Himal Hub / An audit by the Office of the Auditor General has found financial irregularities at the Film Development Board, indicating misuse of state funds. According to the report, the board is required to recover Rs 4.031 million following discrepancies identified during the audit process.
The audit noted that allowances were distributed in the names of various individuals without proper documentation, while some expenses were made without bills or receipts. It also found instances of overpayment to employees and workers beyond approved rates, as well as payments made for more days than specified in contracts. In several cases, tax deductions were not applied, the report further stated.
Following directives from the Office of the Auditor General, employees at the Film Development Board have reportedly been rushing to “adjust” and reconcile bills, according to sources. The audit body had flagged irregularities and ordered recovery of funds, prompting internal efforts to regularize questionable expenses.
Sources also said the board has been hiring staff without approved positions and paying salaries and allowances without proper authorization. The Auditor General’s office has directed the board to either formalize or remove such positions, while also recommending staff reduction and structural reforms. Employees are largely on contract, with only a small number appointed through the Public Service Commission, and many reportedly appointed through political influence over time.
Film industry stakeholders allege that several employees remain in positions without delivering meaningful work, with complaints of inefficiency, delays, and lack of accountability. Some filmmakers claim that appointments in the board have often been influenced by outgoing chairpersons attempting to place close associates in official roles.
Allegations have also emerged that non-staff individuals exercise significant influence within the board, with claims of commission-based practices in awards distribution and other activities. Despite having sufficient internal staff, external individuals are often assigned tasks ranging from technical work to event coordination. Board spokesperson Santosh Lohani defended the practice, stating that external experts are engaged when in-house expertise is lacking. However, concerns persist over irregular financial practices, including post-facto contracts and backdated billing, according to a staff member speaking on condition of anonymity.
