COA says funds found unaccounted for in Taguig City expenditures

By ELIZABETH MARCELO, GMA News

Published November 27, 2014 4:08pm

(Updated 5:38 p.m.) Millions of pesos worth of government funds were found to have been unaccounted for in the expenditures and operations of the Taguig City government, the Commission on Audit (COA) said in a report on its website.

In an annual audit report on Taguig City operations for 2013, the commission cited irregularities in the practices and records, like payment of salaries to possible “ghost employees,” unliquidated cash advances, unwarranted performance bonuses, erroneous liquidation and financial statements and “doubtful existence” of medical supplies in the city's inventory.

Leng Centura, media monitoring staff of Taguig City Public Information Office (PIO) told GMA News Online the management is still reviewing the COA report and will issue an official statement soon.

Ghost employees?

According to the report, the city government spent P317.415 million for salaries of contractual employees whose places and areas of assignments could not be located.

The report noted the absence of a payroll register and the specific places of assignment of the “Job Order personnel” hindered state auditors from completing the audit of the city government payroll.

“We have recommended the immediate submission by the Human Resource and Management Office of the lists of Job Order personnel with their corresponding unit of assignments to facilitate the audit,” the state auditors noted in the report.

COA questioned the Taguig City government's practice of hiring contractual workers and charging their salaries totaling P486.69 million to the city's Other Maintenance and Operating Expenses (OMOE) instead of creating plantilla positions and charging the salaries to personal services expenditures (PS).

“We have recommended that Management prioritize the creation of an appropriate organizational structure and plantilla positions that will complement manpower requirements of the City, the University and the Hospital for effective governance,” the report said.

Unliquidated cash advances

According to the COA report, P54.852 million worth of cash advances given by the Taguig City government to its officials and employees remains unliquidated, P16.807 million of which remains outstanding since 2006.

The commission also found P38.882 million worth of performance incentives were given by the city government to its contractual personnel charged to the city's OMOE.

The state auditors noted such practice “was prohibited per Department of Budget and Management Budget Circular No. 2013-3."

COA recommended that the city government stop paying incentives to JO personnel or contractual employees without any legal basis and to refund what has been paid as performance incentive bonus in 2013.

The commission also ordered the city government to justify hiring consultants and the payments totaling P18.43 million as consultancy fees without supporting documents covering such arrangements.

“We have recommended that [the city government] include the terms of reference in the consultancy contracts and require the submission of their accomplishment reports to justify the necessity, propriety and legality of the hiring of the consultants of the city,” the report said.

Questionable financial reports

State auditors also found as “unreliable” the cash in bank and other financial statements by the Taguig City government.

According to COA report, as of December 31, 2013, the City government recorded P2.145-billion worth of disparities in its cash-in-bank statement due to the following:

Disparities between books and cash in bank balance amounting P49 million

Undocumented bank and book reconciling items in the amount of P80.902 million and P57.821 million, respectively

Delayed recording of interest income which resulted in the understatement of the Cash in Bank-Local Currency Current Account (Code 111) worth P3.863 million.

The state auditors also found as “unreliable” the city's equity account statements, finding a total of P2.222 billion disparities due to the following:

Overstatement of the Prior Year's Adjustments (PYA) worth P45.377 million due to erroneous entry in recording payment of personal services for the Taguig City Hospital

An addition/credit entry to PYA with corresponding debit to Accounts Payable amounting to P436.676 million for unknown reason

An adjustment to the beginning balance of the PYA account on alleged unrecorded fixed assets amounting to P234.835 million in Calendar Year 2008 without any details and supporting documents.

“We have further recommended that the Accounting Office strictly observe the proper recording in the General Ledger, constantly check, review the accuracy and completeness of supporting documents to ensure the reliability of the accounts in the financial statements,” the COA report said

Missing medical, office supplies

The state auditors also noted the “doubtful existence” of medical, dental and laboratory supplies amounting to P55.515 million and office supplies amounting to P46.757 million in the City Hall's inventory.

COA recommended the city government mandate its Inventory Committee “to conduct physical inventory/count of all drugs and medicines, medical, dental and laboratory supplies and (office) materials... segregate good and expired items and prepare the required report.”

Unreleased income to barangays

Finally, the COA report noted a total of P335.668 million worth of shares in Real Property Tax (RPT) collections and P1.173 million in Community Tax Certificate collections has not yet been released to the barangays.

“We have recommended that the City Government closely coordinate with LGU officials/authorities for immediate resolution of the issue so that RPT shares could be released to the concerned barangays... that management direct the immediate release of the fifty percent (50%) shares from the collections of the Community Tax Certificates of the 24 Barangays,” the COA report said.

In a letter dated June 30, 2014, COA-NCR director Carmelita Antasuda directed Taguig City Mayor Laarni “Lani” Cayetano, wife of Senator Alan Peter Cayetano, to submit within 60 days upon the receipt of the letter, an Agency Action Plan and Status of Implementation (AAPSI) report based on the remedial measures recommended by COA in its audit report.

The letter was received by the Taguig City Office of the Mayor on September 3, 2014.

Mayor Cayetano has pending plunder and graft complaints with the Office of the Ombudsman for several allegations of irregularities in the Taguig City Hall such as the supposed hiring of about 3,000 “ghost employees.” – VS, GMA News

Tags: coareport, coataguigcity, taguigcity