COA claims BTr failed to collect P6.9B of idle funds

The Commission on Audit (COA) said the government could have earned an additional P6.982 billion had the Bureau of Treasury (BTr) been more zealous in its efforts to collect the idle funds of various national government agencies (NGAs).
 
“The National Government cash deposits could have increased by at least an estimated P6,982,595,794.85 had collection efforts been enhanced thru proper monitoring of NGAs’ year-end cash balances pursuant to Executive Order No. 338 dated May 17, 1996 and DOF-DBM-COA Permanent Committee Joint Circular 4-2012 dated September 11, 2012,” the COA said in an annual audit report published Wednesday on its website.
 
For the year 2013, a total of P181.866 billion cash balances were incurred by 295 NGAs, The state audit body noted.

Of the amount, P6,982,595,794.85, involving the cash balances of 54 NGAs, was earlier ordered to be remitted back to the national treasury after having been identified as “idle funds.”
 
The commission said among the funds it has ordered the BTr to recover from the 54 NGAs were income from regular operations, interest income, performance and bidders bond, dormant accounts, cash from unauthorized deposit accounts, unutilized project funds and balance of terminated projects funds, deposits from Letters of Credit, unutilized Notice of Cash Allowances (NCAs), unused Priority Development Assistance Fund (PDAF) and Malampaya fund, unutilized fund transfers, unclaimed dividends, and other trust funds and donations.

FOr other purposes
 
“As reported in the individual Annual Audit Reports and the consolidated observations reported in the AFR (Annual Financial Report), these idle cash were being used for purposes/operations other than that for which these were intended,” the COA pointed out.
 
“In some instances, these were being deposited in time deposits or other high yielding investments,” it added.
 
Records state auditors obtained from the BTr’s National Cash Accounting Division (NCAD), as of May 14, 2015, reflect only a total of P1.4 billion have been remitted by the NGAs, the commission noted.
 
The COA said such low figure “is an indication of weak monitoring of remittances” by the BTr despite various assistance and recommendations the audit body has extended to the agency.
 
As it was aware of the “huge balances” several NGAs have been maintaining in various authorized government depository banks (AGDBs), the audit body provided the BTr with an inventory of the NGAs’ cash accounts and dormant accounts as well as unutilized cash balances, the commission pointed out.

It also provided the bureau with auditors’ observations on the matter as well as Annual Financial Report (AFR) “as reference point for the BTr to monitor the status of cash balances in the AGDBs.”

A reminder
 
The commission reminded the BTr that under Section 2 of Executive Order No. 338 of May 17, 1996, all government agencies are required to deposit their cash balances to the national treasury regardless of the source of the funds or income.
 
The audit body further said that under Joint Circular 4-2012 dated September 11, 2012 issued by the commission, Department of Finance (DOF) and Department of Budget and Management (DBM), it is the function of the BTr as an agency under the DOF, to inform the department secretaries of the NGAs regarding the status of their cash balances and the accompanying recommendations.
 
“Without serious efforts on the part of the BTr as collecting agent for the government, unutilized cash balances will tend to accumulate every year rather than be used to augment government scarce resources to meet national expenditures,” the COA said.
 
Based on COA records, these are the top 10 NGAs with the highest amount of unutilized funds in banks in 2013:

• State Universities and Colleges – P38,748,520.26

• Department of National Defense – P16,246,027.60

• Department of Agriculture – P15,249,267.26

• The Judiciary – P14,333,273.00

• Other Executive Offices – P10,573,626.19

• Department of Education – P10,480,545.36

• Department of Budget and Management – P8,464,979.41

• Department of Health – P7,063,727.82

• Dept. of Foreign Affairs – P6,933,994.00

• Commission on Elections – P6,282,863.99

 “We recommended that the BTr… through the NCAD, exercise its functions and responsibilities on the monitoring of remittances of idle/unutilized cash balances of all NGAs as stated in Section 4 of the Joint Circular 4-2012, and the other aforementioned pertinent regulations specifically to directly coordinate with the Heads of agencies, to inspect, examine and evaluate their books of accounts in order to determine the proper action to be taken in this regard,” the commission said. – VS, GMA News