The Commission on Audit (COA) has issued a qualified opinion to the city government that it has not maintained Generally Accepted Accounting Principles (GAAP) as there were receipts that did not correspond to some of the city government’s accounts in relation to its properties.
Based on the report published on February 2019, it said the city government’s “existence, condition and correctness of the Property, Plant and Equipment accounts totaling P7,683,294,117.57 could not be ascertained due to incomplete physical inventory count, and both the cash in bank and income accounts have been understated by the unrecorded collections/deposits totaling P24,680,229.03.”
According to COA Supervising Auditor, Gloria Cañete, they audited the financial statements of the city government,”which comprise the statement of financial position as at December 31, 2018, and the statement of financial performance, statement of changes in net assets/equity, statement of cash flows and statement of comparison of budget and actual amounts for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.”
COA found out that “the inventory committee did not conduct complete physical inventory count” resulting in the difficulty in determining the correctness of the city government’s property, plant and equipment on its account balance per book which totaled P7.68 billion.
There were also unrecorded collections and deposits that amounted to P24.6 million as of yearend. Adding to that was the overdue loans receivable amounting to P37.2 million which remained uncollected as of December.
The General Services Office, in a reply letter to the COA, admitted “there are still discrepancies to be encountered whenever physical inventory taking of PPEs of all offices/departments is conducted.”
However, the office said it would “never cease in making effort to at least reduce or correct the number of bloated accounts through proper and continued reconciliation of records with CAO.”
The Office of Central 911 and the Davao City Disaster Risk Response and Management Office, for its part, said it has assigned a property supply officer to monitor its properties and records to avoid errors and discrepancies.
The city government also assured the COA it would prepare and submit the inventory list of procured and donated items.
Other significant observations included the P102.6 million worth of infrastracture projects that showed zero utilization rate, the programs, activities and other projects worth P256 million which were not implemented as planned and the unutilized fund of P217.6 million.
The Annual Audit Report for the Calendar Year 2018 was transmitted to the City Mayor’s Office on April 30 and to the Office of Sangguniang Panlungsod on May 3.