Tandag City 2008 COA Audit 14

July 2, 2010

14. Purchase and issuance of cellcards to officials or employees, was not properly regulated as there is no clear-cut guidelines that defines the limitation and availment of the same.
Our review on the accounts and operations of the City government noted  total purchases of cellcards in the amount of P183,925.38 (Annex H). It was further noted that:
1. Purchases of cell cards in bulk procurement process were not supported by list of recipient duly acknowledged by the end user;
2. There is no well define guidelines on the issuances and utilization of the same;
3. Charges to appropriation is either other maintenance and operating expenses or supplies and  not telephone expense-mobile;
4. Accounting entries were directly charge to expense account.
The use of cell cards cannot be easily identified whether personal or official in nature. In the Sangguniang Resolution No. 140 series of 2005, the SB  considered “a request for appropriation on telephone expense – mobile of the auditor’s office to be unnecessary and extravagant expense and that it could be easily abused.”  However, it was concurred by this commission to be allowable in audit, provided that the declared policy of the state that all resources must be managed, expended or utilized in accordance with law and regulation, and safeguarded against loss or wastage through illegal or improper disposition must be faithfully adhered to.
Hence, to properly regulate the use of the same, a well defined authority must be issued to avoid wastage of public funds.  Likewise, the necessity and reasonableness of the amount must be taken into consideration.  Charges of the same must be limited to telephone expense – mobile account.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Advise the Sangguniang Panlungsod to prepare a well-defined guidelines in the availment and limitation of cellcards taking into consideration the nature of their work assignment for the approval of the Local Chief Executive. Advise the City Budget Officer & City Accountant to limit charges for the purchase of cell-cards to telephone expense mobile account appropriation only.

14. Purchase and issuance of cellcards to officials or employees, was not properly regulated as there is no clear-cut guidelines that defines the limitation and availment of the same.    Our review on the accounts and operations of the City government noted  total purchases of cellcards in the amount of P183,925.38 (Annex H). It was further noted that:1. Purchases of cell cards in bulk procurement process were not supported by list of recipient duly acknowledged by the end user;2. There is no well define guidelines on the issuances and utilization of the same;3. Charges to appropriation is either other maintenance and operating expenses or supplies and  not telephone expense-mobile;4. Accounting entries were directly charge to expense account.    The use of cell cards cannot be easily identified whether personal or official in nature. In the Sangguniang Resolution No. 140 series of 2005, the SB  considered “a request for appropriation on telephone expense – mobile of the auditor’s office to be unnecessary and extravagant expense and that it could be easily abused.”  However, it was concurred by this commission to be allowable in audit, provided that the declared policy of the state that all resources must be managed, expended or utilized in accordance with law and regulation, and safeguarded against loss or wastage through illegal or improper disposition must be faithfully adhered to.    Hence, to properly regulate the use of the same, a well defined authority must be issued to avoid wastage of public funds.  Likewise, the necessity and reasonableness of the amount must be taken into consideration.  Charges of the same must be limited to telephone expense – mobile account.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Advise the Sangguniang Panlungsod to prepare a well-defined guidelines in the availment and limitation of cellcards taking into consideration the nature of their work assignment for the approval of the Local Chief Executive. Advise the City Budget Officer & City Accountant to limit charges for the purchase of cell-cards to telephone expense mobile account appropriation only.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 13

July 2, 2010

13. The reasonableness of the contract cost of infrastructure projects in the amount of P34,625,473.50 cannot be ascertained due to the failure of the City Engineer’s Office to submit copies of the contract within five days after its perfection as mandated under the provisions of COA Cir. No. 82-195 dated October 26, 1982.
Our review of the operations of the City government noted that a number of projects were implemented thru contracts having a total cost of P34,625,473.50 (Annex F) funded out by local funds and trust funds received from the national government. Although these projects were reported completed there were no contracts submitted to this office despite the verbal demands from that office.
Provision of Section 5.1 of COA Circular No. 82-195 states:
“Review of Contracts for Infrastructure and other construction projects, variations orders, extra works, supplemental contracts and purchase/letter orders. All contracts purchase/letter orders, together with their supporting documents shall be submitted to the COA within five days after the perfection thereof.” (underscoring supplies)
The failure to submit the required documents to the office of the auditor, precluded us from conducting a technical review and cost evaluation that would determine the reasonableness of the contract cost. Likewise, technical inspection reports were deferred pending submission of the contract documents.  Payments to these transactions were suspended in audit. The City Engineer assured us to comply with our Recommendation for Tandag City Government:, but due to manpower constraint in his office, coupled with so many projects to be implemented it always takes time for him to comply with the document required.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Require the concerned official to submit the complete set of documents to the Auditor’s Office within five days after its perfection for any contracts entered into by and between the City government as mandated under COA Circular No. 82-195, to facilitate contract review and technical evaluation.

13. The reasonableness of the contract cost of infrastructure projects in the amount of P34,625,473.50 cannot be ascertained due to the failure of the City Engineer’s Office to submit copies of the contract within five days after its perfection as mandated under the provisions of COA Cir. No. 82-195 dated October 26, 1982.       Our review of the operations of the City government noted that a number of projects were implemented thru contracts having a total cost of P34,625,473.50 (Annex F) funded out by local funds and trust funds received from the national government. Although these projects were reported completed there were no contracts submitted to this office despite the verbal demands from that office.Provision of Section 5.1 of COA Circular No. 82-195 states:“Review of Contracts for Infrastructure and other construction projects, variations orders, extra works, supplemental contracts and purchase/letter orders. All contracts purchase/letter orders, together with their supporting documents shall be submitted to the COA within five days after the perfection thereof.” (underscoring supplies)       The failure to submit the required documents to the office of the auditor, precluded us from conducting a technical review and cost evaluation that would determine the reasonableness of the contract cost. Likewise, technical inspection reports were deferred pending submission of the contract documents.  Payments to these transactions were suspended in audit. The City Engineer assured us to comply with our Recommendation for Tandag City Government:, but due to manpower constraint in his office, coupled with so many projects to be implemented it always takes time for him to comply with the document required.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Require the concerned official to submit the complete set of documents to the Auditor’s Office within five days after its perfection for any contracts entered into by and between the City government as mandated under COA Circular No. 82-195, to facilitate contract review and technical evaluation.

Written by rage · Filed Under Tandag City · 2 Comments 

Tandag City 2008 COA Audit 12

July 2, 2010

12. The regularity, transparency and economy in the utilization of fuel amounting to P1,773,853.56 cannot be  ascertained due to the failure to prepare Monthly Report of Fuel Consumption of government motor transportation as mandated under COA Circular No. 77-61.
Verifications of the accounts of the City government showed that one of voluminous goods being purchased is the fuel & oil that is being used in the different projects & by the equipment, services and motor vehicles of the local government.  It was further noted, that the Municipal Engineer failed to support a fuel consumption report to ascertain the regulated consumption of fuel. A total of P1,773,853.56  (Annex E)  were purchased during the year, that were not supported with either fuel consumption report and/or duly approved trip ticket.
COA Circular No. 77-61 provides:
“F. Fuel consumption of motor transportation shall be properly controlled and accounted for through approval requisition and issue voucher or its equivalent..
G. Monthly report of fuel consumption of government motor  transportation shall be submitted to the Auditor within the first ten days of the succeeding month by the chief general service division of its equivalent.”
The existing condition precluded us in making an analysis of the regulated consumption of fuel.  Our observation was communicated to the management through issuance of Audit Observation  Memorandum No. 2009-12 dated  February 9,  2009.  The  City  Engineer,  kept  on
saying he is on the process of preparing the report. However, as of this writing no report was submitted to this office, despite the previous year’s Recommendation for Tandag City Government:. These transaction had been suspended in audit for every payment made. During the exit conference the City Mayor, instructed the City Engineer to support the purchases of fuel with fuel consumption report.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Advise the City Engineer to  support a fuel consumption report for every payment made for the purchases of fuel and/or submit a monthly fuel consumption report with Requisition and Issue Voucher or Withdrawal Slip duly approved by the Local Chief Executive or his authorized representative to support every withdrawal, as mandated under COA Circular No. 77-61.

12. The regularity, transparency and economy in the utilization of fuel amounting to P1,773,853.56 cannot be  ascertained due to the failure to prepare Monthly Report of Fuel Consumption of government motor transportation as mandated under COA Circular No. 77-61.       Verifications of the accounts of the City government showed that one of voluminous goods being purchased is the fuel & oil that is being used in the different projects & by the equipment, services and motor vehicles of the local government.  It was further noted, that the Municipal Engineer failed to support a fuel consumption report to ascertain the regulated consumption of fuel. A total of P1,773,853.56  (Annex E)  were purchased during the year, that were not supported with either fuel consumption report and/or duly approved trip ticket.       COA Circular No. 77-61 provides: “F. Fuel consumption of motor transportation shall be properly controlled and accounted for through approval requisition and issue voucher or its equivalent..G. Monthly report of fuel consumption of government motor  transportation shall be submitted to the Auditor within the first ten days of the succeeding month by the chief general service division of its equivalent.”       The existing condition precluded us in making an analysis of the regulated consumption of fuel.  Our observation was communicated to the management through issuance of Audit Observation  Memorandum No. 2009-12 dated  February 9,  2009.  The  City  Engineer,  kept  onsaying he is on the process of preparing the report. However, as of this writing no report was submitted to this office, despite the previous year’s Recommendation for Tandag City Government:. These transaction had been suspended in audit for every payment made. During the exit conference the City Mayor, instructed the City Engineer to support the purchases of fuel with fuel consumption report.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:        Advise the City Engineer to  support a fuel consumption report for every payment made for the purchases of fuel and/or submit a monthly fuel consumption report with Requisition and Issue Voucher or Withdrawal Slip duly approved by the Local Chief Executive or his authorized representative to support every withdrawal, as mandated under COA Circular No. 77-61.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 11

July 2, 2010

11. Purchase of supplies and materials were not accounted using perpetual Inventory System, moving average method, as mandated under  Section 114 of the NGAS.
Our review on the accounts and operations of the City Government revealed that purchases of supplies and materials were recorded at cost and were not course through inventory account, as mandated under Section 114 of NGAS which provides:
“Purchase of supplies and materials for stock regardless of whether or not they are consumed within the accounting period shall be recorded as inventory following perpetual inventory method.”
Verification of the accounts showed that regular purchases of supplies and materials were not coursed through inventory account. It was rather  accounted as supply expense for every payment made.
The management was informed with our observation through issuance of Audit Observation Memorandum No. 2008-15 dated September 6, 2008. The City Accountant  in his management comment, stressed that  due to manpower constraint of his office, coupled by a change in job assignment due to the conversion of the Municipality to a City Government, he was unable to implement this method of accounting of inventory valuation. He stressed further, that most of the supplies were purchased through cash advances and/or reimbursement basis and it only reached his office, after it had been consummated. He assured us however to implement our Recommendation for Tandag City Government:.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Advise the City Accountant to maintain supplies & materials ledger cards and course through the purchases of goods to inventory account. Likewise, advise the General Services Officer to maintain supplies and materials stock cards, so that valuation of inventory following perpetual inventory system using moving average method will be facilitated.

11. Purchase of supplies and materials were not accounted using perpetual Inventory System, moving average method, as mandated under  Section 114 of the NGAS.       Our review on the accounts and operations of the City Government revealed that purchases of supplies and materials were recorded at cost and were not course through inventory account, as mandated under Section 114 of NGAS which provides:“Purchase of supplies and materials for stock regardless of whether or not they are consumed within the accounting period shall be recorded as inventory following perpetual inventory method.”       Verification of the accounts showed that regular purchases of supplies and materials were not coursed through inventory account. It was rather  accounted as supply expense for every payment made.       The management was informed with our observation through issuance of Audit Observation Memorandum No. 2008-15 dated September 6, 2008. The City Accountant  in his management comment, stressed that  due to manpower constraint of his office, coupled by a change in job assignment due to the conversion of the Municipality to a City Government, he was unable to implement this method of accounting of inventory valuation. He stressed further, that most of the supplies were purchased through cash advances and/or reimbursement basis and it only reached his office, after it had been consummated. He assured us however to implement our Recommendation for Tandag City Government:.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Advise the City Accountant to maintain supplies & materials ledger cards and course through the purchases of goods to inventory account. Likewise, advise the General Services Officer to maintain supplies and materials stock cards, so that valuation of inventory following perpetual inventory system using moving average method will be facilitated.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 10

July 2, 2010

10. Purchases of goods were done thru cash advances and/or reimbursement basis contrary to the government procurement reform act.
Our post audit of the accounts noted that most of the purchases of goods were made thru cash advances by some officials and employees of the City. A total of P5,800,255.92
Annex  D) were cash advances drawn and granted for the purchase of goods.
Republic Act 9184 provides that procurement of goods and services should be done on a competitive bidding. Moreover, purchase out of cash advance is not an authorized alternative mode of procurement. Thus regularity, transparency, economy, efficiency, and effectiveness in the procurement process cannot be ascertained.
The existing condition is not only a violation of the above cited provisions but also deprived the government of an additional income that can be derived from the suppliers in terms of Value Added Tax  that can be deducted by the government upon payment as mandated.
Section 9, withholding of creditable Value Added Tax (VAT), Section 4-110-3 of Revenue Regulation No. 7-95 is hereby amended and quoted hereunder:
“The government any its political government owned and/or controlled corporations (GOCCs) shall, before making payment on accounts of its purchase of goods from sellers and/or services rendered by contractors which are subjects to the VAT impose in Section 100 and 102 of the Code, deduct and withhold the VAT due at the rate of three percent  (3%) of the gross  payment  for  the purchase of goods and six percent (6%) on the gross receipts for the services rendered by contractors on every sale or installment payment which shall be creditable against the VAT liability of the sellers or contractors pursuant to RA No. 7644, as implemented by Revenue Regulation No. 10-93: Provided, the payment of One Thousand Pesos (P1,000.00) and below per purchase shall not subject to withholding tax.”
AOM No. 2009-13 dated February 9, 2009, was issued to reiterate our observations in the 2007 Annual Audit Report.
Management acknowledged our observation and  justified that the urgency of the need for some supplies which were not available in the locality, resorted to that practice. They justified further that in the middle part of the year 2008, prices of commodities are not stable, and that there are suppliers who will no longer receive their purchase orders served after they had undergone the process  due to inflation. Hence, they were forced to draw cash advances in order not to hamper the need for supplies.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Stop the practice of procuring goods out of cash advances and/or reimbursement basis, so that the amount of tax due to the government can be withheld as mandated in the Revenue Regulations. Strictly adhere to the provisions of RA 9184 on the procurement of goods.

10. Purchases of goods were done thru cash advances and/or reimbursement basis contrary to the government procurement reform act.       Our post audit of the accounts noted that most of the purchases of goods were made thru cash advances by some officials and employees of the City. A total of P5,800,255.92Annex  D) were cash advances drawn and granted for the purchase of goods.       Republic Act 9184 provides that procurement of goods and services should be done on a competitive bidding. Moreover, purchase out of cash advance is not an authorized alternative mode of procurement. Thus regularity, transparency, economy, efficiency, and effectiveness in the procurement process cannot be ascertained.       The existing condition is not only a violation of the above cited provisions but also deprived the government of an additional income that can be derived from the suppliers in terms of Value Added Tax  that can be deducted by the government upon payment as mandated.       Section 9, withholding of creditable Value Added Tax (VAT), Section 4-110-3 of Revenue Regulation No. 7-95 is hereby amended and quoted hereunder:“The government any its political government owned and/or controlled corporations (GOCCs) shall, before making payment on accounts of its purchase of goods from sellers and/or services rendered by contractors which are subjects to the VAT impose in Section 100 and 102 of the Code, deduct and withhold the VAT due at the rate of three percent  (3%) of the gross  payment  for  the purchase of goods and six percent (6%) on the gross receipts for the services rendered by contractors on every sale or installment payment which shall be creditable against the VAT liability of the sellers or contractors pursuant to RA No. 7644, as implemented by Revenue Regulation No. 10-93: Provided, the payment of One Thousand Pesos (P1,000.00) and below per purchase shall not subject to withholding tax.”       AOM No. 2009-13 dated February 9, 2009, was issued to reiterate our observations in the 2007 Annual Audit Report.       Management acknowledged our observation and  justified that the urgency of the need for some supplies which were not available in the locality, resorted to that practice. They justified further that in the middle part of the year 2008, prices of commodities are not stable, and that there are suppliers who will no longer receive their purchase orders served after they had undergone the process  due to inflation. Hence, they were forced to draw cash advances in order not to hamper the need for supplies.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Stop the practice of procuring goods out of cash advances and/or reimbursement basis, so that the amount of tax due to the government can be withheld as mandated in the Revenue Regulations. Strictly adhere to the provisions of RA 9184 on the procurement of goods.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 9

July 2, 2010

9. Some officials/employees on official travel took the Mabuhay Class of transportation contrary to Section 40 of GAAM Volume 1.
Our post audit on the accounts of the City government particularly on the liquidation of cash advance and / or reimbursement for travel noted that some officials of the city government availed of the Mabuhay class of transportation.  The existing condition contravene Section  340 of  the Government Accounting and Auditing Manual which provides:
“a. The department head, or equivalent position shall determine the mode and class of transportation to be taken which shall be the most advantageous to the  government from the standpoint of economy and efficiency.
b. As a general rule, only the ordinary  public conveyances or customary modes of  transportation shall be used. xxx”
As observed, the fare from the ordinary prevailing rate of transportation is almost doubled when taking up the mabuhay class. Thus, economy and efficiency in the use of public fund is being sacrificed.
AOM No. 2009-007 dated February 4, 2009 was issued for the information of the management. The City Vice-Mayor had informed us, that she had already called the attention of that employee and assured us not to authorize again anybody from her office to take the Mabuhay Class of transportation while on official travel. The honorable City Mayor also gave the same comment.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Limit the authority to travel of officials and employees to the ordinary mode of transportation taking into consideration the standpoint of economy and efficiency as provided under Section 40 of GAAM Volume 1.

9. Some officials/employees on official travel took the Mabuhay Class of transportation contrary to Section 40 of GAAM Volume 1.      Our post audit on the accounts of the City government particularly on the liquidation of cash advance and / or reimbursement for travel noted that some officials of the city government availed of the Mabuhay class of transportation.  The existing condition contravene Section  340 of  the Government Accounting and Auditing Manual which provides:“a. The department head, or equivalent position shall determine the mode and class of transportation to be taken which shall be the most advantageous to the  government from the standpoint of economy and efficiency.b. As a general rule, only the ordinary  public conveyances or customary modes of  transportation shall be used. xxx”      As observed, the fare from the ordinary prevailing rate of transportation is almost doubled when taking up the mabuhay class. Thus, economy and efficiency in the use of public fund is being sacrificed.       AOM No. 2009-007 dated February 4, 2009 was issued for the information of the management. The City Vice-Mayor had informed us, that she had already called the attention of that employee and assured us not to authorize again anybody from her office to take the Mabuhay Class of transportation while on official travel. The honorable City Mayor also gave the same comment.  RECOMMENDATION FOR TANDAG CITY GOVERNMENT:        Limit the authority to travel of officials and employees to the ordinary mode of transportation taking into consideration the standpoint of economy and efficiency as provided under Section 40 of GAAM Volume 1.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 8

July 2, 2010

8. Employees and officials monthly net take home pay fall below the mandatory amount of  P3,000.00 as mandated under Section 36 of RA 9206.
Section 36 of Republic Act No. 9206, otherwise known as the General Appropriation Act of 2003 which was re-enacted, provides:
“Deductions from salaries, emoluments or other benefit accruing to any government employees chargeable against the personal services appropriation for the payment of obligation…provided, that such deductions shall not reduce the employees monthly take home pay to an amount lower that three thousand pesos (P3,000.00) after all authorized deduction.”
Post-audit of payrolls of the City employees disclosed that some employees and officials of the City have monthly take home pay of less than P3,000.00.
It was observed that aside from the authorized deductions due the GSIS and other government financial institutions, management catered monthly loans repayment to private banks and cooperative, thereby reducing the employees net take home pay below the amount of P3,000.00.
Audit Observation Memorandum No. 2009-006 was issued to inform the management of our observation.
The City Accountant explained that due to the memorandum agreement entered into by and between the City and the private lending institution, he is forced to withheld the amount due. On the other hand the City Mayor and  Vice-Mayor explained that for humanitarian reasons, and due to the present economic condition that the employees are facing, they were forced to enter into agreement with these financial institutions for the employee to avail of immediate cash at a very minimal interest expense. They assured us however, to implement our Recommendation for Tandag City Government: gradually.
We recognized the noble intention of the management, however, we cannot ignore the existing rules and regulations involving public fund.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Instruct the City Accountant to closely monitor the net take home pay of employees availing additional loans not to go lower than the mandatory amount of P3,000.00.  Refrain deducting from the payroll unauthorized monthly payment of loans,  from private firms and institutions.

8. Employees and officials monthly net take home pay fall below the mandatory amount of  P3,000.00 as mandated under Section 36 of RA 9206.       Section 36 of Republic Act No. 9206, otherwise known as the General Appropriation Act of 2003 which was re-enacted, provides:“Deductions from salaries, emoluments or other benefit accruing to any government employees chargeable against the personal services appropriation for the payment of obligation…provided, that such deductions shall not reduce the employees monthly take home pay to an amount lower that three thousand pesos (P3,000.00) after all authorized deduction.”       Post-audit of payrolls of the City employees disclosed that some employees and officials of the City have monthly take home pay of less than P3,000.00.       It was observed that aside from the authorized deductions due the GSIS and other government financial institutions, management catered monthly loans repayment to private banks and cooperative, thereby reducing the employees net take home pay below the amount of P3,000.00.       Audit Observation Memorandum No. 2009-006 was issued to inform the management of our observation.       The City Accountant explained that due to the memorandum agreement entered into by and between the City and the private lending institution, he is forced to withheld the amount due. On the other hand the City Mayor and  Vice-Mayor explained that for humanitarian reasons, and due to the present economic condition that the employees are facing, they were forced to enter into agreement with these financial institutions for the employee to avail of immediate cash at a very minimal interest expense. They assured us however, to implement our Recommendation for Tandag City Government: gradually.       We recognized the noble intention of the management, however, we cannot ignore the existing rules and regulations involving public fund.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Instruct the City Accountant to closely monitor the net take home pay of employees availing additional loans not to go lower than the mandatory amount of P3,000.00.  Refrain deducting from the payroll unauthorized monthly payment of loans,  from private firms and institutions.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 7

July 2, 2010

7. Government vehicles without the prescribe marking of “For Official Use Only” with the name or logo of the City Government contravene Joint Circular No. 1 dated September 3, 1991 of the COA and DBM.
Joint Circular No. 1 dated September 3, 1991 of the Commission on Audit (COA) and the Department of Budget and Management (DBM), provides:
“No government funds  shall be utilized to provide fuel, spare parts, repair and maintenance to any government vehicles which is not permanently marked “For Official Use Only” with the name or logo of the agency not otherwise properly identified as government vehicle and does not carry the official government plate number, except official vehicles assigned to the President, Vice President, Senate President, Speaker of the House of Representatives and Chief Justice of Supreme Court and those by personnel performing functions.”
In the post audit of disbursement vouchers, it was observed that there were purchases/reimbursement of spare parts and other expenses for the maintenance of City Government Vehicles even without the prescribed marked of “For Official Use Only” with the name or logo of the  City Government on each side of said vehicles/motors.
For the year under review, the  City Government had purchased additional eight service vehicles and a number of motorcycles. These service vehicles and motorcycles in addition to those existing  were not marked with “For Official Use Only” with name or logo of the City Government.
The aforementioned violation of the Joint Circular of COA and DBM exposed  government vehicles without proper identification to personal use of government officials and/or employees issued with the unit.
Audit Observation Memorandum No. 2008-016 dated September 6, 2008 was issued to the management informing them that disbursements for maintenance of these government vehicles will be disallowed in audit if the above-cited provisions will not be complied with. The City Accountant in his management comment, acknowledged our observation and explained that the recently purchased vehicles were distributed immediately to different department heads who were very eager to use the newly acquired vehicle. During our exit conference, management acknowledge our observation and assured us to implement our Recommendation for Tandag City Government:. The City Mayor and the City Vice-Mayor jokingly informed us that with the present status of the LGU, their Logo is not yet finalize, as to their category of either a City or Municipality.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Initiate proper markings of government service vehicles owned by the City Government with “For Official Use Only” with the name or logo of the City, otherwise disbursements on maintenance of these government vehicles be disallowed in audit.

7. Government vehicles without the prescribe marking of “For Official Use Only” with the name or logo of the City Government contravene Joint Circular No. 1 dated September 3, 1991 of the COA and DBM.       Joint Circular No. 1 dated September 3, 1991 of the Commission on Audit (COA) and the Department of Budget and Management (DBM), provides:“No government funds  shall be utilized to provide fuel, spare parts, repair and maintenance to any government vehicles which is not permanently marked “For Official Use Only” with the name or logo of the agency not otherwise properly identified as government vehicle and does not carry the official government plate number, except official vehicles assigned to the President, Vice President, Senate President, Speaker of the House of Representatives and Chief Justice of Supreme Court and those by personnel performing functions.”       In the post audit of disbursement vouchers, it was observed that there were purchases/reimbursement of spare parts and other expenses for the maintenance of City Government Vehicles even without the prescribed marked of “For Official Use Only” with the name or logo of the  City Government on each side of said vehicles/motors.       For the year under review, the  City Government had purchased additional eight service vehicles and a number of motorcycles. These service vehicles and motorcycles in addition to those existing  were not marked with “For Official Use Only” with name or logo of the City Government.       The aforementioned violation of the Joint Circular of COA and DBM exposed  government vehicles without proper identification to personal use of government officials and/or employees issued with the unit.       Audit Observation Memorandum No. 2008-016 dated September 6, 2008 was issued to the management informing them that disbursements for maintenance of these government vehicles will be disallowed in audit if the above-cited provisions will not be complied with. The City Accountant in his management comment, acknowledged our observation and explained that the recently purchased vehicles were distributed immediately to different department heads who were very eager to use the newly acquired vehicle. During our exit conference, management acknowledge our observation and assured us to implement our Recommendation for Tandag City Government:. The City Mayor and the City Vice-Mayor jokingly informed us that with the present status of the LGU, their Logo is not yet finalize, as to their category of either a City or Municipality.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Initiate proper markings of government service vehicles owned by the City Government with “For Official Use Only” with the name or logo of the City, otherwise disbursements on maintenance of these government vehicles be disallowed in audit.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 6

July 2, 2010

6. Prior years expenditures totaling P263,310.00 were paid out of current year’s budget contrary to Section 350 0f RA 7160.
Our post audit of the accounts of the City Government of Tandag for the months of January and February 2008 noted that expenses in the total mount of P263,310.00 (Annex C) for prior year were charged against the  current year’s budget. This obligation were not booked up  as payable of PY’s but rather as current operating expenses. The existing condition does not only overstate the current expenses but also a direct violation of Section 350 of RA 7160, which provides:
“Accounting for obligation-All lawful expenditures and obligations incurred during a fiscal year shall be taken up in the accounts of that year.”
Management was informed of our observation through issuance of AOM No. 2008-017 dated September 28, 2008. The City Accountant justified that these expenses were PY’s billings that were received only during the year. The schedule in Annex C will disprove that justification.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Advise the City Accountant and the City Budget Officer to limit charges to current years appropriation with the expenses of current year only pursuant to Section 350 of RA 7160.

6. Prior years expenditures totaling P263,310.00 were paid out of current year’s budget contrary to Section 350 0f RA 7160.       Our post audit of the accounts of the City Government of Tandag for the months of January and February 2008 noted that expenses in the total mount of P263,310.00 (Annex C) for prior year were charged against the  current year’s budget. This obligation were not booked up  as payable of PY’s but rather as current operating expenses. The existing condition does not only overstate the current expenses but also a direct violation of Section 350 of RA 7160, which provides:“Accounting for obligation-All lawful expenditures and obligations incurred during a fiscal year shall be taken up in the accounts of that year.”       Management was informed of our observation through issuance of AOM No. 2008-017 dated September 28, 2008. The City Accountant justified that these expenses were PY’s billings that were received only during the year. The schedule in Annex C will disprove that justification.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Advise the City Accountant and the City Budget Officer to limit charges to current years appropriation with the expenses of current year only pursuant to Section 350 of RA 7160.

Written by rage · Filed Under Tandag City · Leave a Comment 

Tandag City 2008 COA Audit 5

July 2, 2010

5. Some accountable officers of the City Government are inadequately bonded as compared against the maximum average cash accountability for cash advances drawn as required under Section 305 (f) of RA 7160.
Section 305 (f) of Republic Act No. 7160, otherwise known as the Local Government Code of 1991  provides:
“ (f) Every officer of the local government unit whose duties permit or require the possession or custody of local funds shall be properly bonded and such officer shall be accountable and responsible for said funds and for the safekeeping thereof in conformity with the provision of the law.”
Our review of the accounts and operations of the City Government noted, that many of the special undertakings were done through cash advance basis, due to lack of material time if done through the routinary procedures. Further verifications disclosed that most of the special disbursing officers designated for the special endeavor, were inadequately bonded as compared against the cash advances granted to them.
The existing condition exposed public fund to the risk of unnecessary losses that may not be recovered due to inadequate bond of the accountable officer.
Audit Observation Memorandum No. 2008-12 dated September 6, 2008 was issued for the information of the management. During our exit conference, the City Treasurer informed us that his appropriation for payment of premium is just minimal hence, there was no increase in the amount of bond of his personnel. He assured us however, that for the renewal of this year’s bond, they will increase the amount of bond of the accountable officers corresponding to their average maximum accountability.
RECOMMENDATION FOR TANDAG CITY GOVERNMENT:
Advise the City Treasurer to monitor the amount of bond and the corresponding accountability covered by the accountable officers. In the event that there is a discrepancy, please advise that official to apply for additional bond.

5. Some accountable officers of the City Government are inadequately bonded as compared against the maximum average cash accountability for cash advances drawn as required under Section 305 (f) of RA 7160.       Section 305 (f) of Republic Act No. 7160, otherwise known as the Local Government Code of 1991  provides:“ (f) Every officer of the local government unit whose duties permit or require the possession or custody of local funds shall be properly bonded and such officer shall be accountable and responsible for said funds and for the safekeeping thereof in conformity with the provision of the law.”       Our review of the accounts and operations of the City Government noted, that many of the special undertakings were done through cash advance basis, due to lack of material time if done through the routinary procedures. Further verifications disclosed that most of the special disbursing officers designated for the special endeavor, were inadequately bonded as compared against the cash advances granted to them.       The existing condition exposed public fund to the risk of unnecessary losses that may not be recovered due to inadequate bond of the accountable officer.       Audit Observation Memorandum No. 2008-12 dated September 6, 2008 was issued for the information of the management. During our exit conference, the City Treasurer informed us that his appropriation for payment of premium is just minimal hence, there was no increase in the amount of bond of his personnel. He assured us however, that for the renewal of this year’s bond, they will increase the amount of bond of the accountable officers corresponding to their average maximum accountability.RECOMMENDATION FOR TANDAG CITY GOVERNMENT:       Advise the City Treasurer to monitor the amount of bond and the corresponding accountability covered by the accountable officers. In the event that there is a discrepancy, please advise that official to apply for additional bond.

Written by rage · Filed Under Tandag City · Leave a Comment 

Next Page»