_____________________________________NATIONAL HIGHWAY AUTHORITY (NHA)

EXECUTIVE SUMMARY

Roads Infrastructure plays an important role in the development of any country.

Established in 1991, National Highway Authority (NHA) is responsible for
developing, operating and maintaining the National Highway and Motorway
networks throughout Pakistan. To enhance Pakistan’s competitiveness in the
global market, to sustain the high economic growth achieved in recent years and to
make the country a hub of regional trade, NHA currently is developing a well
integrated network of Highways and Motorways. While planning the development
of roads, it also considers the well-being of individuals and businesses throughout
the country by improving reliability, quality and access of the highway network. I
had listened a lot about NHA from my friends who were already working there. In
fact, that was one of the reasons why I chose NHA for internship. Moreover, it
was easy for me to get internship over at NHA because of strong references over
there.

I started my internship with NHA from the first day of July 2009 till the last day of
August 2009. The environment there was quite new for me. Though it was not my
first exposure to the practical world as I had already done internship at Askari
Bank for 6 weeks yet the atmosphere over there was quite different from that of
private firms. My internship schedule was divided into 8 weeks, in which initial
weeks were for orientation to all of the departments and rest were spent at the
three main departments of the Finance Wing. During my whole internship, I tried
my best to put my all of the best energies and efforts to get fruitful results for the
two months time which I spent over there. And I think I was successful in
achieving my goals and objectives.
THANKS

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_____________________________________NATIONAL HIGHWAY AUTHORITY (NHA)

TABLE OF CONTENTS

Copy of Internship Letter……………………………………

Executive Summary……………………………………………
1. Introduction to National Highway Authority (NHA)…………
NHA Background ………………………………………
Objectives………………………………………………
Organizational Structure……………………………………
Services of NHA……………………………………
1.4.1. Services of Finance Wing……………………....................
1.4.2. Services of Budget & Accounts Department ……………
1.4.3. Services of Finance Department……………………………..
2. Learning & Experience………………………………….
2.1. Internship Duration & Rationale for Selection……………
2.2. Details of Training Department wise/ Task Performed…………
2.2.1. Task Performed (A)……………………………………..
2.2.2. Task Performed (B)………………………….
2.3. SWOT Analysis of NHA……………………………..
2.4. Recommendations…………………………
Conclusion……………………………………
References……………………………
Appendix…………………………………
Acknowledgements………………………
Personal Resume……………………………………………..

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1. INTRODUCTION – NATIONAL HIGHWAY AUTHORITY (NHA)

National Highway Authority (NHA) is responsible for developing, operating and

maintaining the National Highway and Motorway networks throughout Pakistan. To
enhance Pakistan’s competitiveness in the global market, to sustain the high economic
growth achieved in recent years and to make the country a hub of regional trade, NHA
currently is developing a well integrated network of Highways and Motorways. While
planning the development of roads, it also considers the well-being of individuals and
businesses throughout the country by improving reliability, quality and access of the
highway network.

1.1. NHA BACKGROUND

The National Highway Authority (NHA) was established in 1991, through an Act of the
Parliament, for planning, development, operation, repair and maintenance of National
Highways and Strategic Roads specially entrusted to NHA by the Federal Government or
by a Provincial Government or other authority concerned. NHA network is comprised of
11485 Kms which is only 4.4% of Pakistan’s total road network but carries 80% of the
country’s overall commercial traffic and thus is the backbone of the economic stability
and progress of Pakistan. The passenger traffic load in Pakistan is currently shared by
roads (90%), rail (8%) and air (2%). Dependence on road for freight traffic is 95%. The
country has about 7 million vehicles on road growing at 8% annually – projected to
increase to over 40 million by 2030. Transport sector currently accounts for 11% of the
GDP and over 16% of fixed investment. In short, the road sector has become the
backbone of Pakistan’s Transport sector and NHA plays a major role in the development
of road sector.

National Highway Authority (NHA) with the intent of successful execution of its large
contracts requires that works are awarded only to firms that are suitably experienced in
the road/bridge works, that are financially and managerially sound, and that can provide
all the equipment required in a timely manner. For this purpose, NHA carries out the

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annual assessment of the capacity of firms prior to being invited to participate in open
bidding for NHA Projects.

1.2. OBJECTIVES OF NHA:

Objectives of NHA can simply be said to construct and maintain the operations of
highways and motorways of Pakistan. These all tasks require a complete planning and
organizing tactics behind to implement, develop and operate the planned projects.
Moreover, once constructed, the repairing and maintaining of the completed projects is
also amongst the objectives of NHA. In short, we can say that NHA is committed for
improving the communication and transportation infrastructure of Pakistan to promote
trade and commerce in the country.

1.3. ORGANIZATIONAL STRUCTURE:

Head office of National Highway Authority is located in Islamabad, headed by a

Chairman. It is functionally divided into Planning, Administration, Finance, Operations
Wings headed by a Member each. As shown below:

CHAIRMAN

ADMINIST-
PLANNING FINANCE OPERATION
ATION
WING WING WING
WING

All Members are functional heads of their respective wings. They are assisted by General
Managers who are operational heads of wings. The head office controls the operation of
the Authority throughout the country. Six Regional offices, one in each provincial capital

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and one in Multan known as Punjab (South) and one at Abbotabad known as Northern
Areas are headed by Regional General Mangers. Many Project offices dealing with
individual major projects as are declared by the Chairman as “Self Accounting Projects”
are headed by Regional General Managers. The structure of Finance Wing is as follows:

Member Finance

GM (B&A) GM (Finance)

Director Director Director Director

Director Director (Accounts) Director
(Accounts-1) (Accounts-II) (Accounts-III) (Rev. Rec) Punjab- Construction (Finance)

DD DD DD DD DD DD DD
(Accounts) DD DD DD
(Accounts) (Accounts (Accounts) (Accounts) (Accounts DD (Accounts) DD
Regional Maint. (RAMD) (Accounts) (Accounts) (Finance)
(AP) (Est. & (Budget) (GOP) -III) Punj. Cons. (Finance)
Offices (06) M-1 NHIP
Vacant Coord) Vacant Vacant Vacant Vacant
01 vacant

AD
AD AD AD
AD AD (Accounts AD AD AD AD AD
(Accounts) AD (Accounts) AD (Finance)
DDO (Accounts) (Accounts) -III) (Accounts) (Accounts) (Accounts) (BK & C) (Accounts) AD (CPF)
Est. (Budget) Regional (RAMD.) Vacant
AP GOP Vacant Punj. Cont. M-1 NHIP (M-2)
Vacant Offices(06)

Supdt. Supdt.
Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt. Supdt.

IT Analyst (04) Accounting Specialist

(Under Director(Accounts)

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_____________________________________NATIONAL HIGHWAY AUTHORITY (NHA)

1.4. SERVICES OF NHA

In the light of above stated objectives of the authority, services of NHA can be divided
into two parts:

CONSTRUCTION WORKS
Construction works comprise of all new constructions whether of entirely new
works or of additions and alterations to existing works except as hereinafter
provided.

MAINTENANCE WORKS
Maintenance includes operations undertaken to maintain in proper condition the
completed projects of NHA.

But these basic services are delivered after complete planning at different wings of NHA.
According to my qualification i.e. MBA, I was placed in the Finance Wing of NHA. The
Finance Wing is headed by the Member Finance. In terms of the provisions of NHA Act
1991 (as amended in 2001), the Member (Finance) is also a Member of the NHA
Executive Board. Finance Wing deals with all finance, budget, revenue and accounts
related matters of NHA.

1.4.1. SERVICES OF THE FINANCE WING

Lets have a look at the core services being offered by the Finance Wing:
• Principal policy maker of all financial matters for efficient management of
Authority’s finances and financial system
• Preparation and supervision of Authority’s budget in consultation with other
Wings
• Budgetary controls and economic utilization of Authority’s funds
• Liaison with Ministry of Communication, Ministry of Finance, Planning Division
and Economic Affairs Division for all matters concerning NHA’s Finances,
Loans, Grants and Release of Funds.
• Co-ordination with donor agencies.

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• Evaluation and processing of all bids, proposals and expression of interest for
generation of funds.
• Management of Authority’s funds and non-funds accounts
• Evaluation of proposals for enlistment / pre-qualifications of banks and insurance
companies on the approved panel of Authority.
• Pre-audit / scrutiny of administratively approved cases in respect of PSDP,
maintenance and establishment claims of all nature before disbursement as well as
their bookkeeping and accounting
• Accounting of NHA’s own receipts
• Up-gradation of computerized accounting system with technological advancement
• Audit of NHA’s accounts from Auditor General of Pakistan and commercial
auditors
• Preparation of final accounts the Authority and submission of yearly financial
statements and audit reports to NHA executive board and NHA council for
approval.

1.4.2. SERVICES OF BUDGET AND ACCOUNTS DEPARTMENT

• Administration & Training of Finance Staff
• Preparation of all kind of Budgets
• Payment & Accounting of all expenses
• Payroll Processing/Establishment Accounting
• Co-ordination of Regional Accounts Offices & Self Accounting Units
• Audit Paras & Public Accounts Committee
• Co-ordination and Liaison with Ministries
• Maintenance of Books of Accounts & Audit of Financial Statements

1.4.3. SERVICES OF FINANCE DEPARTMENT

• Management of contributory provident fund account.
• Evaluation and interpretation of the clauses of contracts and agreements
having commercial and financial implications.

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• Dealing with financial aspects of BOT/PPP proposals, and private sector

financing proposals.
• Credibility evaluation of banks & insurance companies, insurance policies
bonds and guarantees.
• Evaluation of bids.
• Negotiating loans and funding proposals.
• Dealing with tax matters.
• Conduct review of NHA’s financial operations.
• Preparation of entity budget.
• Managing NHA fund and non fund accounts.
• Book keeping and preparation of accounts
• Maintenance of fixed assets records.
• Audit coordination.

2. LEARNING & EXPERIENCE:

2.1. Internship Duration and Rationale for Selection:

My internship at NHA was for 2 months (July-August 2008) because that was summer-
off from the Institution and was the best time to utilize it in a useful way. As far as the
question is concerned, why I chose NHA, the reasons are simple and logical. Like:
• I had a strong reference over there.
• I wanted to enjoy the working experience at a public sector organization because
prior to that I had done my first internship at Askari Bank (a private firm).
• NHA offers free pick & drop service for its employees.
• Along with my co-internee friend, I had some more friends there who were
already providing their services to NHA.
• At that time, I was of the opinion to choose Finance as my majors (which was
changed later on) and NHA was one of the best options to do internship.

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2.2. Details of Training (Department wise)

When I applied for the internship at NHA, a schedule was given to me by my mentor Mr.
Ahmed Hassan. This schedule was as follows:

Schedule of Internship Program

SECTION FROM TO

Budget 01st July, 2008 05h July, 2008

Revenue 07th July, 2008 12th July, 2008

Establishment 14th July, 2008 19th July, 2008

GOP 21st July, 2008 26th July, 2008

Aided Projects 28th July, 2008 02nd August, 2008

Computer Section (Finance) 04th August, 2008 09th August, 2008

Book-Keeping & Consolidation 11th August, 2008 16th August, 2008

DDO 18th August, 2008 23rd August, 2008

CP Fund 25th August, 2008 30th August, 2008

This schedule was circulated amongst all of the 8 departments, by addressing to the ADs
of the departments. A copy of this circular is attached at end of the report as annexure.

ORIENTATION:
In order to give me an introduction and overview of the organization, an orientation
session was described in the schedule. Due to the policies of the organization, only
orientation was designed for six departments of the Finance Wing i.e., Budget Section,
Revenue Section, Establishment, Computer Section, DDO Section and CP Fund Section.
However, my main internship work was scheduled at Government of Pakistan (GOP)
Section, Aided Projects (AP) Section and the Book-Keeping & Consolidation Section.
The explanation about this orientation and internship work is explained as under:

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ORIENTATION TO BUDGET SECTION:

During the orientation session at the Budget Section, I was told that the section is
responsible for preparing the budgets for the authority. This section estimates the
revenues and expenses for the financial year and makes budgets for the coming period.
These budgets can be categorized as development and non-development budgets. The
explanations of these budgets are as follows:

a. Development budget:
Development Budget (also known as Capital Budget) is made out of the funds granted
(on annual basis) by the Federal Government for development of roads. The amount for
this budget is determined on the basis of estimates made by Planning and Operations
Wings. After this, the data is compiled and sent to Chairman for the approval. If
approved, the budget estimates are sent to Ministry of Communication where Financial
Adviser examines the estimates. Before the budgets are finalized, a meeting is held which
is attended by the representatives of Planning & Development Division, Finance Division
and Economic Affairs Division. The estimates recommended by this committee are
discussed in APCC (Annual Plan Coordination Committee) meeting which is chaired by
the Prime Minister of Pakistan. Finally, these estimates are submitted in the Parliament
for approval.

b. Non-Development Budget:
Non-Development Budget can be further categorized into these two subcategories:
1. Maintenance Budget
2. Establishment Budget

Maintenance Budget:
This is the budget which is required for the maintenance of existing completed
highways and motorways, constructed by NHA. Maintenance Directorate of NHA
is requested to prepare Budget estimates and submit it to NHA budget section of
Finance Wing. Budget section compiles the estimates and submits the same to
Ministry of Communication (MOC). After due consideration in MOC, the same is
forwarded to Ministry of Finance (MOF) for approval. Finance Division allocates

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the funds for maintenance grant and MOC releases these funds to NHA on
quarterly basis.

Establishment Budget:
Administration Wing of NHA is requested to provide details of 252 core posts of
NHA upon the request of Budget Section. Budget section prepares and compiles
the budget estimates for the posts and submits it to MOC and the same is
forwarded to MOF for approval. Finance Division allocates the funds for the
establishment charges under MOC 252 core posts. Again MOC releases these
funds to NHA on quarterly basis.

ORIENTATION TO REVENUE SECTION:

The second week of my internship was scheduled for the The main function of revenue
section is to collect revenue for the NHA. In addition, it makes payments for repair &
maintenance of roads as per maintenance plan devised by Road Assets Management
Directorate (RAMD).

This section is divided into two sub-sections:-

1. Receipts Section
2. Payment Section

Receipts Section:
This section is responsible to collect revenues. The main sources of revenue generation
are:
• Toll Receipts
• Weigh Station Fees
• Right of Way (RoW) Receipts
• Rent from Hotels, Petrol/CNG Stations
• Hoardings and Advertisements
• Any other receipts from Row
• Sale proceeds of NHA Assets

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• Tender Documents Fees

• Rates, Fees and Taxes
• Police Fines
• Miscellaneous Receipts
NHA collects these revenues through contractors. The main contractors are National
Logistic Corporation (NLC) and Frontier Works Organization (FWO) etc. Every
collector is required to send monthly MIS reports regarding the traffic counts and toll
collection data to the Revenue Section. Contractors deposit receipts on daily basis into
prescribed bank accounts and transfer to NHA main account “Road Maintenance
Account (RMA)” on weekly, monthly, quarterly basis as per contract and intimate to
Revenue section. The section processes the information, takes into accounts and forwards
such information to Drawing & Disbursing Officer for booking the receipts and its
confirmation from banks. The section reconciles the data and requests the contractor for
balance amounts if there is difference between monthly MIS reports and actual receipts.

Payment Section:
This section is responsible to make all payments relating to maintenance of road. It
makes payments for routine maintenance, periodic maintenance, emergency maintenance
and Geometric maintenance. The section makes arrangements for Mobilization Advance,
Secured Advance, Interim Payments Certificate (IPC) and final payment to contractors
and consultants as per contract. Funds are also transferred to Regional Offices on their
demand, according to their shares, for maintenance of roads.

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