,105.61 crore, which were not closed as required under Article 286A of the Karnataka Financial Code. Such practices violate legislative intent, which is to ensure that funds approved by the State government for the financial year concerned are spent during the year itself,” the report said.

“Further, not transferring the unspent balance lying in the PD accounts to the Consolidated Fund of the State before the closure of the financial year entails the risks of misuse of public funds, fraud and misappropriation,” the CAG added.