014 Dpta en

Audited Entity Financial Statements
Project Number: 43407-014

Loan Number: 3369
Period covered: 01 January – 31 December 2019
PHI: Social Protection Support Project (Additional

Financing)
Prepared by: Department of Social Welfare and Development
For the Asian Development Bank

Date received by ADB: 29 October 2020
The audited entity financial statements are documents owned by the borrower. The views expressed herein
do not necessarily represent those of ADB’s Board of Directors, Management, or staff. These documents
are made publicly available in accordance with ADB’s Access to Information Policy and as agreed between
ADB and the Department of Social Welfare and Development.
Republic of the Philippines
COMMISSION ON AUDIT
Commonwealth Ave., Quezon City
CONSOLIDATED
ANNUAL AUDIT REPORT
on the
DEPARTMENT OF SOCIAL WELFARE

AND DEVELOPMENT
For the Year Ended December 31, 2019

EXECUTIVE SUMMARY
A. Introduction
The Department of Social Welfare and Development (DSWD) is mandated to

provide assistance to local government units (LGUs), non-government organizations
(NGOs), other national government agencies (NGAs), people's organizations (POs) and
other members of Civil Society in effectively implementing programs, projects, and
services that will alleviate poverty and empower disadvantaged individuals, families and
communities for an improved quality of life. It implements statutory and specialized
programs which are directly lodged with the Department.
The DSWD is composed of the Central Office (CO) and 16 Field Offices (FOs) in
Regions I-XII, CAR, NCR, and CARAGA. It is headed by Secretary Rolando Joselito D.
Bautista, who is assisted by six (6) Undersecretaries and four (4) Assistant Secretaries.
Each of the 16 FOs is headed by a Regional Director.
For CY 2019, the DSWD personnel complement totaled 25,973, consisting of 2,911
permanent,1 coterm with the project, 10,050 contractual, 66 casual, 10,947 Contracts of
Service and 1,998 Job Orders, distributed in the CO and 16 FOs.
B. Financial Highlights
For CY 2018, the DSWD had a total appropriation of P146,648.573 million

pursuant to R.A. No. 10964, received total allotments of P146,594.850 million, and
incurred total obligations of P136,816.897 million, thereby leaving a balance of P9,777.952
million, broken down as follows:
Amounts (in million P)

Source/Nature Increase/
2019 CY 2018 (Restated)
(Decrease)
Current Year’s
Appropriation
Regular GAA 136,675.741 139,634.094 (2,958.353)
Automatic Appropriation 330.261 312.984 17.277
Special Purpose Fund 4,187.170 4,314.979 (127.809)
Total Current 141,193.173 144,262.057 (3,068.884)
Continuing Appropriation 5,455.399 - 5,455.399
Grand Total 146,648.573 144,262.057 2,386.516
Total Allotment Received 146,594.850 144,262.057 2,332.793
Total Obligations Incurred 136,816.897 138,621.524 (1,804.627)
Unobligated Allotment 9,777.952 5,640.533 4,137.419
The Agency’s financial condition and sources and application of funds are
presented below.
i
Amounts (in million P)
Particulars CY 2018 Increase/
CY 2019
(Restated) (Decrease)
A. Financial Condition
Assets 79,802.975 97,323.871 (17,520.90)
Liabilities 29,448.473 52,458.000 (23,009.53)
Net Assets/Equity 50,354.501 44,865.871 5,488.63
Sources of Fund
Revenue 218.145 147.004 71.141
Subsidy from NG - net 27,336.931 13,917.387 13,419.54
Other Income/(losses) (31.105) 185.294 (216.40)
Total Income 27,523.97 14,249.69 13,274.28
Application of Fund
Personnel Services 6,861.488 6,186.168 675.32
MOOE 9,532.554 9,033.079 499.48
Financial Expenses 161.671 519.780 (358.11)
Non-Cash Expenses 319.177 323.858 (4.68)
Total Expenses 16,874.892 16,062.886 812.01
Surplus (Deficit) for the Period 10,649.078 (1,813.201) 12,462.28
C. Scope and Objectives of Audit
The audit covered the accounts and operations of the DSWD Central Office and 16
FOs for CY 2019. The audit was conducted to: a) verify the level of assurance that maybe
placed on management’s assertions on the financial statements; (b) recommend agency’s
improvement opportunities, (c) determine the propriety of transactions as well as the extent
of compliance with pertinent laws, rules and regulations, and (d) determine the extent of
implementation of prior year’s audit recommendations.
D. Independent Auditor’s Report
A qualified opinion was rendered on the financial statements of the DSWD as at

December 31, 2019 for the misstatements overstating the total Assets and Net
Assets/Equity by ₱919.829 million and ₱483.512 million, respectively, and understating
the total Liabilities by ₱43.841 million which represent 1.15 percent, 0.15 percent and 0.96
percent of its total Assets, Liabilities and Net Assets/Equity, respectively.
Moreover, we noted deficiencies amounting to ₱41,519.287 million in keeping of

the accounts affecting fair presentation of the assets and liabilities accounts balances
reported in the financial statements by ₱40,765.002 million and ₱754.285 million,
respectively.
E. Significant Observations and Recommendations
Among the audit observations and corresponding recommendations discussed in

Part II of this report, the significant observations are summarized as follows:
ii
a. Various accounts of the Department of Social Welfare and Development
(DSWD) have misstatements overstating the reported total Assets, Liability and
Net Assets/Equity by ₱919.829 million, ₱43.841 million and ₱483.512 million,
respectively, which represents 1.15 percent, 0.15 percent, and 0.96 percent of its
total Assets, Liabilities and Net Assets/ Equity, respectively
We recommended and Management agreed to require the concerned

Chief Accountant of DSWD offices to effect the necessary adjustments on the
errors/omissions and provide the corresponding supporting documents or
JEV of the adjustments made.
b. Five DSWD offices failed to submit perfected contracts and supporting

documentary requirements amounting to P543.877 million for auditorial and
technical review/evaluation within five working days from the execution of
contract as required under Section 39(1) of PD 1445 and Section 3 of COA Circular
No. 2009-001 dated February 12, 2009, thus precluded the timely and judicious
review/evaluation of contracts.
We reiterated our prior year recommendations, with modification, and

Management agreed to require the Head of concerned Offices to:
a) require the Chief Accountant to:
i. make the necessary adjustments/correcting entries for the

accounts affected by errors/omissions;
ii. observe the highest degree of objectivity and consistency in

keeping of the accounts to safeguard against inaccurate or
misleading information; and
iii. carefully analyze the transactions before these are recorded,

for proper classification of accounts, and accurate recording
of financial transactions;
b) establish close coordination and strengthen linkages among

concerned offices to ensure timely submission of reports as basis of the
Accountants in recording transactions;
c) evaluate and assess the capabilities of personnel assigned to

perform crucial tasks and give appropriate trainings, if necessary, to
ensure effective and efficient performance of their tasks and adherence
to reporting requirements;
d) ensure strict adherence to existing rules, regulations, policies,

and guidelines.; and
iii
e) require the concerned personnel of FOs III and V to strictly
adhere with the recommendations noted in CY 2018 and 2019 CAARs
to avoid similar observations from occurring.
c. Six DSWD Offices have paid various transactions amounting ₱738.532

million despite the absence of the required supporting documents and deficiencies
noted, in violation of Section 4 of PD 1445, and COA Circular NO. 2012-001 dated
June 14, 2012.
We recommended and Management agreed to require the Head/s of:
a) the NCR and FOs V, VIII, XI and XII to submit the required
and appropriate documents to support the payment of various
expenses, to preclude the issuance of Notice of Suspension, as
applicable;
b) the NCR to: (i) require the contractor to submit legal documents
as proof that they are allowed to engage in the supply and delivery of
ICT Equipment; (ii) require the BAC to diligently evaluate bidding
documents submitted by the prospective bidders and ensure equitable
treatment to all bidders and to recommend to HoPE the most qualified
winning bidder which is capable to deliver the required goods; and (iii)
require the BAC TWG to carefully perform eligibility screening,
evaluation of bids and post qualification to avoid deficiencies in the
procurement process;
c) the NCR BAC Chairperson to require: (i) the contractor to

submit justification on the non-compliance as to the technical
specifications of the delivered laptops; (ii) the BAC TWG to refrain
from approving requests of contractor/supplier on the new technical
specifications of required equipment, which was already awarded, and
in cases like these, inform and consult immediately the BAC and HoPE
for their further actions and decisions on the matter; and (iii) the
Inspection Committee to conduct inspection through test analysis to
ensure that delivered equipment are all working and in accordance
with the required technical specifications, and submit the said report
to the Accounting Section as attachment in the payment thereof.
Thereafter, conduct inspection of the received items based only on the
technical specifications required in the approved PR and bidding
documents, otherwise, reject or disapprove the same;
d) FO IVA ensure that the written conformity and acquiescence of

the Solicitor General and the written concurrence of the Commission
on Audit shall first be secured before the hiring or employment of a
private lawyer or law firm; and
iv
e) the Property and Supply Section and Warehousing and
Donations Sections/Units of the FO V to gather the documents for
submission to the Accounting Section as their basis to close/adjust the
non-moving balance of inventories in the books.
d. The delayed/non-submission of required report and supporting documents

prevented the auditor of several DSWD offices from conducting a timely audit and
verification of financial transactions, the results of which could have been used as
an aid in management decisions and inputs in enhancing financial accountability.
We recommended and Management agreed to direct the concerned

Accountants of:
a) NCR, FOs I, IVB, XI, XIII to immediately submit all the

overdue financial/accounting reports and, henceforth, ensure timely
preparation thereof by the AOs and submission to the Accountant and
COA, otherwise, impose appropriate sanctions under Section 122(2) of
PD 1445, supra;
b) FOs I and XIII to strictly and consistently observe the provisions

of PD 1445 and COA circular 1995-006 in the submission of DVs to the
Office of the Auditor;
c) FO V to cause the submission of DVs, JEVs and all validated

LDDAP-ADA to support the paid DVs through ADA for the years
2016-2019, thereafter include the subject form as supporting document
to paid DVs before submission to the audit team as required by existing
regulation;
d) FOs VIII and X to submit the required Liquidation Reports

with adequate supporting document to support recording in the books
of accounts, to validate propriety of the transactions and to determine
the accuracy of the reported liquidations involving the PCF, Advances
to Special Disbursing Officer, Advances to Officers and Employees,
Due from NGAs, Due from LGUs and the Due from NGOs/POs.
e. Non-attainment/achievement of the objective of the Program,

“Establishment of New Public Schools for Indigenous Peoples in Mindanao” for
the construction of 605 classrooms in 251 sites for the new public schools for
Indigenous People in Mindanao through the DSWD KC-NCDDP due to delayed
completion of the project, as manifested in the status of implementation, in which
421 classrooms (CLs) or equivalent to 69.59% were completed as at December 31,
2019, and still had an unmet target of 184 CLs or 30.41% of total CLs. Moreover,
the accuracy and reliability of the submitted Physical Accomplishment Report as
at December 31, 2019 is doubtful in view of inconsistencies in data reported.
v
We reiterated our previous year’s recommendations, with
modification, that the Management require the KC-NCDDP National Project
Monitoring Team/Regional Project Monitoring Team to:
a) review its existing Work Plan and identify the cause/s of delays
that occurred, and close coordination with BLGUs be made to fast
track the implementation and completion of the project, to ensure that
beneficiaries are not deprived from the benefits thereof, and to
facilitate liquidation of fund transfer;
b) evaluate and assess the viability of the remaining projects,

identify flaws and problems in the implementation, and consider
returning the unutilized funds to DepEd to free DSWD from obligation;
c) henceforth, ensure that DSWD review its capacity to implement

projects before entering into agreements to ensure that project
objectives are achieved; and
d) consider that reports are the windows of accomplishments, and

the agency’s performance is assessed based on what was reported, the
DSWD should consider improving the report contents to be reflective
of the activities undertaken in attaining its objectives.
f. Reported project accounts were non-existent and irregularities in the

accounts and transactions of SEA-K funds were not prevented, detected and
corrected due to inadequacy and breakdown of controls in the project
implementation, monitoring and recording of accounts and transactions, contrary
to Sections 4 (8) and 124 of PD 1445, resulted in the wastage and/or misuse of
government funds in the total amount of ₱10.028 million, thereby, depriving the
beneficiaries of the benefits that could be derived therefrom.
We recommended and the DSWD-FO-XIII Management agreed to:
a) require the SLP RPMO and Legal Officers to conduct in-depth

investigations on the above observations and take appropriate legal
actions against persons liable to recover the amount wasted or misused
under the SEA-K program;
b) require the Accountant to reconcile the accounting records of

SEA-K accounts with the records of the SEA-K associations; make
necessary adjustments in the books of accounts including the
recognition of receivable for proper monitoring of collections and
remittances thereof; and
c) segregate key duties and functions of project personnel to avoid

collusion, or opportunity to make fraudulent activities; see to it that the
vi
implementing PDO assigned in a certain area will not be also assigned
to monitor the implementation of the project, and collect the amounts
due to the government.
g. Unutilized proceeds of SEA-K grant, as well as, repayments of grants

accumulating to ₱2.676 million at the Associations’ bank accounts were already
dormant for years and not returned/deposited to the accounts of the National
Treasury, contrary to Section 2.2 of Treasury Circular No. 03-2014 dated June 16,
2014 and Section 4.5.3 of COA Circular No. 2007-001 dated October 25, 2007,
thus, defeated the purpose for which the funds were allotted and deprived the
government from the use of such resources.
We recommended that DSWD-FO-XIII Management:
a) require the SLP Regional Program Coordinator to conduct

further evaluation on the observations noted above, and identify other
issues and causes particularly on monitoring of project
implementation, utilization of funds as well as, remittance of CSF roll-
back or loan repayments for enhancement of controls in the
implementation of SEA-K Program; and
b) require the Accountant to reconcile the SEA-K account

balances, monitor and confirm repayments, and direct SLP-RPMO to
coordinate with the focal persons of the associations with dormant
accounts in returning the dormant account balances
h. Errors and abnormal balances in the SEA-K accounts in the total amount of
₱1.168 million due to overpayment and erroneous posting of repayments from 32
SKAs were not timely detected and corrected in the absence of proper accounting
controls, in violation of Section 124 of PD 1445, thereby, casting doubt on the
accuracy of the account balances of SEA-K receivables as presented in the certified
Statement of Releases, Repayments and Balances and the Financial Statement.
We recommended and DSWD-FO-XIII Management agreed to require

the Accountant to: (i) reconcile the balances of DSWD with the records of the
SKAs, and take appropriate adjustments in the Statement of Releases,
Repayments and Balances, as well as in the books of accounts to fairly present
the accounts and transactions of SEA-K in the Financial Statements; and (ii)
enhance controls in the monitoring of SEA-K accounts specifically on the
recognition of receivables, collections and remittances, and periodic
reconciliation of accounts to avoid recurring the same errors.
i. DSWD-Caraga had incurred substantial delays ranging from one (1) up to

two (2) years, in the implementation of their Assistance to Communities in Need
(ACN) projects, thus, prevented the timely delivery of benefits that could have been
vii
derived from the said poverty reduction projects intended to the vulnerable
communities.
We recommended that DSWD-FO-XIII Management require:
a) the ACN focal persons to intensify and fast track their

coordination, inspection and regular monitoring in the field to be able
to immediately address the gaps identified under the program; and
b) the concerned LGUs to prioritize the prompt implementation of

ACN projects, in compliance with the MOA and expedite the
submission of necessary documents to fast track release of funds.
j. Lapses on reporting, accounting, and utilization of the DRRMF is not in

conformity with COA Cir. No. 2014-002, which hindered the timely audit of
accounts related to calamity funds, and precluded transparency and accountability
in the use of disaster relief aid/donations and NDRRMF.
We recommended that DSWD-FO-V Management require:
a) the preparation and submission of the DRRM reports as

prescribed in COA Cir. No. 2014-002 to the Office of the Auditor for
the timely review and evaluation of the same; and
b) the concerned agency officials to adopt the accounting and

reporting guidelines prescribed by COA Cir. 2014-002.
k. Validation as to existence, functionality and accountability of 27

subprojects in DSWD FOs V, VI and XI costing ₱42.776 million were either not
operational or functional due to failure to adequately maintain the subprojects, and
the absence of proper turn-over of completed subprojects as required in the
Community-Based Infrastructure Manual, thus, may result to wastage of
government funds/non-sustainability of the subprojects, and unrealized objectives
of the program. Moreover, FO V funded three ineligible Kalahi subprojects
amounting to P1.601 million located at selected barangays of Buhi, Camarines Sur,
which is not in keeping with Section 1.2.4, Volume 1 of the Revised Community-
Based Infrastructure Manual, and Section 29, Article VI of the 1987 Philippine
Constitution.
We recommended and Management agreed to require the DSWD

Regional Project Management Office of KALAHI-CIDSS in:
a) FO V to (i) capacitate communities using existing KC Manual

designed for the proper implementation of the program and look into
viii
the subprojects with noted defects and make representations with
proper authorities including LGUs concerned towards possible
remedial measures; (ii) require Kalahi personnel to turn over records
under his custody before separation from the agency; (iii) coordinate
and advise the Barangay Council to allocate sufficient O&M funds for
the regular maintenance of the subproject requirements of the project
to achieve proper turn-over of SPs and maintain complete separate
records; and (iv) assist the BLGUs and O&M committees in the
implementation of the Operations & Maintenance Plan;
b) FO V to discontinue funding projects not eligible for the

agency’s Kalahi program otherwise be held liable for disbursing public
funds to illegal projects;
c) FO VI to strictly observe the required Road Right of Way in the

construction of KALAHI-CIDSS sub-projects along national and local
roads to avoid its demolition due to the road widening projects of the
DPWH in the construction of future projects, and provide technical
assistance to LGU-Cauayan, Negros Occidental so that the
construction of the new Health Stations will be immediately
implemented;
d) FO VI Regional Project Management Office (RPMO) to ensure

that the community-identified priority projects are not the potential
development sites of the DPWH infrastructure projects to avoid the
demolition of the completed KC sub-projects so that its maximum
utilization could be fully attained; and
e) FOs VI and XI to make the necessary representation with the

Barangays/ Municipalities to monitor/revisit the different completed
subprojects to ascertain the functionality of the different subprojects.
l. Safety and control measures were not assured because insurance of

properties with the Government Services Insurance System (GSIS) were not made,
as required in COA Circular No. 92-930 dated Nov. 17, 1992, COA Circular 2018-
002 dated May 31, 2018 and Section 2 and 5 of Republic Act No. 656 otherwise
known as Property Insurance Law.
We recommended and Management agreed to require the Property

personnel to ensure strict compliance with the provisions of COA Circular No.
2018-002.
m. In the audit of various transactions, the Audit Team noted the non-
compliance with laws, rules and regulations which resulted in total suspensions of
P10,934.299 million and disallowance of P838.211 million and charges of P8.174
million or a total of P11,780.684 million as at December 31, 2019.
ix
We recommended and Management agreed to require the officials
concerned to (i) comply with laws, rules and regulations to avoid audit
suspensions, disallowance and charges; and (ii) settle the same within the
prescribed period to prevent their accumulation to highly significant amounts
F. Status of Settlement of Suspensions, Disallowances and Charges
The non-compliance with laws, rules and regulations resulted in the total
suspensions and disallowances and charges in the audit of various transactions amounting
to ₱10,934.299 million, ₱838.211 million and 8.174 million, respectively.
Status of Notices of Suspensions/Disallowances

Beginning January 1 to December 31, 2019
Ending Balance
Particulars Balance (As at
NS/ND/NC NSSDC (As at 12/31/2019)
12/31/2018)
Notice of Suspension (NS) ₱2,378,850,994.76 ₱10,449,541,489.97 ₱1,894,093,268.52 ₱10,934,299,216.21
Notice of Disallowance (ND) 825,375,788.24 15,268,410.08 2,432,992.49 838,211,205.83
Notice of Charge (NC) 8,173,866.36 - - 8,173,866.36
Total ₱3,212,400,649.36 ₱10,464,809,900.05 ₱1,896,526,261.01 ₱11,780,684,288.40
G. Status of Implementation of Prior Years’ Audit Recommendations
Of the 145 prior years’ audit recommendations 108 were implemented and 37 were
not implemented. The details of these audit recommendations are shown in Part III of the
report.
x
TABLE OF CONTENTS
PART PARTICULARS PAGE
I Financial Statements 
 Independent Auditor’s Report  1

 Statement of Management’s Responsibility  4
for Financial Statements
 Statement of Financial Position  5
 Statement of Financial Performance  6
 Statement of Changes in Net Assets Equity  7
 Statement of Cash Flow  8
 Statement of Comparison of Budget and Actual  9
Amounts 
 Notes to Financial Statements  10

II Observations and Recommendations  66

III Status of Implementation of Prior Years’  253
Audit Recommendations
DEPARTMENT OF SOCIAL WELFARE AND DEVELOPMENT
STATEMENT OF FINANCIAL POSITION
ALL FUNDS CLUSTERS
AS OF DECEMBER 31, 2019
Note 2019 2018 (restated)

ASSETS
Current Assets
Cash and Cash Equivalents 6 15,099,710,661.36 19,264,852,205.71
Receivables 7 14,638,106,186.23 31,588,946,639.52
Inventories 8 2,680,177,020.68 2,739,638,819.38
Other Current Assets 12.1 3,033,308,084.61 543,343,745.97
Total Current Assets 35,451,301,952.88 54,136,781,410.58
Non-Current Assets
Property, Plant and Equipment 9 44,249,605,420.77 42,982,185,264.46
Biological Assets 10 158,300.00 158,300.00
Intangible Assets 11 17,343,601.28 37,827,064.46
Other Non-Current Assets 12.2 84,565,848.20 166,919,765.31
Total Non-Current Assets 44,351,673,170.25 43,187,090,394.23
TOTAL ASSETS 79,802,975,123.13 97,323,871,804.81
LIABILITIES
Current Liabilities
Financial Liabilities 13 8,617,222,577.46 6,707,900,604.65
Inter-Agency Payables 14 947,721,374.25 1,159,363,898.50
Intra-Agency Payables 15 298,232,903.77 571,709,375.50
Trust Liabilities 16 162,133,244.14 121,304,099.72
Total Current Liabilities 10,025,310,099.62 8,560,277,978.37
Non-Current Liabilities
Trust Liabilities 16 95,498,903.44 61,190,751.93
Deferred Credits 17 889,831.18 816,191.50
Other Payables 18 19,326,774,366.14 43,835,715,282.37
Total Non-Current Liabilities 19,423,163,100.76 43,897,722,225.80
Total Liabilities 29,448,473,200.38 52,458,000,204.17
Total Assets less Total Liabilities 50,354,501,922.75 44,865,871,600.64
NET ASSETS/EQUITY
Accumulated Surplus/(Deficit) 50,354,501,922.75 44,865,871,600.64
Total Net Assets/Equity 50,354,501,922.75 44,865,871,600.64
This statement should be read in conjunction with the accompanying notes.
5
STATEMENT OF FINANCIAL PERFORMANCE
ALL FUNDS CLUSTERS
FOR THE YEAR ENDED DECEMBER 31, 2019
Note 2019 2018 (restated)

Revenue
Service and Business Income 19 63,325,693.02 52,825,251.40
Shares, Grants and Donations 20 101,879,346.02 85,849,219.87
Other Non-Operating Income 21 52,939,823.45 8,329,054.50
Total Revenue 218,144,862.49 147,003,525.77
Less: Current Operating Expenses

Personnel Services 22 6,861,488,971.43 6,186,168,356.86
Maintenance and Other Operating Expenses 23 9,532,554,176.79 9,033,079,538.30
Financial Expenses 24 161,671,518.23 519,780,615.65
Non-Cash Expenses 25 319,177,668.32 323,858,115.68
Current Operating Expenses 16,874,892,334.77 16,062,886,626.49
Surplus/(Deficit) from Current Operations (16,656,747,472.28) (15,915,883,100.72)
Net Financial Assistance/Subsidy to NGAs, LGUs, GOCCs 27,336,931,904.79 13,917,387,089.12

Sale of Assets 109,390.00 194,535.92
Gains 12,544,547.23 284,053,282.79
Losses (43,759,613.69) (98,953,391.74)
Surplus/(Deficit) for the period 10,649,078,756.05 (1,813,201,584.63)
6
STATEMENT OF CHANGES IN NET ASSETS/EQUITY
ALL FUNDS CLUSTERS
2019 2018 (restated)
Balance at January 1 44,865,871,600.64 48,453,538,682.71

Changes in Accounting Policy - -
Prior Period Adjustment - -
Other Adjustments - -
Restated Balance 44,865,871,600.64 48,453,538,682.71
Changes in Net Assets/Equity for the Calendar Year

Adjustment of net revenue recognized directly in net assets/equity
Surplus for the period 10,649,078,756.05 (1,813,201,584.63)
Adjustments (1,520,101,789.90) -
Others (3,640,346,644.04) (1,774,465,497.44)
Balance at December 31 50,354,501,922.75 44,865,871,600.64
7
`
CONDENSED STATEMENT OF CASH FLOWS (COMPARATIVE)
ALL FUND CLUSTERS
2019 2018 (restated)

Cash Flows From Operating Activities
Cash Inflows
Receipt of Notice of Cash Allocation 161,791,980,198.47 163,199,217,166.28
Collection of Income/Revenues 77,445,449.20 85,084,317.71
Receipt of Assistance and Subsidy from Other NGAs, LGUs and GOCCs 767,360.00 1,861,352.77
Collection of Receivables 72,191,246.20 38,788,448.31
Receipt of Inter-Agency Fund Transfers 1,583,445,040.24 266,716,056.44
Receipt of Intra-Agency Fund Transfers 3,358,669,265.30 3,352,217,016.02
Trust Receipts 67,432,978.27 112,483,070.37
Other Receipts 1,170,371,374.97 1,365,997,495.17
Adjustments 446,159,222.06 117,293,989.61
Total Cash Inflows 168,568,462,134.71 168,539,658,912.68
Cash Outflows
Replenishment of Negotiated MDS Checks (for BTr) - -
Remittance to National Treasury 3,716,195,054.20 2,313,073,148.27
Payment of Expenses 16,563,158,940.50 15,727,120,725.94
Purchase of Inventories 886,152,832.25 947,434,383.15
Grant of Cash Advances 22,671,594,268.28 8,057,974,062.09
Prepayments 9,026,115.06 20,665,641.85
Refund of Deposits 136,904,084.13 19,788,502.90
Payment of Accounts Payables 1,663,203,074.64 1,811,498,793.78
Remittance of Personnel Benefit Contributions and Mandatory Deductions 1,757,967,349.49 1,686,288,054.93
Grant of Financial Assistance/Subsidy 77,742,710,579.92 54,489,487,505.57
Release of Inter-Agency Fund Transfers 12,620,458,751.09 56,486,477,817.43
Release of Intra-Agency Fund Transfers 21,169,863,211.12 27,511,016,972.55
Other Disbursements 1,980,174,397.05 83,702,769.03
Adjustments 10,745,571,163.65 4,127,923,269.67
Total Cash Outflows 171,662,979,821.38 173,282,451,647.16
Cash Provided by (Used in) Operating Activities (3,094,517,686.67) (4,742,792,734.48)
Cash Flows from Investing Activities

Cash Inflows
Proceed from Sale/Disposal of Property, Plant and Equipment 242,651.78 189,739.92
Total Cash Inflows 242,651.78 189,739.92
Cash Outflows
Purchase/Construction of Property, Plant and Equipment 1,038,119,189.54 503,256,149.08
Total Cash Outflows 1,038,119,189.54 503,256,149.08
Net Cash Provided By (Used In) Investing Activities (1,037,876,537.76) (503,066,409.16)
Cash Flows From Financing Activities

Cash Inflows
Cash Provided By (Used In) Financing Activities - -
Increase (Decrease)in Cash and Cash Equivalents (4,132,394,224.43) (5,245,859,143.64)
Effects of Exchange Rate Changes on Cash and Cash Equivalents (32,747,319.92) 182,541,917.24
Add: Cash Balance, Beginning January 1 19,264,852,205.71 24,328,169,432.11

- -
Cash Balance, Ending December 31 15,099,710,661.36 19,264,852,205.71
8
Office of the Secretary
Notes to Financial Statements for the Year Ended December 31, 2019
Consolidated Central Office and Regional Offices
All Fund Clusters
1. General Information/Agency Profile PPSAS

1.63(b)
The financial statements of Department of Social Welfare and Development-Office of the PPSAS
Secretary were authorized for issue on February 14, 2020 as shown in the Statement of 14.26
Management Responsibility for Financial Statements signed by Director Wayne C. Belizar,
Director for Finance and Management Service and Undersecretary Jose Ernesto B. Gaviola,
Office of the Undersecretary for General Administrative and Support Services Group. PPSAS
1.150
On 15 February 1915, upon creation of the Public Welfare Board during the American
Regime, the government started to get involved in social welfare. The board was established
to coordinate, regulate and supervise social services activities and other charitable works
rendered by religious orders and organizations. Finally in 1917, the first government
orphanage was established. As a result of several changes by the government in its bureaus
and departments, the original Public Welfare Board of the year 1915 became the Department
of Social Welfare and Development (DSWD). After which, the Social Welfare Administrator
was formally created by virtue of Executive Order No. 396 dated 13 January 1951. Republic
Act No. 5416 known as the Social Welfare Act was approved in 1968. It was made into a
Department, whose responsibility was to provide comprehensive program of social welfare
services designed to ameliorate the living conditions of distressed Filipinos, particularly those
who are handicapped by reason of poverty, youth, physical and mental disability, illness and
old age, or who are victims of natural calamities including assistance to members of the
cultural minorities.
With the provision of DSWD Mandate under Executive Order No. 15, DSWD was
transformed from the rowing to steering role that usher in the new vision, mission and goals
for the Department.
The DSWD envisions all Filipinos free from hunger and poverty, have equal access to
opportunities, enabled by a fair, just, and peaceful society. In the pursuit of its vision, the
DSWD mission is "to lead in the formulation, implementation, and coordination of social
welfare and development policies and programs for and with the poor, vulnerable
and disadvantaged.
1.1 Programs/Projects/Activities
❖ General Administration and Support
❖ Support to Operations
❖ Operations
• Social Protection Policy Services
➢ Formulation and Development of Policies and Plans

➢ Social Technology Development and Enhancement
• Social Protection Services
10
All Fund Clusters
➢ Services for Residential and Center-Based Clients

➢ Assistance to Persons with Disability and Older Persons
➢ Disaster Response and Rehabilitation Program
➢ Protective Services for Individuals and Families in Difficult
Circumstances
➢ Program Management and Monitoring
➢ Pantawid Pamilyang Pilipino Program
➢ Supplementary Feeding Program
➢ Poverty and Reintegration Program for Trafficked Persons
➢ Social Pension for Indigent Senior Citizens
➢ Sustainable Livelihood Program
➢ Micro-enterprise Development
➢ National Resource Operation
➢ Implementation of Centenarian Act of 2016
➢ Reducing Vulnerabilities of Children from Hunger and Malnutrition in
ARMM or Bangsamoro Umpungan sa Nutrisyon (BangUN)
➢ Services to Distressed Overseas Filipinos
➢ Aid Relief and Rehabilitation Services to Communities/Areas Affected by
Calamities, including Training of Personnel, and Other Pre-disaster
Activities
➢ Marawi Recovery, Rehabilitation and Reconstruction Program
• Capacity Building Services
➢ Provision of Technical/Advisory Assistance and Other Related Services

➢ Provision of Capability Training Programs
• Regulatory Services
➢ Standard-Setting, Licensing, Accreditation, and Monitoring Services
❖ Projects
• Comprehensive Project for Street Children, Families and IPs, especially

Badjaus
• National Household Targeting System for Poverty Reduction
• Implementation and Monitoring of Payapa at Masaganang Pamayanan
Program-Peace and Development Fund
• Tax Reform Cash Transfer Project
❖ Foreign Assisted Projects
• KALAHI-CIDSS National Community Driven Development Project

(NCDDP) - a poverty alleviation program of the National Government
implemented by the DSWD. It is supported by the Philippine Development
11
All Fund Clusters
Plan (2011-2016). Approved on 18 January 2013, it is the expansion into a

national scale of the operations of community-driven development (CDD), a
strategy that has been tried and proven effective in Kalahi-CIDSS (Kapit-
Bisig Laban sa Kahirapan-Comprehensive and Integrated Delivery of Social
Services), the parent project of KC-NCDDP. The development objective of
KC-NCDDP is to have barangays/communities of targeted municipalities
become empowered to achieve improved access to services and to participate
in more inclusive local planning, budgeting, and implementation. KC-NCDDP
will also be aligned into a program to support community-driven post-disaster
response and development in Typhoon Yolanda-affected municipalities within
provinces covered by KC-NCDDP.
• KC NCDDP ADB AF Typhoon Yolanda Multi-Donor Trust Fund (TYMDTF)

Grant No. 0472-PHI - This is a financial assistance from the Typhoon
Yolanda Multi-Donor Trust Fund (TYMDFT) administered by ADB. The
objective of the Project is that Project Provinces and Municipalities achieve
improved access to services and infrastructure and participate in more
inclusive local disaster risk reduction and management planning, budgeting
and implementation.
• ADB Grant is for Integrated People Driven Model Community Project and
various construction of Transitional Shelter Units for families affected by
Typhoon Yolanda.
• Government of Australia (GoA) Department of Foreign Affairs and Trade

(DFAT) Support Program for Disaster Programs Direct Funding Agreement
No 70013 - The objective of the program is to enhance the capacity of the
DSWD to provide leadership in disaster response and prompt humanitarian
assistance in times of disaster.
• Government of Australia (GoA) Department of Foreign Affairs and Trade

(DFAT) DSWD Technical Assistance Facility for Social Protection Reforms
Direct Funding Agreement No 70507 - The objective of the program is to
improve the efficiency and effectiveness of the DSWD social protection
programs through the provision of harmonised and coordinated technical
assistance.
● AECID - is a grant agreement entered into by the Spanish Agency for

International Development Cooperation (AECID) and DSWD to finance the
project for “Capacity building for 1000 in community development and
disaster risk reduction (DRR)”, which aims to strengthen the capacity of
communities and local governments to coordinate, plan, implement and
manage programs, projects and activities (PPAs) for local management of
disaster risk reduction with the essential elements contained in the project
design document.
● 100 million grant from People’s Republic of China – pertains to the funding
support from the Embassy of the People’s Republic of China for the
implementation of various DSWD programs and projects in Mindanao area.
12
All Fund Clusters
❖ Protection and Promotion of Rights and Welfare of the Poor, Vulnerable and
the Disadvantaged
❖ Augmentation and Support Services to Intermediaries in their

implementation of Social Welfare and Development Programs
• Activities for Distressed and Displaced Individuals, Families and
Communities in Especially Difficult Circumstances including Victims of
Disaster and Calamities.
• Inter-Agency Transferred Funds (IATF) - Agency received funds from

another agency for the purpose of prosecuting/implementing the project. The
said funds are subject for liquidation to be submitted to the following source
agencies:
Department of Education
• Construction of 605 Classrooms for Lumads
Office of the President
• 5K Presidential Assistance (5KPFA) for Typhoon Yolanda /
• Medicine Assistance Program – Lingap sa Masa

• Second Tranche Financial Assistance to DSWD Employees affected by
Typhoon Yolanda and 7.2 Magnitude Earthquake in Bohol
National Housing Authority
• Temporary Assistance for 5,587 family victims of the CY 2013

Zamboanga Siege under Zamboanga City Roadmap to recovery and
construction plan.
• Trust Receipts – includes receipts from Local and Foreign Donations,

acknowledge/issued with official receipts, in case of direct deposits immediate
entry to the book of accounts. All receipts should be deposited to Bureau of
the Treasury and will be requested later for the its intended purpose, as such
calamities/disasters victims. All unused cash donations after the purpose has
been served must be deposited back to BTr for return to donor if such
agreement exists.
DSWD Central Office registered office address is located in Constitution Hills, Batasan
Pambansa Complex, Main Road, Quezon City, Philippines.
2. Statement of Compliance and Basis of Preparation of Financial Statements
2.1 The financial statements have been prepared in accordance with and PPSAS
comply with the Philippine Public Sector Accounting Standards (PPSAS) issued by the 1.129
13
All Fund Clusters
Commission on Audit per COA Resolution No. 2014-003 dated January 24, 2014. The PPSAS 2
financial statements are presented in Philippine Peso, which is the functional and reporting PPSAS 6
currency of the DSWD.
2.2 The financial statements have been prepared on the basis of historical cost, unless
stated otherwise. The Statement of Cash Flows is prepared using the direct method.
3. Summary of Significant Accounting Policies
3.1 Basis of accounting
The financial statements are prepared on an accrual basis in accordance with the PPSAS 1, 6
Philippine Public Sector Accounting Standards (PPSAS)
3.2 Financial instruments
a. Financial assets
Initial recognition and measurement
Financial assets within the scope of PPSAS 29 Financial Instruments: PPSAS

Recognition and Measurement are classified as financial assets at fair value 29.10
through surplus or deficit, loans and receivables as appropriate. The PPSAS
Department of Social Welfare and Development determines the classification 30.31
of its financial assets at initial recognition.
The DSWD's financial assets include cash, receivables, inventories, PPE and
other assets.
Subsequent measurement
The subsequent measurement of financial assets depends on their

classification.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or PPSAS
determinable payments that are not quoted in an active market. After initial 29.10
measurement, such financial assets are subsequently measured at amortized PPSAS
cost using the effective interest method, less impairment. Amortized cost is 29.48(a)
calculated by taking into account any discount or premium on acquisition and PPSAS
fees or costs that are an integral part of the effective interest rate. Losses 29.65
arising from impairment are recognized in the surplus or deficit.
Derecognition
The DSWD derecognizes a financial asset or, where applicable, a part of a PPSAS
financial asset or part of DSWD of similar financial assets when the rights to 29.19
14
All Fund Clusters
receive cash flows from the asset have expired or is waived; the DSWD has PPSAS
transferred its rights to receive cash flows from the asset; or has assumed an 29.20-22
obligation to pay the received cash flows in full without material delay to a
third party; and either: (a) the DSWD has transferred substantially all the risks
and rewards of the asset; or (b) the DSWD has neither transferred nor retained
substantially all the risks and rewards of the asset, but has transferred control
of the asset.
Impairment of financial assets
The DSWD assesses at each reporting date whether there is objective evidence PPSAS 29
that a financial asset or a group of financial assets is impaired. A financial .67-68
asset or a group of financial assets is deemed to be impaired if, and only if, PPSAS 30.
there is objective evidence of impairment as a result of one or more events PAG5(f)
that has occurred after the initial recognition of the asset (an incurred “loss
event”) and that loss event has an impact on the estimated future cash flows of
the financial asset or the group of financial assets that can be reliably
estimated.
Evidence of impairment may include the following indicators:
• The debtors or a group of debtors are experiencing significant financial

difficulty;
• Default or delinquency in interest or principal payments;
• The probability that debtors will enter bankruptcy or other financial
reorganization;
• Observable data indicates a measurable decrease in estimated future cash
flows (e.g. changes in arrears or economic conditions that correlate with
defaults).
b. Financial liabilities
Initial recognition and measurement
Financial liabilities within the scope of PPSAS 29 are classified as financial PPSAS 29.10
liabilities at fair value through surplus or deficit. The entity determines the
classification of its financial liabilities at initial recognition.
The DSWD’s financial liabilities include inter/intra-agency payables, trust

liabilities and other payables.
Subsequent measurement
The measurement of financial liabilities depends on their classification.
15
All Fund Clusters
Derecognition
A financial liability is derecognized when the obligation under the liability is PPSAS 29.41
discharged or cancelled or expires.
When an existing financial liability is replaced by another from the same lender PPSAS 29.43
on substantially different terms, or the terms of an existing liability are
substantially modified, such an exchange or modification is treated as a
derecognition of the original liability and the recognition of a new liability, and
the difference in the respective carrying amounts is recognized in surplus or
deficit.
3.3 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, cash in bank for local and PPSAS 2.8
foreign currencies, and treasury/agency accounts. PPSAS 2.9
PPSAS 2.56
3.4 Inventories
Inventory is measured at cost upon initial recognition. To the extent that PPSAS 12.15
inventory was received through non-exchange transactions (for no cost or for a PPSAS 12.17(a)
nominal cost), the cost of the inventory is its fair value at the date of
acquisition.
After initial recognition, inventory is measured at the lower of cost and net
realizable value. However, to the extent that a class of inventory is distributed
or deployed at no charge or for a nominal charge, that class of inventory is
measured at the lower of cost and current replacement cost.
Net realizable value is the estimated selling price in the ordinary course of PPSAS 12.35
operations, less the estimated costs of completion and the estimated costs PPSAS 12.20
necessary to make the sale, exchange, or distribution. PPSAS 12.21
Inventories are recognized as an expense when deployed for utilization or PPSAS 12.9
consumption in the ordinary course of operations of the DSWD.
3.5 Property, Plant and Equipment
Recognition
An item is recognized as property, plant, and equipment (PPE) if it meets the PPSAS 17.13
characteristics and recognition criteria as a PPE.
The characteristics of PPE are as follows:
• tangible items; PPSAS 17.14

• are held for use in the production or supply of goods or services, for rental
to others, or for administrative purposes; and
16
All Fund Clusters
• are expected to be used during more than one reporting period.
An item of PPE is recognized as an asset if:
• it is probable that future economic benefits or service potential associated

with the item will flow to the entity; and
• the cost or fair value of the item can be measured reliably.
Measurement at Recognition
An item recognized as property, plant, and equipment is measured at cost. PPSAS 17.26
A PPE acquired through non-exchange transaction is measured at its fair value PPSAS 17.27
as at the date of acquisition.
The cost of the PPE is the cash price equivalent or, for PPE acquired through PPSAS 17.37
non-exchange transaction its cost is its fair value as at recognition date.
Cost includes the following: PPSAS 17.30
• Its purchase price, including import duties and non-refundable purchase

taxes, after deducting trade discounts and rebates;
• expenditure that is directly attributable to the acquisition of the items; and
• initial estimate of the costs of dismantling and removing the item and
restoring the site on which it is located, the obligation for which an entity
incurs either when the item is acquired, or as a consequence of
having used the item during a particular period for purposes other than
to produce inventories during that period.
Measurement After Recognition
After recognition, all property, plant and equipment are stated at cost less PPSAS 17.43
accumulated depreciation and impairment losses. PAG2 of
PPSAS 17
When significant parts of property, plant and equipment are required to be PPSAS 17.24
replaced at intervals, the DSWD recognizes such parts as individual assets with PPSAS 17.25
specific useful lives and depreciates them accordingly. Likewise, when a major
repair/replacement is done, its cost is recognized in the carrying amount of the
plant and equipment as a replacement if the recognition criteria are satisfied.
All other repair and maintenance costs are recognized as expense in surplus or PPSAS 17.23
deficit as incurred.
Depreciation
Each part of an item of property, plant, and equipment with a cost that is PPSAS 17.59
significant in relation to the total cost of the item is depreciated separately.
17
All Fund Clusters
The depreciation charge for each period is recognized as expense unless it is PPSAS 17.64
included in the cost of another asset.
Initial Recognition of Depreciation
Depreciation of an asset begins when it is available for use such as when it is in

the location and condition necessary for it to be capable of operating in the
manner intended by management.
For simplicity and to avoid proportionate computation, the depreciation is for PAG3 of
one month if the PPE is available for use on or before the 15th of the month. PPSAS 17
However, if the PPE is available for use after the 15th of the month,
depreciation is for the succeeding month.
Depreciation Method
Each part of an item of property, plant, and equipment with a cost that is PAG4 of
significant in relation to the total cost of the item is depreciated separately. PPSAS 17
The depreciation charge for each period is recognized as expense unless it is

included in the cost of another asset.
The straight line method of depreciation shall be adopted unless another

method is more appropriate for agency operation.
Estimated Useful Life
The DSWD uses the Schedule on the Estimated Useful Life of PPE by PAG5 of
classification prepared by COA. PPSAS 17
The DSWD uses a residual value equivalent to at least five percent (5%) of the PAG6 of
cost of the PPE. PPSAS 17
Impairment
An asset’s carrying amount is written down to its recoverable amount, or

recoverable service amount, if the asset’s carrying amount is greater than its
estimated recoverable service amount.
Derecognition
The DSWD derecognizes items of property, plant and equipment and/or any PPSAS 17.82
significant part of an asset upon disposal or when no future economic benefits PPSAS 17.83
or service potential is expected from its continuing use. Any gain or loss arising PPSAS 17.86
on derecognition of the asset (calculated as the difference between the net
disposal proceeds and the carrying amount of the asset) is included in the
surplus or deficit when the asset is derecognized.
18
All Fund Clusters
3.6 Leases
Operating lease
Operating leases are leases that do not transfer substantially all the risks and PPSAS 13.42
benefits incidental to ownership of the leased item to the DSWD. Operating
lease payments are recognized as an operating expense in surplus or deficit on
a straight-line basis over the lease term. DSWD as a lessor.
Leases in which the DSWD does not transfer substantially all the risks and PPSAS 13.13
benefits of ownership of an asset are classified as operating leases.
Rent received from an operating lease is recognized as income on a straight- PPSAS 13.63
line basis over the lease term. Contingent rents are recognized as revenue in the
period in which they are earned.
The depreciation policy for PPE is applied to similar assets leased by the PPSAS 13.66
entity.
3.7 Intangible Assets
Recognition and Measurement
Intangible assets are recognized when the items are identifiable non-monetary PPSAS 31.26
assets without physical substance; it is probable that the expected future
economic benefits or service potential that are attributable to the assets will flow
to the entity; and the cost or fair value of the assets can be measured reliably.
Intangible assets acquired separately are initially recognized at cost. PPSAS 31.31
Intangible Assets Acquired through Non-Exchange Transactions
The cost of intangible assets acquired in a non-exchange transaction is their fair PPSAS 31.42-43
value at the date these were acquired.
Internally Generated Intangible Assets
Internally generated intangible assets, excluding capitalized development costs, PPSAS 31.49
are not capitalized and expenditure is reflected in surplus or deficit in the period PPSAS 31.55
in which the expenditure is incurred.
Recognition of an Expense
Expenditure on an intangible item shall be recognized as an expense when it is

incurred unless it forms part of the cost of an intangible asset that meets the
recognition criteria of an intangible asset.
19
All Fund Clusters
Subsequent Measurement
The useful life of the intangible assets is assessed as either finite or indefinite. PPSAS 31.87
Intangible assets with a finite life is amortized over its useful life: PPSAS 31.96
PPSAS 26.22
The straight line method is adopted in the amortization of the expected pattern PAG3 of
of consumption of the expected future economic benefits or service potential. PPSAS 31
PPSAS 31.117
An intangible asset with indefinite useful lives shall not be amortized. PPSAS 31.106
Intangible assets with an indefinite useful life or an intangible asset not yet PPSAS 31.107
available for use are assessed for impairment whenever there is an indication
that the asset may be impaired.
The amortization period and the amortization method, for an intangible asset PPSAS 31.103
with a finite useful life, are reviewed at the end of each reporting period. PPSAS 31.108
Changes in the expected useful life or the expected pattern of consumption of
future economic benefits embodied in the asset are considered to modify the
amortization period or method, as appropriate, and are treated as changes in
accounting estimates. The amortization expense on an intangible asset with a
finite life is recognized in surplus or deficit as the expense category that is
consistent with the nature of the intangible asset.
Gains or losses arising from derecognition of an intangible asset are measured as PPSAS 31.112
the difference between the net disposal proceeds and the carrying amount of the
asset and are recognized in the surplus or deficit when the asset is derecognized.
3.8 Changes in accounting policies and estimates
The DSWD recognizes the effects of changes in accounting policy PPSAS 3.27
retrospectively. The effects of changes in accounting policy are applied PPSAS 3.30
prospectively if retrospective application is impractical.
The DSWD recognizes the effects of changes in accounting estimates PPSAS 3.41
prospectively by including in surplus or deficit.
The DSWD correct material prior period errors retrospectively in the first set of PPSAS 3.47
financial statements authorized for issue after their discovery by:
• Restating the comparative amounts for prior period(s) presented in which

the error occurred; or
• If the error occurred before the earliest prior period presented, restating
the opening balances of assets, liabilities and net assets/equity for the
earliest prior period presented.
20
All Fund Clusters
3.9 Foreign currency transactions
Transactions in foreign currencies are initially recognized by applying the spot PPSAS 4.24
exchange rate between the function currency and the foreign currency at the
transaction.
At each reporting date:
• Foreign currency monetary items are translated using the closing rate; PPSAS 4.27
• Nonmonetary items that are measured in terms of historical cost in a
foreign currency shall be translated using the exchange rate at the date of
the transaction; and PPSAS 4.32
• Nonmonetary items that are measured at fair value in a foreign currency
shall be translated using the exchange rates at the date when the fair value
was determined.
Exchange differences arising (a) on the settlement of monetary items, or (b) on

translating monetary items at rates different from those at which they were
translated on initial recognition during the period or in previous financial
statements, are recognized in surplus or deficit in the period in which they arise,
except as those arising on a monetary item that forms part of a reporting entity’s
net investment in a foreign operation.
3.10 Revenue from non-exchange transactions
Recognition and Measurement of Assets from Non-Exchange Transactions PPSAS 23.31
An inflow of resources from a non-exchange transaction, other than services in-

kind, that meets the definition of an asset are recognized as an asset if the
following criteria are met:
• It is probable that the future economic benefits or service potential PPSAS 23.42
associated with the asset will flow to the entity; and
• The fair value of the asset can be measured reliably.
An asset acquired through a non-exchange transaction is initially measured at its PPSAS 23.44
fair value as at the date of acquisition.
Recognition Revenue from Non-Exchange Transactions
An inflow of resources from a non-exchange transaction recognized as an asset is PPSAS 23.45

recognized as revenue, except to the extent that a liability is also recognized in
respect of the same inflow.
As DSWD satisfies a present obligation recognized as a liability in respect of an

inflow of resources from a non-exchange transaction recognized as an asset, it
reduces the carrying amount of the liability recognized and recognize an amount
of revenue equal to that reduction.
21
All Fund Clusters
Measurement of Revenue from Non-Exchange Transactions
Revenue from non-exchange transactions is measured at the amount of the PPSAS 23.48-
increase in net assets recognized by the entity, unless a corresponding liability is 49
recognized.
Measurement of Liabilities on Initial Recognition from Non-Exchange

Transactions
The amount recognized as a liability in a non-exchange transaction is the best PPSAS 23.57
estimate of the amount required to settle the present obligation at the reporting
date.
Fees and fines not related to taxes
The DSWD recognizes revenues from fees and fines, except those related to PPSAS 23.89
taxes, when earned and the asset recognition criteria are met.
Other non-exchange revenues were recognized when it is probable that the future
economic benefits or service potential associated with the asset will flow to the
entity and the fair value of the asset can be measured reliably.
Gifts and Donations
The DSWD recognizes assets and revenue from gifts and donations when it is PPSAS 23.95
probable that the future economic benefits or service potential will flow to the
entity and the fair value of the assets can be measured reliably.
Goods in-kind are recognized as assets when the goods are received, or there is a PPSAS 23.96
binding arrangement to receive the goods. If goods in-kind are received without
conditions attached, revenue is recognized immediately. If conditions are
attached, a liability is recognized, which is reduced and revenue recognized as
the conditions are satisfied.
On initial recognition, gifts and donations including goods in-kind are measured PPSAS 23.97
at their fair value as at the date of acquisition, which were ascertained by
reference to an active market, or by appraisal. An appraisal of the value of an
asset is normally undertaken by a member of the valuation profession who holds
a recognized and relevant professional qualification. For many assets, the fair
value are ascertained by reference to quoted prices in an active and liquid market.
Transfers
The DSWD recognizes an asset in respect of transfers when the transferred PPSAS 23.96
resources meet the definition of an asset and satisfy the criteria for recognition as
an asset, except those arising from services in-kind.
Services in-Kind
22
All Fund Clusters
Services in-kind are not recognized as asset and revenue considering the PPSAS 23.98
complexity of the determination of and recognition of asset and revenue and the PAG3 of
eventual recognition of expenses. PPSAS 23
Transfers from other government entities
Revenues from non-exchange transactions with other government entities and the PPSAS 23.42
related assets are measured at fair value and recognized on obtaining control of PPSAS 23.44
the asset (cash, goods, services and property) if the transfer is free from
conditions and it is probable that the economic benefits or service potential
related to the asset will flow to the Department of Social Welfare and
Development and can be measured reliably.
3.11 Budget information PPSAS 24
The annual budget is prepared on a cash basis and is published in the government
website.
A separate Statement of Comparison of Budget and Actual Amounts (SCBAA)

was prepared since the budget and financial statements were not prepared on
comparable basis. The SCBAA was presented showing the original and final
budget and the actual amounts on comparable basis to the budget.
3.12 Impairment of Non-Financial Assets PPSAS 21.26
Impairment of non-cash-generating assets PPSAS 26.14
The DSWD assesses at each reporting date whether there is an indication that a
non-cash-generating asset may be impaired. If any indication exists, or when
annual impairment testing for an asset is required, the DSWD estimates the asset’s PPSAS 26.14
recoverable service amount. An asset’s recoverable service amount is the higher of
the non-cash generating asset’s fair value less costs to sell and its value in use.
Where the carrying amount of an asset exceeds its recoverable service amount, the
asset is considered impaired and is written down to its recoverable service amount.
The DSWD classifies assets as cash-generating assets when those assets are held
with the primary objective generating a commercial return. Therefore, non-cash
generating assets would be those assets from which the DSWD does not intend (as
its primary objective) to realize a commercial return.
3.13 Employee benefits
The employees of DSWD are members of the Government Service Insurance

System (GSIS) which provides life and retirement insurance coverage.
The DSWD recognizes the undiscounted amount of short term employee benefits,
like salaries, wages, bonuses, allowance, etc., as expense and as a liability after
deducting the amount paid.
23
All Fund Clusters
The DSWD recognizes expenses for accumulating compensated absences when

these were paid (commuted or paid as terminal leave benefits). Unused
entitlements that has accumulated at the reporting date were not recognized as
expense. Non-accumulating compensated absences, like special leave privileges,
were not recognized.
3.14 Measurement uncertainty
The preparation of financial statements in conformity with PPSAS, requires

management to make estimates and assumptions that affect the reporting amounts
of assets and liabilities, at the date of the financial statements and the reported
amounts of the revenues and expenses during the period. Items requiring the use
of significant estimates include the useful life of capital assets.
Estimates were based on the best information available at the time of preparation
of the financial statements and were reviewed annually to reflect new information
as it becomes available. Measurement uncertainty exists in these financial
statements. Actual results could differ from these estimates.
4. Changes in Accounting Policies
DSWD has not adopted any change in Accounting Policies for CY 2016. The 25 PPSAS had
been adopted beginning January 1, 2014 as per COA Resolution No. 2014-003 dated January
24, 2014.
5. Prior Period Adjustments
The DSWD has determined transactions relating to the previous year which have cumulative
effect on surplus/deficit of the prior year.
The description of the prior period adjustments, including peso amount, its effect for each
financial statement line item affected in current and prior year, and cumulative effect on
opening accumulated surplus/(deficit) in current and prior year, and cumulative effect on
surplus/deficit in prior year are shown on this notes to financial statements.
6. Cash and Cash Equivalents
Account Name 2019 2018 As Restated

Cash - Collecting Officer P 44,450,738.60 P 41,840,026.49
Petty Cash 50,621,752.51 20,848,644.64
Cash in Bank - Local Currency, Current
13,512,627,574.22 17,280,413,286.54
Account
Cash in Bank - Local Currency, Savings
313,374.55 4,779,411.85
Account
Cash in Bank - Foreign Currency, Savings
604,630,599.04 1,147,757,949.16
Account
Cash - Treasury/Agency Deposit, Special 197,456,786.61 270,084,385.95
24
All Fund Clusters

Cash - Treasury/Agency Deposit, Trust 689,609,835.83 498,584,106.80
Cash, TRA 544,394.28
Total 15,099,710,661.36 19,264,852,205.71
All collections during the year were remitted to the Bureau of Treasury except for the
amount of P44,450,738.60 which was deposited on the first working day of January 2020
In Central Office, the Petty Cash Fund (PCF) is maintained under the imprest system
wherein at year end the PCF balance is always the same as if its first issuance unless there is an
authority to increase or decrease the said amount. The PCF represents the amount granted to
petty cash custodians for various petty expenditures of the Department. The PCF of Ms. Ester
Egamino was liquidated through the submission of unreplenished petty cash vouchers
amounting to P18,639.84 and refunded the balance P1,360.16 on January 20, 2020 per Official
Receipt No. 4829401. While, Ms. Gloria G. Dominguez replenished her PCF during the year,
thus, the P150,000 remains intact at year end.
While, in Field Offices, the account represents the cash advances granted to bonded
officers of the various Centers and Institutions and for Assistance in Crisis Situation (AICS) of
the Crisis Intervention Unit, as well as, assistance to deportees.
Cash in Bank- Local Currency, Current Account pertains to deposits with Land
Bank of the Philippines maintained for payroll, Bureau of Internal Revenue and Bureau of
Customs transactions. It also includes cash grants for the Pantawid Pamilya beneficiaries
deposited to LBP Conduit Accounts and DSWD 4Ps PVB Account amounting to
P12,802,746,828.57, as well as accounts for SEA-RSF, training fund, KALAHI-CIDSS peso
accounts, donations and BAC honoraria.
Cash in Bank, Local Currency, Savings Account pertains to Field Office II receipts
from income generating project and trust liabilities that were deposited under Philippine
Veterans Bank.
Cash in Bank Foreign Currency Savings Account includes the deposits from Grants
and Donations and loan proceeds received by DSWD from National Community Driven
Development Project (NCDDP)–World Bank DSWD Foreign Donations
Cash-Treasury/Agency Deposit, Special Account pertains to the receipt of NCA per

Direct Funding Agreement Nos. 70013 and 70507 between the Government of Australia as
represented by the Department of Foreign Affairs and Trade (DFAT) and DSWD.
Cash-Treasury/Agency Deposit, Trust Account represents the amount from DSWD

Miscellaneous Trust Account, DSWD Donations Account, DSWD Performance Bond -
Guaranty/Security Deposits Payable and Bidders Bid Security (transferred from Cluster 1 to
Cluster 7), and other DSWD Trust Accounts previously deposited with the AGDB which are
now deposited or remitted to the Bureau of the Treasury as of December 31, 2019.
In Field Offices, the account includes collection from LGUs as 1/3 share for cost of
care and maintenance of residents confined at Regional Rehabilitation Center for Youth as
provided under Section 50 of RA No. 9344 Juvenile Justice and Welfare Act dated April 28,
25
All Fund Clusters
2006. It also includes Field Office IX seminar fees, affiliation fees/practicum fees on students
that are placed-out at different centers as care giver trainees, sale of scrap materials and
collections from RYH dormitory. Utilization of which is subject for DBM authorization. While,
Field Office IVA represents current and prior year National Training School for Boys care and
maintenance collections deposited to the Bureau of Treasury for Miscellaneous Trust Fund
account.
7. Receivables
Accounts 2019 2018
Accounts Receivable 56,548.23 83,922.04
Loans Receivable - Others 34,821,028.31 35,648,581.22

7.1 Loans and Receivables Accounts 34,877,576.54 35,732,503.26
Due from National Government Agencies 1,805,792,531.11 2,126,585,775.26

Due from Government-Owned and/or Controlled
Corporations 5,652,711,092.95 21,510,249,849.01
Due from Local Government Units 4,622,885,285.58 5,295,104,468.32

7.3 Inter-Agency Receivables 12,081,388,909.64 28,931,940,092.59
Due from Central Office - 647,328,668.70

Due from Regional Offices 297,160,390.00 -
Due from Other Funds 3,319,068.80 1,520,295.97
7.4 Intra-Agency Receivables 300,479,458.80 648,848,964.67
Receivables - Disallowances/Charges 23,777,924.67 20,877,450.66
Due from Officers and Employees 2,797,686.92 3,126,496.07

Due from Non-Government
Organizations/People's Organizations 2,164,924,711.78 1,916,166,992.50
Other Receivables 40,310,880.88 42,705,102.77
Allowance for Impairment - Other Receivables (10,450,963.00) (10,450,963.00)
7.5 Other Receivables 2,221,360,241.25 1,972,425,079.00
7 Total Receivables 14,638,106,186.23 31,588,946,639.52
7.1 Loans and Accounts Receivables
Accounts 2019 2018 As Restated

Accounts Receivable P 56,548.23 P 83,922.04
Loans Receivable - Others 34,821,028.31 35,648,581.22
Total 34,877,576.54 35,732,503.26
26
All Fund Clusters
In Central Office, COA has granted the Department’s request for write-off of dormant
Accounts Receivable amounting to P73,103.06 per Decision No. 2019-01 dated September 10,
2019. The P441.40 pertains to receivable in current operations.
Accounts Receivable includes Field Office VIII balance of P55,869.36

forwarded from CY2013 in the amount of P37,166.13 which is dormant account since
1987 and an amount of P18,703.23 balance forwarded from the CY2016. Efforts have
been exerted to determine the details of this account, however, no data has still been
found.
Loans Receivable - Others represents capital assistance extended to

clients/beneficiaries of PGMA Micro-financing program and National Livelihood Support Fund
project.
7.2 Aging/Analysis of Receivables
Not Past due

Total past < 30 30 - 60
> 60 days
Accounts due days days
Accounts Receivable P 56,548.23 - - - P 56,548.23
TOTAL 56,548.23 56,548.23
7.3 Inter-Agency Receivables
2019
Account Name
Current Non-Current Total
Due from National -
Government Agencies
P 1,805,792,531.11 P 1,805,792,531.11
Due from Government- -
Owned and/or Controlled 5,652,711,092.95 5,652,711,092.95
Corporations
Due from Local -
4,622,885,285.58 4,622,885,285.58
Government Units
TOTAL 12,081,388,909.64 - 12,081,388,909.64
In Central Office, Due from National Government Agencies are broken down as
follows:
Name Amount
Issued in CY 2019:
Department of Public Works and Highways-QCFED P 336,227.11
DBM Procurement Service 6,125,276.60
Sub-total 6,461,503.71
Issued in CY 2018 and Prior Years:

ARMM 1,381,679.50
27
All Fund Clusters
Commission on Higher Education (CHED) 42,238,030.15

Department of Agrarian Reform 944,995,403.80
Department of Public Works & Highways – CO 118,195,964.15
Department of Public Works & Highways – NCR 15,911,932.68
Department of Public Works & Highways – QCFED 26,784,641.60
Department of Public Works & Highways – SMED 6,481,648.15
National Council of Disability Affairs 2,124,755.00
Philippine Information Agency 106,044.57
DBM Procurement Service 40,519,817.24
UP College of Education 409,124.30
Sub-total 1,199,149,041.14
GRAND TOTAL P 1,205,610,544.85
Current Year’s balance of Due from National Government amounting to

P40,729,600.46 was reduced to P6,453,481.61 or equivalent to 84.16% was liquidated from
current fund transfers.
The balance of funds transferred to the Procurement Service (DBM) pertains to the
procurement of ordinary or regular office supplies and equipment which are required by
Republic Act No. 9184, otherwise known as Government Procurement Reform Act, to be
procured from Procurement Service (PS). The Department advances amount required for the
items based on the Agency Procurement Request.
The Due from ARMM amounting to P1,000,000.00 represents the balance of fund
transferred to ARMM for the implementation of the PGMA-Micro Financing under the SEA-K
scheme. Coordination was already made to BARMM Accountant to facilitate the submission of
liquidation reports for the said balance.
The Department had sent quarterly follow-up/demand letters and conduct annual
personal visit to Implementing Agencies (IAs) with overdue accounts/long outstanding fund
transfers to oblige them to submit regular liquidation reports in accordance with COA Circular
No. 94-013 dated 13 December 1994. The latest demand letter sent was on December 5, 2019
to those IAs with accounts balances.
There were personal visits to follow-up the submission of liquidation reports to

Implementing Agencies such as the Commission on Higher Education (CHED), University of
the Philippines (UP), DOST-TRC, Socialize Housing Finance Corporation and Philippine
Information Agency (PIA), with regards to their respective remaining balances. Coordinated
with Ms. Lorelie Vinluan, Project Coordinator of UP College of Education and promised to
gather all the documents and submit personally to the Department. While the remaining balance
of PIA is still subject for their on-going reconciliation and promised to refund the balance once
done with their reconciliation.
In Field Office NCR, Due from NGAs includes 2001 to 2017 receivables from the
Procurement Service, Schools, Hospitals and DPWH with a total amount of P11,623,518.34,
half of the amount was from QC Division Schools amounting to P6,600,000.00 dated May
2015.
28
All Fund Clusters
In Field Office I, Due from NGAs represents balances of fund transfer to Philippine
Carabao Center (PCC) and various State Universities and Colleges (SUCs) for the skills training
on Microenterprise Development projects of the Sustainable Livelihood Program.
In Central Office, Due from GOCCs are broken down as follows:
Name of GOCC Amount

CY 2019
Land Bank of the Philippines P 5,156,609,809.26
Sub-total 5,156,609,809.26
CY 2018 and Prior Years
National Food Authority 378,100.00
Philippine International Trading Corp. (PITC) 269,731,026.27
Social Housing and Finance Corp. 10,360,000.00
Technology & Livelihood Resource Center (TLRC) 23,500,000.00
Sub-total 303,969,126.27
Grand Total P 5,460,578,935.53
The balance of P2,557,539,885.47 and P2,599,069,923.79 was Due from the Land Bank
of the Philippines that pertains to fund transfers for the over-the-counter payment of cash grants
of Pantawid Pamilya beneficiaries for the current year and prior years, respectively.
The Due from the National Food Authority was a balance of fund transferred for the
purchase of NFA rice to be used in the preparation of family food packs by the National
Response and Logistics Management Bureau (NRLMB).
The balance of the fund transfer to Philippine International Trading Corp. (PITC)
amounting to P4,024,690.62 was for the emergency procurement of goods and services under
the Yolanda Recovery and Rehabilitation Program, while the P265,710,692.67 was for goods,
services and infrastructure projects of the ICTMS.
Demand letter was sent last December 5, 2019 to Social Housing and Finance
Corporation (SHFC) for the outstanding balance of P10,360,000.00 requesting the submission
of liquidation documents in accordance with COA Circular No. 94-013 dated 13 December
1994. Also, a personal visit was conducted to SHFC- Accounting Office last December 12,
2019 to verify the status of the account balance. It was found out that the balance is still intact
and the project was not yet implemented. Hence, we suggest for the refund of the said amount.
Another personal visit was undertaken to DOST- Technology & Livelihood Resource
Center (TLRC) for the status of the liquidation of funds transferred to TLRC last December 12,
2019. However, the person in-charge is not available to verify the status of the liquidation report
submitted to the Commission on Audit.
In Field Office NCR, Due from GOCCs bulk of receivables was from fund transfer to
National Food Authority from 2007 to 2018 with a total amount of P76,499,737.34 and from
Philippine Veterans Bank amounting to P3,372,000.00 for the stipend of Senior Citizens.
29
All Fund Clusters
In Field Office I, Due from NGOs/POs amounting to P500,000.00 pertains to fund

transfer to Cooperative Bank of Pangasinan that ceased operation sometime in 2004. No
liability was recorded in the books of the bank in favour of DSWD. The FO legal officer sent
demand letter to Mr. Alfredo Gonzales, Bank Manager of the bank during the implementation
of the project.
Total Due from LGU amounting to P397,706,314.49 was transferred for PAMANA-
BLGU-KALAHI CIDSS community grants to various barangays, are broken down as follows:
Name of LGU Amount

CY 2019
Various Barangays – PAMANA-BLGU KALAHI CIDSS P 366,421,932.68
Prior Years
Various Barangays – PAMANA-BLGU KALAHI CIDSS 31,284,381.81
TOTAL P 397,706,314.49
Due from the Municipality of Guihulngan, Negros Oriental in the amount of

P1,495,755.75 and La Libertad, Negros Oriental in the amount of P1,001,925.00 were already
fully settled in CY 2019.
In Field Office V, Due from GOCCs account represents the balance of funds transferred
to the National Food Authority for the implementation of the Supplemental Feeding Program.
According to the National Food Authority Regional Office, they had already returned the
unutilized balance to the NFA Central Office, but since such amounts were not yet returned to
the DSWD Field Office, the amounts still remain in the books of the latter.
In Field Offices, Due from LGUs includes funds transferred to different provinces and
municipalities/cities of the regions for the implementation of various programs of the
Department i.e., Supplemental Feeding Program (SFP), Social Pension for indigent senior
citizens, Crisis Intervention program, Sustainable Livelihood, implementation of Bottom-up
Budgeting, calamity fund, shelter assistance, construction of Core Shelter units and day care
center and senior citizens center. Letters have already been mailed to concerned LGUs to
follow- up submission of the utilization reports in accordance with COA Circular No. 94-013 to
facilitate the liquidation process of outstanding balances.
In Field Office III, the account pertains to funds transferred to all one hundred thirty-
seven (137) municipalities, cities and provincial government to all seven (7) provinces of
Region III. With the commitment of the agency to deliver timely processing and liquidation of
transfer of funds, a regional memorandum circular was crafted and approved named as
“Regional Guidelines in the Assessment, Processing, Releasing and Monitoring of
Implementation and Liquidation of Transfer of Funds to the Local Government Units (LGUs)”.
This guideline includes the process flow on processing of transfer of funds and the submission
of Pledge of Commitment in which the LGU commit to liquidate based on the prescribed
timeline prior to the release of check.
The account Due from LGUs includes the balance of funds transferred in prior years to
different provinces and municipalities in Region 9 for the implementation of various programs
of the Department i.e., Assistance to Community in Need, Supplemental Feeding Program
30
All Fund Clusters
(SFP), Social Pension for indigent senior citizens, implementation of Bottom-up Budgeting and
transfer of funds to the different municipalities in Basilan and Tawi-Tawi Province for the
Construction of Core Shelter units for Sabah displacement and construction of day care.
Coordination and provision of technical assistance to LGU implementers and monitoring visits
to LGUs as to program implementation and constant follow-up relating to prior years'
unliquidated fund balances are constantly done by program focal persons. Demand letters were
also sent to Local Chief Executives for the immediate submission of liquidation documents.
The long outstanding balances for SF Programs remain unliquidated because some are
still due for utilization while some are already utilized but concerned LGUs failed to submit
their liquidation reports. The bulk of the unliquidated amount is that of the fund transferred to 3
LGUs (Payao, Malangas and Alicia, Zamboanga Sibugay for the implementation of PAMANA
- PSB programs and projects transferred last December 2018.
Also, in CY2007, FO9 has downloaded the 2nd tranche or equivalent to 30% to the
Municipality of Mapun for the construction of core-shelter units amounting to P1,050,000 but
up to this time, no liquidation had been submitted to this Office. Demand letters were sent to the
LGU concerned and DSWD ARMM Tawi-Tawi who is responsible in the monitoring of the
project.
In CARAGA, on Bottom-up Budgeting projects under PSU, only two LGUs remain to
have unliquidated balance of P2,406,481.47. One has already completed implementation
(P2,342,781.47), and on the process of liquidation. Implementation is still on-going by the other
LGU.
On BUB under SLP, 8 out of 11 LGUs have unliquidated balances of P4,496,016.97.

One of the 8 LGUs has projects that are still on-going (P2,954,059.79); 7 are already completed
and liquidation is on process (P1,541,957.18). The project Implementers are under close
monitoring by the PDO’s.
On Supplementary Feeding Program, the 26 LGUs (7th and 8th cycle implementation)
submitted liquidation amounting to P 21,216,073.99 that were reversed due to audit findings
received from COA, only 14 LGUs (P10,279,307.00) were able to comply, 8 LGUs wrote a
letter that they can no longer comply with the requirements and the remaining LGUs were still
unliquidated. On the 8th cycle implementation, only 49 LGUs out of 75 LGUs were able to
fully liquidate with a total liquidated amount of P 118,154,151.84.
On PSP E-AICS, 46 out of 92 projects have unliquidated balances. The 22 projects

amounting to P3,185,575.96 are already completed and on liquidation process; 24 projects are
still on-going.
The Field Office is taking serious efforts to secure liquidation from the LGUs. Constant
follow ups through phone calls and demand letters are being made.
31
All Fund Clusters
7.4 Intra-Agency Receivables
Account Name 2019 2018

Due from Regional Offices P 297,160,390.00 P 647,328,668.70
Due from Other Funds 3,319,068.80 1,520,295.97
TOTAL 300,479,458.80 648,848,964.67
Due from Regional Office represents the following funds transferred to FOs for
implementation of various programs subject for liquidation:
• PGMA Microfinancing and Enterprise Development Program and National Livelihood

Support Fund.
• temporary housing assistance for 5,587 family victims of the CY 2013 Zamboanga City
siege under the Zamboanga City Roadmap to recovery and reconstruction plan and for the
Pilot Implementation of Community Managed Road Maintenance Project
• Libreng Gamot sa Masa (Lingap sa Masa) medicine assistance program of the Office of
the President
• Community Grants as per Memorandum of Agreement between DSWD and Deped for
the construction of 605 classroom
• Second Tranche financial assistance to DSWD Employees affected by Typhoon Yolanda
and 7.2 Magnitude Earthquake in Bohol
• Socio economic programs for Normalization on the Bangsamoro
• Conduct of 2019 nationwide survey on the nature and extent of drug abuse in the
Philippines
The difference of P2,107,524.25 between Due from Regional Office of

P297,160,390.00 versus Due to Central Office of P295,052,865.75 is accounted as follows:
FO Amount Particulars
XII P 514,268.80 Discrepancy in account of PGMA microfinance project
subject for verification
NCR 1,593,255.45 Advances for salaries of transferred/detailed officials in
Field Office IVA, however, Due to Regional Office
account of Field Office IVA amounts to P765,792.62 or
a difference of P827,462.83 subject for reconciliation
and verification of the concerned regions
Total P 2,107,524.25
Due from Other Funds pertains to disbursements inadvertently charged to wrong

Fund, which was or will be paid through remittance of the amount to Bureau of Treasury.
7.5 Other Receivables
This account consists of the following:

Receivables - Disallowances/Charges P 23,777,924.67 P 20,877,450.66
Due from Officers and Employees 2,797,686.92 3,126,496.07
Due from Non-Government 2,164,924,711.78 1,916,166,992.50
32
All Fund Clusters
Organizations/People's Organizations
Other Receivables 40,310,880.88 42,705,102.77
Allowance for Impairment - Other Receivables (10,450,963.00) (10,450,963.00)
TOTAL P 2,221,360,241.25 P 1,972,425,079.00
The account Receivables-Disallowances/Charges represents the disallowance for

various types of expenses including Staple Food Incentive (SFI) and Agency Productivity
Bonus (APB) given to DSWD Officials and Employees for CY 2000. The disallowances are
under appeal by the DSWD employees. Though the disallowances/charges are under appeal,
these are being collected from the officials and employees upon retirement, resignation,
termination or transfer of office.
The account also includes Field Office IX unsettled CNA disallowance of

retired/deceased personnel in the amount of P260,403.00; Field Office VII assistance to low
salaried employees; and Field Office II receivables from devolved employees since 1990 which
was subject to litigation and payment of Magna Carta Benefit-Hazard Pay of employees for CY
2015 and unauthorized payment of honoraria for CY2015
The account Due from Officers and Employees in Central Office of P188,357.30
pertains to receivables from officials and employees resulted from overpayment of salaries due
to leave without pay and excess payment of CNA in CY2011 which are being deducted from
the monthly payroll.
In Field Offices, the account includes the following:
Field Office Particulars

FO-CAR P772,406.54 accountabilities of employees that were set-up due to the loss
of asset, overpayment of salaries and remittance of employees benefits in
which salaries are not yet paid.
FO-IVA P20,074.90 loss of assets due to fire calamity incident last January 22, 2016
at the DSWD-IVA Records Center located in GMA, Cavite with pending
result of relief of accountability.
FO-IX Over deduction from salary amounting to P1,730.95 and
overpayment of salary amounting to P18,516.24 in which deduction will be
effected in 2020
CARAGA P933,786.88 composed of P865,094.70 Cash shortage and P18,001.94
unremitted collections and P50,690.24 receivable from employees on excess
CNA benefit granted in December 2011.
In Central Office, Due from Non-Government Organizations/People’s Organization

includes transfer to United Nations Development Programme (UNDP) on the implementation of
the 10 projects on “Accelerating Bottom-Up Budgeting through inclusive and effective
Governance” with Project ID: 00094900 totaling P516,347,786.98 will be coordinated with
proper OBSUs to facilitate the submission of liquidation report. Accordingly, UNDP
committed to submit a closure report and financial report by March 2020.
Prior years’ outstanding fund transfer to Jacinto Castel Borja Foundation, Inc. in the
total amount of P14,180,000.00 was fully accounted in the books of accounts through the
validation report and issuance of the Certificate of Allowable Expenses issued by our Internal
33
All Fund Clusters
Audit Service amounting to P6,080,000.00 and refunded the amount of P8,100,000.00 on April
26, 2019.
Additional issuance of validation report and Certificate of Allowable Expenses by our

Internal Audit Service facilitated the reduction in the outstanding balances of Active Citizenship
Foundation, Inc. and PETA for the amount of P1,642,000.00 and P219,500.00, respectively.
Also, the said account includes transfers to barangay communities for the
implementation of KALAHI CIDSS-NCDDP-PAMANA Project and the liquidations and
refund of various barangay communities.
In Field Offices, Due from NGOs/POs includes unliquidated balances of Kalahi-CIDSS

and BUB Projects and construction of tangible projects, modified cash transfers
implementation, Priority Development Assistance Fund and transfer to Day Care workers group
and organized federation intended for Supplemental feeding program. Unliquidated balances
from 2009 and below are subject for write-off considering the reglementary period of 10 years
and above.
In Field Office I, the amount of P 500,000.00 is fund transfer to Cooperative Bank of

Pangasinan that ceased operation sometime in 2004. No liability was recorded in the books of
the bank in favour of DSWD. Our Legal Officer sent demand letters to Mr. Alfredo Gonzales,
Bank Manager of the bank during the implementation of the project.
In Field Office II, it includes funds released to various Non-Government Organizations

in previous years for the implementation of BUB and prior years funded from Congressional
Initiative, Congressional Development Funds (CDF) and PDAF of congressman. This also
includes funds released to non-formal organizations/groups like the Day Care Workers Groups
and Parents Federation for Supplementary Feeding Program, MCCT projects, livelihood and
KALAHI-CIDSS projects under the BUB.
In Field office III, out of the unliquidated balance of P32,885,104.33, the

P8,340,000.00 or 3% was already requested for write-off by the DSWD-Central Office and
were endorsed by the DSWD-CO Legal Office to the Solicitor General on June 3, 2017. As of
to date, no update was received from the Solicitor General Office despite of continuous follow
up DSWD-CO.
Three (3) NGOs amounting to P10,920,000.00 or 3.7% has no certificate of allowable

expenses verified by IAS of DSWD-CO. Three (3) NGOs amounting to P482,104.33 or 0.17%
are for settlement of balance disallowed by IAS of the DSWD-CO. One (1) NGO amounting to
P10,483,000.00 or 3.5% is still at IAS for validation of liquidation report. One (1) NGO
amounting to P700,000.00 is unlocated and one (1) NGO amounting to P1,960,000.00 has not
yet submitted liquidation reports.
In Central Office, a reduction in the account of Other Receivables amounting to

P1,657,128.29 was recorded in the books of accounts upon receipt of the authority to write-off
the account per COA Decision No. 2018-01 dated October 8, 2018 and NGS-Cluster 6 Decision
No. 2019-001 dated January 3, 2019 on dormant accounts aging 10 years and above. The
remaining balance for dormant accounts aging 10 years and above will also be requested
authority for write-off from COA.
34
All Fund Clusters
In Field Offices, the account Other Receivables includes the following:
FO-CAR Over payment of payables and will be credited once payment is received.
FO-II Payments to various suppliers which are not yet delivered but paid based on
“Cash-on-delivery
FO-IVA Social Pension Program grants for Senior Citizens thru its conduit partner, the
Philippine Veterans Bank.
FO-V advances granted to former DSWD employees and officials for official travel or
as disbursing officers of the Department. Re-classification of these balances
were undertaken due to impossibility of collection from separated employees
and collectibles from resigned employees who have not secured clearance for
their accountabilities and who cannot be located anymore
FO-IX receipts from other funds due to checks inadvertently issued under other bank
accounts. Reclassification from Account #20101010 was made in the amount of
P1,900,000.00 which was then under COA Investigation. Also recorded in this
Account is the reconciling items reflected in the Bank Reconciliation Statement
checks not taken up by the Agency in the total amount of P8,239,628.96 which
is the accountability of the previous cashier, Ms. Aurora Agustin, who
absconded last February 1997. This is the subject of COA investigation.
Undeposited collections of the missing cashier in the amount of P2,647.71 while
the amount of P21,000 represents undeposited collections of PSCB sales
covering Ms. Malou Dolar's accountability.
FO-XI Cash shortage by the convicted former cashier plus her unliquidated cash
advances and undeposited collections for a total of P2,023,005.55. She can no
longer be located. This account also includes reclassified investment in stock
worth P1,300.00.
CARAGA Receivable from LGUs with RRCY and HFG CICL wards for their one-third
share in the said facility’s operations amounting to P3,270,089.32, a receivable
amounting to P546.43 under JSDF CDED and a financial assistance from the
Office of the President for the livelihood projects of the two beneficiaries of
killed DENR anti-illegal logging enforcers amounting to P420,000.00. This also
includes agency’s receivable from Sword & Flame amounting to P102,059.50
under Fund Cluster 02 whose amount was erroneously credited to their account
last April 26, 2016. Series of follow-ups were already made to the said supplier
for the collection of the refund.
35
All Fund Clusters
8. Inventories
Inventory items of the Department include the following:
2019
Reversal of
Inventories Inventory
Inventory
Accounts Inventories carried at carried at write-down
write-down
the lower of cost and fair value recognized
recognized
net realizable value less cost to during the
during the
sell year
year
Inventory Held for - - - -
Distribution
Carrying Amount, P 2,029,462,529.77 - - -
January 1, 2019
Additions/Acquisitions 924,984,262.18 - - -
during the year
Expensed during the year (844,534,378.83) - - -
except write-down
Adjustments during the (219,120,224.37) - - -
year
Write-down during the (13,856,237.52) - - -
year
Reversal of Write-down - - - -
during the year
Carrying Amount, 1,876,935,951.23 - - -
December 31, 2019
Inventory Held for - - - -
Consumption
Carrying Amount, 673,526,943.61 - - -
January 1, 2019
during the year
except write-down
year
Write-down during the (151,605,931.95) - - -
year
Reversal of Write-down - - - -
during the year
Carrying Amount, 744,265,337.06 - - -
December 31, 2019
Semi-Expendable - - - -
Inventory
Carrying Amount, 36,649,346.00 - - -
January 1, 2019
36
All Fund Clusters
during the year
except write-down
year
Write-down during the - - - -
year
Reversal of Write-down (20,970.00) - - -
during the year
Carrying Amount, 58,975,732.39 - - -
December 31, 2019
TOTALS CARRYING P 2,680,177,020.68 - - -
AMOUNT,
DECEMBER 31, 2019

Inventory Held for Distribution
Food Supplies for Distribution P 84,107,814.53 P 83,781,702.03
Welfare Goods for Distribution 1,747,722,566.62 1,891,298,774.77
Drugs and Medicines for Distribution 627,153.54 627,153.54
Medical, Dental and Laboratory Supplies for 332.98 332.98
Distribution
Construction Materials for Distribution - -
Property and Equipment for Distribution 25,000.00 25,000.00
Other Supplies and Materials for Distribution 44,453,083.56 53,729,566.45
Sub-total – Inventory Held for Distribution 1,876,935,951.23 2,029,462,529.77
Inventory Held for Consumption
Office Supplies Inventory 226,113,996.76 235,340,549.38
Accountable Forms, Plates and Stickers Inventory 584,545.50 1,015,741.00
Non-Accountable Forms Inventory 1,329,019.14 706,100.25
Food Supplies Inventory 282,922,270.10 180,618,228.14
Drugs and Medicines Inventory 12,953,888.09 5,055,438.98
Medical, Dental and Laboratory Supplies 1,941,773.32 858,213.62
Inventory
Fuel, Oil and Lubricants Inventory 74,012.55 74,012.55
Agricultural and Marine Supplies Inventory - -
Textbooks and Instructional Materials Inventory 243,033.00 241,886.00
Construction Materials Inventory 4,366,861.82 4,036,580.86
Other Supplies and Materials Inventory 213,735,936.78 245,580,192.83
Sub-total 744,265,337.06 673,526,943.61
Semi-Expendable Machinery and Equipment
Semi-Expendable Machinery 63,959.05 (294,418.00)
Semi-Expendable Office Equipment 13,770,479.26 4,346,175.99
Semi-Expendable Information and 11,971,862.46 13,136,932.01
Communications Technology Equipment
37
All Fund Clusters
Semi-Expendable Communications Equipment 939,753.92 792,564.44

Semi-Expendable Disaster Response and Rescue 594,616.00 1,853,151.24
Equipment
Semi-Expendable Medical Equipment 311,084.58 282,954.58
Semi-Expendable Printing Equipment 414,117.89 630,276.00
Semi-Expendable Sports Equipment 72,600.00 28,695.20
Semi-Expendable Technical and Scientific 60,690.00 (973,998.00)
Equipment
Semi-Expendable Other Machinery and 9,779,772.96 2,245,696.15
Equipment
Sub-total 37,978,936.12 22,048,029.61
Semi-Expendable Furniture and Fixtures 20,996,796.27 14,601,316.39
Semi-Expendable Books - -
Sub-Total 20,996,796.27 14,601,316.39
Sub-Total – Inventory Held For Consumption 803,241,069.45 710,176,289.61
TOTAL P 2,680,177,020.68 P 2,739,638,819.38
The account Welfare Goods for Distribution represents cost of food and non-food
items being used for the production of family food packs and non-food supplies for distribution
to individuals affected by various calamities, disasters and ground conflicts. These are locally
purchased inventories out of General Appropriations Act (GAA). The Report of Supplies and
Materials Issued (RSMI) report submitted by NRLMS warehouse as of December 31, 2019 was
already taken up in the books of accounts.
The account Office Supplies Inventory consists of office supplies, printed special
forms, IT supplies and janitorial supplies in stockpile of the DSWD Central Office.
Accountable Form Inventory includes the printing of accountable forms namely;

Purchase Order, Purchase Request, Requisition and Issuance Slip, Inspection and Acceptance
Report and LBP blank checks.
Non-Accountable Forms Inventory is the remaining of NHTS Family Assessment

Form (FAF).
Food Supplies Inventory consists of food items procured for stock and subsequently
issued for consumption of the wards of various Centers and Residential Facilities of the regions,
i.e. Home for Girls (HFG), Regional Center for Women (RCW), and Regional Rehabilitation
Center for Children and Youth (RRCY), Reception and Study Center for Children, etc..
Drugs and Medicines Inventory and Medical, Dental and Laboratory Supplies
Inventory consist of purchases for consumption and issuance to end-users.
Construction Materials Inventory consists of cost of painting, carpentry, plumbing

and electrical supplies for office repairs and maintenance and other minor constructions of
DSWD Central Office.
Other Supplies and Materials Inventory consist of spare parts purchased for the
repair and maintenance of vehicles and supplies used for packaging of family food packs at
NROC.
38
All Fund Clusters
Semi-Expendable Office Equipment are purchases office equipment costing less than
P15,000.00 for distribution to end-users.
9. Property, Plant and Equipment
Property, Plant and Equipment for CY 2019 are summarized as follows:
Particulars Land Land Infrastructure Buildings and Machinery and

Improvements Assets Other Structures Equipment
Carrying Amount,
January 1, 2019 40,298,220,558.50 77,044,529.28 1,198,021.13 1,024,038,746.34 821,588,151.26
Additions 1,262,364.14 30,032,984.08 - 779,202,671.17 184,828,057.02

Adjustments/
Reclassifications (1,262,364.14) (176,331,998.03) 28,632,039.38
Total 40,298,220,558.50 107,077,513.36 1,198,021.13 1,626,909,419.48 1,035,048,247.66

- -
Disposal/ Transfer - (69,756,408.17) (102,400,190.06)
Depreciation (As per - (6,123,817.87) (59,131.92) (45,283,125.98) (170,426,707.93)
Statement of Financial
Performance)
Impairment Loss (As - - - -
per Statement of -
Financial
Performance)
Carrying Amount,
December 31, 2019
(As per Statement of 40,298,220,558.50 100,953,695.49 1,138,889.21 1,511,869,885.33 762,221,349.67
Financial Position
Gross Cost (Asset 40,298,220,558.50 129,090,788.72 1,490,287.41 2,077,112,622.49 2,009,242,036.84
Account Balance per
Position)
Less: Acc. (28,137,093.23) (351,398.20) (565,242,737.16) (1,246,906,129.29)
Depreciation
Allowance for (114,557.88)
Impairment
Carrying Amount, 40,298,220,558.50 100,953,695.49 1,138,889.21 1,511,869,885.33 762,221,349.67
December 31, 2019
(As per Statement of
Financial Position
Particulars Transportation Furniture, Leased Asset Other Construction in TOTAL

Equipment Fixtures and Property, Progress
Books Plant and
Equipment
Carrying Amount,
January 1, 2019 128,695,314.84 56,938,492.24 36,780.00 30,085,328.58 544,339,342.29 42,982,185,264.46
Additions 373,781,710.26 80,586,600.23 2,259,028.23 86,585,514.24 925,164,798.77 2,463,703,728.14

Adjustments/
Reclassifications 52,054,360.52 (10,653,873.16) (1,897,814.22) (63,954,025.00) (336,175,644.57) (509,589,319.22)
39
All Fund Clusters
Particulars Transportation Furniture, Leased Asset Other Construction in TOTAL

Equipment Fixtures and Property, Progress
Books Plant and
Equipment
Total 554,531,385.62 126,871,219.31 397,994.01 52,716,817.82 1,133,328,496.49 44,936,299,673.38
Disposal/ Transfer (194,234,908.43) (3,452,286.55) - (2,535,837.35) (18,126,212.28) (390,505,842.84)

Depreciation (As per
Statement of Financial (41,627,388.31) (24,845,058.21) - (6,276,212.50) - (294,641,442.72)
Performance)
Impairment Loss (As
per Statement of - - - (1,546,967.05) - (1,546,967.05)
Financial
Performance)
Carrying Amount,
December 31, 2019
(As per Statement of 318,669,088.88 98,573,874.55 397,994.01 42,357,800.92 1,115,202,284.21 44,249,605,420.77
Financial Position
Gross Cost (Asset
Account Balance per 573,673,160.53 163,791,499.11 397,994.01 91,440,160.50 1,115,202,284.21 46,459,661,392.32
Position)
Less: Acc.
Depreciation (255,004,071.65) (65,217,624.56) (49,080,743.08) (2,209,939,797.17)
Allowance for
Impairment (1,616.50) (116,174.38)
Carrying Amount,
December 31, 2019
318,669,088.88 98,573,874.55 397,994.01 42,357,800.92 1,115,202,284.21 44,249,605,420.77
(As per Statement of
Financial Position)
Property, Plant and Equipment is carried at cost less accumulated depreciation. Regular
maintenance, repair and minor replacements are charged against Maintenance and Other
Operating Expense (MOOE).
In Central Office, there are no additions in Land and Other Land Improvements for CY
2019.
Additions to Buildings and Other Structures include rehabilitation of the existing

powerhouse and roofing at Matapat and Magiliw Building at Central Office, upgrading of 2nd
floor employees’ dormitory and rehabilitation of DSWD SWADCAP Building.
Machinery and Equipment account include transactions of Office Equipment,

Information and Communication Technology Equipment, Communication Equipment,
Construction and Heavy Equipment, Disaster Response and Rescue Equipment, Medical
Equipment, Sports Equipment, Technical and Scientific Equipment and Other Machinery and
Equipment. Machinery and Equipment that are below the capitalization threshold of P15,000.00
were reclassified into semi-expendable expense or to its appropriate account.
Transactions for Office Equipment include purchases amounting to P1,336,261.76,

transfer to Field Office NCR amounting to P135,850.00, reclassification of semi-expendable
equipment amounting to P109,200.00 and disposal of unserviceable equipment in the amount of
P1,193,783.99.
40
All Fund Clusters
Transactions for Information and Communication Technology Equipment include

purchases amounting to P29,608,615.05, disposal of unserviceable equipment with book value
of P2,757,919.76 and transfer to various field offices with book value of P 38,245,828.24.
Transactions for Communication Equipment includes purchases amounting to

P85,500.00, transfer to Field Office VIII amounting to P1,517,496.75 and disposal of
unserviceable equipment in the amount of P221,359.80.
Transactions for Technical and Scientific Equipment and Other Machinery and
Equipment are purchases amounting to P78,977.29 and P43,500.00, respectively.
Transactions for Other Property, Plant and Equipment includes purchases amounting to
P150,000.00, transfer to Field Office VIII amounting to P50,000.00 and disposal of
unserviceable equipment with book value of P49,264.39.
Transactions for Motor Vehicle includes the receipt of 13 units of Hino Delivery Truck
donated by the Government of Japan in the amount of P50,623,453.79 and the purchase of 70
units of DSWD Ambulance in the amount of P164,990,000.00. A combined amount of
P190,610,001.16 for both vehicles were transferred to various field offices.
Transactions for Furniture, Fixtures and Books includes purchases amounting to

P21,000.00, reclassification of semi-expendable furniture with book value of P669,700.76 and
transfer to Field Office NCR with book value of P52,388.20
Construction in Progress account refers to different unfinished and on-going

construction projects of the Department as of December 31, 2019.
Increases to Buildings and Other Structures include KALAHI Annex Building, Day
Care and Child Minding Center, Records Data Center (Phase II), Regional Office in Tacloban
City and Main Processing Center in NROC.
In Field Office XII, the Building includes the cost of the New DSWD Regional Office
XII located at Regional Center, Carpenter Hills, Koronadal City, DSWD Annex Building
(Phase I), CIU Building located at DSWD Compound, Purok Bumanaag, Brgy Zone III,
Koronadal City and Admin. Bldg 2 story, concrete Office Bldg, General Services Unit Bldg.
This also includes the RSCC Bldg, Lingap Center, Regional Haven, PSCB Phase II Bldg.,
Dormitory for Trainees (PSCB Phase II), Regional Training Center, PSCB Phase I and Center
for Handicapped which are all situated in Cotabato City.
In CARAGA, the balance of Construction in Progress is for the project of Home for
Girls Power House and Upgrading of Electrical System, not yet reclassified as Building account
since there is still no Certificate of Final Acceptance and Turn-Over received.
41
All Fund Clusters
10. Biological Assets

Breeding Stocks P 154,000.00 P 154,000.00
Livestock Held for
4,300.00 4,300.00
Consumption/Sale/Distribution
Total P 158,300.00 P 158,300.00
Breeding Stocks includes Field Office II - P49,000.00 purchase of carabao as a result of

productivity/livelihood activities (agro-farming) which was a part of rehabilitation of RRCY
residents, and Field office XI- P49,000.00 Breeding stocks of cow for cow raising program in
the centers.
Livestock Held for Consumption/Sale/Distribution is for Field office XI

productivity/livelihood activities in the center and livelihood assets.
11. Intangible Assets
Intangible asset of the Department is composed of Computer Software only to wit:
Computer
Particulars
Software
Carrying Amount, January 1, 2019 P 37,827,064.46
Additions-Purchased/Acquired thru exchange or non-
5,115,643.25
exchange transaction
Adjustments (5,085,643.56)
Total 37,857,064.15
Amortization recognized (As per Statement of Financial
(20,513,462.87)
Performance)
Carrying Amount, December 31, 2019 (As per Statement
17,343,601.28
of Financial Position)
Gross Cost (Balance per Statement of Financial Position) 181,731,609.17
Less: Accumulated Amortization (including accumulated
164,388,007.89
impairment loss)
Carrying Amount, December 31, 2019 (As per Statement
P 17,343,601.28
of Financial Position)
12. Other Assets
Breakdown of Other Assets

2019 2018
A. Other Current Asset
Advances for Operating P 19,483,868.75 P 14,911,291.55
Expenses
Advances for Payroll 25,149,728.54 6,463,684.16
Advances to Special Disbursing 2,985,057,724.92 519,768,610.86
Officer
42
All Fund Clusters
Advances to Officers and 3,616,762.40 2,200,159.40

Employees
12.1 Advances P 3,033,308,084.61 P 543,343,745.97
Total Other Current Assets P 3,033,308,084.61 P 543,343,745.97
B. Other Non-Current Asset
Advances to Contractors P 49,809,012.16 P 131,052,037.67
Prepaid Rent 1,732,609.90 1,771,951.33
Prepaid Registration 13,019.29 9,618.97
Prepaid Insurance 6,342,313.60 6,857,482.40
Other Prepayments 4,438,064.14 4,861,614.14
12.2 Prepayments P 62,335,019.09 P 144,552,704.51
Guaranty Deposits P 9,379,894.21 P 9,967,836.76
Other Deposits 1,453,612.16 1,006,281.06
12.3 Deposits P 10,833,506.37 P 10,974,117.82
Other Assets P 11,397,322.74 P 11,392,942.98
12.4 Other Assets 11,397,322.74 11,392,942.98
Total Other Non-Current P 84,565,848.20 P 166,919,765.31
Assets
12.1 Advances

Advances for Operating Expenses P 19,483,868.75 P 14,911,291.55
Advances for Payroll 25,149,728.54 6,463,684.16
Advances to Special Disbursing Officer 2,985,057,724.92 519,768,610.86
Advances to Officers and Employees 3,616,762.40 2,200,159.40
TOTAL P 3,033,308,084.61 P 543,343,745.97
Advances to Operating Expenses are cash advances granted to Social Welfare

Attaches’ (SWAtts) posted in Kuala Lumpur, Malaysia, Hongkong, Qatar, Kuwait, Jeddah and
Riyadh of Kingdom of Saudi Arabia and Dubai, United Arab Emirates. SWAtts are provided
with operational expenses to be used for administrative expenses and grants/subsidies to
Overseas Filipinos needing financial intervention through bank transfer of funds.
Details and status of the unliquidated balance of P18,961,519.60 from Central Office is
as follows:
Country of Unliquidated
Status
Assignment Balance
Jeddah, KSA 4,149,968.48 Included in the balance was P1,262,846.62,

unliquidated balance of the late Ms. Josephine
Arang. Newly assigned SWAtt posted last June
2019 had a remaining balance P2,887,121.86,
after considering the last liquidation report for
the month of September 2019.
43
All Fund Clusters
Country of Unliquidated
Status
Assignment Balance
Riyadh, KSA 2,025,317.46 Balance is composed of two accounts: Former

Attache had an outstanding balance of
P112,157.31. While the remaining balance of
P1,913,160.15 pertains to the currently assigned
SWAtt, the latest liquidation report was for the
month of November 2019.
Qatar 552,085.20 Latest liquidation report was for the month of

August 2019.
Kuwait 1,478,404.56 Latest liquidation report was for the month of

November 2019.
Dubai, UAE 2,132,109.79 Latest liquidation report was for the month of
September 2019.
Kuala Lumpur, 7,129,370.96 Latest liquidation report was for the month of
Malaysia August 2019.
Hongkong, China 1,494,263.15 Latest liquidation report was for the month of
September 2019.
Total P18,961,519.60
All liquidation reports submitted to FMS-Accounting Division were properly accounted

for in the report, however, liquidation reports received after the cut-off period, January 20, 2020
were no longer included in the report. Reports received after the said date will be included in
the next reporting period.
Advances to Special Disbursing Officers of Central Office with outstanding balance

of P4,023,730.00 is composed of unutilized balance of P4,017,800.00 and P5,930.00 for the
cash advance drawn for financial assistance to regular clients served through our Crisis
Intervention Unit (CIU) and expenses for the Year-End Evaluation, respectively. The said
balances were already refunded in January 2020.
In Field Offices, the account represents cash advances for the implementation of
various DSWD programs and projects like the Social Pension, Cash for Work, assistance to
beneficiaries of SLP, MCCT and calamities, crisis intervention program, emergency shelter
assistance, etc. Bulk of the amount pertains to advances for the implementation of Social
Pension, Supplemental Feeding and the Crisis Intervention Program granted in the last quarter
of 2019.
Advances to Officers and Employees consist of unliquidated balance from cash

advances from local and foreign travels.
44
All Fund Clusters
12.2 Prepayments

Advances to Contractors P 49,809,012.16 P 131,052,037.67
Prepaid Rent 1,732,609.90 1,771,951.33
Prepaid Registration 13,019.29 9,618.97
Prepaid Insurance 6,342,313.60 6,857,482.40
Other Prepayments 4,438,064.14 4,861,614.14
TOTAL P 62,335,019.09 P 144,552,704.51
Advances to Contractors pertain to the amount given in advance to

contractors for various projects of the Department based on the contract agreement as
an advance payment upon submission of required documents and are repaid by
deducting from their respective progress billings.
In CARAGA, the significant decrease from CY 2018 to CY 2019 amounting to

P4,451,821.44 is due to the completion of the Construction of Buildings in
Rehabilitation & Recovery Centers for Youth (RRCY) in Patin-ay, Agusan del Sur and
Home for Girls (HFG) in Bonbon, Butuan City. While in Field Office IX decrease
represents the amount that was deducted as recoupment from the progress billings of
different contractors of various projects of the Department based on the submission of
required documents. These projects aim to establish new centers and residential care
facilities and improve the existing ones under its CRCF infrastructure projects.
In Field Office XII, the account includes P3,856,005.20 which was a Dormant
Account reflected in the Books of Accounts since 1994. The Department has requested
write-off of this account to the Commission on Audit.
Prepaid Rent includes advance payment as well as deposit for the rent of office
building and warehouse in the regions
In CARAGA, the account represents payment for the advance rent of SDS POO
of Pantawid Pamilya which started its contract last October, 2019. The decrease is due
to the subsequent usage of the advance payment during the last month of the rent.
Prepaid Insurance pertains to payment for insurance of various properties of

the Department. These are also adjusted at year-end for the expired portion and are
expensed.
In Field Office III, the account is used to recognize the amount advanced for
the vehicle insurance of all nineteen (19) government service vehicles and building
insurance for 6 centers and institution and 1 regional office to Government Service
Insurance System. Also, included in this account is the fidelity bond premiums paid to
Bureau of Treasury for bonded accountable officers of the agency amounting to
P1,201,314.07.
In Field office IX, the account represents fire insurance paid to government
entity of various buildings and contents for 2019.
45
All Fund Clusters
Other Prepayments include cash bonds paid to PAL Express (Philippine

Airlines) and Cebu Air, Inc. (Cebu Pacific Air) to maintain the credit limit with the said
service providers. Also included are prepayments for subscription services.
In Field office IX, the account represents unutilized prepaid electronic load for
Pantawid staff and unliquidated Gasoline for SF monitoring and Greening Projects and
various office supplies purchased at Procurement Service.
In CAR, the account pertains mainly to the transformer used for the
electricity which was paid to the Benguet Electric Cooperative, ownership of which is
not yet transferred to the Agency.
12.3 Deposits

Guaranty Deposits P 9,379,894.21 P 9,967,836.76
Other Deposits 1,453,612.16 1,006,281.06
TOTAL P 10,833,506.37 P 10,974,117.82
Guaranty Deposits include payment to various service providers which serves

as Custom Facility Deposits, Container Deposits for the release of shipments consigned
with the Department, and as guarantee deposits for the procurement of Water,
Electricity and Fuel, Oil, and Lubricants with fleet card facility.
12.4 Other Assets

Other Assets P 11,397,322.74 P 11,392,942.98
TOTAL 11,397,322.74 11,392,942.98
Bulk of Other Assets account is for Field Office VIII amounting to P10,098,840.59
13. Financial Liabilities

Current Non-Current Current Non-Current
Accounts
P 8,248,353,594.41 P 6,518,702,625.44
Payable
Due to Officers
368,224,226.92 188,063,305.45
and Employees
Tax Refunds
644,756.13
Payable 1,134,673.76
TOTAL 8,617,222,577.46 6,707,900,604.65
The Accounts Payable pertains to unpaid obligations for the delivered goods and
services as of December 31, 2019.
46
All Fund Clusters
As of December 31, 2019, the Department has an outstanding accounts payable to

Dextel Trading amounting to P362,775,000.00 for the delivery of sleeping kits and family
kits. Out of the total amount recorded, only P188,616,979.75 was ratified by the Secretary for
the payment. This payment pertains to items actually distributed to beneficiaries. The unpaid
portion remains undistributed with ongoing negotiation for its return to the supplier as of date
of the Financial Statements.
Due to Officers and Employees consist of unpaid salaries, reimbursement of

transportation and per diem and other unpaid claims as of December 31, 2019.
In Field Office XII, the account consists of unpaid collection fee granted to payroll
officer by the National Housing Authority (NHA) and Cooperative Bank of Cotabato (CBC).
14. Inter-Agency Payables
2019 2018 As Restated

Account Name Non-
Current Non-Current Current
Current
Due to BIR P 67,364,090.32 - P 64,848,321.60 -
Due to GSIS 23,619,858.98 - 7,868,845.85 -
Due to Pag-IBIG 8,044,244.77 - 6,068,373.78 -
Due to PhilHealth 8,556,264.67 - 2,426,157.36 -
Due to NGAs 756,010,619.76 - 1,009,242,701.66 -
Due to GOCCs 8,781,506.65 - 9,332,209.77 -
Due to LGUs 75,344,789.10 - 59,577,288.48 -
TOTAL P 947,721,374.25 - P 1,159,363,898.50 -
Due to BIR consists of income tax deducted from employees and suppliers and
consultants and will be remitted thru Tax Remittance Advice (TRA) and Electronic Final
Payment System (eFPS) in the ensuing year.
Due to GSIS include Life and Retirement Premium, salary loan, policy loan and ECC
and are also for remittance on the ensuing year.
Due to Pag-IBIG comprise of Pag-IBIG Premiums, Multi-Purpose Loan and

Housing Loans are also remitted during the first month of the ensuing year.
Due to PhilHealth is the unremitted balance from PhilHealth premiums that are
included in the remittance of the ensuing year.
Due to NGAs pertains to inter-agency transferred funds from various agencies, i.e.
Office of the President, Dangerous Drug Board, DepEd, National Housing Authority,
Philippine Statistics Authority, Commission on Population and Development, Council for the
Welfare of Children, Juvenile Justice Welfare Council, etc. for program implementation,
subject for liquidation.
Due to GOCCs include deductions from salaries of employees for their respective
loans payable to Land Bank of the Philippines, Social Security System and National Home
47
All Fund Clusters
Mortgage Finance Corporation Housing and the same was remitted during the first month of
the ensuing year.
In Field office IX, Due to LGUs represents the collection from LGUs for the 1/3 cost
of care and maintenance of residents confined at Regional Rehabilitation Center for Youth.
15. Intra-Agency Payables

Due to Central Office P 295,052,865.75 P 569,306,707.45
Due to Bureaus - -
Due to Regional Offices 765,792.62 765,792.62
Due to Other Funds 2,414,245.40 1,636,875.43
Total P 298,232,903.77 P 571,709,375.50
Due to Central Office represents balance of funds received for implementation of

various programs subject for liquidation:
• PGMA Microfinancing and Enterprise Development Program and National

Livelihood Support Fund.
• temporary housing assistance for 5,587 family victims of the CY 2013 Zamboanga
City siege under the Zamboanga City Roadmap to recovery and reconstruction plan
and for the Pilot Implementation of Community Managed Road Maintenance Project
• Libreng Gamot sa Masa (Lingap sa Masa) medicine assistance program of the Office
of the President
• Community Grants as per Memorandum of Agreement between DSWD and Deped
for the construction of 605 classroom
• Second Tranche financial assistance to DSWD Employees affected by Typhoon
Yolanda and 7.2 Magnitude Earthquake in Bohol
• Socio economic programs for Normalization on the Bangsamoro
• Conduct of 2019 nationalwide survey on the nature and extent of drug abuse in the
Philippines
16. Trust Liabilities
2019 2018 As Restated

Account Name
Current Non-Current Current Non-Current
Trust Liabilities 14,302,238.53 15,684,637.75
Trust Liabilities - Disaster
Risk Reduction and 147,831,005.61
105,619,461.97
Management Fund
Guaranty/Security Deposits
95,498,903.44
Payable 60,206,402.21
Customers' Deposits
- 984,349.72
Payable
Total 162,133,244.14 95,498,903.44 121,304,099.72 61,190,751.93
48
All Fund Clusters
In Field Office IVA, Trust Liabilities – DRRMF represents fund transfer of cash
assistance for the families of killed PNP SAF members in Mamasapano, Maguindanao and
cash for work or Emergency Shelter Assistance for the Victims of Typhoon Maring and
Habagat
In Field Office II, the account pertains to the unliquidated balance of the subsidy
received amounting to P26,316,800.00 and P3,402,318.00 for Emergency Shelter Assistance
(ESA) and Cash For Work project for the victims of Typhoon Ompong and Lawin,
respectively.
The Account Guaranty/Security Deposits Payable pertains to cash bond to

guarantee performance of the term of contract and participation in bidding. This will be
returned to the supplier after completion of the needed services and the lapse of the validity
period.
17. Deferred Credits

Other Deferred Credits P 889,831.18 P 816,191.50
TOTAL 889,831.18 816,191.50
In Field Office CAR, the account amounting to P747,998.31 represents the

accountabilities of the responsible/accountable officer that were established due to the loss of
asset on which no relief of accountability was issued.
In Field Office III, this account refers to the setup of accountability from the
accountable officer and debited once payment from the loss of asset is recognized.
18. Other Payables

Other Payables P 19,326,774,366.14 P 43,835,715,282.37
This account includes payroll deductions for remittance to Mutual Benefit

Association (MBA), Social Welfare Employees Association of the Philippines (SWEAP),
Project to Supplement Personnel Economic Resources (PROSPER), Social Security Services
(SSS), healthcard, and other individual creditors/suppliers which include service providers/
suppliers of CIU clients. This also includes the set-up of unpaid cash grants
for Pantawid Pamilya beneficiaries amounting to P18,354,355,005.69 with the following
details:
PARTICULARS AMOUNT
Unliquidated balances of advances to LBP P 5,156,609,809.26
Amount deposited in DSWD Conduit Account # 3122-1021-13 12,496,443,110.15
Amount deposited in DSWD PVB Account # 0037-011685-001 302,385,000.00
Set up of payable accounts 398,917,086.28
TOTAL P 18,354,355,005.69
49
All Fund Clusters
In Field Office II, the Other Payables includes the amount of P452,388,225.00
accrual of grants for the implementation of Emergency Shelter Assistance and Cash For Work
project for typhoon Rosita.
19. Service and Business Income

Permit Fees P 4,278,440.00 P 3,885,200.00
Registration Fees 483,725.50 333,925.00
Clearance and Certification Fees 14,955,910.00 13,711,436.09
Licensing Fees 235,500.00 145,635.00
Verification and Authentication
Fees 78,000.00 159,000.00
Processing Fees 9,530.00 2,000.00
Fines and Penalties - Service
Income 16,431,387.96 8,255,525.62
Other Service Income 2,852,789.16 2,667,830.61
Affiliation Fees 6,000.00 500.00
Rent/Lease Income 10,700.00
Income from Hostels/Dormitories
and Other Like Facilities 2,651,808.00 2,668,810.00
Interest Income 12,591,406.85 15,274,528.57
Fines and Penalties - Business
Income
Other Business Income 8,751,195.55 5,710,160.51
Total P 63,325,693.02 P 52,825,251.40
Permit Fees pertains to fees collected by the Department for fund raising campaign
fee from various registered, licensed and accredited SWDAs and for duty free entry or
facilitation fees.
Registration Fees pertains to collections for registration and licensing of various

accredited Social Welfare and Development Agency (SWDAs).
Verification and Authentication Fees are collections for accreditation fees of

various accredited SWDAs.
Clearance and Certification Fees are collections for travel clearance issued to
minors travelling abroad alone and/or accompanied by a person other than his/her parents.
The account Fines and Penalties - Service Income is the amount charged or being
collected by the Department from various contractors/ suppliers for late delivery of goods and
services as specified in the Purchase Order.
Interest Income represents income earned from various bank accounts of the
Department which were remitted to the Bureau of Treasury.
50
All Fund Clusters
20. Shares, Grants and Donations

Income from Grants and Donations in Cash P 8,510,017.98 P 16,583,993.10
Income from Grants and Donations in Kind 93,369,328.04 69,265,226.77
Total P 101,879,346.02 P 85,849,219.87
In Field Offices, Income from Grants and Donations in Cash account is used to record
grants and donations received for subsistence and other operational expenses of various
centers of the Department. While, Income from Grants and Donations in Kind is used to
record food, clothing, medicines, other supplies and materials received for consumption of the
residents of various centers of the Department.
Income from Grants and Donations in-Kind is used to record grants and donations
received by the Department. For CY 2019 the department received thirteen (13) units of Hino
6 Wheeler Wing Van Delivery Truck from the Government of Japan through Japan’s Non-
Profit Grant Aid for the provision of Japanese Disaster Reduction Equipment (FY 2014) for
the Republic of the Philippines.
It also includes the receipt of donated building from Ephphetha Foundation for the
Blind, Inc. (EFBI) which was then transferred to Field Office NCR.
21. Miscellaneous Income

Proceeds from Insurance/Indemnities 7,913.50 726,795.55
Miscellaneous Income 52,931,909.95 7,602,258.95
Total 52,939,823.45 8,329,054.50
In FOs CAR and VII, Miscellaneous Income pertains to liquidated damages deducted
from the payment to service providers due to delay in the delivery of the goods/services.
While, in Field Office VI, this represents collection from interested bidders in procurement of
bidding documents
In CAR, Proceeds from Insurance/Indemnities pertains to the proceeds received from

GSIS.
In Field Office VIII, the account pertains to P40,226,251.37 accumulated prior years
collection of SEA-K under the collection fund account which will be remitted in January
2020.
22. Personnel Services
22.1 Salaries and Wages
51
All Fund Clusters

Salaries and Wages - Regular P 1,079,725,411.36 P 1,045,641,228.67
Salaries and Wages - Casual/Contractual 3,593,444,454.89 3,340,468,349.85
Total Salaries and Wages P 4,673,169,866.25 P 4,386,109,578.52
22.2 Other Compensation
Particulars 2019 2018

Personal Economic Relief
P 236,206,573.44 P 234,601,997.01
Allowance (PERA)
Representation Allowance (RA) 15,621,791.59 15,371,156.76
Transportation Allowance (TA) 11,014,372.33 9,930,123.06
Clothing/Uniform Allowance 61,224,259.32 59,139,234.72
Subsistence Allowance 23,847,474.65 30,198,964.56
Laundry Allowance 105,960.42 162,839.10
Quarters Allowance 77,500.00 -
Productivity Incentive Allowance 4,757,000.00 4,427,500.00
Overseas Allowance 22,024,959.33 22,051,766.27
Honoraria 6,707,622.10 3,286,736.19
Hazard Pay 4,773,460.31 493,569.30
Longevity Pay 935,000.00 860,209.00
Overtime and Night Pay 33,631,474.62 26,024,329.06
Year End Bonus 485,922,067.62 446,369,524.75
Cash Gift 47,221,750.00 41,492,250.00
Other Bonuses and Allowances 609,453,011.08 398,113,471.41
Total Other Compensation P 1,563,524,276.81 P 1,292,523,671.19
Subsistence Allowance represents the amount paid for the Magna Carta of
DSWD Public Social Workers and DSWD Health Workers.
Laundry Allowance is due to Health Workers in different Centers &

institutions.
Overseas Allowance pertains to the Post Allowances of Social Service

Attaches in Kuala Lumpur, Malaysia, Hongkong, Qatar, Kuwait, Jeddah and Riyadh
of Kingdom of Saudi Arabia and Dubai, United Arab Emirates.
Longevity Pay refers to the cash incentive given to DSWD Loyalty Awardees
during CY 2019.
Other Bonuses and Allowances pertains to the Mid-Year Bonus, Productivity

Enhancement Incentive (PEI), Performance Based Bonus (PBB) and Collective
Negotiation Agreement (C.N.A.) given to all DSWD Regular, Casual and Contractual
Employees for CY 2019.
In CARAGA, the account Honoraria refers to the cash incentive granted to

DSWD Officials & Employees for services rendered in Special Projects in addition to
their regular duties.
52
All Fund Clusters
Other Bonuses and Allowances pertain to the Mid-Year Bonus, Productivity

Enhancement Incentive (PEI) and Collective Negotiation Agreement (C.N.A.) given
to all DSWD Regular, Casual and Contractual Employees for CY 2019.
22.3 Employee Future Benefits
The DSWD and its employees contribute to the GSIS in accordance with the
Republic Act 8291 dated April 30, 1997. The GSIS administers the plan, including
payment of pension benefits to employees to whom the act applies.
22.4 Personnel Benefit Contributions

Retirement and Life Insurance Premiums P 390,756,061.24 P 366,953,508.20
Pag-IBIG Contributions 11,484,323.16 13,749,533.99
PhilHealth Contributions 39,788,014.16 38,562,244.40
Employees Compensation Insurance Premiums 11,738,475.08 9,422,537.59
Total Personal Benefit Contributions P 453,766,873.64 P 428,687,824.18
Retirement and Life Insurance Premium pertains to the remittances made to

the Government Service Insurance System (GSIS) for Life & Retirement Premium
Government's share.
Pag-IBIG Contributions represents remittances to the Home Development

Mutual Fund (HDMF) for PAG-IBIG premiums pertaining to government share.
PhilHealth Contributions represents payment of PhilHealth premium for

government share.
22.5 Other Personnel Benefits
2018 As
Particulars 2019
Restated
Retirement Gratuity - P 6,081,123.95
Terminal Leave Benefits P 60,292,211.24 35,597,372.26
Other Personnel Benefits 110,735,743.49 37,168,786.76
Total Other Personnel Benefits P 171,027,954.73 P 78,847,282.97
Terminal Leave Benefits represents the amount paid to former DSWD

Officials and Employees who retired from government service either as Compulsory
and/or Optional retiree.
Other Personnel Benefits pertains to monetization of leave credits availed

by DSWD employees.
23. Maintenance and Other Operating Expenses
53
All Fund Clusters
23.1 Traveling Expenses
Particulars 2019 2018 As Restated

Traveling Expenses - Local P 918,798,840.87 P 765,624,693.85
Traveling Expenses - Foreign 5,177,190.04 39,107,594.66
Total P 923,976,030.91 P 804,732,288.51
Traveling Expenses - Local includes airfare, per diems and other related
travelling expenses of DSWD Officials and Employees on official business to attend
various activities within the country for the period January to December 2019.
Traveling Expenses - Foreign includes airfare, pre-travel allowance,

accommodation and daily subsistence allowance of DSWD Officials during travels
on official business to attend various conference/ workshop for the period January to
December 2019. It also includes liquidation of operating expenses by the Disbursing
Officer in Foreign Posts.
23.2 Training and Scholarship Expenses

Training Expenses P 1,101,975,602.13 P 1,219,963,655.25
Scholarship Grants/Expenses 1,037,958.92 843,456.12
Total P 1,103,013,561.05 P 1,220,807,111.37
Training Expenses pertains to payment of honorarium of resource persons,

board and lodging and or hotel accommodation of participants during training and
traveling expenses of participants to various trainings, seminar and workshops. It
also includes course fee and or registration fees of DSWD officials and employees to
enhancement training and seminars.
23.3 Supplies and Materials Expenses

Office Supplies Expenses P 216,393,092.55 P 220,071,626.51
Accountable Forms Expenses 987,269.30 1,611,361.83
Non-Accountable Forms Expense 133,618.00 533,338.40
Food Supplies Expenses 221,552,076.90 21,685,220.56
Welfare Goods Expenses 622,982,301.93 249,042,643.23
Drugs and Medicines Expenses 18,646,817.26 563,678,741.80
Medical, Dental and Laboratory
Supplies Expenses 2,247,859.05 21,661,743.87
Fuel, Oil and Lubricants Expenses 47,046,516.48 1,820,529.49
Agricultural and Marine Supplies
Expenses 36,450.00 46,663,433.52
Textbooks and Instructional Materials
Expenses 561,598.00 8,039.26
Semi-Expendable Machinery and
Equipment Expenses 67,593,998.40 102,704,548.83
54
All Fund Clusters

Semi-Expendable Furniture, Fixtures
and Books Expenses 33,836,468.60 44,144,784.91
Other Supplies and Materials Expenses 169,857,689.22 155,882,466.25
Total Supplies and Materials
P 1,401,875,755.69 P 1,429,508,478.46
Expenses
23.4 Utility Expenses

Water Expenses P 33,537,644.64 P 34,409,416.94
Electricity Expenses 129,711,173.30 125,810,906.42
Other Utility Expenses 648,900.40
Total Utility Expenses P 163,248,817.94 P 160,869,223.76
Water Expenses are payments made for the water consumption at DSWD
Central Office and Field Offices, including that of the NHTO (Mahusay Building),
Malasakit building, Director's Dormitory and DSWD AHON Center, MIA Road,
Pasay City. It also includes water consumption of DSWD SWADCAP, Taguig City
and DSWD 4Ps Training Center, Bago Bantay, Quezon City.
Electricity Expenses are payments made to MERALCO for electric bill at

DSWD - Central Office (Matapat & Magiliw Building, NHTO/Mahusay Building,
Director’s Dormitory, 4 storey Malasakit Building, KC Building), DSWD
Welfareville Compound, Addition Hills, Mandaluyong City; DSWD Gastambide
Street Sampaloc, Manila; DSWD SWADCAP, Taguig, Metro Manila, and DSWD
NROO, Chapel Road, Pasay City
23.5 Communication Expenses

Postage and Courier Services P 6,888,984.06 P 11,415,431.02
Telephone Expenses 112,636,834.24 136,287,002.42
Internet Subscription Expenses 10,057,686.96 18,590,037.72
Cable, Satellite, Telegraph and Radio
Expenses 315,685.01 271,116.69
Total Communication Expenses P 129,899,190.27 P 166,563,587.85
Postage and Courier Services represents payment made to the LBC

Express, Inc. and Intertraffic Transport Corp. for courier services of the department.
It also includes liquidation of cash advance for Operating Expenses by the Social
Welfare Attache at post (Jeddah, Riyadh, Qatar, Kuwait, Dubai, Malaysia &
Hongkong).
Telephone Expenses are payments made to the Philippine Long Distance

Telephone Company (PLDT) for current charges of DSWD telephone (Landlines)
lines. It also consists of mobile expenses made to Globe Telecom, Inc. and Smart
55
All Fund Clusters
Communications, Inc. for the Globe and Smart cellular phones used by DSWD
officials and employees and the individual reimbursements made for the
communication load allowance in lieu of prepaid card allocation for the period
January to December 2019.
In Field Office IX Internet Subscription Expenses are payments made to

PLDT-DSL for the wireless internet subscription of FO9. It also includes payment
made to other internet companies as internet service provider of different centers and
institutions.
In Field Office IX - Cable, Satellite, Telegraph and Radio Expenses

represents payment of cable subscription of FO9 and different Centers and
institutions.
23.6 Awards/Rewards and Prizes

Awards/Rewards Expenses P 1,330,706.51 P 963,626.69
Prizes 3,662,808.26 3,918,904.72
Total Awards/Rewards and Prizes P 4,993,514.77 P 4,882,531.41
Awards/Rewards Expenses refers to the awards/recognition given to the

winners of different activities of the department, such as the DSWD 2019 PRAISE
Gawad Awards in various categories: Huwaran awardee, Best Support Staff, Best
Division Chief, Best Manager and Best Technical Staff.
Prizes represent the token given to winners of competitive and promotional

activities of the department, such as the winners of DSWD 68th Anniversary Got
Talent Cluster Competition, Tagisan ng Talino, Videoke Challenge and individual
prizes for the winners of the sports fest competition. It also includes prizes for the
winners of the DSWD 2019 PRAISE awards.
23.7 Extraordinary Expenses

Extraordinary and Miscellaneous
P 6,077,163.05 P 5,593,662.96
Expenses
Total Extraordinary Expenses 6,077,163.05 5,593,662.96
Extraordinary and Miscellaneous Expenses pertains to payment of

extraordinary and miscellaneous expenses of DSWD Officials for the period January
to December 2019.
23.8 Professional Services

Legal Services P 2,860,392.12 P 1,928,678.90
Auditing Services 1,100,973.41 680,305.25
56
All Fund Clusters

Consultancy Services 125,513,495.92 139,092,186.89
Other Professional Services 3,917,536,507.02 3,884,231,561.64
Total Professional Services P 4,047,011,368.47 P 4,025,932,732.68
Legal Services represents payment of counsel's fee of DSWD Legal Service

Staff during attendance to various court hearings. It also includes payment to PLDT
for current telephone charges of the Office of the Ombudsman and Child Justice
League; honorarium for legal services rendered by the Child Justice League and
monthly allowance of the Office of the Solicitor General Officials and Personnel for
legal services rendered for the period January to December 2019.
Auditing Services are payments made to PLDT for current charges of

DSWD - COA telephone lines. It also includes the travelling expenses of COA
Personnel, Fuel and Oil and office supplies.
Consultancy Services includes payment to service providers engaged in the

development of systems and the program/project consultants.
Other Professional Services are payments to DSWD hired workers under a

Cost of Service Contracts.
23.9 General Services

Environment/Sanitary Services P 6,359.65 -
Janitorial Services 64,201,651.37 P 69,072,603.95
Security Services 180,922,356.10 164,608,654.73
Other General Services 996,499.63 1,997,693.86
Total Professional Services P 246,126,866.75 P 235,678,952.54
Janitorial Services are payment made to Philcare Manpower Services for

janitorial services rendered at DSWD Central Office and satellite offices including
special, additional and overtime services rendered at DSWD NROC and SWADCAP.
Security Services are payments made to Prime Security Agency, Inc. for
security services rendered at DSWD Central Office, NROC and RSCC.
Other General Services represent payment made to Power House Pest

Control Services for the termite treatment and general services pest control services
rendered at DSWD Central Office and satellite offices covering the period July to
December 2019.
23.10 Repairs and Maintenance
2018 As
Particulars 2019
Restated
Repairs and Maintenance - Land P 1,285,233.97 P 2,167,866.81
57
All Fund Clusters
2018 As
Particulars 2019
Restated
Improvements
Repairs and Maintenance – Infrastructure
Assets 59,200.00 -
Repairs and Maintenance - Buildings and
Other Structures 81,998,494.07 76,842,876.98
Repairs and Maintenance - Machinery and
Equipment 15,822,875.66 4,022,633.18
Repairs and Maintenance - Transportation
Equipment 24,134,509.36 27,045,112.50
Repairs and Maintenance - Furniture and
Fixtures 869,634.05 811,887.64
Repairs and Maintenance - Semi-
Expendable Machinery and Equipment 834,458.30 416,841.27
Repairs and Maintenance - Semi-
Expendable Furniture, Fixtures and Books 12,235.00 -
Repairs and Maintenance - Other Property,
Plant and Equipment 118,200.00 119,333.50
Total Repairs and Maintenance
P125,134,840.41 P111,426,551.88
Expenses
23.11 Taxes, Insurance Premiums and Other Fees

Taxes, Duties and Licenses P 46,649,882.93 P 2,572,623.35
Fidelity Bond Premiums 30,700,286.23 22,071,053.90
Insurance Expenses 19,736,222.56 16,481,000.46
Total Taxes, Insurance Premiums
P 97,086,391.72 P 41,124,677.71
and Other Fees
Taxes, Duties and Licenses represent the release of allotment to cover

payment for Customs Duties and Internal Revenues Taxes for the shipment of
donated goods received by DSWD.
It also includes payment made to Quickway Customs Brokerage Firm for the
brokerage and hauling services including port charges for the release and delivery of
rice donation from the PROC.
Field Office IX Taxes, Duties and Licenses includes expenses incurred for
the registration, renewal of license and smoke emission of vehicles of FO9.
Fidelity Bond Premium represents payment of 1.5% fidelity bond premium

of Regular Disbursing Officers, Special Disbursing Officers and Approving/Signatory
of each Bureau/Service of the Department.
58
All Fund Clusters
Insurance Expenses pertains to payment to Government Service Insurance

System for insurance from fire and other perils for various DSWD buildings and
motor vehicles.
23.12 Labor and Wages

Labor and Wages P 576,228,211.83 P 217,639,582.94
Total 576,228,211.83 217,639,582.94
The account pertains to DSWD hired under job order contracts as follows:
Particulars Amount
FO-X- payments made to hired individuals for repacking of P 284,906,091.85
goods ready for distribution and payments to the Camp
Managers of evacuation centers facilitating the needs of the
victims of Marawi Siege, encoders and temporary/piece
work job orders
Field Offices except CAR 291,322,119.98
Total P 576,228,211.83
23.13 Other Maintenance and Operating Expenses

Advertising Expenses P 31,678,411.87 P 40,855,767.62
Printing and Publication Expenses 24,187,323.25 19,633,173.37
Representation Expenses 135,880,148.78 120,518,307.35
Transportation and Delivery
28,402,032.84 37,235,829.05
Expenses
Rent/Lease Expenses 129,099,834.35 100,592,913.08
Membership Dues and Contributions
29,431.00 65,000.00
to Organizations
Subscription Expenses 240,821,824.58 148,207,552.25
Donations 970,667.46 20,951,314.94
Other Maintenance and Operating
116,812,789.80 120,260,298.57
Expenses
Total Other Maintenance and
P 707,882,463.93 P 608,320,156.23
Operating Expenses
Advertising Expenses are payment made to the Philippine Daily Inquirer for
the newspaper publication or advertorial for the procurement of Fleet Card
Distribution/Credit facility for petroleum, oil and lubricants for DSWD vehicles. It
also includes payment made to Marcus Phoenix Media Production for the production
of audio visual presentation of DSWD Strategic Plan 2018-2022. It also includes
newspaper publication or advertorial for Invitation to Bid for the procurement of
goods and services.
59
All Fund Clusters
Printing and Publication Expenses are payment for printing of tarpaulin

and streamers for various activities of the Department and publications to
newspapers.
Representation Expenses are payment for food expenses during meetings,

forums and other various activities of the department. It also includes liquidation of
Cash Advances by the Social Welfare Attache for operating expenses at foreign post.
Transportation and Delivery expenses are payments made for the delivery
of various relief items from DSWD NRLMS to DSWD Field Offices. It also includes
payment made to Transmodal International, Inc. for the delivery of rice donations
from NFA Valenzuela City to DSWD Field Office I warehouse.
Membership Dues and Contributions represent payment to Philippine

Statistical Association for membership fee.
Subscription Expenses refers to the receipt of various computer software

procured from the Procurement Service - DBM and payment for the newspaper
subscription and other subscriptions.
It also include payment made to AG Datacom Phils, Inc. for the subscription
of Database Management and Cluster Management Service (MySQL Enterprise
Edition License - 3 licenses); Accent Micro Technologies, Inc. for the subscription
of Managed Services for DSWD Complete Suite of Primary ICT Security Devices;
Innove Communications, Inc. for the procurement of Managed Network Services
for DSWD Convergence Programs and Services; PLDT for the subscription to
managed network services for DSWD Programs and services; Massive Integrated
Tech Solution, Inc. for the acquisition of yearly subscription for an upgrade of
Pantawid Pamilya Hyper Convergence Infrastructure to support daily operation;
Kollab Guru Group, Inc. for the subscription of Managed Electronic Mail (Email)
services with video conference solutions for DSWD; AGD Infotech, Inc. for the
subscription of Service Level Agreement (SLA) License for DSWD existing Web
Hosting Software. Also included are the Accounts Payable for various expenses for
the month of December 2019.
Donations represent the transfer of Information and Communications

Equipment to DSWD ARMM.
Rent/Lease Expenses pertain to rental/lease of office building, machineries

and equipment for official use of various regional offices.
24. Financial Expenses

Bank Charges P 161,671,330.49 P 518,286,320.57
Other Financial Charges 187.74 1,494,295.08
Total P 161,671,518.23 P 519,780,615.65
60
All Fund Clusters
The account Bank Charges generally refers to payment and accruals of interbank fees
for cash card grants advanced by Land Bank of the Philippines (LBP) to other banks for ATM
transactions and the bank service fees for over-the-counter payments of cash grants by the
LBP conduits for the implementation of the Pantawid Pamilya Program and Disaster
Response Management Division for the typhoon Lawin.
25. Non-Cash Expenses
25.1 Depreciation
Depreciation - Land Improvements P 6,123,817.87 P 6,556,307.82
Depreciation - Infrastructure Assets 59,131.92 59,131.93
Depreciation - Buildings and Other Structures 45,283,125.98 42,273,325.69
Depreciation - Machinery and Equipment 170,426,707.93 193,376,893.34
Depreciation - Transportation Equipment 41,627,388.31 32,286,212.52
Depreciation - Furniture, Fixtures and Books 24,845,058.21 7,138,103.49
Depreciation - Other Property, Plant and
6,276,212.50 12,533,875.43
Equipment
Total Depreciation P294,641,442.72 P 294,223,850.22
The Depreciation for Buildings and Other Structures, Machinery and Equipment,
Transportation Equipment, Furniture and Fixtures and Books, Other Property, Plant
and Equipment are periodic cost allocation for the wear and tear the Department's PPE.
25.2 Amortization

Amortization – Intangible Assets 20,513,462.87 16,930,398.36
25.3 Impairment Loss

Impairment Loss - Other
P 10,450,963.00
Receivables
Impairment Loss - Inventories 2,475,795.68 258,200.72
Impairment Loss - Property,
1,546,967.05 1,994,703.38
Plant and Equipment
Total P 4,022,762.73 P 12,703,867.10
Impairment Loss-Property, Plant and Equipment pertains to loss incurred for

the impaired unserviceable properties of the Department.
26. Net Financial Assistance/Subsidy
Financial Assistance/Subsidy from NGAs, LGUs, GOCCs
61
All Fund Clusters

Subsidy from National Government P 134,233,466,806.98 P 135,689,983,888.56
Subsidy from Other National Government
6,292,436.64
Agencies
Assistance from Local Government Units 1,952,850.88 2,745,842.00
Subsidy from Other Funds
Total Financial Assistance/Subsidy from 134,241,712,094.50 135,692,729,730.56

NGAs, LGUs, GOCCs
Less: Financial Assistance/Subsidy to

NGAs, LGUs, GOCCs, NGOs/POs
Subsidies - Others 106,904,780,189.71 121,775,342,641.44
Net Financial Assistance/Subsidy P 27,336,931,904.79 P 13,917,387,089.12
The account Subsidy from National Government is further broken down as follows:
Particulars 2019
Receipt of Notice of Cash Allocation P 142,244,292,559.63
(NCA)
Tax Remittance Advice (TRA) 695,945,099.53
Non-Cash Availment Authority 44,904,626.00
Total 142,985,142,285.16
Less:
Reversion of Lapsed NCA 8,751,675,478.18
Total as of December 31, 2019 P 134,233,466,806.98
Total NCAs and NTCAs received amounted to P161,791,980,198.47 broken down as

as follows:
Fund Notice of Cash Allocation Notice of Transfer of Cash Receipt of Total

Cluster (NCA) Allocation (NTCA) Working Fund
for Foreign
Assisted
Projects
1 P138,703,504,949.00 16,670,306,242.58 - 155,373,811,191.58
2 1,821,052,544.00 1,341,761,829.74 1,719,735,066.63 4,882,549,440.37
4 282,210,696.52 - 282,210,696.52
7 1,253,408,870.00 - - 1,253,408,870.00
Total P142,060,177,059.52 18,012,068,072.32 1,719,735,066.63 161,791,980,198.47
The account Subsidies – Others includes cash grants of Pantawid Pamilya

beneficiaries amounting to P73,402,579,400.00. These include P60,041,974,300.00 paid to
the beneficiaries through their Cash Card accounts while P13,360,605,100.00 were paid
through LBP Conduits. This also includes grants/assistance provided to beneficiaries of
62
All Fund Clusters
various DSWD programs and projects like Social Pension, Supplemental Feeding, AICS,
SLP, KC-NCDDP, etc.
27. Non-operating Income, Gain, or Losses
27.1 Non-Operating Income/Gain
Particulars 2019 2018 As Restated

Sale of Unserviceable Property P 109,390.00 194,535.92
Gain on Foreign Exchange (FOREX) 5,385,585.21 279,846,648.98
Gain on Sale of Property, Plant and 145,840.20 31,050.00
Equipment
Other Gains 7,013,121.82 4,175,583.81
Total Non-Operating Income/Gain P12,653,937.23 P284,247,818.71
27.2 Non-Operating Losses

Loss on Foreign Exchange (FOREX) P 38,192,270.49 P 97,790,737.98
Loss on Sale of Property, Plant and Equipment 1,659,280.60 216,356.01
Loss on Sale of Assets 3,625,502.60
Loss of Assets 282,560.00 937,430.17
Other Losses 8,867.58
Total Non-Operating Losses P 43,759,613.69 P 98,953,391.74
Gain on Foreign Exchange is gain from the translation of foreign currency into
local currency, which is Philippine Peso, using the prevailing exchange rate at end of every
period or at year-end.
Other Gains pertains to proceeds from disposal thru public sale of unserviceable
equipment's, motor vehicles, valueless records, scrap/waste materials. It also includes fees
charged to various registered, licensed and accredited SWDAs for photocopying of
documents in accordance with Circular No. 12 Series of 2015.
Loss on Foreign Exchange (FOREX) is loss from the translation of foreign

currency into local currency, which is Philippine Peso, using the prevailing exchange rate at
end of every period or at year-end.
28. Budget Information
The original budget per General Appropriations Act of 2019 is P138,618,217,000.00

including RLIP, plus Automatic Appropriations under Fund Cluster 3 and 4 of
P156,830,857.00 or a total of P138,775,047,857.00, while the total budget allocated to the
Department, inclusive of Special Allotment Release Order (SARO) and other fund
augmentation was P146,594,850,381.96 with a difference of P7,819,802,524.96
The following are the reasons of the variances between the original and the final
budget:
63
All Fund Clusters
Difference of Original and Final Budget P7,819,802,524.96
Realignments/Augmentation 4,235,008,771.00
Continuing Appropriations 5,455,399,427.11
Transfers (1,783,277,000.00)
Unreleased Appropriations (53,722,635.00)
Lapsed PS Allotment-CMI for 1st Qtr (33,606,038.15)
Total P7,819,802,524.96
29. Prior Period Adjustment
Adjustment of prior years expenses and income due to liquidation of prior years’ cash
advances, payment of unrecorded payables and not yet due and demandable and staled checks
of prior year resulting to overstatement of Net Assets/Equity of 2018. The effect of
restatement on those financial statements is summarized below.
Effect on 2018 Statement of Financial Performance

Particular Amount
Net Increase in Expense Account and Losses P14,437,778,892.05
Net Decrease in Income Account and Gains (69,454,620.66)
Decrease in Surplus/Deficit P (14,507,233,512.71)
Effect on 2018 Statement of Financial Position

Particular Amount
Net Decrease in Asset P (11,775,525,144.57)
Net Increase in Liability 4,424,653,538.36
Net Decrease in Net Assets/Equity before restatement 16,200,178,682.93
Decrease in Beginning Balance of Net Assets/Equity P (1,692,945,170.22)
Decrease in Net Assets/Equity after restatement (14,507,233,512.71)
30. Related Party Transactions
30.1 Key Management Personnel
The key management personnel of the DSWD are the Head of the Agency, the
members of the Executive Committee which consists of the Undersecretaries and the
Assistant Secretaries.
30.2 Key Management Personnel Compensation
The aggregate remuneration of members of the governing body and the number of
members determined on a fulltime equivalent basis receiving remuneration within this
category, are:
Particulars Aggregate Remuneration

Salaries and Wages P 31,822,269.99
64
All Fund Clusters
Particulars Aggregate Remuneration

Other Compensation 4,906113.64
Personnel Benefit Contributions 2,838,645.12
Other Personnel Benefits 5,922,828.80
Total Other Personnel Benefits 45,489,857.55
31. Pantawid Pamilyang Pilipino Program
Program Loan No. 3369-PHI
On February 21, 2019 and November 20, 2019, the Department of Social Welfare and
Development has submitted the Statement of Cash Grants Payment made to the Department
of Finance (DOF) for the purposes of submitting the Withdrawal Application (WA) No. 03
and 04 for Direct Payment and Reimbursement in the amount of US$150,572,646.79 and
US$116,819,678.85, respectively, to the Asian Development Bank. On May 30, 2019 and
January 8, 2020, the total amount of P5,238,000,000.00 and
P5,084,100,000.00, respectively, total peso equivalent of US$100,000,000.00 each,
representing Program Loan No. 3369-PHI received from Asian Development Bank for the
Social Protection Support Project, was credited to the Treasurer of the Philippines Foreign
Currency Deposit – Dollar Account.
Program Loan No. 8584-PHI
On February 21, 2019, the Department of Social Welfare and Development had
submitted the Statement of Cash Grants Payments made to the Department of Finance (DOF)
for the purposes of submitting the Withdrawal Application (WA) No. 03 for Direct Payment
and Reimbursement in the amount of US$207,988,217.60 to the World Bank. On March 29,
2019, the total amount of P6,802,280,250.00, peso equivalent of US$128,875,000.00
representing Program Loan No. 8584-PHI received from World Bank for the Social Welfare
and Development Reform Project, was credited to the Treasurer of the Philippines Foreign
Currency Deposit-Dollar Account.
65
Part II - OBSERVATIONS AND RECOMMENDATIONS
Financial Audit
A. Accounting Errors and Omissions
1. Various accounts of the Department of Social Welfare and Development

(DSWD) have misstatements overstating the reported total Assets, Liability and Net
Assets/Equity by ₱919.829 million, ₱43.841 million and ₱483.512 million,
respectively, which represents 1.15 percent, 0.15 percent, and 0.96 percent of its total
Assets, Liabilities and Net Assets/ Equity, respectively.
2. Section 27 of the Philippine Public Sector Accounting Standards (PPSAS) 1 and

Section 15, Chapter 19 of the Government Accounting Manual (GAM), Volume I, states
that “the Financial Statements (FSs) shall present fairly the financial position, financial
performance and cash flows of an entity. Fair presentation requires the faithful
representation of the effects of transactions, other events, and conditions in accordance
with the definitions and recognition criteria for assets, liabilities, revenue, and expenses
set out in PPSAS.”
3. Moreover, Sections 111 and 112 of Presidential Decree (PD) No. 1445 provide that
the accounts of the agency shall be kept in such detail as necessary to meet the needs of
the Agency and at the same time be adequate to furnish the information needed by the
fiscal or control Agencies of the government; and that the highest standard of honesty,
objectivity and consistency shall be observed in the keeping of accounts to safeguard
against inaccurate and misleading information. Each government Agency shall record its
financial transactions and operations conformably with PPSAS and in accordance with
pertinent laws and regulations.
4. Full disclosure principle is one of the generally accepted accounting principles that
require an organization to disclose all the information that would affect a reader’s
understanding of the FSs.
5. Review and verification of accounts and transactions of the DSWD Central Office
(CO) and 16 Field Offices (FOs) disclosed various errors and omissions which were not
adjusted by Management that have an impact on the fair presentation of the year-end
consolidated FSs and had affected Management’s assertions that all transactions and
events have been fully reported (Completeness), recorded without error (Accuracy), within
the correct reported period (Cut-off), in the proper accounts (Classification), they actually
took place (Occurrence), and that all account balances exist (Existence), as shown in Table
1.
66
Table 1. Summary of Accounting Errors and Omissions
Amount of Misstatements in PhP (Over)/Understatement
ASSETS EQUITY
Errors (including
Other LIABILITIES
Cash Receivables Inventories PPE Income and
Assets Expenses
A. Erroneous recording of Transactions
(88.81) 293,375,970.00 (9,132,533.59) 650,499.64 105,000.00 (27,649,484.48) 312,648,331.72
B. Unrecorded Transactions
3,211,189.85 735,016.80 (373,067,378.89) (55,099,438.96) - 5,039,790.95 (429,260,402.15)
Net of Misstatements 3,211,101.04 294,110,986.80 (382,199,912.48) (54,448,939.32) 105,000.00 (22,609,693.53) (116,612,070.43)
A=L+E (139,221,763.96) (22,609,693.53) (116,612,070.43)

TOTAL ACCOUNTING
ERROS/OMMISSIONS
PER ACCOUNT TITLE
3,211,278.66 327,843,802.80 403,090,965.30 185,578,688.18 105,000.00 43,840,746.45 483,512,236.97
IN ABSOLUTE
AMOUNT (see Annex
A for computation)
Financial Statement
79,802,975,123.13 29,448,473,200.38 50,354,501,922.75
Balances
% of Misstatement 1.15% 0.15% 0.96%
The Misstatement of 919,829,734.94, 43,840,746.45 and 483,512,236.97 for Asset, Liabilities and Equity, respectively,
is not reflected and adjusted in the December 31, 2019 Financial Statement balances of the DSWD
6. Shown in Table 2 are the details of errors and omissions affecting the Cash,
Receivables, Inventories, Property, Plant and Equipment (PPE), Other Assets and
Liabilities accounts.
Table 2. Details of Accounting Errors and Omissions

Net of
Misstatement
Audit Amount per Account
Category Accounts Affected Office Standard/Criteria
observation (Over)/Under affected
(absolute
amount)
Cash Petty Cash Fund Erroneous NCR 49,633.43 88.81 Section 110.1 of PD
recognition V (49,722.24) 1445
of grant and
liquidation Section 5, Chapter 21
Cash in Bank, LCCA Unrecorded NCR 3,841,667.36 3,211,189.85 of the GAM, Volume I
transaction
Section 44, Chapter 6
of the GAM, Volume I
V (711,736.80)
Unrecorded IX 44,084.86
book
reconciling
items
Non- VII 483,234.43
restoration X (446,060.00)
of stale
check
67
Net of
Misstatement
(absolute
amount)
Total 3,211,101.04 3,211,278.66
Receivables Due from NGAs Misclassifi- NCR 332,475.00 16,866,408.00 COA Circular No. 2013-
cation IVA 16,533,933.00 002 dated January 30,
2013
Due from GOCCs NCR (332,475.00) 332,475.00
Other Receivables IVA (16,533,933.00) 16,533,933.00 COA Circular No. 2007-
Due from NGOs/POs Fund CAR 203,100,000.00 289,686,556.80 001 dated October 25,
transfers to 2007
NGOs POS
recorded as Section 7.2.1(d) of COA
XIII 85,874,820.00
direct Circular No. 2009-006
expense dated September 15,
2009
Unrecorded V 711,736.80
transaction
Due from LGUs Erroneous VIII 4,401,150.00 4,401,150.00
recording in
Fund
Clusters
Receivables- Non- VI 23,280.00 23,280.00
Disallowances/ recognition
Charges of ND which
are final and
executory
Total 294,110,986.80 327,843,802.80
Inventory Accountable Forms, Unrecorded VI (101,425.00) 101,425.00 COA Circular No. 2013-
Plates and Stickers issuances 002 dated January 30,
Inventory of 2013
inventories
Food Supplies for Improper/ V (2,398,862.90) 4,676,362.90 Section 9, Chapter 8 of
Distribution misclassifi- the GAM, Volume I
cation of
account Section 10.b., Chapter
VIII (2,277,500.00)
8 of the GAM, Volume I
Food Supplies Improper/ VIII 4,817,200.70 5,663,283.55
Inventory misclassifi-
b. These tangible items
cation of
shall be recognized as
account
expenses upon issue to
Inventory CAR 846,082.85 the end-user.
purchases
recorded as
direct of the GAM, Volume I
expense Records, Forms and
and Reports to be prepared
remained
and/or maintained in
on hand as
the accounting and
at year-end custody of Inventory
Medical, Dental & Improper/ VII (49,364.00) 49,364.00 accounts
Laboratory Supplies misclassifi-
Inventory cation of
68
Net of
Misstatement
(absolute
amount)
account Section 15, Chapter 8
Non-Accountable Unrecorded VI (357,000.00) 357,000.00 of the GAM, Volume I
Forms Inventory issuances
of
inventories
Office Supplies Unrecorded III 295,270.01 1,388,619.98
Inventory deliveries
Invalid VIII (5,522.00)

claims/un-
supported
transaction
Improper/ III (398,516.01)
misclassific
ation of
account
Erroneous III (499,585.00)
payment
recorded
Invalid VIII (148,326.00)
claims/un-
supported
transaction
Unrecorded III (631,940.98)
issuances
of
inventories
Other Supplies & Improper/ VII (494,965.00) 791,716.82
Materials Inventory misclassifi-
cation of
account
XIII 899,213.31
III (54,600.00)
III 398,516.01
Unrecorded VIII 43,552.50
deliveries
Semi-Expendable Unrecorded III (584,900.00) 584,900.00
Inventories issuances
of
inventories
Semi-Expendable - Improper/ VII 49,364.00 43,064.00
Medical Equipment misclassifi-
cation of
account
Unrecorded XI (6,300.00)
issuances
of
inventories
69
Net of
Misstatement
(absolute
amount)
Semi-Expendable Unrecorded XI (83,085.10) 83,085.10
Communications issuances
Equipment of
inventories
Semi-Expendable Invalid VIII (333,730.00) 2,735,547.90
Furniture & Fixtures claims/un-
supported
transaction
Improper/ VIII (2,160,000.00)
misclassifi-
cation of
account
VII 244,377.00
VII (68,264.00)
issuances
of
inventories
Information and issuances
Communications of
Technology Equipment inventories
Semi-Expendable Improper/ VIII (8,802,000.00) 9,427,478.40
Office Equipment misclassifi-
cation of
account
issuances
of
inventories
Other Machinery and issuances
Equipment of
inventories
Improper/ VII 84,000.00
misclassifi-
cation of
account
Printing Equipment issuances
of
inventories
Various inventory Unrecorded XI-Fund 3,944,676.79 3,944,676.79
accounts issuances 102
of
inventories
Welfare Goods for Improper/ V 2,398,862.90 371,723,413.01
Distribution misclassifi-
cation of
70
Net of
Misstatement
(absolute
amount)
account VIII 2,277,500.00
VIII (4,817,200.70)
XIII 302,000.00
Receipt of III 1,056,000.00
welfare
goods
erroneously
recorded in
Accounts
payable
Unrecorded CO
issuances (353,671,668.37)
of
inventories CAR (42,213,209.38)
III (4,925,549.44)
III (640,444.02)
XI 14,963,000.00
Unrecorded VIII 13,547,296.00
deliveries
Welfare goods Erroneous III 2,785.25 2,785.25
Inventory recording of
issuance
Total (382,199,912.48) 403,090,965.30
PPE Buildings Improper/ XI 59,753,070.97 56,743,573.30 COA Circular No. 2013-

non- 002, or the Revised
reclassifi- Chart of Accounts,
cation of XIII (3,009,497.67) dated January 30, 2013
account xxx Construction in
Construction in Improper/ III (168,545.61) 59,427,132.51 Progress-Buildings and
Progress-building and non- Other Structures
other structure reclassifi- account xxx and to be
cation of reclassified to the
XIII 3,009,497.67
account appropriate PPE
XI (64,032,060.72)
account upon
Unrecorded CAR 1,763,976.15 completion xxx
cost of
completed
project with Section 119 of PD 1445
billing
received on Section 2(a) and 6(b),
12/11/19 Chapter 2 of the GAM,
Disaster Response Improper/ XI 3,893,139.00 3,893,139.00 Volume I
and Rescue non-
Equipment reclassifi- Section 14, Chapter 10
cation of of the GAM, Volume I
account
71
Net of
Misstatement
(absolute
amount)
Furniture and Fixture Improper/ VII 68,264.00 68,264.00 Section 27, Chapter 10,
non- of the GAM, Volume I
reclassifi-
cation of
account
ICT Equipment Improper/ XIII 895,344.00 753,248.40
non- VII 110,000.00
reclassifi-
cation of
account
Loss asset IVB (59,850.00)
Disposed, NCR (192,245.60)
lost, and
non-existing
properties
Motor Vehicles Improper/ VII 16,000.00 3,991,361.73
non-
reclassifi-
cation of
account
Non- IVB 3,975,361.73
recognition
of
transferred
PPEs
Office Equipment Disposed, NCR (374,430.00) 374,430.00
lost, and
non-existing
properties
Other Machinery and Improper/ XIII 74,700.00 115,288.00
Equipment non-
reclassifi-
cation of
VII 40,588.00
account
Various PPE Account Unrecorded CO (59,225,421.72) 60,212,251.24
Deprecia-
tion
Unrecorded III (986,829.52)
Deprecia-
tion
Total (54,448,939.32) 185,578,688.18
Other Asset Advances to SDO Erroneous IVA 105,000.00 105,000.00

recording of
liquidation
Total 105,000.00 105,000.00
TOTAL ERRORS/OMISSION ON ASSETS ACCOUNTS (139,221,763.96) 919,829,734.94
Liabilities Accounts Payable Improper III (1,497,295.61) 24,340,479.41 Sections 13 and 19,
72
Net of
Misstatement
(absolute
amount)
classificatio IX (451,442.51) Chapter 6 of the GAM,
n of account Volume I
Erroneous III 1,056,000.00 Illustration of
Recording III (499,585.00) accounting entries to
of Inventory set up salary
Recognition NCR (1,360,407.40) deductions and its
of payables V (7,203,458.91) corresponding
without valid remittances as well as
claims and the remittance of
over two Government’s share
VIII (881,688.76)
years
Section 98 of PD 1445
and EO 87
IX (1,179,109.25)
X (8,766,738.13) Section 57, Chapter 6 -
Disbursements of the
Erroneous NCR (5,616,000.00)
GAM, Volume I
recording of
payment of
liability
accounts
Unrecorded CAR 1,763,976.15
cost of
completed
project with
billing
received on
12/11/19
Unrecorded III 295,270.01
deliveries
Due to GSIS Improper V 36,000.00 6,177,561.18
classificatio IX 451,442.51
n of account
Erroneous XI 5,858,440.43
recording of
GSIS
Remit-
tances
Recognition V (168,321.76)
of payables
without valid
claims and
over two
years
Due to Officers and Recognition IX (77,684.99) 2,358,697.22
Employees of payables
without valid
73
Net of
Misstatement
(absolute
amount)
claims and IX (2,281,012.23)
over two
years
Due to PhilHealth Improper V (36,000.00) 36,000.00
classificatio
n of account
Other Payables Recognition V (2,726,826.40) 6,490,043.36
of payables IX (80,945.25)
without valid
claims and
over two
years IX (2,224,851.22)
Improper V (1,457,420.49)
classificatio
n of account
Trust Liabilities-DRRM, Improper V 1,457,420.49 1,457,420.49
Trust Liabilities/Due to classificatio
other funds n of account
Various payable Non- VII 483,234.43 2,980,544.79
accounts restoration VII 244,452.67
of stale/
cancelled IX 2,205,289.72
checks X 34,140.00
XIII 13,427.97
TOTAL ERRORS/OMISSIONS ON LIABILITIES ACCOUNTS (22,609,693.53) 43,840,746.45
Accumulated Accumulated Various CAR, 240,611,416.73 183,991,124.81 Section 10.b., Chapter
Surplus/ Surplus/(Deficit) NCR, 8 of the GAM, Volume I
(Deficit) III,
IVA,V,VI
II, IX,X
Various CO,CAR (424,602,541.54) b. These tangible items
NCR, shall be recognized as
III, expenses upon issue to
IVB,VI,V the end-user.
II,VIII,
IX,XI,XII Section 5, Chapter 21
I of the GAM, Volume I
Depreciation Expense Unrecorded III (982,502.96) 982,502.96
Deprecia- Section 44, Chapter 6
tion of the GAM, Volume I
Employees Improper XI 705,680.34 705,680.34
Compensation classificatio Section 17, Chapter 8
Insurance Premiums n of account of the GAM, Volume I
Fidelity Bond Improper VIII 55,000.00 55,000.00
Premiums classificatio Section 7.2.1(d) of COA
n of account Circular No. 2009-006
Food Supplies Inventory CAR 846,082.85 846,082.85 dated September 15,
Expense purchases 2009
recorded as
74
Net of
Misstatement
(absolute
amount)
direct Section 57, Chapter 6 -
expense Disbursements of the
and GAM, Volume I
remained
on hand as COA Circular No. 2013-
of year-end 002 dated January 30,
Fuel, Oil and Recognition VIII 326,110.76 326,110.76 2013
Lubricants Expenses of payables
without valid
claims and
over two
years
Honoraria Improper VII 552,212.00 552,212.00
classificatio
n of account
Longevity Pay Improper V (65,000.00) 65,000.00
classificatio
n of account
Non-Accountable Unrecorded VI (357,000.00) 357,000.00
Forms Expenses issuances
of
inventories
Office supplies Unrecorded III (631,940.98) 631,940.98
expense issuances
of
inventories
Other Bonuses and Improper VII (26,328,301.00) 26,328,301.00
Allowances classificatio
n of account
Other MOOE Improper VIII 14,999.60 14,999.60
classificatio
n of account
Other Personnel Improper V 65,000.00 65,000.00
Benefits classificatio
n of account
Other Professional Improper VII (585,152.00) 585,152.00
Services classificatio
n of account
Productivity Incentive Improper VII 4,124,500.00 4,124,500.00
Allowance classificatio
n of account
Rents-Motor Vehicles Improper VIII 8,800.00 8,800.00
classificatio
n of account
Repairs and Improper XI (385,850.75) 385,850.75
Maintenance-Building classificatio
and Other Structure n of account
Representation Improper III 8,750.00 8,750.00
expense classificatio
75
Net of
Misstatement
(absolute
amount)
n of account
Retirement and Life Improper XI 21,977,390.17 21,977,390.17
Insurance Premiums classificatio
n of account
Salaries & Wages- Improper XI (28,541,510.94) 28,541,510.94
Casual/Contractual classificatio
n of account
Semi expendable Improper III (54,600.00) 54,600.00
Furniture and Fixtures classificatio
Expense n of account
Semi Expendable Unrecorded III (584,900.00) 584,900.00
Inventories issuances
of
inventories
Subscription Expenses Improper XIII 895,344.00 895,344.00
classificatio
n of account
Subsidies-Others Improper VIII, IX, (48,654,041.26) 48,654,041.26
classificatio XIII
n of account
Training Expenses Recognition VIII, XIII (8,420,029.00) 8,420,029.00
of payables
without valid
claims and
over two
years
Travelling Expenses- Improper VIII 331,292.00 331,292.00
Local classificatio
n of account
Various expense acct Unrecorded X (480,200.00) 480,200.00
disburse-
ment
Various inventory Unrecorded XI-Fund 3,944,676.79 3,944,676.79
expense accounts issuances 102
of
inventories
Welfare Goods Various III, XI 132,956,437.22 127,390,443.76
Expenses Various III (5,565,993.46)
Year-End Bonus Improper VII 22,203,801.00 22,203,801.00

classificatio
n of account
TOTAL ERRORS/OMISSION IN NET ASSETS/EQUITY (116,612,070.43) 483,512,236.97
7. It is worthy to mention that errors reported in the CY 2018 Consolidated Annual

Audit Report were already adjusted, except for the misclassification of accounts in
inventory which still exist in FOs III and V, amounting to ₱54,600.00 and ₱2,398,862.90,
respectively.
76
8. While the errors reported in CY 2018 were adjusted and the recommendations were
complied with by the concerned FOs, we noted similar conditions existed in different FOs
for CY 2019 as presented below:
Comparative observations for CYs 2018 and 2019

2018 2019
FO Amount FO Amount
Account Audit Observation
(in million ₱) (in Million
₱)
Cash in Unrecorded book reconciling items V 1.256 IX 0.44
Bank,
LCCA Unadjusted stale and unissued checks III 0.014 VII 0.483
V 0.017 X 0.446
VI 0.482
Inventory Improper/ misclassification of accounts CO 17.651
III 1.403 III 0.546
V 2.399 V 2.399
XI 56.966 VII 0.235
VIII 10.962
XIII 1.201
PPE Non-recognition of transferred PPEs CO 124.302 IVB 3.975
NCR 8.610
III 0.505
V 2.330
9. The above-cited errors and omissions in recording and reporting of financial

transactions were due to the lack of coordination, review and monitoring by the concerned
process owners or offices for the compliance of required reports in accurate and timely
manner, ineptitude or lack of appropriate training of assigned personnel, and non-
adherence to or lack of awareness on the existing rules and regulations, policies and
guidelines.
10. We reiterated our prior year recommendations, with modification, and Management
agreed to require the Heads of the concerned Offices to:
a. require the Chief Accountant to:
(i) make the necessary adjustments/correcting entries for the accounts

affected by errors/omissions;
(ii) observe the highest degree of objectivity and consistency in the keeping
of the accounts to safeguard against inaccurate or misleading
information; and
(iii) carefully analyze the transactions before these are recorded, for proper
classification of accounts, and accurate recording of financial
transactions;
77
b. establish close coordination and strengthen linkages among concerned offices
to ensure timely submission of reports as basis of the Accountants in
recording transactions;
c. evaluate and assess the capabilities of personnel assigned to perform crucial

tasks and give appropriate trainings, if necessary, to ensure effective and
efficient performance of their tasks and adherence to reporting
requirements;
d. ensure strict adherence to existing rules, regulations, policies, and guidelines;

and
e. require the concerned personnel of FOs III and V to strictly adhere to the
recommendations in the CYs 2018 and 2019 audit reports to prevent the
recurrence of similar conditions/observations.
B. Accounting Deficiencies
11. Deficiencies amounting to ₱41,519.287 million were noted affecting the fair
presentation of the account balances reported in the Financial Statements (FSs).
12. During the year, deficiencies were also noted in recording transactions that have
impact on the fairness of presentation of the accounts in the FSs as presented in Table 3.
Table 3. Summary of Accounting Deficiencies (in million pesos)

Amount
Deficiencies ASSETS
LIABILITIES
Cash Receivables Inventories PPE Other Asset
Unreconciled
110.137 65.198 1,376.153 29,685.129 505.302
discrepancies
Unserviceable
equipment not yet
8.948
dropped from the
books
Non-inclusion of semi-
expendable items in .144
the RPCI
Cash Advance at year-

4.037
end were not liquidated
Non-moving inventory
4.954
balances
Unsupported balances - 12.240 9,434.241 216.124
Negative Balance 60.372 0.157 32.859

Inventory Recorded
3.292
Directly to Expense
78
110.137 125.570 1,396.940 39,128.318 4.037 754.285
Total
41,519.287
13. The details of the deficiencies are shown in Table 4.
Table 4. Details of Accounting Deficiencies

Observation Office Amount Criteria Cause Effect Recommendation
Petty Cash Fund; Cash in Bank-LCCA; Cash in Bank-LCSA; Cash-MDS
Unrecon- NCR 2,915,529.22 Section 5, Non-preparation of Doubtful We reiterated our
ciled IVB 1,792,488.47 Chapter 21, bank reconciliation Existence, prior year’s
Balance V 104,909,469.07 GAM, Volume I statement due to completeness recommendations,
between requires that non-availability and accuracy with modification, to
book and Chief and/or delayed of balances require the concerned
bank Accountant/ receipt of bank Accountants to:
balance Designated Staff statement
to reconcile the (a) prepare the BRSs
BS with the GL No BRSs and on a timely basis,
and prepare the inadequacy of account and validate
BRS in four subsidiary records the unreconciled
copies within ten differences, and
days from effect immediately
receipt of the any necessary
monthly Bank adjustments/
Statement (BS) corrections on
together with the discrepancies, or
paid checks, identified and valid
original copies reconciling items in
of Debit the books of
Memoranda accounts; and
(DM)/Credit
Memoranda (b) make
(CM) from the representation with
GSB the depository banks
to make available the
bank statements on
time, or give access
to authorized
personnel to bank's
online viewing facility
(Land Bank of the
Philippines' we
Access), or make
arrangement that the
banks may provide
snapshots of bank
statements so that
the Accountants can
prepare BRS on time.
Unreconcile NCR 447,436.00 Appendix 6 of Lapses in Doubtful Require their
d balance GAM, Volume II monitoring and existence, Accountants to
79
between IX 72,014.24 review of posted completeness reconcile the GL and
General transactions and accuracy SL balance regularly,
Ledger and of balances as prescribed by
Subsidiary Appendix 6, of GAM
Ledger Vol. II
Sub-total - Cash 110,136,937.00
Due from GOCCS, Due from LGUS, Due from NGAs, Other Receivables Account
Unrecon- V 44,451,384.67 Memorandum of Lapses in Inaccurate Require the Accountant
ciled Agreement monitoring and account to:
CAR 20,265,357.60
discrepancy entered into by review of posted balance
between GL IVA 481,500.00 and between the transactions (a) strictly monitor the
and DSWD and the Receivables account;
and
Confirmation IA
Letter (b) reconcile their
COA Circular records with
No. 94-013 implementing
dated December agencies/NGOs /POs
13, 1994 regularly and require
the submission of
liquidation report to
effect immediately
correcting/ adjusting
entries on
discrepancies/
reconciling items in the
books
Existence of NCR 75,666.96 Memorandum of Lapses in Inaccurate We reiterated our
negative IVA 8,469.40 Agreement monitoring and balance of prior year’s
balance VIII 60,287,338.47 entered into by recording of accountability recommendations,
and between the liquidation reports due to over- with modification, to
DSWD and the and refunds by not recording of require the
IA matching with the liquidations Accountant to:
specific grant
COA Circular amount of the (a) reconcile their
No. 94-013 program project records with
dated December recipients LGUs and
13, 1994 record immediately
liquidations already
COA Circular submitted with
No. 2017-001 complete supporting
dated October documents; and
25, 2007
(b) monitor closely
the submission of
liquidations for
appropriate recording
against the specific
grant amount.
Sub-total – Receivables 125,569,717.10
80
Inventories
Unrecon- CO 615,824,473.39 Section 13, Absence of Affected the We reiterated our
ciled II 12,423,640.31 Chapter 8, GAM reconciliation of integrity of the prior year’s
balance III 12,046,713.42 Vol I stresses accounting and inventory recommendations
between per that semi-annual property records, balances in the with modification as
IVB 42,777,317.27
books and physical count/ non-conduct of FSs follows:
RPCI V 152,414,642.30 inventory is an physical count,
VII 50,738,544.36 indispensable non-preparation (a) To require the
VIII 415,279,574.23 procedure for and/or submission Property Division to
XI 74,648,518.50 checking the of RSMIs, strictly conduct a
integrity of improper/ non- complete physical
property maintenance of count of inventories
custodianship; updated SLC and and prepare a reliable
SC, and non- report thereon based
Item 4, Section conformity with the on physical count to
VI of COA perpetual inventory avoid unaccounted
Circular No. method. inventory;
2014-002 and
Appendix 66C, (b) To require the
GAM, Volume II Property and
require periodic Accounting Divisions
reconciliation of to diligently prepare,
accounting and maintain and update
property records their inventory
and verification/ records, forms and
adjustments of reports to facilitate
discrepancy, if conduct of periodic
any. reconciliation of
balances, and to
correct promptly any
deficiency noted;
(c) To report any loss

or damage inventory
based on the
Physical Count
conducted, and
properly identify the
responsible officer;
and
(d) To account for the

deficiencies noted
after reconciliation;
Sub-total 1,376,153,423.78
Non- XI 144,380.30 Section 17.l of Improper Affected the Require the
inclusion of Chapter 8, GAM maintenance of reliability of Accounting Unit to
semi- Volume I subsidiary ledger account exert extra effort to
81
expendable RPCI includes accounts balances trace the details of
items in the the semi- the "For
RPCI expendable reconciliation"
property issued captioned entries
that are covered recorded in the SLs
by Inventory of inventory account
Custodian Slip totaling P12.239
(ICS) million.
Sub-total 144,380.30
Non-moving XI 1,940,877.60 Sec 13, Chapter Improper Expired and To require:
inventory V 3,013,139.12 8, GAM Volume assessment and obsolete
balances I planning in inventory a) the attendance of
The Inventory procurement the Property/Supply
Accounting office employees to
System consists the seminar on
of the system of Property and
monitoring, Supplies
controlling and Management System,
recording of to become more
acquisition and responsible in
disposal of periodic assessment
inventory. of the inventory
movements; and
(b) the Head of the

Procurement Section
to properly plan the
procurement of
supplies equivalent to
two-month
requirement of the
agency.
Sub-total 4,954,016.72
Unsupported VII 12,239,371.01 Section 111 of Inadequate effort in Affected the Require the
balance PD 1445 states reconciliation of reliability of Accounting Unit of
that the accounts account FO VII to exert extra
accounts of an balance effort to trace the
agency shall be details of the “For
kept in such Reconciliation”
detail as is captioned entries
necessary to recorded in the SLs
meet the needs of inventory account
of the agency totaling
and at the same ₱12,239,371.01.
time be
adequate to
furnish the
information
needed by fiscal
82
or control
agencies of the
government
Sub-total 12,239,371.01
SL accounts VII 156,531.42 Section 111 of Failure to take up Unreliable SL Require the
with PD 1445 states in the books of Balance Accounting Unit of
negative that the account some of FO VII to review and
balances accounts of an purchases/ trace back the
agency shall be procurement made negative entries in
kept in such for supplies, the SL ₱156,535.31
detail as is materials and other and in order to arrive
necessary to inventory items, at an accurate and
meet the needs and instead, reliable year-end
of the agency issuance of said balance of the
and at the same supplies, materials accounts in the
time be and other inventory financial statements.
adequate to items based on the
furnish the Report of Supplies
information and Materials
needed by fiscal Issued (RSMI)
or control received from the
agencies of the Supply and
government Property Unit were
recorded in the
books by crediting
the inventory
account without its
corresponding
debit entry
Sub-total 156,531.42
Purchases CO 2,940,388.39 Section 9, Lapses of the While the We reiterated our
of VIII 351,527.50 Chapter 8, Accounting unit in items may prior year’s
inventories GAM, Volume I recording have been recommendation that
were requires to purchases as already issued the concerned Offices
expensed course through inventory at the end of require their
outright the inventory the year, the respective
account regular practice is not Accountants to record
purchases and in keeping with all purchases in their
to record existing respective inventory
issuances as regulations accounts and
they take place and issuances as
in accordance established expense in
with the internal control accordance with the
Perpetual systems perpetual inventory
Inventory method of recording,
83
Method. and avoid directly
recording to expense.
Sub-total 3,291,915.89
Sub-total - Inventories 1,396,939,639.12
Property, Plant and Equipment
Unrecon- CO 29,068,133,373.47 Section 38, Absence of Doubtful, We reiterated our
ciled NCR 94,376,167.03 Chapter 10, reconciliation of existence, prior years’
variance CAR 9,244,338.20 GAM Volume I accounting and accuracy, and recommendation,
between requires the property records, reliability of the with modification, to
III 22,002,445.30
PPE conduct of non-conduct of PPE accounts the Directors
balances per IVA 210,950,911.10 periodic physical physical count, as of year-end concerned, to:
books and V 77,165,177.36 count of PPE non-preparation of
report of VII 9,689,215.76 RPCPPE and/or a. Require the
Physical VIII 192,876,734.12 Inventory and property unit to
count of Inspection report of conduct physical
XIII 690,658.01
PPE Unserviceable count and reconcile
(RPCPPE) Property (IIRUP), actual physical count
improper/non- and property records
maintenance of to, identify the causes
updated Property of the differences,
Cards (PCs) and and accordingly,
PPE Ledger card make the necessary
(PPELC) and adjustments;
absence/incomplet
e records and data b. Verify and validate
of prior years’ the whereabouts of
transactions. items not reported in
the RPCPPE but
recorded in the books
and make the
necessary
adjustments if
warranted.
c. Report the
identified lost PPE
during physical count
and make necessary
actions; and
d. Require the
Property and
Accounting unit to
reconcile their
records and make the
necessary adjusting
84
entries.
Sub-total 29,685,129,020.35
Unservicea- CAR 1,302,512.86 Paragraph D, Lapses of reliability of the Require the
ble Section 40, management in the PPE accounts concerned office to:
II 1,085,060.80
equipment Chapter 10 of monitoring and as year-end
not yet IVA 1,503,347.00 the GAM, disposal of cannot be a. Derecognize
dropped IVB 228,178.08 Volume I unserviceable PPE established unserviceable PPE
from the and the preparation items from the book
books VII 4,828,888.87 “All of IIRUP and debit it to
unserviceable Impairment Loss at
property shall be the asset’s Carrying
reported in the Amount (Acquisition
Inventory and Cost less
Inspection Accumulated
Report of Depreciation) upon
Unserviceable preparation of
Property (IIRUP) Inventory and
(Appendix 74). Inspection Report of
PPE reported in Unserviceable
the IIRUP shall Property (IIRUP), and
be dropped from to conduct disposal
the books by thereof in accordance
debiting with the provisions of
Impairment COA Circular 86-264
Loss-Property, and Section 79 of PD
Plant and 1445;
Equipment (cost
of the PPE less b. Immediately
Accumulated process the disposal
Depreciation).” of unserviceable PPE
to prevent further
deterioration; and
c. Report all the

unserviceable
properties in the
Inventory and
Inspection Report of
Unserviceable
Property (IIRUP)
supported with proper
documentation to
facilitate its disposal
85
in accordance with
COA rules and
regulations and
eventual
derecognition in the
books after disposal.
Thereafter, the
Regional Accountant
to drop from the
books the
unserviceable PPE
Sub-total 8,947,987.61
Unsupported V 529,453.00 Sections 38 and Reclassification of The balance Require the Officials
PPE NCR 9,433,711,200.00 42, Chapter 10 Subsidiary Ledger cannot be concerned to:
of GAM, Volume Accounts; to relied upon
I derecognize Semi- a. Regularly follow-up
Expendables From Rights to the the letter request to
The entity shall PPE account. land recorded concerned agencies/
have a periodic cannot be Individuals to
physical count of JEV not covered established facilitate processing
PPE, which shall with Transfer and relied of documents needed
be done Certificates of Title upon in the registration
annually and (TCT) to show and/or transfer of title
presented on absolute ownership to DSWD-FO NCR to
the Report on of the real ensure full ownership
the Physical properties over the properties
Count of and elude third party
Property, Plant claims;
and Equipment
(RPCPPE) b. Immediately
(Appendix 71) register in the name
as at December of DSWD-FO NCR all
31 of each year. acquisitions including
This shall be donations of land to
submitted to the establish ownership
Auditor over the land in
concerned not accordance with PD
later than No.1445; and
January 31 of
the following c. (FO V) submit for
year. Equipment verification the
found at station supporting
and losses documents relative to
discovered the adjustments and
during the reclassification made
physical count on the PPE account.
shall be reported
to the
Accounting
86
Division/Unit for
proper
accounting/recor
ding.
Section 39(2) of
PD 1445
In the case of
deeds to
property
purchased by
any government
agency, the
Commission
shall require a
certificate of title
entered in favor
of the
government or
other evidence
satisfactory to it
that the title is in
the government.
Sub-total 9,434,240,653.00
Sub-total - PPE 39,128,317,660.96
Other Assets/Advances Account
Cash CO 4,037,265.50 COA Circular Management is Expenses Require the
Advance at No. 97-002, unaware of the incurred may concerned
year end Section 5.8 regulation and not be accountable officers
were not becomes the recorded that and divisions to
liquidated All cash practice not to can result to liquidate all the
advances shall liquidate at year- the outstanding cash
be fully end. understatemen advances at year-end
liquidated at the t of the said in accordance with
end of each accounts with Section 5.1 of COA
year. Except for corresponding Circular No. 97-002.
petty cash fund, overstatement
the AO shall to the
refund any advances
unexpended account.
balance to the
Cashier/Collecti
ng Officer who
will issue the
necessary
official receipt.
Sub-total – Other 4,037,265.50
Assets
87
Liabilities
Unreconcile II 505,301,967.13 Paragraph 31 of Lapses in Unreliable Require the office
d GL and SL the Framework monitoring and balance concerned to review
balance for the review of posted the nature of the
Preparation and transactions transactions to
Presentation of determine whether
Financial they are still part of
Statements the payables, and
effect the necessary
adjustments, if
warranted; and
Sub-total 505,301,967.13
Unsupported CAR 3,511,889.46 Section 37, Non-reversion of Unreliable We reiterated our
and VI 54,711,116.59 paragraph 2, undocumented balance of prior years’
unauthorized VIII 117,187,292.21 Chapter 2 of the payables. other recommendation to
liabilities GAM, Volume I payables. require the concerned
IX 23,592,837.58
Accountants to stop
XI 17,121,409.79 No Obligation setting-up payables
shall be certified without complete
to accounts documentation/valid
payable unless claimant.
the obligation is
founded on a
valid claim that
is properly
supported by
sufficient
evidence and
unless there is
proper authority
for its
incurrence.
Sub-total 216,124,545.63
Negative III 5,180,000.00 Section 111 of A negative balance Unreliable Require the
balance PD 1445 seemingly balance Accountant to:
V 19,931,392.17 suggests that an
account was over a. Review/analyze
VII 9,117.19
paid or recording of the entries made,
VIII 204,130.00 payment was which resulted to the
IX 7,534,313.90 applied to an negative balances of
incorrect account in the affected Liability
which the accounts, and
accountant failed to prepare the
detect due to the necessary adjusting
absence of entries; and
monitoring,
analysis and b. Strengthen the
reconciliation of the review, monitoring
accounts. These and analysis of
88
accounts remain in transactions before
the books of recording them
accounts over a
long period of time
resulting to
misstatement in the
financial
statements.
Subtotal 32,858,953.26
Sub-total - Liabilities 754,285,466.02
Grand Total 41,519,286,685.70
14. Non-compliance by Management with the pertinent provisions of the laws and
regulations cited above affected the accuracy of its accounts balances reported in the FSs.
15. In summary, the total misstatements amounted to ₱919.829 million which

represents 1.15 percent of the total Assets, while the Liabilities and Net Assets/Equity
accounts were misstated by ₱43.841 million or 0.15 percent and ₱483.512 million or 0.96
percent, respectively. Moreover, as discussed in the succeeding paragraphs, the accounts
showed various accounting deficiencies totaling ₱41,519.287 million. Due to the
significant impact of such misstatements on the FSs of the DSWD, we rendered a
Qualified Opinion on the financial statements of the agency as at year-end.
Compliance Audit
Non-submission of contracts, POs, and related documentary requirements within the

prescribed period
16. Five DSWD offices failed to submit perfected contracts and supporting
documentary requirements amounting to ₱543.877 million, for auditorial and
technical review/evaluation within five working days from the execution of the
contract, contrary to Section 39(1) of PD 1445, and Section 3 of COA Circular No.
2009-001 dated February 12, 2009, thus, precluding the Audit Teams (ATs) from the
timely and judicious review/evaluation of contracts.
17. PD 1445 Section 39 (1) provides that “The Commission shall have the power, for
purposes of inspection, to require the submission of the original or any order, deed,
contract, or other document under which any collection of, or payment from, government
funds may be made, together with any certificate, receipt, or other evidence in connection
therewith. If an authenticated copy is needed for record purposes, the copy shall upon
demand be furnished.”
18. Section 3.1.1 of COA Circular No. 2009-001 dated February 12, 2009 states that
within five (5) working days from the execution of a contract by the government or any of
its subdivisions, agencies or instrumentalities, including government-owned and/or
89
controlled corporations and their subsidiaries, a copy of said contract and each of all the
documents forming part thereof by reference or incorporation shall be furnished to the
Auditor of the agency concerned. In case of agencies audited on an engagement basis,
submission of a copy of the contract and its supporting documents shall be to the Auditor
of the mother agency or parent company, as the case may be.
19. Five DSWD offices failed to submit perfected contracts and corresponding
documentary requirements to COA for auditorial review as presented in Table 5.
Table 5. List of DSWD Offices that Failed to Submit

Perfected Contracts to COA within the Prescribed Period
Office No. of Contracts Contract Amount Particulars
V 312 ₱77,502,700.60 Contract Agreement and Purchase Orders (POs)
delayed from one to 353 days
VIII 1,077 107,266,214.44 Contracts/POs for the procurement of
supplies/equipment/security services/venue and
catering services with an average delay of 62
days
IX 157 349,765,380.45 Three infrastructure contracts and 154 POs/
other contracts
X 106 No data POs with delays ranging from 3 to 72 days
XI 3 9,342,950.00 Procurement of goods ranging from 5 to 39 days
Total ₱543,877,245.49
20. Likewise, the following deficiencies were noted in the submitted POs in the
following offices presented in Table 6.
Table 6. Deficiencies in the Submitted POs

Office Deficiency Criteria
FO V Contract submitted are not supported with complete COA Circular No. 96-010 dated
attachments such as Purchase Request, Abstract of August 15, 1996
Bids/Canvass, Bids and Awards Committee Resolution
Recommending Award, and Notice of Award. Paragraph 6.9 of COA Circular
FO X 257 proofs of delivery of procured items were not No. 2009-002 dated May 18,
furnished/submitted while 368 delivery documents were 2009
submitted late, ranging from 1 to 70 days
21. Part of our audit activity is the review and inspection of delivered goods and
services, separately and independently, based on the copies of the documents required,
such as Purchase Request, Abstract of Bids/Canvass, Bids and Awards. Due to the delay
in the submission of the said documents, the procured goods may no longer be available
for inspection as these were already consumed or have been distributed to end-users. The
certification of the Supply Officer and the Property Inspector in the IAR that the
goods/services were inspected, verified and found to be in accordance with the
specifications cannot be verified since we were unable to conduct its inspection.
22. The failure of Management to submit the said documents within the prescribed
period prevented us from immediately informing Management of any defect and/or
deficiency found in its review as well as to conduct the ocular inspection of delivered
90
goods or accomplished projects at the most opportune time, i.e., at the point of delivery of
the items or during the implementation of the projects.
23. We recommended and Management agreed to require the Regional Directors

of:
a. FOs V, VIII, IX, X and XI to ensure the submission of perfected contracts

and corresponding complete supporting documents within five working
days from execution of the contract, and to strictly comply with PD 1445,
and Section 3 of COA Circular No. 2009-001 dated February 12, 2009 to
preclude audit suspensions; and
b. FOs V and X to require the Supply Officer to inform the Auditor of the
date and time of all deliveries within 24 hours from their acceptance.
24. FO IX Management admitted their failure to submit the required documents to the
COA Audit Team due to lack of orientation of the Procurement Unit on their responsibility
to submit the contracts and POs within the prescribed reglementary period. However, in
the latter part of 2019, management conducted the said orientation and issued Procurement
Advisory No. 5 directing the Procurement Unit to comply with their responsibilities under
COA Circular 2009-001.
25. Nevertheless, they already transmitted the documents pertaining to the three (3)
infrastructure contracts and explained that the delay was caused by difficulty in producing
copies due to limited resources such as office supplies and manpower, and delayed
implementation of the projects. As for the non-submission of projects for technical review,
the Management explained that there were lacking signatures of the Technical Plans and
they had difficulty in producing copies of the plan. However, Management committed to
implement the audit recommendations.
Payments were made despite absence/lack of complete/adequate documentary

requirements
26. Six DSWD Offices have paid various transactions amounting to ₱738.532
million despite the absence of the required supporting documents and deficiencies
noted, in violation of Section 4 of PD 1445, and COA Circular NO. 2012-001 dated
June 14, 2012.
27. Section 4 of P.D. No. 1445 provides, thus: “Financial transactions and operations
of any government agency shall be governed by the fundamental principles set forth
hereunder, to wit:
(2) Government funds or property shall be spent or used solely for public
purposes.
(6) Claims against government funds shall be supported with complete
documentation.
91
(7) All laws and regulations applicable to financial transactions shall be
faithfully adhered to.”
28. COA Circular No. 2012-001 dated June 14, 2012 provides the documentary
requirements for common government transactions. Included therein are the following:
“xxx
(f) Claims against government funds shall be supported with complete

documentation.
xxx”
29. Six DSWD offices made various payment transactions amounting to ₱738.532
million despite the absence of the required documents, thus, the validity and propriety of
the transactions cannot be ascertained. Details are shown in Table 7:
Table 7. Summary of Payment Transactions with Incomplete Supporting Documents

Laws, Rules
Account
Nature of Transaction/ and
Office Affected/ Amount
Deficiencies Noted Regulations
Particulars
Violated
NCR Advances to SDO Grant of cash advances for the Section 4 of 593,200,000.00
Expanded/Assistance to Individuals PD 1445 dated
in Crisis Situations (E-AICs/AICs) June 11, 1978
program totaling P593.2 million
despite lack of adequate and COA Circular
necessary supporting documents No. 2012-001
such as: dated June 14,
• Fidelity Bond 2012
• Authority of the Accountable
Officer as issued by the Head
of the Agency
• Incomplete signatures in the
DV
• Certification from the
Accountant that previous cash
advances have been liquidated
and accounted for in the books
• Original copy of other relevant
documents
ICT Equipment Supply and delivery of 278 laptop Section 9.0 of 9,489,999.82
units for the implementation of COA Circular
Listahanan or the National No. 2012-001
Household Targeting System for dated June 14,
Poverty Reduction (NHTS-PR) is 2012
deficient due to:
• Incomplete documentation; Section
• Out of line of business based 23.4.1.4 of the
on the Articles of Incorporation 2016 Revised
of contractor showing that it is IRR of RA
a corporation duly recognized 9184 dated
by law which is engaged in September 19,
92
Laws, Rules
Account
Particulars
Violated
furniture manufacturing and 2016
interior designing and the
Bureau of Internal Revenue
(BIR) Certification of
Registration (COR) showed
that the company’s line of
business is to manufacture and
repair wood furniture.
• Erroneous computation of
NFCC
• Delivered laptops were not in
conformity with the required
technical specifications
IVA Legal Services Absence of the written conformity COA Circular 71,806.84
and acquiescence of the Solicitor No. 95-011
General and the written dated
concurrence of the Commission on December 4,
Audit for the period January 1, 1995
2019 to February 13, 2019
Payment made for cost of services Section 4(6) of 542,010.76
to its Legal Counsel approved by PD 1445 dated
the Office of the Solicitor General June 11, 1978
(OSG) effective February 14 to
December 31, 2019; however, no
concurrence from COA was
secured.
V Due from NGAs Fund transfer to DPWH-Sorsogon COA Circular 17,000,000.00
on December 18, 2018 for the No. 2012-001
construction of nine Senior Citizen dated June 14,
Centers and ten Child Development 2012
Centers was either incomplete and
deficient:
• Boxes D and E of DV is
unsigned by the Agency Head
and the Payee;
• Attached MOA is not original,
undated and unsigned by the
Supervising Administrative
Officer as to funds availability;
• No copy of the approved
program of work;
• No OR issued by the IA to
DSWD FOV acknowledging
receipt of funds transferred;
• No Certification by the
Accountant that funds
previously transferred to the IA
has been liquidated, submitted
to COA and accounted in the
books of the agency.
Welfare Goods Representing issued inventories not 50,371,373.78
93
Laws, Rules
Account
Particulars
Violated
for Distribution supported by corresponding Report
of Supplies and Materials Issued
Office Supplies (RSMI)
Inventory
Food Supplies
Inventory
VIII Other Payments for the services of hired Appendices 32 35,814,248.52
Professional professionals were not and 33 of the
Services acknowledged as received by the GAM, Volume
payees in the absence of their II
signatures in the Disbursement
Vouchers (DVs)/Payrolls. Further,
the Daily Time Records (DTRs) of
the Municipal Links and Project
Development Officers were not
supported with electronically
generated attendance records and/or
logbook entries, which cast doubt
on the accuracy and correctness of
the computation of the actual
services rendered and the propriety
of the payments.
XI Salaries and • Payments of salaries and wages Section 4(6) of 22,330,033.73
Wages-Regular to regular employees for the Presidential
period January to November Decree (PD)
2019 disclosed that DTRs (CSC No. 1445 dated
Form No. 48) were not June 11, 1978
supported with the necessary
documents such as Bundy Card/ Section 36(f),
Attendance Report (Biometric Chapter 2,
print-out), approved GAM Volume
Application for Leave, I
approved Special/Travel Order,
Certificate of Appearance and
approved Outslip;
• DTRs were not attached to the

payrolls during the months of
October and November 2019
• Some DTRs were not certified

by the employee concerned as
to the correctness of the
reported hours of work
performed and/or verified by
the immediate head or
supervisor as to the prescribed
office hours.
• DVs for payroll claims were not
94
Laws, Rules
Account
Particulars
Violated
approved for payment by the
Agency Head/authorized
Representative, yet stamped
“PAID”.
XI Salaries and Payments for salaries of hospital Sections 1.1.1 51,535.00
Wages-Regular watchers/relievers are supported and 1.2.1 of
with Reimbursement Expense COA Circular
Receipts (RERs) instead of signed No. 2012-001
payrolls, DTRs and other pertinent dated June 14,
documents as deemed applicable 2012
XI Subsidies-others Not supported with Certificate of Paragraph 6, 5,876,635.00
Eligibility (COE) to establish if Section 4 of
beneficiaries are legitimate and PD 1445 dated
qualified members of the June 11, 1978
implemented Sustainable
Livelihood Program (SLP) which is COA Circular
a requisite for the approval and No. 2012-001
obligation of the Mungkahing dated June 14,
Proyekto and shall be the basis of 2012
the Standards Unit of the FO in
issuing the Certificate of DSWD
Accreditation (CoA) to the SLP Memorandum
Associations. Circular No. 22
series of 2019
dated
November 19,
2019
XI Subsidy Expense Release of transportation, medical, DSWD 796,330.00
burial, educational, food and other Memorandum
assistance were not supported with: Circular No.
• affixed signature in the 11, series of
photocopy of ID; 2019, also
• Physician’s Prescription, known as the
Canvassed Price Quotation in Revised
the Physician’s Prescription, Guidelines on
medical certificate, amount due the
in the medical certificate and Implementation
hospital bill for medical of Assistance
assistance; to Individuals
• Funeral contract and amount in Crisis
due in Funeral Contract/ Situation dated
Medical Certificate for burial May 10, 2019.
assistance;
• Enrolment Assessment Form
for educational assistance;
• Inconsistency of type of food
assistance
XI Travel Expense Payment for taxi fares, ultrasound, COA Circular 32,213.65
and other snacks, printing, medicine, postage No. 2017-001
miscellaneous and supplies were supported with dated June 12,
expense Reimbursement Expense Receipt 2017
95
Laws, Rules
Account
Particulars
Violated
(RER) instead of Official Receipts
(ORs) COA Circular
No. 2004-006
dated
September 9,
2004
Sections 1.1.1
and 1.2.1 of
COA Circular
No. 2012-001
dated June 14,
2012
XI Representation Payments ranging from P300.00 COA Circular 102,648.50
Expense and below not requiring ORs, were No. 2017-001
covered with RER and/or Petty dated June 12,
Cash Receipts instead of 2017
Certification of Expenses Not
Requiring Receipts
XII Training Disbursements for training expense COA Circular 2,853,276.06
Expenses were inadequately supported with No. 2012-001
documents that will prove dated June 14,
regularity, completeness and 2012
validity of the training expense
incurred. Section 4 (6) of
PD 1445 dated
June 11, 1978
Total 738,532,111.66
30. We could not ascertain the accuracy and reasonableness of the foregoing payments,
which failed to comply with the required/ necessary documentations. Absence of the
required supporting documents may render the claims/transactions unauthorized/invalid.
31. We recommended and Management agreed to require the Head/s of:
a. the NCR and FOs V, VIII, XI and XII to submit the required and
appropriate documents to support the payment of various expenses, to
preclude the issuance of Notice of Suspension, as applicable;
b. the NCR to:
(i) require the contractor to submit legal documents as proof that they
are allowed to engage in the supply and delivery of ICT Equipment;
(ii) require the BAC to diligently evaluate bidding documents submitted

by the prospective bidders and ensure equitable treatment to all
bidders and to recommend to HoPE the most qualified winning
bidder which is capable to deliver the required goods; and
96
(iii) require the BAC TWG to carefully perform eligibility screening,
evaluation of bids and post qualification to avoid deficiencies in the
procurement process;
c. the NCR BAC Chairperson to require:
(i) the contractor to submit justification on the non-compliance as to

the technical specifications of the delivered laptops;
(ii) the BAC TWG to refrain from approving requests of

contractor/supplier on the new technical specifications of required
equipment, which was already awarded, and in cases like these,
inform and consult immediately the BAC and HoPE for their
further actions and decisions on the matter; and
(iii) the Inspection Committee to conduct inspection through test analysis

to ensure that delivered equipment are all working and in
accordance with the required technical specifications, and submit
the said report to the Accounting Section as attachment in the
payment thereof. Thereafter, conduct inspection of the received
items based only on the technical specifications required in the
approved PR and bidding documents, otherwise, reject or
disapprove the same;
d. the FO IVA to ensure that the written conformity and acquiescence of the
Solicitor General and the written concurrence of the Commission on
Audit shall first be secured before the hiring or employment of a private
lawyer or law firm; and
e. the FO V Property and Supply Section and Warehousing and Donations

Sections/Units to gather the documents for submission to the Accounting
Section as their basis to close/adjust the non-moving balance of
inventories in the books.
32. Hereunder are the Management comments and corresponding rejoinders in audit:
Office Management Comment Auditor’s Rejoinder

NCR On the supply and delivery of 278 laptop units: We acknowledged the internal control made by the
Agency on the safekeeping of original documents for
• Management explained that certified copies future reference; however, the DSWD-FO-NCR
were submitted to the COA office and employees concerned is required to submit the original
original copies were forwarded to the End- documents as attachments in the DV as required in
User. COA Circular No. 2012-001, to ensure validity of the
payment thereof. Likewise, COA is mandated to be the
depository of documents for post audit and future
reference.
97
It was further observed that the Certificate of Exclusive
Distributorship, Samples and brochures/photographs
were not required by the BAC in the procurement of
ICT equipment, which is not in conformity with Annex F
and G of COA Circular No. 2009-001. The said
documents are also necessary in determining the
capability and eligibility of prospective bidders and
further eliminate bidders which are not in the line of
business of ICT Equipment.
• BAC has conducted a thorough review and It is the responsibility of the BAC and TWG to
evaluation of documents during bid opening determine the eligibility of the prospective bidder from
and post qualification process as well as in the opening of bids to post qualification stage, pursuant
the computation of Net to Section 12 of the Revised 2016 RA No. 9184 and its
Financial Contracting Capacity (NFCC), the IRR.
recommendation to award the contract was
If post qualification was properly performed by the BAC
not in congruent with the provisions of RA
TWG, the deficiencies could have been observed
No. 9184 and its 2016 IRR. However,
before the awarding of contract. The Agency through
Management relied on the documents
its BAC should strictly follow the rules and regulations
submitted by the Bidder that all contents
in the government procurement act and diligently
are valid and correct. Likewise, TWG
perform such duties and responsibilities.
recommendation was also given
importance and consideration on the award
The computation of a prospective bidder’s NFCC
of the contract. Given the deficiencies noted
should be based on the latest Audited Financial
by the respective COA Auditor, the Supplier
Statement (FSs) submitted to BIR not on the up-to-
was not remiss on the delivery of 278 pcs
date or present NFCC as provided in Section 23.4.1.4
computer laptops based on agreed delivery of the 2016 Revised IRR of RA No. 9184.
schedule and have met the urgent need to
deliver laptops in order to fast track the The BAC and TWG must ensure equitable treatment in
encoding, verification and other objectives the evaluation of submitted documents to warrant
of Listahanan 3rd cycle NHTO project competitiveness to all prospective bidders.
implementation.
• Management verified the SLCC similar

contract to be bid specified in the Invitation
to Bid of the contractor is valid and deemed
compliant to at least 50% of the ABC. The
SLCC were supported by Certificate of
Final Acceptance by the project owner and
has a final rating of Satisfactory on their
performance. There is also an issued
certification coming from Infoworks stating
that the Supplier is authorized reseller of IT
Equipment.
• Further, the contractor has posted

performance security prior to the signing of
contract, to guarantee faithful performance
by the winning bidder of its obligations
under the contract in accordance with the
bidding documents. Likewise, a notarized
Omnibus Sworn Statement was also
submitted in good faith prior to bid opening.
98
Thus, finds them fitting and proper, the
awarding of contract.
• Likewise, the contractor also commented

that they did not receive any complaints nor
did the management receive any negative
reaction as to our capacity to bid. Hence,
only relied on their unqualified acceptance
which the management firmly believes was
done in faithful compliance of their duty as
BAC Officers.
• Justification submitted to resolve the non- We acknowledged the urgency on the need for laptops
compliance with technical specification, are in the delivery of services of the Department but again
as follows: this should follow the laws, rules and regulations on the
procurement act to ensure regularity of the
a. The submitted proposal of the Supplier procurement process.
with regards to Operating System was
based on the Technical Specifications The Inspection Committee and end-user should
Windows Professional, 64 bit as diligently check technical specifications in conformity
indicated in the Purchase Request. with approved Purchase Request and Bidding
However, prior to the delivery, the
Documents.
supplier informed the BAC and TWG
that the Operating System of the units
As regards to the change of technical specifications
to be delivered was Window 10 Home
64 bit. offered by the Supplier and was deemed accepted by
the BAC TWG with conforme by the end-user; this was
b. The delivered laptops were bundled not in accordance with RA No. 9184. During the
with an operating system that is opening of bids, the Supplier offered the same
authentic as it does not require to technical specifications as required by the Procuring
insert a boot device and it turn on Entity, thus, declaring the contractor as eligible in the
automatically without any configuration pass/fail criteria. Hence, they are required to deliver as
or modification method. offered and required.
c. Removable battery is limited in the This further showed that awarding of contract to the
market due to innovations. The winning bidder, a furniture company, is not capable to
delivered laptops were designed with a deliver the goods needed by the agency. Thus, the
built-in can meet the required hours of delivery of the ICT Equipment with the new
operation without affecting its specifications is disadvantageous to the national
performance. government.
• It was also recommended the acceptance

of delivery of 278 units of laptops was vital
to the delivery of services of the
Department as there is an on-going training
for area supervisors, field workers and
encoders. These laptops will be distributed
to the hired staff in order for them to meet
the timeline for the completion of the NHTU
Listahanan Project, encoding the
Household Assessment Form and other
related activities.
IVA Management commented that they posed no We maintain our stand on the observation, and
objection to the audit recommendations and reiterated that Management should secure first the
averred to ensure proper documentation and acquiescence of the Solicitor General and the written
legal basis in the succeeding hiring of Attorney concurrence of the Commission on Audit before the
99
position. However, they justified that the hiring hiring of a private lawyer.
and payment of salaries/professional fees of
Legal Counsel was in compliance to the issued
written authority to hire under MOA arrangement
of then DSWD Secretary Judy Taguiwalo. They
further explained that the hiring of said position
was made in good faith based on the issued
authority from the Central Office, thus the
presumption of regularity in paying the Cost of
Service of the Legal Counsel. In fact, by the time
he was hired as Memorandum of Agreement
worker, there were funds allotted for the
payment of his Cost of Service supported by a
Certification of Availability of Funds and
approved Work and Financial Plan.
Delayed and/or Non-submission of Financial/Accounting Reports
33. The delayed/non-submission of required reports and supporting documents

prevented the auditors of several DSWD offices from conducting a timely audit and
verification of the financial transactions, the results of which could have been used as
an aid in Management decisions and inputs in enhancing financial accountability.
34. Section 122(2) of PD 1445 provides that “Failure on the part of the officials
concerned to submit the documents and reports xxx shall automatically cause the
suspension of payment of their salaries until they shall have complied with the
requirements of the Commission.” (emphasis supplied)
35. Section 60, Chapter 19 of the GAM, Volume I prescribes the timelines for the
submission of FS and supporting schedules of all NGAs.
36. Section 6.05 of COA Circular No. 95-006 dated May 18, 1995, requires the officials
involved in the recording of transactions in the books of accounts to turn over the receipts
and disbursement records with all paid vouchers and documents evidencing the transaction
to the Auditor within ten (10) days from date of receipt of said documents
37. Also, Chapter 21, Section 7 of the GAM required the Chief Accountant to submit
the Bank Reconciliation Statement (BRS) within twenty (20) days after receipt of the Bank
Statement (BS) to the following: Original – COA Auditor (with all the supporting
documents and JEVs); Copy 2 – Head of Agency; Copy 3 – Accounting Division/Unit file
and Copy 4- Bank, if necessary.
Table 8. Summary of Delays/Non-submission of Financial/Accounting Reports

Reports/Documents Office Reference/Deadline Time Lag/ Status
Budget Accountability Report No. 1 I Section 4.3 of the COA-DBM Not Submitted
Joint Circular No. 2019-01 dated
FAR Nos. 1, 1A, 1B, 1C, 2, 2A,3, 4 January 1, 2019
and 5
Within 30 days after the end of
100
each quarter
XI Not Submitted
Monthly/Quarterly TB and FS with X Section 60, Chapter 19 of GAM Incomplete submission of SCF;
Management Representation Letter for NGAs, Volume I SCBAA not submitted
(MRL)
Bank Reconciliation Statement NCR Section 7, Chapter 21, GAM, Incomplete submission with delays
(BRS) Volume I ranging from 19 days to 1,118 days
or more than 3 years
III and Within 20 days after receipt of Not submitted

IVB the monthly Bank Statement
Two current accounts - 0 to 262

V days delayed; 19 MDs and current
account-not submitted
VI 28 days to 10 months
IX Incomplete submission of BRS for 9

out of 10 bank account ranging
from June to December 2019 or
total of 55 unsubmitted BRS
Out of 9 bank accounts:

3 – no BRS;
4 – incomplete submission;
X 2 - submitted
-RCI with Disbursement Vouchers NCR Section 60 (c), Chapter 19 of the • 4,103 JEVs amounting to
(DVs)/Payrolls GAM, Volume I ₱11,165,170,309.18;
• 5,432 DVs amounting to
-Authority to Debit Account (ADA) Within ten (10) days after the ₱312,108,682.26;
with DVs/Payrolls end of the month/quarter • 3,935 Liquidation Reports
unsubmitted
-Journal Entry Vouchers (JEVs)/
General Journal (GJs) CAR • 37 DVs from February to
December 2019, not
-RCD with Official Receipts (ORs) submitted
I
• Delayed submission of 182
-Liquidation Reports (LRs) DVs from January to July
• August DV not submitted

V • 12,485 DVs from 2016-2019
amounting to
₱3,356,550,305.06 not
submitted
101
• 4,650 JEVs (Collections) from

2016-2019 amounting to
₱199,013,003.84 not
submitted
• 1,093 JEVs (Disbursement)

from 2016-2019 amounting to
₱194,017,272.34 not
submitted
X
• 242 DVs from Jan. to Oct.
2019 not submitted
• LRs not submitted Advances

to Special Disbursing Officer -
1,741,052,629.44
• Advances to Officers and

Employees - ₱17,676,221.54
• Due from NGAs -

₱9,345,560.00
• Due from LGUs -

₱77,383,512.27
XI
• Due from NGOs/ POs -
XIII
₱54,348,741.22
XIII
18-199 days
Incomplete submission of DVs
• 3,185 DVs from amounting to

₱451,171,077.59 not
submitted
Year-end Pre and Post Closing TB IVB Section 60 (c), Chapter 19 of the Not submitted
and FS with MRL GAM, Volume. I
14th day of February of the

ensuing year
38. Delays in the submission of the financial and accounting reports were attributed to
the following:
Table 9. Reasons for Delay of Submission

Office Reasons for Delayed Submission
NCR Ten (10) of their staff, including those who are handling the submission of these documents resigned,
and their job assignments have not yet been transferred to a different person as to this time.
IVB The non-submission of the CY 2019 year-end reports is caused by the preparation of financial reports
solely being done by the newly designated personnel who is not yet fully knowledgeable to do so,
102
Office Reasons for Delayed Submission
while the Accountant failed to give proper supervision thereto.
XI The Accountant is unable to submit the financial reports on time due to absence of additional
personnel to assist in checking the completeness of supporting documents and to ensure that all
Obligation Request and Status and DVs are properly signed by different unit heads of DSWD. Also,
the Accountant needs to wait for the SDO to submit the liquidation reports of their cash advances with
complete supporting documents.
In addition, the Cashier mentioned that delays in the submission of DVs to the Accounting Unit was
due to unclaimed checks by the DSWD creditors.
Hard copies of BAR and FARs were not printable since their office does not have an available printer
to print large documents. It was also mentioned that they are not required to submit hard copies as
practiced by the previous in-charge.
X Delayed submission of BRS is due to the delayed receipt of the bank statements. Further,
Management set a regular schedule monthly for retrieving Bank Statements, that is, every 20th of the
month.
XIII Backlog in the preparation/generation of JEV to be attached in every DVs/transaction
23. Moreover, the following deficiencies were noted as far as submission of reports
contrary to the pertinent laws, rules and regulations as presented in Table 10.
Table 10. Deficiencies in the Submission of Reports.

Office Report Criteria Deficiency
FO I DVs Section 39 of PD January to July DVs - 194 to 375 days delayed;
1445 August to December DVs - not submitted
FO V LDDAP- Section 56, Accounts submitted for disbursements paid through Advice to
ADA Chapter 6 of GAM Debit Accounts from CYs 2016-2019 were not supported with
for NGAs, Volume bank validated List of Due and Demandable Accounts
I Payable-Advice to Debit Accounts (LDDAP-ADA) thus caused
difficulty confirming the actual amount debited to the agency’s
MDS account for these transactions at a certain date.
The absence of the validated LDDAP-ADA caused difficulty in

determining the actual amount debited to the MDS account of
the agency to pay the creditors of the agency. Identification of
the series of disbursement vouchers paid through this mode
and debited to the MDS account on a certain date is
challenging without the validated accountable form.
Consequently, reconciling the recorded transactions for the
MDS account with the bank entries on a specific date entail
trial and error since the number of LDDAP-ADA has different
reference numbers when posted in the bank statement.
FO VIII Liquidation Section 112 of PD Cash advances granted to SDOs and PCF Custodians
Report 1445 and Section amounting to ₱661,202,567.60 and ₱25,000,000.00,
33, Chapter 6 of respectively, were recorded as liquidated in the books despite
the GAM, Vol. I the incomplete review and validation of the liquidation
documents, thereby, affecting the presentation of the affected
accounts in the financial statements.
FO X BRS Section 5, The bank statements do not reflect on their face the dates they
Chapter 21 of were received by the agency from the banks which would be
GAM for NGAs, the basis in the counting of the number of days they need to
Volume I submit the same to the Auditor’s Office.
103
39. On the delayed submission of BRS, we pointed out that the FO X Management
should have taken earlier initiative in retrieving the bank statements through making a
representation with the agency’s depositary banks on a regular monthly schedule rather
than waiting indefinitely for the said banks to mail or furnish the agency with a copy of the
monthly bank statements. Further, the agency could have made use of the Land Bank of
the Philippines (LBP) weAccess to view the electronic copy of the account statement of
their bank accounts, in order to observe the prompt preparation and submission of the
monthly BRS while waiting for the bank’s print-out copies.
40. The delayed preparation of financial/accounting reports and subsequent submission

may not only result to possible loss of supporting documents substantiating the financial
transactions of the agency, but also the delayed verification and examination by the Audit
Team.
41. We recommended and Management agreed to require the concerned

Accountants of:
a. the NCR, FOs I, II, IVB, V, VI, IX, X XI, and XIII to immediately submit
all the overdue financial/accounting reports and, henceforth, ensure
timely preparation thereof by the AOs and submission to the Accountant
and COA, otherwise, impose appropriate sanctions under Section 122(2)
of PD 1445, supra;
b. FOs I and XIII to strictly and consistently observe the provisions of PD

1445 and COA Circular No. 95-006 in the submission of DVs to the Office
of the Auditor;
c. FO V to cause the submission of DVs, JEVs and all validated LDDAP-

ADA to support the paid DVs through ADA for the years 2016-2019,
thereafter, include the subject form as supporting document to paid DVs
before submission to the audit team as required by existing regulation;
and
d. FOs VIII and X to submit the required Liquidation Reports with

adequate supporting documents to support recording in the books of
accounts, to validate propriety of the transactions and to determine the
accuracy of the reported liquidations involving the PCF, Advances to
Special Disbursing Officer, Advances to Officers and Employees, Due
from NGAs, Due from LGUs and the Due from NGOs/POs.
42. FO IVB Management commented that the Year-End Financial Reports was done on
February 21, 2020 by the Accounting staff with the assistance of the Management and
Audit Analyst and other staff, however, it was not submitted to the Auditor’s Office
because the Regional Accountant wanted to see the schedule for Financial Statements as
supporting documents to the report.
104
43. As to the issue of the difficulty in confirming the actual amount debited to the
agency’s MDS account for transactions at a certain date, the Head of the Financial
Management Division (FMD) of FO V had already verbally clarified this matter to the
Audit Team and explained that the LLDAP-ADA reference number appearing in the
Reports of ADA Issued (RADAI) is the same as the reference number appearing in the
LBP MDS Treasury Statement, only that, it has a different format. He had already
converted the reference number appearing on the RADAI being used by the COA Auditor
to the bank format for easier reference on the part of the latter.
Defects/deficiencies in implementation of Modified Conditional Cash Transfer (MCCT)
44. Various defects/deficiencies were noted by FO IX in the implementation of

the MCCT as follows: (a) non-adherence to RA 9184 for procurement of service
providers amounting to ₱163.937 million; (b) inadequate and inappropriate
supporting documents for liquidations amounting to ₱93.182 million; (c) delayed
submission of twenty-one (21) Memoranda of Agreement (MOA) amounting to
₱163.937 million; (d) unreasonable delay in the liquidation of cash advances
amounting to ₱79.063 million; (e) incomplete supporting documents on DVs and
RCDisb amounting to P141.562; and (f) non-submission of DVs involving
transactions amounting to ₱18.885 million, thus, casting doubt on the regularity,
validity legality, propriety, and accuracy of the transactions, disbursements, and
reported balances in the financial statements.
45. Audit of the implementation of the MCCT, DSWD-FO-IX resulted in the following
deficiencies as shown in Table 11.
Table 11. Summary of Observations and Recommendations
Observations Amount Criteria Cause/s Effect Recommendations

Non- ₱163,937,415.00 2016 RIRR Procurement of Rendering the Adhere to the provisions of the
adherence to of RA 9184 service providers for transactions RIRR of RA 9184 in the
RA 9184 for the implementation irregular and procurement of service providers
the SLP Field of the Skills Training denying the agency for the implementation of the
procurement Operations Modality of the the opportunity to MCCT in line with the
of service Manual MCCT were not obtain the lowest commitment of the Government
providers (March 18, done through possible and of the Philippines (GoP) to
promote good governance and its
2015) competitive bidding. reasonable cost and
effort to adhere to the principles
excellent quality
of transparency, accountability,
services. equity, efficiency, and economy in
its procurement process.
Inadequate and 93,182,459.00 Section 4, Audit of 198 This led to the a. Require the Accountable
improper PD 1445 liquidation reports variance in the Officers to:
supporting COA Circular amounting to amount of ▪ attach original copies of
documents on No. 2012- ₱93,182,459.00 liquidation as supporting documents
liquidations 001 revealed that 32 presented in the especially the OR;
official receipts liquidation report ▪ stop the practice of
(ORs) supporting and the total partial liquidation of cash
the disbursements advances;
amount appearing
105
were photocopies in the supporting ▪ prohibit the use of
and were documents. As a repeated supporting
repeatedly attached result, the documents unless
to support 317 Accounting Unit necessary.
Report of made several
Disbursements adjustments in the b. Require the Accounting
(RCDisb) of dropping of Section to review carefully the
different supporting documents attach
Advances to SDOs
Accountable in the liquidation reports
account from the
Officers (AOs) submitted by AO and ensure
under different books accumulating
that these are original and not
checks. An OR was to ₱2,060,500.00. recycle.
issued/used by the
Service Provider for Doubtful balance of
several training Advances to SDOs
costs and starter amounting to
kits chargeable ₱93,182,459.00.
against the different
cash advances of
AOs since the
agency did not
require the TVIs to
issue OR for each
cash advance paid
for their services.
Liquidations of cash
advances were
done partially and
intermittently in
which, all the
supporting
documents of the
first partial
liquidation were
attached to the
succeeding
liquidations.
Delayed 163,937,415.00 Section 3.1.1 Twenty-one (21) Complete and Ensure that no contract shall be
submission of of COA MOAs amounting to timely evaluation of entered into by agency unless
MOA Circular No. ₱163,937,415.00 the legal and there is a Certificate of Available
2009-001 were not submitted technical aspects of Funds (CAF) by the Accountant,
dated to the Audit Team the agreement duly appropriated for the purpose.
February 12, within the could not be
2009 reglementary period immediately Strictly adhere with the provision
of five (5) working conducted, likewise of COA Circular 2009-001 in
Section 86 of days depriving the submission of contract/agreement
PD 1445 management of the to COA Audit Team.
MOA were not opportunity to be
supported with the informed of the
certification of the deficiencies, if any,
accountant as to the at the earliest time
availability of funds possible.
Unreasonable 79,063,547.00 Section 1.2 Cash advances for Accumulation of Comply with the provisions of
106
delay in the of COA MCCT skills training unliquidated cash COA Circular 2012-001 on the
liquidation of Circular were liquidated from advances reglementary period on the
cash advances 2012-001 33 to 301 days from liquidation of cash advances of
the completion of special purpose / time-bound
the training undertaking.
Incomplete 141,562,787.50 Section 4.6 153 DVs covering Renders doubtful Improve commitment to sound
supporting of PD no. the period from the accuracy, internal control over
documents on 1445 2016 to 2018 for validity and disbursements by ensuring that
DVs and MCCT cash propriety of the every disbursement and
RCDisb, and COA Circular advances in the related liquidation is supported with
non-submission No. 2012- total amount of disbursement, and complete documentation before it
of DVs 001 ₱127,232,782.50 manifests poor is processed for payment and
internal control over
and RCDisb recording, respectively.
disbursements.
Section 5.3 amounting to
of COA ₱14,330,005.00
Circular 97- were not supported
002 with required
documentation
Non-submission 18,884,949.00 Section 100 46 DVs totaling The legality, validity, Require the Accountant to submit
of Disbursement of PD No. ₱18,884,949.00 for propriety and the aforementioned paid DVs and
Vouchers 1445 the implementation accuracy on the their supporting documents, and
of MCCT skills grants of the cash henceforth, ensure that RCIs as
Section 12, training were not advances is well as Report of Advice to Debit
Chapter 6 of submitted to the doubtful Account Issued (RADAI) are
the GAM COA Audit Team to submitted with complete DVs and
Volume I date their supporting documents.
Total Amount ₱660,568,572.50
46. DSWD-FO-IX Management justified the following:
a. that it relied in good faith on the response of the National Project Management
Office (NPMO) on the clarification letter sent by the Regional Project
Management Office (RPMO) regarding the use of Cash Assistance Payroll in
the implementation of MCCT’s skills training under the Pantawid Program
where the NPMO categorically allowed the use of the scheme considering that
the procurement process is not feasible and not convenient.
b. the lack of documents could possibly be due to the practice of partial

liquidation where supporting documents attached to previous liquidations were
no longer attached to the present ones. However, since 2019, Management
already issued a directive prohibiting partial liquidation. Also in 2019, the
Accounting Unit started to attach JEVs in every Liquidation Report in
compliance with COA recommendations.
107
Auditor’s Rejoinder
47. While NPMO categorically allowed the use of Cash Assistance Payroll in the
implementation of MCCT’s skills training, the Audit Team maintains that the SLP Field
Operations Manual which was referred to by MCCT in the implementation of its skills
training provided that “for financial transactions between DSWD and partners, the services
of the latter maybe employed following RA 9184, through competitive bidding, as well as
alternative methods of procurement.”
Implementation of Social Pension (SocPen)
48. Lapses were noted in the implementation of the Social Pension for Indigent
Senior Citizen (SPISC), thus, depriving the beneficiaries of the benefits they could
have gained and posed high risk of loss of government funds thru robbery/hold-up
considering the peace and order, terrain and geographical locations of the LGUs in
the region.
49. The Social Pension for Indigent Senior Citizen (SPISC), commonly known as the
SocPen is in-line with the fulfilment of the obligation of the government to protect the
most vulnerable sector through social protection, and for the full implementation of the
Republic Act (RA) No. 9994 also known as Expanded Senior Citizens Act of 2010, stating
that the Indigent Senior Citizens shall be entitled to a monthly stipend amounting five
hundred pesos (₱500.00) to augment the daily subsistence and other medical needs of
senior citizens.
50. RA 9994 defines Indigent Senior Citizen as any elderly, who is frail, sickly, or with
disability, and without pension or permanent source of income, compensation or financial
assistance from his/her relatives to support his/her basic needs.
51. DSWD Memorandum Circular No. 04, Series of 2019 states that the beneficiary
shall receive the stipend on a semestral basis, using the most cost-effective and efficient
payment modality, such as but not limited to direct payment to beneficiary through cash
advance by a designated Special Disbursing Officer (SDO), door-to-door delivery scheme
or use of cash card.
52. Results of validation on the implementation of the SocPen Program for CY 2019
disclosed the following:
Table 12. Deficiencies in the Implementation of SocPen

FOs Observations Amount Criteria Cause Effect Recommendations
II Concerned officials - DSWD In the conduct of Resulted in Require the DSWD-FO-II
failed to exercise Administrativ pay-out, the huge cash in Management, to:
prudence and e Order No. concerned officials the hands of
ordinary diligence in 15, series of failed to coordinate paymasters a. prepare a travel plan
the conduct of pay- 2010 with the concerned representing for the conduct of
out of stipends to LGUs at least 5 unpaid payout to enable the
Social Pension days before the stipends at concerned division
(SocPen) conduct of actual the end of to have ample time to
108
beneficiaries which payout to enable each payout, coordinate with their
posed undue risk of the LGUs inform and posed counterparts in the
cash in the SocPen high risk of LGUs, and to prepare
possession of beneficiaries and loss of the venue of the
paymasters, the to prepare a venue government payout conducive for
safety and well for the payout funds thru the activity and the
being of the verifiers, conducive to the robbery/ hold- pensioners;
paymasters and the verifiers, up
b. study properly the
lolo and lola paymasters and considering
needed number of
beneficiaries. most especially the the peace and days necessary in
health conditions order, terrain the conduct of
of the “lolos” and and payout in a particular
“lolas”. geographical LGU so that no more
locations of cash payout is made
the LGUs in after 3 or 4pm to give
the region. them time to report
to the FO for the
safety deposit of
unexpended
amounts in the
agency’s safety
vaults;
c. require the
paymasters after the
end of each payout
to submit the names
of the unpaid
beneficiaries who
were not present, to
the person in charge
in the SocPen, to
evaluate how many
semesters these
pensioners failed to
claim their pensions;
and
d. after a thorough
review, and if found
that the same
pensioners did not
receive their
pensions for the last
two or more
semesters, require
the agency head to
request the Municipal
Link concerned to
validate the
whereabouts of these
pensioners; and if
found dead, or
moved to other
109
places, require for
the reporting to the
FO2 for appropriate
action.
VI The inadequate 796,650,000.00 DSWD Inadequate Delayed Devise a scheme to fast-

monitoring of the Memorandu monitoring in the payment of track the liquidation of
liquidation of cash m Circular prompt liquidation stipend to cash advances to SDOs so
advances to Special No. 04, of cash advances indigent that the stipend of all
Disbursing Officers Series of to SDOs senior citizens indigent senior citizens will
resulted in the 2019 and depriving be fully paid at year-end.
unpaid stipend of the
indigent senior Republic Act beneficiaries
citizens amounting No. 9994 of the timely
to ₱796.650 million delivery of the
at year-end, thus, benefits due
depriving the to them.
beneficiaries of the
timely delivery of the
benefits due to
them.
VII Cash Advances for 7,176,000.00 Delayed payout. The risk of Require the DSWD-FO-VII
payment of stipend exposing the Management to:
for indigent senior fund to
citizens under the possible loss a. avoid delays in the
SocPen program of thru theft, and payment of stipend to
DWSD-FO VII misuse of beneficiaries of the
remained unpaid government SocPen program in
funds. order for the
and the cash still
intact, was accountable officers to
kept/deposited refrain from holding
substantial amount of
under the custody of
cash advances which
the Cashier at the
may expose it to
regional office for possible loss thru theft
over 66 to 99 days or misuse; and
(2 to 3 months) with
a substantial amount b. provide a durable and
of ₱7,176,000.00, more secure area/room
due to delayed pay- for keeping the cash,
out, thus, exposing and if possible, require
to possible loss thru each SDOs to have a
theft and misuse of safe/vault to be used in
government funds, keeping their cash
contrary to the advances while waiting
financial controls for the scheduled pay-
and administrative out in order to provide
adequate safeguards
controls set forth in
against loss thru theft
the internal control
of government funds.
system.
Total Amount 803,826,000.00
110
53. DSWD Management commented the following:
II - The pay-out schedules were being communicated with the MSWDO a few
days before the pay-out. However, they assured that the succeeding pay-out
schedules will be conducted orderly. Also, they assured the Audit Team
that they will prepare their calendar of activities for the year, for the timely
conduct of pay-out activities.
VI - Management appreciated the recommendation and is exerting efforts to

expedite the pay-outs of the CY 2019 stipends and the monitoring of the
liquidation was religiously made. The following are reasons, which also
contributed to the unpaid stipend of indigent senior citizens amounting to
₱796.650 million at year-end were submitted:
a. The validation was conducted from April to June 2019 to come up

with the clean list of pensioners pursuant to DSWD Memorandum
Circular No. 04, series of 2019 and the 1st batch of the generated list
was received on June 18, 2019, hence, the pay-outs only started on
June 25, 2019;
b. The 50 Special Disbursing Officers who were utilized in the payment

of the stipend of indigent senior citizens were not sufficient to
undertake the cash advances amounting to ₱2,195,448,000.00 in a
span of six months; and
c. The Accounting and Social Pension Units were monitoring the cash
advances of SDOs, however, there were instances which the whole
amount of the cash advance granted could not be fully paid during the
scheduled pay-out since not all pensioners were present and the SDOs
would still wait for another pay-out schedule.
VII - Management replied that during 4th quarter of CY 2019, Spot Cash
Examination that was conducted by the Accounting Unit and Office of the
Regional Director staff, the SDOs were already instructed to maintain and
periodically update their respective cashbook/Cash Disbursement Record so
that they can present it anytime to COA auditors.
During the SDO meeting in the last quarter of CY 2019, the SDOs were
already provided with orientation/briefing on their duties relating to the
disbursements of cash advance received and its corresponding liquidations
pursuant to the provisions of COA Circular No. 92-007 dated February 10,
1992.
The Audit Team will require Management to submit Minutes of Meeting on

the said SDOs meeting conducted in the last quarter of CY 2019 in order to
validate the implementation of the audit recommendation.
111
Non-attainment/achievement of the objective of the Kalahi-CIDSS National Community
Driven Development Program (KC-NCDDP)
54. Non-attainment/achievement of the objective of the KC-NCDDP on the

“Establishment of New Public Schools for Indigenous Peoples in Mindanao” for the
construction of 605 classrooms in 251 sites for the new public schools for Indigenous
People in Mindanao due to delayed completion of the project, as manifested in the
status of implementation, in which 421 classrooms (CLs) or equivalent to 69.59%
were completed as at December 31, 2019, and still had an unmet target of 184 CLs or
30.41% of total CLs. Moreover, the accuracy and reliability of the submitted
Physical Accomplishment Report as at December 31, 2019 is doubtful in view of
inconsistencies in data reported.
55. In connection with R.A. No. 8371, otherwise known as the Indigenous Peoples
Rights Act (IPRA) of 1997, the Department of Education (DepEd) has adopted a National
Indigenous People Education (IPEd) Policy Framework (DepEd Order No. 62, 2011)
which seeks, among others, to enable the basic education system to recognize, protect,
and promote the rights and welfare of the Indigenous Cultural Communities
(ICCs)/Indigenous Peoples (IPs), as well as equip them with the knowledge and skills
needed to face various social realities and challenges. DepEd has also adopted IPEd
Curriculum Framework (DepEd Order No. 32, s. 2015), which seeks to provide guidance
to schools and other education programs, both public and private, as they engage with
indigenous communities in localizing, indigenizing, and enhancing the K to 12 Basic
Education Curriculum based on their respective educational and social contexts.
56. The DSWD on the other hand, is implementing a poverty reduction program called
the KC-NCDDP which seeks to empower communities to have better access to basic
services which shall include education, among others.
57. Relative thereto, a Memorandum of Agreement (MOA) dated May 18, 2016, was
entered into by and between DepEd and DSWD, to facilitate the construction of 605
classrooms in 251 sites, a component of the initiative “Establishment of New Public
Schools for Indigenous Peoples in Mindanao” covering Regions IX, X, XI, XII, and XIII,
through the DSWD KC-NCDDP modality.
58. As a background, it was stipulated in the MOA that the DepEd shall release funds to
the DSWD for the construction of classrooms and operating costs amounting to ₱500
million, with validity and effectivity until May 31, 2017. A Supplemental MOA was made
and entered into by and between DepEd Secretary and DSWD Secretary for the release of
additional funds of ₱20.5 million by DepEd to cover operating costs until December 31,
2017, and for the extension from June 1, 2017 until December 31, 2017. A Second
Supplemental MOA was entered into by and between the DepEd and DSWD, represented
by DepEd Secretary and DSWD Secretary. DepEd released additional funds of ₱27
million to cover operating costs and extending the validity and effectivity of the MOA
until December 31, 2018.
112
59. Therefore, DepEd transferred funds to DSWD amounting to ₱547.5 million for the
above cited project. Details of the releases are as shown in Table 13.
Table 13: Details of Releases

Reference Amount
O.R. No. 8084722 dated July 13, 2016 ₱500,000,000.00
JEV No. 2017-12-001515 20,500,000.00
O.R. No. 7287280 dated May 22, 2018 27,000,000.00
Total ₱547,500,000.00
60. The fund allocation per region as provided in the Schedule of Allocation per Region
attached to the MOA is summarized in Table 14.
Table 14. Summary of Allocation to Regions

No. Sub- No. of
Implementation Community
Field projects Classrooms Total Allocation
Operating Cost Grants
Offices (SP) (CL) (e)
(c) (d)
(a) (b)
IX 18 21 ₱593,352.00 ₱16,762,020.00 ₱17,355,372.00
X 39 82 4,326,886.00 63,441,709.00 67,768,595.00
XI 69 169 6,927,229.00 132,742,192.00 139,669,421.00
XII 50 135 6,532,068.00 105,038,180.00 111,570,248.00
XIII 75 198 8,669,255.00 154,967,109.00 163,636,364.00
TOTAL 251 605 ₱27,048,790.00 ₱472,951,210.00 ₱500,000,000.00
61. Of the P547.5 million funds received from DepEd, the total amount of
₱522,301,463.43 were transferred to the five (5) identified regions in Mindanao. Further
verification of the General Ledger (e-NGAS) of the account Due from Regional Offices
(ROs) – IATF disclosed that from July 2016 to October 2018, out of the total fund
transferred, total liquidations as at December 31, 2019 amounted to ₱400,002,225.18
resulting in an unliquidated balance amounting of P122,299,238.25 as at year-end, details
of which are shown in Table 15.
Table 15. Summary of Funds Transferred/Liquidation as at December 31, 2019

%age of
FOs Funds Transferred %age of Balance Unliquidated
to Field Offices Liquidation Liquidation Unliquidated Balance
a b c = b/a d = a-b e = d/a
IX ₱18,954,945.97 ₱ 15,311,061.71 80.78% ₱ 3,643,884.26 19.22%
X 67,052,449.36 17,397,024.90 25.95% 49,655,424.46 74.05%
XI 151,889,760.12 100,772,541.29 66.35% 51,117,218.83 33.65%
XII 118,781,537.77 100,898,827.07 84.94% 17,882,710.70 15.06%
XIII 165,622,770.21 165,622,770.21 100.00% - 0.00%
Total ₱ 522,301,463.43 ₱400,002,225.18 76.58% ₱ 122,299,238.25 23.42%
62. While the overall rate of liquidation is high at 76.58%, Region X had a low
liquidation rate of 25.95% as it relates to the amount of unliquidated funds transferred to
them from CYs 2016 to 2018. However, it is worthy to note that Region XIII had fully
liquidated the funds transferred to them in CY 2019.
113
63. Inquiry with Management with regard to the remaining unreleased fund amounting
to ₱25,198,536.57 (P547,500,000.00 – ₱522,301,463.43) revealed that the said amount
was included, or part of the lapsed Notice of Cash Allocation (NCA) and/or balances
remitted to the Bureau of the Treasury (BTR), details as follows:
Table 16. Schedule of Lapsed NCA / Remittance to the BTR

DepEd DATE OF
JEV NO. PARTICULARS AMOUNT
RELEASES JEV
20,500,000.00 2017-12-001593 29-Dec-2017 MISC. TRUST – Bureau of the Treasury ₱ 458,560,591.32
– Remit the remaining balance of
DSWD Miscellaneous Trust Account
LBP 3122-1016-72 as at Nov. 30, 2017
to the Bureau of the Treasury
67,054,524.00 2018-12-000742 31-Dec-2018 F101-184 MDS TRUST – To record the 24,990,387.33
lapsed Notice of Cash Allocation (NCA)
for the 4th Qtr of CY 2018
27,000,000.00 2018-12-000723 31-Dec-2018 F101-184 MDS TRUST – To record the 58,216,753.45
lapsed Notice of Cash Allocation (NCA)
for the 4th Qtr of CY 2018
Perf. Bond – P 11,359,961.87
DepEd 1,167,400.27
Lumads 5,419,075.31
Lingap 18,340,000.00
Cash for Work 21,930,316.00
58,216,753.45
64. Likewise, comparison on the releases/transfers made to the FOs with the submitted
Status/Physical Accomplishment Report appeared that from the funds transferred to FOs
amounting to ₱522,301,463.43, only ₱343,695,978.28 or 65.80 percent were downloaded
to the Municipalities/Barangays resulting in unexpended balance of ₱178,605,485.15 at
the regions/FOs for the implementation of the said project as at December 31, 2019, the
details of which are as follows:
Table 17. Comparison of Fund Transfer Due from ROs vs. DepEd Grants per Status of
Implementation of Projects per Regions as at December 31, 2019
Fund Transfer
Regions Difference
Due from ROs Per Regional Report
IX 18,954,945.97 14,370,168.00 4,584,777.97
X 67,052,449.36 22,733,392.28 44,319,057.08
XI 151,889,760.12 101,323,953.00 50,565,807.12
XII 118,781,537.77 48,236,000.00 70,545,537.77
CARAGA 165,622,770.21 157,032,465.00 8,590,305.21
TOTALS 522,301,463.43 343,695,978.28 178,605,485.15
65. Moreover, the reported physical accomplishments, based on the submitted List of
KALAHI-CIDSS Subprojects – CCL as at December, 2019, showed a total of 421
classrooms (173 SPs/212 SBs) with total funding of ₱343,695,978.28 from DepEd. These
114
projects are either completed, on-going or not yet started as at December 31, 2019. Details
are shown in the succeeding Tables.
Table 18. Summary of Financial Accomplishment vis-à-vis Physical Accomplishment

(In Philippine Pesos)
No. Completed SPs Balance
No. of of
Funds
Sub CLs No. No. No.
Transferred % of No.
projects per Amount of of Amount of
FOs CL of SP
(SP) MOA SP CLs CLs
g= i = a- j = b-
a b c D e f h = c-d
f/b e f
IX 18 21 18,954,945.97 14,370,168.00 15 18 86% 4,584,777.97 3 3
X 39 82 67,052,449.36 19,343,565.11 13 25 30% 47,708,884.25 26 57
XI 69 169 151,889,760.12 100,538,496.00 35 129 76% 51,351,264.12 34 40
XII 50 135 118,781,537.77 48,236,000.00 18 51 38% 70,545,537.77 32 84
XIII 75 198 165,622,770.21 157,032,465.00 92 198 100% 8,590,305.21 (17) 0
Total 251 605 522,301,463.43 339,520,694.11 173 421 70% 182,780,769.32 78 184
Table 19. Status of Implementation of Projects Funded by DepEd by Year as at December 31, 2019
(Amounts in Philippine Pesos)
Amount No. of
No. No. No.
CL with No. of Amount
Year Started of of of
Grant LCC Total DepEd CL (Grant)
SPs SBs CLs
Grants
Completed
2016 6 6 8 6,360,918.00 314,808.00 6,675,726.00 8 1.89% 1.85%
2017 120 145 314 254,101,807.11 4,201,797.88 258,303,604.99 314 74.23% 73.93%
2018 38 51 87 70,417,942.00 934,553.50 71,352,495.50 87 14.38% 20.49%
2019 9 10 12 8,640,027.00 2,000.00 8,642,027.00 12 1.98% 2.51%
Sub-total 173 212 421 339,520,694.11 5,453,159.38 344,973,853.49 421 99.53% 98.79%
On-going
2016 1 1 1 - 19,321.00 19,321.00 - 0.00% 0.00%
2017 34 43 86 - 920,715.80 920,715.80 - 0.00% 0.00%
2018 7 8 32 - 383,004.00 383,004.00 - 0.00% 0.00%
2019 5 6 10 - 163,063.64 163,063.64 - 0.00% 0.00%
Sub-total 47 58 129 - 1,486,104.44 1,486,104.44 - 0.00% 0.00%
Not yet Started 34 38 55 4,175,284.17 223,521.91 4,398,806.08 2 0.47% 1.21%
Total 254 308 605 343,695,978.28 7,162,785.73 350,858,764.01 423 100.00% 100.00%
115
Table 20. Status of Implementation of Projects Funded by DepEd per Region
No. of CL
with
No. Amount DepEd CL for
No. of No. of of (In Philippine Pesos) Grant construction
Regions CLs (Should
SP SBs
be)
DepEd Grant LCC Total
a b c d = b+c e f = a-e
Completed
Region IX 15 15 18 14,370,168.00 639,545.50 15,009,713.50 18 -
Region X 13 13 25 19,343,565.11 954,206.13 20,297,771.24 25 -
Region XI 35 62 129 100,538,496.00 33,850.00 100,572,346.00 129 -
Region XII 18 20 51 48,236,000.00 - 48,236,000.00 51 -
Region XIII 92 102 198 157,032,465.00 3,825,557.75 160,858,022.75 198 -
Sub-total 173 212 421 339,520,694.11 5,453,159.38 344,973,853.49 421
On-going
Region IX 3 3 3 - 385,475.00 385,475.00 3
Region X 15 15 28 - 1,095,629.44 1,095,629.44 28
Region XI 8 13 31 - 5,000.00 5,000.00 31
Region XII 21 27 67 - - - 67
Region XIII - - - - - - -
Sub-total 47 58 129 - 1,486,104.44 1,486,104.44 - 129
Not Yet Started
Region IX - - - - - - -
Region X 14 5 17 3,389,827.17 196,421.91 3,586,249.08 17
Region XI 18 30 33 785,457.00 27,100.00 812,557.00 2 31
Region XII 2 3 5 - - - 5
Region XIII - - - - - - -
Sub-total 34 38 55 4,175,284.17 223,521.91 4,398,806.08 2 53
Total
Region IX 18 18 21 14,370,168.00 1,025,020.50 15,395,188.50 18 3
116
No. of CL
with
No. Amount DepEd CL for
No. of No. of of (In Philippine Pesos) Grant construction
Regions CLs (Should
SP SBs
be)
DepEd Grant LCC Total
a b c d = b+c e f = a-e
Region X 42 33 70 22,733,392.28 2,246,257.48 24,979,649.76 25 45
Region XI 61 105 193 101,323,953.00 65,950.00 101,389,903.00 131 62
Region XII 41 50 123 48,236,000.00 48,236,000.00 51 72

-
Region XIII 92 102 198 157,032,465.00 3,825,557.75 160,823,352.75 198 0
Grand Total 254 308 605 343,695,978.28 7,162,785.73 350,824,094.01 423 182
66. As can be gleaned from the above Tables, particularly Table 20, while there are no
on-going constructions and 2 CLs not yet started for CY 2019, there is still an unmet 182
classrooms. The reported accomplishment as at December 31, 2019 of 173 completed SPs,
consists of 212 school buildings with 421 classrooms or 69.59% of the total targeted
classroom of 605.
67. The implementation of the DepEd-CCL project for CY 2019 was stopped allegedly
due to the non-approval of the proposed Memorandum of Agreement (MOA) for its
extension without additional costs. The Second Supplemental MOA’s validity ended last
December 31, 2018. Without a written justification or agreement for the extension on
implementation of the said project, DSWD Management opted to delay its implementation
which prevents them for timely completing of the project. Due to the delayed completion
of the project, the objective thereof had not been achieved, thus, depriving the
beneficiaries thereof of the expected benefits.
68. Moreover, based on the submitted physical accomplishment report, it has been
observed that the report includes funds releases from Local Community Counterpart
(LCC) totaling to ₱7,162,785.73.
69. Furthermore, were 34 SPs/ 38 SBs/55 CLs not yet started as at December 31, 2019
with a DepEd grant totaling P4,175,284.17, but per submitted report, the DepEd grants for
Region X amounting to P3,389,827.17 pertains to the construction of 3 SBs only, and for
Region XI with grant totaling to P785,457.00 for the construction of two (2) Units – one
(1) Classroom Elementary School Building.
70. The inclusion of the number of SPs/SBs/CLs totally funded by the Local
Government Units is tantamount of overstating the number of SPs implemented and/or the
number of CLs being constructed and rendering the report submitted unreliable.
117
71. The audit and evaluation of the said Program is an update and follow-up from the
previous year’s audit.
72. The following were the results of audit and validation of DSWD-FOs:
Table 21. Results of validation in DSWD-FOs and its Recommendations

FOs Deficiencies noted Amount Criteria Causes Effects Recommendations
V Various deficiencies Kalahi Lack of capacity Resulted in a Require the DSWD-FO-V
on the completed CIDDS building and non-functional, Project Management Team
subprojects funded Operation monitoring of delayed to:
by KC-NCDDP. Manual completed turnover and
subprojects to non-sustainable a. capacitate communities
ensure that projects, and using existing KC Manual
subprojects are depriving the designed for the proper
implemented and community of implementation of the
completed the access to program;
according to plan basic social
and in compliance services, b. look into the subprojects
with the program’s infrastructures with noted defects and
make representations
manual. as well as other
with proper authorities
benefits due
including LGUs
them. concerned towards
possible remedial
measures;
c. require Kalahi personnel

to turn over records
under his custody before
separation from the
agency;
d. coordinate and advise

the Barangay Council to
allocate sufficient O&M
funds for the regular
maintenance of the
subproject requirements
of the project to achieve
proper turn-over of SPs
and maintain complete
separate records; and
e. assist the BLGUs and

O&M committees in the
implementation of the
Operations &
Maintenance Plan.
V The agency funded 1,601,438.00 Section Non-observance Objective of the Require the DSWD-FO-V
three ineligible 1.2.4, of rules/laws and program was Management to discontinue
Kalahi subprojects Volume 1 of regulation due to not attained. funding projects not eligible
amounting to the Revised the reliance in the for the agency’s Kalahi
₱1.601 million Community- declaration of program, otherwise, they will
118
located at selected Based state calamity in be held liable for disbursing
barangays of Buhi, Infrastructur Buhi, Camarines public funds to illegal projects.
Camarines Sur, e Manual Sur.
which is not dated June
keeping with 2016 and
existing and related Section 29,
laws, rules, and Article VI of
regulations. the 1987
Philippine
Constitution.
VI The non- 2,961,914.47 Executive The non- Impending Require the DSWD-FO-VI
observance of the Order No. observance of the demolition of Regional Project
required Road Right 621, s. 1980 required RROW, the Health Management Office (RPMO)
of Way (RROW) in due to the road Centers to:
the construction of National widening project amounting to
KALAHI-CIDSS roads shall of DPWH ₱2.962 million, a. observe strictly the
subprojects in the have a right may result in required Road Right of
Municipality of of way of the wastage of Way (RROW) in the
not less construction of KALAHI-
Cauayan, Negros government
than twenty CIDSS sub-projects
Occidental, due to funds.
(20) meters, along national and local
the road widening roads to avoid its
provided
project of DPWH, demolition due to the
that such
resulted in the road widening projects of
minimum
impending width may the DPWH in the
demolition of the be reduced construction of future
Health Centers at the projects; and
amounting to discretion of
₱2.962 million, the Minister b. provide technical
hence, may result in of Public assistance to LGU-
the wastage of Highways Cauayan, Negros
government funds. value. Occidental so that the
construction of the new
Health Stations will be
immediately
implemented.
VI The KALAHI-CIDSS 4,264,244.00 Executive Overlapping The utilization of DSWD-FO-VI Management to
subprojects in the Order No. Kalahi CIDDS and the KALAHI require:
total amount of 621, s. 1980 DPWH funded CIDSS sub-
₱4.264 million in projects, projects was not a. the Regional Project
Barangay San National maximized. Management Office
Pedro, San Jose, roads shall (RPMO) to ensure that
Antique and have a right the community-
Barangay Baybay, of way of identified priority
Pandan, Antique not less projects are not the
were affected by than twenty potential development
(20) meters, sites of the DPWH
the on-going DPWH
provided infrastructure projects to
funded project,
that such avoid the demolition of
thus, the maximum the completed KC sub-
minimum
utilization of the width may projects so that its
sub-projects was be reduced maximum utilization
not fully attained. at the could be fully attained;
119
discretion of and
the Minister
of Public b. the BLGU-San Pedro,
Highways San Jose, Antique and
value. BLGU-Baybay, Pandan,
Antique to properly
document the KC sub-
projects affected by the
DPWH projects to
provide trail for
monitoring purposes.
VI Out of 26 sub- 12,955,736.44 Kalahi Defective sub The efficient Require the KC-Regional
projects inspected, CIDDS projects with and effective Project Management Office
eight worth operation deficiencies noted use of the sub- (RPMO) to:
₱12.956 million manual after the projects may be
were found with construction such compromised; a. coordinate and provide
deficiencies that as: thus, immediate technical assistance to
may compromise corrective the concerned
the effective use of Crack and scaling measures are MLGU/BLGU/Communit
y Group so that the
the facility, hence, in some parts of necessary to
damaged sub-projects
requiring immediate the concrete road maintain the
will be repaired
corrective ₱2.5 million functionality and immediately to maintain
measures to sustainability of its functionality and
maintain the After one year, the sub-
the solar street sustainability for the
functionality and projects. benefits of the intended
sustainability of the lights tend to start
beneficiaries; and
KALAHI-CIDSS performing poorly.
sub-projects. ₱ 2.062 million b. follow up the
After one year, commitment of the
the solar street Municipal Mayor of Miag-
ao, Iloilo to repair the
lights tend to start
damaged portion of the
performing poorly.
sub-project.
₱2.216 million
One of the
comfort rooms is
not functional
₱0.870 million
The production
center on fish
processing is not
operational
₱1.226 million
The ceiling is not

evenly painted;
Door knob is
damaged; Wall
finished poorly;
Low grade
ceramic
tiles installed.
120
₱1.850 million
The sub-project
was
uncompleted/as-
built due to the
loan closing date.
SP was partially
damaged by
strong waves due
to southwest
monsoon.
₱1.361.
The Audit Team
of FO VI will verify
the main cause of
the defects.
IX Of the 78 KC- 60,410,969.85 Section 3.1 The deficiencies Affecting the DSWD-FO-IX M to:
NCDDP projects of the indicate functionality of
with total cost of Tripartite inadequate the SPs to the a. require the Deputy Area
₱82.883million, 62 Sub-Project monitoring and disadvantage of Coordinator and
projects amounting Agreement supervision by the the intended Regional Infrastructure
to ₱60.410 million entered by DSWD FO IX and beneficiaries. Officer to:
were found to have DSWD failure of the
defects or Barangay Sub- i. conduct inspection on
deficiencies due to Project the site, work and
construction of SP with
the failure of the Management
the representatives of
parties to comply Committee
the organization;
with their roles and (BSPMC) and
responsibilities Operations and ii. monitor SP
defined under the Monitoring Group implementation;
Tripartite Sub- to comply with
Project Agreement their roles and iii. provide technical
entered into responsibilities assistance to the
between the provisioned under barangay in SP
DSWD, the the Tripartite Sub- implementation;
Municipal LGU and project
the Barangay LGU, Agreement. iv. ensure that all
thus, affecting the amenities of the SPs
functionality of the are properly marked.
SPs to the
disadvantage of the b. suspend, terminate or
intended withdraw the right of the
beneficiaries. Barangay to the use of
the Grant proceeds upon
failure by such Barangay
to perform its obligations
under the Sub-Project
Agreement;
c. ensure that the
121
Municipal LGU provides
technical assistance to
the barangay in the SP
implementation as well
as monitor and evaluate
overall implementation
on the Sub-Project;
d. ensure that the

Barangay LGU provides
a project implementation
team through the
BSPMC to manage the
Sub-project including the
organization of
committees and/or sub-
committees or team as
maybe necessary for the
successful
Sub-Project; and
e. require the BSPMC/OM

Group to correct the
defects/deficiencies
noted for the continuity
and functionality of the
SPs.
IX Tripartite Sub- 56,873,030.69 Section Non-observance Timely DSWD-FO-IX to strengthen

Project Agreement 3.1.1 of of Section 3.1.1 of evaluation of the controls on the
including their COA COA Circular No. the legal and implementation and
documents forming Circular No. 2009-001 dated technical monitoring of the KALAHI-
part thereof by 2009-001 February 12, 2009 aspects of the CIDDS sub-projects by:
reference or dated contracts could
incorporation of 54 February not be a. requiring the submission
SPs amounting to 12, 2009 undertaken, and of sub-agreements and
₱56.873 million informing all supporting
were not submitted management of documents of 54 SPs;
to the COA Audit the deficiencies, and
Team within the if any, at the
reglementary period earliest time b. requiring the Division
of five (5) working possible could Chief of the Promotive
Services and Regional
days for review, not be made.
Project Coordinator of
which is not in
the KALAHI-CIDDS to
accordance with strictly follow the
COA Circular No. regulations on the
2009-001. submission of contracts
to COA.
XI Validation as to P91,596,346.00 Section 2 of Failure of BSPMC Waste of Reiterated, with modification,

existence, Presidential and concerned government that DSWD-FO-XI Regional
122
functionality and Decree No. officials to funds/non- Project Management Office of
accountability of 40 1445 adequately sustainability of KALAHI-CIDSS to:
Sub Projects (SPs) maintain the SPs the SPs and
amounting to and absence of unattained a. make the necessary
P91.596 million proper turn-over objectives of the representation with the
revealed that five of completed SPs program. Barangays/Municipalities
SPs worth P10.70 as required in the to monitor/revisit the
million were found Non-recognition different projects which
Community-
to be non- of asset were long due
Based
functional. accounts in the implemented in the
Infrastructure
BLGU books for different municipalities
Manual. and continue the
completed and
turned-over Sustainability Evaluation
projects to Test to ascertain the
functionalities of the
barangays
different sub-projects;
b. to require the Barangay

Bookkeepers through the
Municipal Accountants to
conduct inventory of all
completed sub-projects
funded under KALAHI-
CIDSS and KKB
Projects, and thereafter,
record them in their
books of accounts for
easy funding for their
repairs and maintenance.
c. strengthen the operation

and maintenance
functions of the different
associations or BLGU by
installing a barangay
project monitoring team
to promptly address more
proactive operation and
maintenance strategies in
the different completed
subprojects of
barangays; and
d. institute and facilitate

new policies governing
monitoring, O&M
committee organization
and participation, and
asset inventory
registration
123
73. We reiterated our previous year’s recommendations, with modification, that
Management require the KC-NCDDP National Project Monitoring Team/Regional
Project Monitoring Team to:
a. review its existing Work Plan and identify the cause/s of delays that
occurred, and close coordination with BLGUs be made to fast track the
implementation and completion of the project, to ensure that
beneficiaries are not deprived from the benefits thereof, and to facilitate
liquidation of fund transfer;
b. evaluate and assess the viability of the remaining projects, identify flaws
and problems in the implementation, and consider returning the
unutilized funds to DepEd to free DSWD from obligation;
c. henceforth, ensure that DSWD review its capacity to implement projects
before entering into agreements to ensure that project objectives are
achieved; and
d. consider that reports are the windows of accomplishments, and the
agency’s performance is assessed based on what was reported, the
DSWD should consider improving the report contents to be reflective of
the activities undertaken in attaining its objectives.
74. Management commented that:
CO - The implementation of the sub-projects is bounded by the stipulation

indicated in the MOA with DepEd where the effectivity ended December
31, 2018. Relatively, the program management office cannot proceed in the
downloading of funds to the indigenous People (IP) communities through
the Regional offices, until the MOA is renewed unless otherwise the
Commission recommends this.
For the information of the Commission, the Program closely coordinated
with the DepEd regarding the renewal of the MOA as indicated in our
official communications.
Management affirmed that the delay in the completion of the construction

of the classrooms resonate to the delay in the delivery of social services to
our beneficiaries. Consistent with our explanation on the previous AOM,
the operation is affected by external factors beyond the control of the
program. In view of this, the Program, through the program management
office, consistently provides technical assistance and guidance through
constant monitoring and coordination with the RO as well as field visits to
communities to ensure that these operational challenges are addressed.
V- As a result of the validation conducted, the common agreements/

recommendations on the deficiencies noted on the streetlights include
BLGU to follow up on the agreement made with the contractor and shall be
put into writing since this was only done through a verbal agreement.
124
Likewise, Regional Project Management Team will continuously provide
technical assistance and put in place mechanisms to ensure that documents
and SPs are properly turned-over to target beneficiaries and the in-charged
operation and maintenance group.
The Multi-Stakeholders Inspectorate Team (MSIT) will also conduct

continuous sustainability evaluation to thoroughly assess the status of the
completed sub-projects for action planning and ensure the continuous
benefits of target beneficiaries. Likewise, the RPMT and LGU will provide
continuous capacity building interventions of these Operation and
Maintenance Group to properly operate and sustain the completed
subprojects.
For ineligible Kalahi Sub-projects, DSWD-FO-V Management

commented that Buhi, Camarines Sur was declared under the state of
Calamity last December 31, 2016, by the National Disaster Risk Reduction
and Management Council. With the declaration of the State of Calamity, it
was agreed during the Municipal Inter Barangay Forum to shift from
standard Community Empowerment Activity Cycle (CEAC) to Disaster
Response Operations Procedures allowing the said sub-projects. Included in
the MIBF resolution is that the sub-projects will also be used during
disaster operations and as temporary shelters.
VI - The RPMO will strengthen the safeguard mechanisms of the program such
as close coordination with DPWH and other agencies; and provide
manpower and technical assistance to the LGU to ensure that the project
will be implemented on time and within the prescribed quality and
standards of KALAHI-CIDSS. The Team will verify the main causes why
the sub-projects were defective/not functioning properly after it was turned-
over to the community. Further, they will look into whether the O and M
Groups are functioning effectively and the funds committed for operation
and maintenance are provided.
IX - Management has already sent communications to concerned LGUs

reminding them of their roles and responsibilities over the sub-projects
within their jurisdiction. Moreover, the agency organized a team tagged as
“Task Force SP Functionality”, who shall monitor the SPs.
On the matter of non-submission of Sub-project Tripartite Agreement,

Management admitted that their practice is to submit the Agreement and
supporting documents to COA only after inspection by the Audit Team. In
view of the AOMs issued, it committed to implement the recommendations.
125
75. As a rejoinder, we reiterated that COA Circular No. 2009-001 provides that
contracts and supporting documents shall be submitted to COA within five (5) days from
execution thereof, without regard to prior visit or inspection of the Audit Team.
Implementation of Sustainable Livelihood Program (SLP)
76. Various deficiencies noted in the implementation of the Sustainable Livelihood

Program in CY 2019, deprived the identified project-recipients of the maximum
benefits thereof, resulting in non-achievement of the program objectives.
77. DSWD Memorandum Circular No. 11 series of 2014 provides for the guidelines in
the implementation of the Sustainable Livelihood Program (SLP). The Department
through the SLP is mandated to support the poor households identified by NHTS-PR by
actively facilitating or linking them to economic opportunities that will facilitate their
transition from state of survival to self-sufficiency.
Table 22. Summary of Observations and Recommendations of SLP

Audit
FOs Amount Criteria Causes Effect Recommendations
Observations
CAR Projects were ₱ 283,765.00 Item 4.2 of Activity and fund Affecting the DSWD-FO-CAR to require
implemented before SLP allocation were completeness, the program personnel to
approval of the Operations not included in the propriety and prepare and submit a
proposals contrary Manual Project Proposal. authority of the justification for the incurrence
to the SLP Field financial of the assessment-related
Operations Manual; transaction expenses and submit
resulting in one supplementary project
project incurring
One project proposal, if necessary. We
₱283,765.00 in
incurring also recommend that
assessment-related
₱283,765.00 in revisions to future SLP
expenses which
assessment- projects be submitted and
were not included
related approved prior to
in the project
expenses which implementation and include
proposal.
were not activity and fund allocation in
included in the
the project proposal.
project
proposal.
CAR Rules and 1,890,000.00 Item 21 of The necessary Resulted in DSWD-FO-CAR to:
regulations of the DOTr requirements of irregular
a. review the process on
Department of Department regulatory disbursements evaluation and grant of
Transportation Order No. agencies in the amounting to livelihood projects to
were not 011, Series operation of ₱1,890,000.00 consider compliance
considered in the of 2017, transportation and with other regulatory
preparation of the service like the jeopardizing agency requirements;
project proposal for DSWD DOTr and LTFRB implementation and
Seed Capital Funds Memo were not taken of the project.
under the SLP for Circular No. into consideration
b. require the
transportation 12 s.2018. in the Templates
organizations to return
service; thus, for Assessments
the amount paid to
resulted in irregular them, if the project
disbursements cannot be implemented
126
Audit
Observations
amounting to due to non-compliance
₱1,890,000.00 and with the rules and
jeopardizing regulation of the DOTr
implementation of and LTFRB,
the project.
II Validated - DSWD The beneficiaries The DSWD-FO-II to:
Livelihood Projects Memorandu utilized sustainability of
of the SLP under m Circular immediately the the livelihood a. review properly the project
the Microenterprise No. 11 proceeds of their projects proposals to determine its
Track shows lack of series of sales to sustain implemented to feasibility before approval
sustainability 2014 their daily support and and implementation;
because, of the household needs improve the
total projects and failed to give economic b. strengthen its monitoring
implemented, only the proceeds back condition of the aspect during the
61 percent are to the enterprise members was implementation phase of
operating and the for proper not successfully the projects:
remaining 39% are accounting achieved. It also
c. support the projects
no longer thereof and resulted to
implemented by providing
operating. Of the distribution of wastage of
further capability
61 percent profit. government interventions especially on
operating projects, funds due to the managing their funds and
only 32 percent of The projects failed unutilized skills providing additional funds,
its due to poor acquired by the if necessary;
participants/membe market which was beneficiaries,
rs are actively attributed to poor expensive d. conduct further
engaged in these planning in the materials and assessment and propose
projects, thus, the preparation of the equipments whenever applicable
objective of project proposals were left idle strategies to assist the
improving or Skills Training and exposed to active participants to
alleviating the acquired were deterioration, acquire additional financial
socio-economic limited due to lack and acquisition or non-financial resources
condition of the of additional of useless farm from partners, from other
institutions or from the
beneficiaries was capacity building inputs and farm
agency for a higher level
not successfully or skills training animals.
of livelihood intervention;
achieved and also interventions.
resulted to wastage technical issues e. adopt / implement a
of government and concerns feasible selection of
funds. were not acted projects in the locality
upon immediately based on the preference
such as lack of of the member/
resources in the beneficiaries, and not the
production, low preference of the project
quality tool kits implementers;
and poor variety
of farm inputs f. conduct assessment as to
the capability, level of
Lack of Technical interest and willingness of
Assistance and the member/beneficiaries
poor monitoring to continue and sustain
the chosen enterprise;
by concerned
127
Audit
Observations
personnel and
g. Institute appropriate
actions to ensure that the
objective of the program is
achieved.
II The SLP under the 32,121,549.55 DSWD The procurement The DSWD-FO-II to:
Skills Training Memorandu process for implementation
modality disclosed m Circular suppliers of and utilization of a. strictly comply with the
a total of No. 11 starter kits and the Skills Government Procurement
₱32,121,549.55, series of service providers Training Fund Law R.A. 9184 and its IRR,
representing 2014 of training centers was overly Rules and Regulations on
refunds of did not undergo delayed, the Grant, Utilization and
Liquidation of Cash
unutilized cash with the existing affecting the
Advances, DSWD
advances/fund laws on participants,
Memorandum Circulars
transfers, cancelled procurement partners and and Guidance Notes for
purchased orders method despite program Sustainable Livelihood
and undistributed the provisions of implementers Program for the efficient
starter kits, due to DSWD MC No. and effective
the overly delayed 11, series of implementation of the
implementation of 2014. program;
the projects, thus,
the objective of the b. partner with other
program was not Accredited Private Training
fully achieved. Institutes and/or
Assessment Centers that
can accommodate the
participants so they can
undergo trainings
immediately;
c. distribute the idle starter

kits to eligible participants
who had undergone
trainings under the same
program. The Field Office
should exert effort to
identify partner agencies
who can provide the
training expenses of
interested participants so
that undistributed/idle
starter kits will be utilized,
subject to Property and
Supply Management
Guidelines; and
d. safeguard
undistributed/idle starter
kits to possible loss and
deterioration.
128
Audit
Observations
V Irregularities in the - DSWD Implementing Significant DSWD FO-V to:
implementation of Admin. PDOs of the unaccounted
SLP with significant Order No. validated skills and missing a. assist the officials of the
unaccounted and 11 series of training (ST) were funds resulted SLP Associations to
missing funds 2011 no longer around in the loss and require the former PDO
resulted in the loss for interview and wastage of to account and return the
and wastage of Monitoring confirmation government funds borrowed to
government and Payroll for the resources and continue the project;
resources and Evaluation individual cash deprived the
deprived the (M&E) assistance was identified b. provide control measures
that will prohibit the
identified project- Manual for signed in full by project-
implementing PDOs and
recipients of the SLP the beneficiaries recipients of the
PCs from manipulating
maximum benefits but the whole maximum the funds of the SLP
thereof. amount was never benefits thereof. beneficiaries;
given to them.
The contents and c. review the feasibility of
quantities of the the SLP project being
starter kits were proposed by the PDO to
not uniformly be implemented in the
distributed to the field;
trainees.
Beneficiaries who d. reiterate the essential
were usually roles and responsibilities
Pantawid enumerated in the
members never existing DSWD SLP
hesitated to sign Monitoring Sub-Manual
the CAP as of the members of the
Regional Project
instructed by the
Monitoring Office that
implementing
shall ensure the success
PDO because of the program for the
they were afraid benefit of the less
that non- fortunate members of our
cooperation will community; and
cause their
removal from the e. conduct the investigation,
4Ps. if warranted, file
Period of training appropriate charges
was shortened against those responsible
from 38 to 25 for the noted
days for the Skills irregularities.
Training on
SMAW NC I-
Mercedes,
Camarines Norte
Eight out of 41
SLP Projects
validated by the
audit team were
not operational
due to incomplete
129
Audit
Observations
starter kits
delivered by the
implementing
partner
Four SLP Projects
in the Province of
Camarines Norte
that was granted
in CYs 2016 and
2017 are not yet
implemented
allegedly due to
missing funds and
non-availability of
program
participants.
former
implementing
PDO of the
Province of
Camarines Norte,
exceeded in her
duty by allegedly
manipulating and
borrowing the
funds intended for
the
implementation of
the SLP projects
V Very slow 305,697,570.15 COA No regular Low utilization DSWD-FO-V to:
implementation of Circular No. monitoring and rate and a. require the immediate
the training of SLP- 94-013 visitation of the program results liquidation, or if the
DSWD identified dated project and slow and benefits implementing agency
program December implementation of cannot be opted not to continue the
participants and 13, 1994 the program expected to be implementation of the
non-compliance realized Program, to immediately
with the guidelines immediately at return to DSWD FO V
set by the the the unutilized amount of
participating parties disadvantage of ₱305,697,570.15,
adversely affected the identified including the bank
the success of the pantawid interests thereon, which
Program, as 98 beneficiaries/ should be remitted by the
percent of more trainees. latter to the Bureau of
than P313 million Treasury;
released to Bicol
University in CYs b. conduct regular
2017 and 2018 by monitoring and visitation
DSWD FO V were of the project to ensure
still unutilized as at the success
December 31, implementation of the
130
Audit
Observations
2019. program; and
c. ensure that related

provisions of COA Cir.
No. 94-013 on fund
transfers are
incorporated in its MOA
with IA to include
sanctions for non-
compliance to guarantee
faithful compliance of the
terms thereof.
VI The inadequate 345,222,523.85 Inadequate Non-liquidation DSWD-FO-VI to:

monitoring in the monitoring in the of the fund
implementation of implementation of transfers by the a. require the Sustainable
the Sustainable the Sustainable recipient LGUs Livelihood Program
Livelihood Program Livelihood amounting to Focal Person to monitor
resulted in the non- Program ₱345.222 strictly the project
liquidation of the million implementation and
fund transfers by submission of
Liquidation Reports by
the recipient LGUs Accumulation of
the concerned LGUs;
amounting to the unliquidated
and
₱345.222 million, fund transfers to
thus, casts doubt the LGUs and b. require the concerned
on the actual the doubt on the LGUs to execute the
implementation of actual unimplemented
the projects that implementation projects, liquidate the
may deprive the of the projects, fund transfers, and
target beneficiaries and deprive the refund the unutilized
of the benefits due target balances, if any.
to them. beneficiaries of
the benefits due
to them.
VII Inadequate 5,863,853.72 Memorandu No regular Deprived the DSWD-FO-VII to:
monitoring of the m Circular monitoring of beneficiaries on a. act on the problems
projects and non- No. 11, program which the benefits of encountered by the
compliance to the Series of was supposed to the project and program participants of
guidelines of the 2014 be conducted by defeating the Lower Becerril, Boljoon,
SLP of DSWD-FO PDOs assigned objectives of the Cebu and Cambaol,
VII affected the on said projects, program. Alicia, Bohol and monitor
effectiveness and pursuant to the the actions taken by them
on the recommendations
sustainability of provisions
made by the
three (3) SLP contained in the
evaluation/validation
projects totaling guidelines for the team pertaining to the
₱890,503.00, while implementation of deficiencies in the
ten (10) SLP the SLP implementation of their
projects totaling SLP projects. Further,
₱4,973,350.72 we recommend that the
already audit team be updated on
131
Audit
Observations
implemented but its the status of compliance
sustainability is at by the SLP associations
risk due to some on the said
deficiencies recommendations;
encountered in the
implementation of b. conduct investigation on
such, thus, the SLP projects with
noted deficiencies and
depriving the
recommend solutions to
beneficiaries on the
settle the problems
benefits of the encountered by the SLP
project and associations in the
defeating the implementation of the
objectives of the projects to ensure its
program. sustainability and furnish
the audit team on the
results of the
investigation; and
c. adhere strictly to the

provisions of the
guidelines on the
SLP specifically on the
regular and continuous
monitoring by concerned
PDOs on SLP projects to
achieve the program’s
objectives.
VII The program 1,432,075.00 DSWD Participants/ Some of the DSWD FO-VII to:
participants who Memorandu beneficiaries who participants/ben
have completed the m Circular have completed eficiaries were a. conduct investigation
Skills Training 11, Series the various skills not able to and take appropriate
under SLP of of 2014 training in CY secure their NC action on the above-
DSWD-FO VII with 2017 and 2018 II which could mentioned deficiencies
project cost totaling was not able to have helped noted during the
₱1,432,075.00, evaluation and validation
take the them in applying
were not able to of the SLP Skills Training
assessment test for employment,
take the NC II Program, and determine
Assessment Test supposed to be thus, defeating
whether there was any
conducted by conducted by the the
violation committed by
service provider St. training effectiveness of said service provider per
James Academy of center/service the program. contract agreement
Skills Technology, provider signed between St.
Inc., thus some of James Academy of Skills
the program Technology, Inc. and
participants/benefici DSWD-FO VII pertaining
aries failed to to the conduct of
secure their NC II, assessment test to the
which could have program participants who
helped them in have completed the skills
applying for training;
employment, thus,
defeating the b. act on the problems
132
Audit
Observations
effectiveness of the encountered by the
program. program participants with
regards to their failure to
take the NC II
assessment test, and
require the service
provider St. James
Academy of Skills
Technology, Inc. to
schedule and conduct
NC II assessment test to
these program
participants who have
completed the course but
was unable to take said
assessment test,
pursuant to the contract
agreement signed
between the said service
provider and DSWD-FO
VII; and
c. inform and update the

audit team on the action
taken by management to
correct the said
deficiency.
VIII The implementation - DSWD Late release of Stalling the DSWD-FO-VIII to:
of the SLP was Memorandu the SCF to the sustainability of a. conduct continuous
excessively m Circular SLPA the livelihood monitoring visits and
delayed and not No. 13 beneficiaries. and business random re-validation of
properly monitored Series of opportunities of the projects under the
due to late release 2017 Lack or absence the recipients SLPs to ensure the
of the Seed Capital of close and hindering success and
Fund to the DSWD monitoring and the ultimate sustainability of the
beneficiaries and Memorandu visits to assess goal of the livelihood and business
inability to conduct m Circular the status of government to enterprises established
close monitoring No. 12 implementation of reduce poverty by the SLPAs, and
visits and random Series of the program. incidence and augment the income of
re-validation of the 2018 improve the the beneficiaries; and
projects’ status of quality of life for
implementation the poor, b. strictly implement Step 4
thereby, stalling the vulnerable and of DSWD Memorandum
sustainability of the disadvantaged Circular No. 12 Series of
livelihood and sector. 2018 to return the
business unutilized grants within
opportunities of the 45 days from release of
recipients and the SCFs to prevent
hindering the misuse of the fund, and
ultimate goal of the ensure the
government to operationalization of the
reduce poverty Association’s projects
133
Audit
Observations
incidence and thereby, guaranteeing
improve the quality the attainment of the
of life for the poor, ultimate objective of
vulnerable and reducing poverty
disadvantaged incidence, and improving
sector. the quality of life for the
poor, vulnerable and
disadvantaged sector.
VIII The budgeted and 47,454,762.74 DSWD Inappropriate Zero physical DSWD-FO-VIII to give
approved SLPs for Memo Circ. prioritization and performance in priority to the full
CY 2019 of No. 11, lack of manpower. CY 2019. implementation of the SLP
₽83,620,729.50 series of through proper coordination,
showed 56.75% 2014 and Delay in the collaboration and
budget utilization Sec. 1(a) (b) implementation communication with the
rate and 96.42% or of EO No. of the projects program implementers in the
₽45,754,762.74 of 91. and inability of field and other external
the issued checks the beneficiaries partners, to improve the
were already to generate socio-economic status of the
released to the additional beneficiaries, maximize the
beneficiaries but income from the benefits to be derived
the program has a livelihood and therefrom, and attain the
zero physical business ultimate goal of reducing
performance. opportunities to poverty incidence and
improve their improving the quality of life for
socio-economic the poor, vulnerable and
status, disadvantaged sector
pursuant to DSWD
Memorandum Circular No.
11, series of 2014.
IX Fifty (50) projects 17,408,701.00 Section III of Collaborations of Resulting to DSWD to ensure that the pre-
totaling ₱17.408 MC 12 s. the Sustainable redundancy, implementation stages are
million under the 2018 Livelihood market sharing, carried out properly and
SLP of the DSWD Program were non-viability and meticulously by:
FO IX were not inadequate failing unsustainability
properly identified to significantly of projects, a. proper identification of
at the pre- improve the limited market livelihood assets and
implementation efficiency of the and low market map, and analysis
stage as required program as well profitability. of every detail with
by DSWD as ease the complete critical
Memorandum burden on the information;
Circular No. 12 PCs and IPDOs.
series of 2018, b. emphasizing viability and
sustainability of each and
resulting to
every project;
redundancy, market
sharing, non-
c. encouraging projects that
viability and will not only generate
unsustainability of profits for distribution but
projects, limited as well employment for all
market and low the SLPA members;
profitability.
134
Audit
Observations
d. considering availability of
natural resources within
the locality showcasing its
unique products with the
end vision of exporting
them to nearby towns,
cities and other countries;
e. being aware of other

PPAs to strengthen
linkages to other
programs;
f. ensuring the accessibility

of commercial areas and
financing institutions; and
g. exploring the presence,

involvement and
provision of possible
assistance by the NGOs,
CSOs and NGAs as well
as LGUs and establish
connection with them to
help identify institutional
market resources and
opportunities for the
products and services of
program participants.
XI Disbursements for 5,876,635.00 Paragraph Fourteen (14) The regularity of DSWD-FO-XI to:
the implementation 6, Section 4 DVs amounting to the said
of Sustainable of PD No. P5,876,635.00, disbursements a. submit immediately the
Livelihood Program 1445 were not is doubtful. Certificate of Eligibility/s
(SLP) amounting to supported with to preclude suspension
P5.876 million for COA Certificate of of transactions; and
CY 2019 were not Circular No. Eligibility (COE)
b. require the Accountant to
sufficiently 2012-001
refrain from processing
supported by dated June
vouchers with incomplete
required 14, 2012 documentations.
documents,
contrary to Section DSWD
4 of PD No. 1445, Memorandu
and COA Circular m Circular
No. 2012-001 dated No. 22
June 14, 2012, series of
casting doubt on 2019
the regularity of
transactions.
135
78. The DSWD FOs Management commented as follows:
CAR - The assessment fee paid was part of the training fee which is covered in the
approved project proposal. However, such assessment fee was not explicitly
stated in the approved project proposal. As a condition, Security Guard
licenses of participants will not be issued unless they have undergone the
assessment. Furthermore, the additional expenses incurred for meals and
transportation from December 10 to 13, 2016 were necessary since the
service provider shouldered the lodging of participants.
Management acknowledged that the rules and regulations of LTFRB

particularly the Public Utility Vehicle Modernization Program (PUVMP)
were not considered in the project evaluation. A memorandum shall be sent
to the provincial staff as well as to be discussed during meetings as guide to
consider compliance with other regulatory agency requirements in the
evaluation of project proposals.
SLP RPMO strongly recommends a change of project using the DSWD

memorandum dated June 6, 2019 entitled “Guidance on the Change of
project for 2016 to 2017 Funded Projects” instead of returning the fund so
as not to deprive the participants of the assistance they deserve from the
Program.
II - The program does not provide funds for rehabilitation of failed projects
because it will not form part of their accomplishment anymore, rather, it
would only entail additional cost while depriving other set of beneficiaries
of the opportunity to benefit from the projects. Moreover, they reasoned out
the lack of manpower due to the reduction of large number of PDOs in
prior years, thus, the monitoring phase was significantly affected. However,
they elevated this matter to the NPMO and the latter already approved the
hiring of thirty (30) PDOs in the FO II for CY 2020.
Nonetheless, we advised management to continue to provide technical

assistance to the member/beneficiaries after the projects have been
implemented as this phase is considered indispensable to sustain the
livelihood projects under the said program.
The discontinuance of various projects were attributed to the abrupt change

in program policies that resulted to the change of project proposals from
time to time that consumed much of the implementation period coupled
with less number of program staff and PDOs to implement the projects in
accordance with the policies issued. Thus, resulted to numerous number of
backed out and/or disinterested participants. Management agreed to the
observations noted above and assured implementation of the
recommendations. They also informed the Audit Team that the
136
undistributed starter kits will be used this CY 2020 in the implementation
of various projects under the Skills Training modality.
V- Primary consideration of frequent turnover of personnel (Implementing

PDOs) is due to the status of employment as contractual/MOA, however,
the program’s dynamic thrusts and priorities are also the main factors.
A program’s re-orientation or SLPA meeting is being held prior to the

release of fund usually with the presence of Pantawid Pamilya Program’s
staff and Barangay/ Municipal officials/livelihood workers, the activity
shall clarify that the whole amount reflected on the payroll, as signed and
acknowledged by the program participants, shall be given by the
SDO/paymaster. Participants conduct procurement activities in identifying
the service providers/suppliers such as serving canvass. Hence, payment for
tuition, starter kits/tools, and assessment fees due to participant-identified
service providers and suppliers shall be done by the participants themselves
without any direct intervention or manipulation of program implementers.
The number of training days for a training course is derived from the
minimum number of hours that a certain training course requires, hence,
modifications may be allowed within the set standard of the training (e.g.
TESDA-accredited training course or trainers) and as agreed between and
among the participants, trainers, and program implementers.
Non-operational of some projects due to various factors are inevitable,

nonetheless, program implementers shall provide appropriate technical
assistance to program participants to revive and ensure the sustainability of
the livelihood projects as part of the participant mainstreaming stage. Non-
implemented projects due to alleged missing funds and non-availability of
program participants are currently being validated and shall be dealt with
following program guidelines.
The unsettled cash advances of SDO on SLP projects with allegations that
some of the documents needed to settle such accountability are being kept
by the former implementing Project Development Officer (PDO) of the
Province of Camarines Norte was neither officially reported nor
acknowledged to and by the RPMO, thus, it was the risk taken by the
current SDO in entrusting funds to the former PDO.
Feedback reports submitted by present SLP officials in the province of

Camarines Norte have been acknowledged by the RPMO and top
management officials, have acted to address the concerns such as the
issuance of series of demand letters to accountable officer for the
immediate settlement of such accountabilities as well as the issuance of a
memorandum directing her to report to RPM Office effective 25 March
2019 to solely focus on the settlement of her unliquidated cash advances.
137
Last March 13, 2020, the Audit Team received a letter containing the
following comments of DSWD FOV Management:
a. Implementation Update
As at March 9, 2020, below is the status of implementation of various skills

training projects:
Target Completed On-going Not Yet Started
No. of Projects 587 4 83 479
Physical (pax) 26,798 105 4,094 20,026
Financial (php) 313,022,516.35 591,936.00 39,730,277.02 263,212,202.48
For on-going projects, 60 agriculture and non-agriculture-related projects

are merely waiting for the procurement and delivery of starter kits for the
projects to be tagged as completed. Fifty-four Security Services-related
training was awarded to Falcon Security as the training provider. Of the 54,
23 projects have an on-going implementation where the participants are still
undergoing on-the-job training (OJT) as required in their respective
modules. The remaining 31 projects are yet to be implemented, though
tentative schedules of training were already agreed upon.
b. Procurement Status
As at March 9, 2020, BU processed items worth P 190.8 Million of which

they were able to successfully procure items/services for agriculture-related
skills training and skills training with National Competency
Qualifications/requirements worth P 70.9 Million; and with failed bids
amounting to P45.8 Million and items with on-going canvassing worth
PHP3.2 Million. Furthermore, BU has procured services from three State
University and Colleges (SUCs) namely: Central Bicol State University
(CBSUA), Bicol State College of Applied Science and Technology
(BISCAST) and Dr. Emilio B. Espinosa Sr., Memorial State College of
Agriculture and Technology (DEBESMSCAT) amounting to P70.8 million.
For SUCs, MOA with CBSUA and BISCAST was also signed last
November 2019. Under these MOAs, CBSUA and BISCAST will be co-
implementers of BU. They shall cover a total of 64 projects with skills
training funds amounting to P36,064,989.01. Both SUCs are waiting for the
initial training fees to be paid to them to commence skills training.
Further, in 2019 BU had a standing internal policy where all procurement

amount to and above P3 Million shall require approval from the BU’s
138
Board of Regents to authorize bidding. This policy further lengthened the
processing of procurement activities. As at November 2019, this policy was
lifted.
c. Implementation Extension
With the concurrence of the SLP-National Program Management Office,

the implementation of the various skills training projects was extended until
December 31, 2020. As part of the compliance to the recommendations of
SLP-NPMO, there is on-going drafting of a supplemental memorandum of
agreement with BU to amend the implementation of projects until
December 2020. As practiced, SLP and BUEMD shall continue to have its
regular weekly DSWD-BU meetings and Semestral Implementers’ Meeting
to ensure prompt updating and monitoring of BU’s project implementation
VI - The liquidation of funds transferred to LGUs was not closely monitored due
to the significant decrease in the SLP’s manpower in the previous year.
The Management explained that SLP is currently on the process of hiring a
total of 110 Monitoring PDOs and the follow-up of the unliquidated fund
transfer to the LGUs will be integrated as one of the performance indicators
on their respective Individual Performance Contract to ensure that the
liquidation of funds by the LGUs is being acted upon.
VII - The project implementation diversion which the audit team found not in
accordance with proposed project proposal as approved by the DSWD FO
VII, was clearly noted and thus, will be given priority to look into. An
investigation team will be sent to conduct thorough validation and furnish
the audit team with update report.
On the other hand, the MPDO is monitoring on the progress of their

livestock raising and tapped the Municipal Agriculture Office (MAO) for
technical inputs. Management will conduct a thorough clarification on the
matter and forward update report to the audit team.
VIII - Management will look into how the activities therein can be improved.
They also stated that 20 demand letters were already issued to erring
SLPAs such as those who divided the money among the members. Further,
as to the other audit observations, they have identified courses of actions to
improve the implementation of the program.
IX - Management committed to direct the Regional Project Management Office

(RPMO) to improve the template of RLAMM and PLAMM, emphasize its
importance to field implementers and include the same in the Individual
Performance Contract.
139
Management also directed the RPMO to execute a MOA between the
DSWD and LGU to highlight, among others, the duty of the LGU
livelihood worker to monitor the SLPA and their projects and the duty of
the LGU to provide for a strategic location for the projects.
Moreover, in order to encourage employment of SLPA members,

management commits to conduct livelihood intervention and to widen
possible market of the SLPAs. The Management also recognizes its
responsibility to coordinate with NGOs, NGAs and CSOs through
Partnership Forum, however, due to financial constraint, this is only done
twice a year at most.
XI - In compliance with the recommendation, management submitted the

fourteen (14) Certificate of Eligibility.
SLP implementation last 2019 were covered and followed the

Memorandum Circular (MC) 12 series of 2018 guidelines, hence Certificate
of Compliance were attached to the Disbursement Vouchers (DVs) for Seed
Capital Fund modality.
79. As a rejoinder, Management is required to ensure that future implementation of

DSWD FO XI projects is supported with complete documents. The Audit Team maintains
its stand on the recommendations that Management shall strictly comply with Section 4 of
PD 1445, and COA Circular No. 2012-001 dated June 14, 2012.
Implementation of Supplemental Feeding Program (SFP)
80. The delayed implementation of the Supplemental Feeding Program, non-

adherence to 2016 RIRR of RA 9184, laxity in nutritional assessment, and
deworming in DSWD-FO-IX, affecting the timely delivery of services, resulted to
non-attainment of the objectives, and uncertainty on the effectiveness of the program.
81. Review, analysis and assessment of the implementation of SFP in DSWD-FO-IX

have noted audit deficiencies as shown in Table 23.
Table 23. Deficiencies Noted and Recommendations in the Implementation of SFP

Causes and
Deficiencies Noted Amount Criteria Recommendations
Effects
Procurement of welfare ₱184,877,591.74 Section 3 of Negligence of DSWD-FO-IX to require:
goods totaling ₱184.877 the 2016 RIRR officers and
million for the of RA 9184 employees to verify a. the Accountant to ensure that
Supplementary Feeding the supporting no payment will be processed
Program (SFP) were not COA Circular documents due to if procurement of goods and
in accordance with the No. 2009-001 delayed services is not in accordance
2016 RIRR of RA 9184, dated implementation of with RA 9184 and its 2016
thereby defeating the February 12, projects resulted in RIRR.
purpose of transparency, 2009, Section the non-submission/
competitiveness and 3.1.2 preparation of b. the BAC Secretariat to:
140
Causes and
Effects
accountability in the required
procurement process. documents. i. prepare and update the
PPMPs and the APP in
coordination with the
Procurement Unit; and
ii. post all procurement

activities, including the
Supplemental Bid Bulletins
at the agency website, any
conspicuous places and at
the PhilGEPs and ensure
that the Procurement Unit is
furnished with said printed
copies to be attached to the
contracts for submission to
COA; and
c. the Procurement Unit to:
i. monitor the APP vis-a-vis

projects, if all are properly
executed in consonance
with the provisions of RA
9184 to efficiently and
effectively carry out
procurement activities;
ii. ensure that dates are

indicated on all Notices
and other significant
documents received by the
supplier; and
iii. ensure that all contracts

submitted to COA are with
complete supporting
documents.
Implementation of the 9th - DSWD Delayed pre- Since RA 11037 provides that the
cycle of the SFP of Memorandum procurement SFP be conducted 120 days every
DSWD FO IX was Circular (MC) activities such as year in day care centers or any
delayed due to the late No. 03. Series submission of list of other facility which can be used for
preparation of pre- of 2019 beneficiaries by the such purpose, we recommended
procurement activities LGUs, preparation that DSWD-FO-IX management
which is not in keeping and submission of improve the timely implementation
with DSWD Circular No. memorandum of of the SFP by requiring the
03 s. 2019. understanding concerned officials to anticipate the
(MOUs), purchase needs and work on the calendar of
request, the program, by requesting the
identification of early submission of list of
141
Causes and
Effects
procurement beneficiaries, preparation of MOUs,
mechanism, PRs, distribution lists and delivery
distribution lists and schedules, as well as, identifying in
delivery schedules, advance the procurement
thus, the objective mechanism that will effectively and
to improve the efficiently implement the program.
nutritional status of
preschoolers was
not immediately
achieved.
Savings from the 12,281,808.26 Section I and II LGUs Implemented DSWD-FO-IX to require the
implementation of SFP in of the DSWD the 8th cycle behind concerned officials to closely
the total amount of Memorandum schedule resulting monitor and vigorously pursue the
₱12.282 million were not Circular No. 3, to delayed maximum or full utilization of the
immediately allocated to s. 2019 implementation of funds and adopt appropriate
the nine municipalities not Section 5 of projects depriving measures to ensure that SFP is
yet served in the RA 11037 the school children implemented in all of the cities and
implementation of the 9th otherwise beneficiaries of municipalities in the region.
cycle of the SFP. known as the these LGUs the
Masustan- opportunity to
syang Pagkain improve their
para sa nutritional status
Batang Pilipino and health
Act of 2018 condition.
Nutritional assessment - Section 5 (a) Laxity of the social Require the concerned officials to
and deworming were not of the DSWD preparation strictly comply with the afore-cited
fully implemented before Memorandum particularly on guidelines on SFP by ensuring that
the start of the feeding Circular No. nutrition partner-agencies conduct the
session of the 9th cycle of 03, s. 2019 assessment and necessary social preparation of the
the SFP which resulted to deworming, program through strict monitoring.
uncertainty on the resulting to,
effectiveness of the non-attainment of
program. the objectives of the
said program and
uncertainty on the
effectiveness of the
program.
Implementation of Other Programs
82. Various deficiencies noted in the implementation of the National Training

School for Boys (NTSB), Core Shelter Assistance Program (CSAP), Emergency
Shelter Assistance Program (ESAP), and Cash for Work (CFW)-Climate Change
Adaptation and Mitigation, thereby, depriving the target beneficiaries of the services
that can be derived therefrom.
83. For the Other DSWD Programs such as the National Training School for Boys
(NTSB), Core Shelter Assistance Program (CSAP), Emergency Shelter Assistance
142
Program (ESAP) and Cash for Work (CFW)-Climate Change Adaptation and Mitigation
presented below the deficiencies noted in its implementation:
FOs Observations Amount Criteria Causes Effects Recommendations

National Training School for Boys (NTSB)
IV-A The non-intensified 10,883,414.09 Section 50 The failure of Resulted in the DSWD-FO-IVA to
collections of the cost of of the RA Management to unsettled balance of require the Regional
care and maintenance No. 9344 intensify P10,883,414.09 as Accountant to
of wards at National collections of the at December 31, coordinate, and send
Training School for cost of care and 2019, but also demand letters and
Boys (NTSB) due from maintenance of deprived the billing statements to the
the LGUs. wards from children needing the concerned LGUs for the
various LGUs NTSB’s care from settlement of overdue
the concerned and current account.
LGUs the future
admission thereat,
hence defeats the
DSWD’s
organizational
outcome of
promoted and
protected rights of
poor and vulnerable
sectors being the
lead agency in
social welfare and
development.
Implementation of Core Shelter Assistance Program (CSAP)

CAR 40,220,000.00 Section XI.2 Of the total 416 Resulted in low
Financial assistance of DSWD units completed, accomplishments. DSWD-FO-CAR to:
amounting to ₱40.22 Administrati 41 were a. strengthen the
million granted to ve Order unoccupied with monitoring function
families with damaged No. 17, corresponding of the designated
shelter under the Core series of costs of Regional Project
Shelter Assistance 2010 ₱3,170,000.00; Coordinator/ Focal
Program (CSAP) were 340 units Person to improve
not fully monitored due amounting to implementation of
₱27,720,000.00 the project;
to various reasons,
thus, resulted in low still on-going; and
75 units
b. review the
accomplishments. effectiveness of
amounting to
actions taken on
₱9,330,000.00 the enumerated
were not yet reasons or
started as of challenges
validation date. encountered that
Moreover, out of caused the current
the 340 units status of the
which are still-on projects to identify
going, 58 units a more appropriate
were occupied or additional
143
even if the solutions for the
structures were issues; and
not yet completed
as to design and c. require the NASA
specifications. to refund the
undisbursed funds
to avoid
The duration of misappropriation.
the projects’
implementation
was also noted to
be too long as
175 units were not
yet started since
2010. This implies
that issues
encountered
during the
implementation in
CY 2010 remains
unresolved as at
November 11,
2019, the date of
the DRMD report.
Poor monitoring of
the project.
II Delayed 59,325,750.00 Administrati Poor Delay of the DSWD-FO-2 to:
construction/completion ve Order implementation construction/comple
of the project and non- No. 101, and monitoring of tion of the project a) create a
attainment of the series of Core Shelter and non-attainment committee
objective of the 1989 projects. of the objective of composed of
Program deprived the the Program that officials or
beneficiaries of the Of the 2,340 core deprived the employees from
immediate use of the shelter units, only beneficiaries of the the Disaster Risk
Reduction
typhoon resistant 1,515 units were immediate use of
Management,
indigenous shelters. constructed and the typhoon
Accounting Office
the remaining 825 resistant indigenous and Engineering
units with a total shelters and Division to
cost of exposed conduct a
₱59,325,750.00 government funds thorough
were not 100% to misuse and evaluation of the
completed and left wastage. project vis-à-vis
unfinished and fund released and
some were not yet accomplishment;
started.
b) determine the
persons found to
be liable for its
non-completion
and hold them
accountable and
144
responsible for its
completion as per
plans and
specifications;
c) consider the filing

of an administrative
and/or criminal
and/or civil liability
case against
persons found to
be accountable
and liable, if
necessary; and
d) award the long

completed core
shelter units to the
identified and
qualified
beneficiaries.
V Ninety-four out of the 32,585,000.00 DSWD a. Irregular Material lapses DSWD Management to:
200 shelter units in Administrati replacement of have adversely
Sorsogon remain ve Order CSAP affected the a. make
unfinished due to No. 17, beneficiaries implementation of representation with
several deficiencies series of b. Unavailability of CSAP thereby the LGU to remind
causing the delay of 2010 construction depriving displaced concerned local
almost two years from materials families immediate officials of its
its target date of c. Improper and use of the shelter existing obligation
completion thereby uncertain use units, posing under MOA to
depriving displaced of funds dangers to them in provide fund
families/disaster victims d. Lack of electric the event of natural counterpart for any
immediate use of and water calamities and shortages or need
typhoon-resistant facilities could result in for additional
dwelling houses. wastage of construction
government funds materials to
and properties. complete the
CSAP;
b. cause the
submission by
NASA officials of its
financial reports
including
supporting
documents to the
audit team to
determine actual
utilization of the
subject cash
assistance for
CSAP; and
145
c. review existing
agreements to
include a provision
that will prevent
signatories from
deviating from its
terms and
conditions to
ensure proper
implementation of
DSWD programs.
Total Amount ₱132,130,750.00
Emergency Shelter Assistance Program
II Liquidation Reports of 13,215,000.00 COA Improper The validity, Require:
Cash Advances granted Circular 97- monitoring of accuracy and
to various Special 002 dated Liquidation of completeness of the a. the DSWD-FO-II
Disbursing Officers February Cash Advance. funds could not be concerned office be
(SDOs) totaling to 10, 1997 ascertained. required to submit
₱13,215,000.00 for the the liquidation papers
initial release of of the said balances
Emergency Shelter immediately, to
Cash Assistance (First ascertain the validity,
Tranche) to the victims accuracy and
of Typhoon “Lawin” completeness of the
remained unsubmitted transactions, and to
despite the completion clear the accountable
of the project. officers of their cash
accountabilities;
b. the Accounting
Section to closely
monitor the timely
submission of LRs of
the AOs and send
demand letters, if
necessary; and
c. the concerned SDOs

to immediately
submit the liquidation
papers for the
Second Tranche re:
Typhoon “Lawin” as
its purpose has
already been served
and completed
before the end of
2018.
146
Cash for Work (CFW)-Climate Change Adaptation and Mitigation
II The completion report ₱34,436,500.00 DSWD The community The program a. Require the
of the (CFW) projects Administrati works undertaken objective of concerned DSWD
amounting to ve Order were mostly empowering FO II officials to
₱34,436,500.00 under No. 15, cleaning of communities to implement the
the Risk and Resiliency series of surroundings become disaster- program in
Program on Climate 2008 along barangay resilient by accordance with its
Change Adaptation and halls, clinics, combating the guidelines to achieve
Mitigation and Disaster schools, day care effects of climate the intended
Risk Resilience (RRP- centers, roads, change was not objective; and
CCAM-DRR) projects streets and foot fully realized.
involving the community trails through b. Require the
works undertaken grass cutting, P/C/MSWDO to
composed mostly of sweeping and submit the
road/foot garbage picking, supporting
trails/surroundings which were
documents to
clean-up which is not in activities involving
accord with the projects mostly of cleaning support the
and activities stated in and may not be disbursements
DSWD Administrative considered as and to prepare
Order No. 15, series of climate and the complete
2008. disaster mitigation report, noted by
and preparedness
the Local Chief
Likewise, the activities of the
completion report was program, thus, Executive, relative
not prepared by the has no significant to the implementation
P/C/MSWDO with impact in of the program in
highlights on both cash combating the accordance with
disbursement and work effects of climate DSWD
completed with pictures change. Administrative Order
of completed projects No. 15, series of
and not noted by the The completion 2008.
Local Chief Executive report was
per DSWD prepared by the
Administrative Order Barangay Captain
No. 15, series of 2008. instead of the
P/C/MSWDO and
was not noted by
the Local Chief
Executive
XIII Unsustainable Risk Republic Act Lacked the long- Defeating the DSWD FO XIII
Resiliency Program No. 10121 term sustainability purpose of Management to:
(RRP) - Change An act and impact in alleviating the plight
Adaptation and strengthenin addressing of the poor and a. make
Mitigation CCAM, Cash- g the Climate Change vulnerable representation with
for-Work (CFW) Philippine Adaptation, communities from Central Office to
Activities as most of the disaster risk Mitigation and the long-term hasten the
issuance of a
activities implemented reduction Disaster Risk impacts of climate
specific program
have only temporary or and Reduction as change.
guidelines intended
short-term impact. managemen most of the for the RRP-CCAM
t system, activities for uniformity of
147
Majority of the types of providing for implemented have implementation
CFW activities the national only temporary or which should
implemented by DSWD- disaster risk short-term impact include project
FO XIII for RRP-CCAM reduction specifications
were mostly communal and (menu) and
gardening and clean-up managemen parameters to avoid
undertakings, it t framework projects/activities
not geared towards
appeared that these and
RRP-CCAM and for
RRP-CCAM CFW institutionali
easy guidance to all
activities lack the long- zing the implementing
term sustainability and national agencies and
impact in addressing disaster risk LGUs;
Climate Change reduction
Adaptation, Mitigation and b. see to it that the
and Disaster Risk managemen proposed
Reduction mainly t plan, projects/activities of
because these types of appropriatin the implementing
activities have only g funds LGUs are anchored
temporary or short-term therefor and and link to their
impact for other Local Climate
purposes Change Action Plan
dated May (LCCAP) by
requiring the
27, 2010.
proponent LGUs to
submit the same
National prior to project
Climate approval; and
Change
Action Plan c. conduct thorough
(NCCAP) in evaluation of the
2011 proposed
projects/activities
DSWD together with
Administrati supporting
ve Order documents before
(AO) No. 15 its approval to
s. of 2008. ensure
sustainability and
attainment of
CCAM-RRP
objectives and
outcomes.
XIII Inequitable Fund 14,044,800.00 Dinagat Islands, The purpose of DSWD-FO XIII to
Allocation for RRP- which is among addressing the ensure equitable budget
CCAM the third potential adverse impact of allocation based on the
priority province in Climate Change most identified priority
Caraga Region Adaptation, provinces susceptible to
susceptible to Mitigation and multiple climate hazard,
multiple climate Disaster Risk and poverty incidence.
hazards and Reduction in most Consideration should
poverty incidence identified potential particularly focus on
was given the priority provinces municipalities and
least budget was defeated. barangays in the
148
allocation of only identified provinces with
P14,044,800.00 historical high incidence
or 12% of the total of disaster hazards.
P121,955,970.00
RRP-CCAM
budget allocation
for CY 2019
XIII Incomplete - Section 4(6) The claims from Regularity/validity of Apply uniform
Documentation of RRP- of PD No. Risk Resiliency the claims and documentary
CCAM 1445 Program thru accountability on requirements for its
Cash-For Work the preparation and RRP-CCAM
Projects and verification thereof transactions, and to
Activities were not could not be readily ensure that claims
supported with established. against government
complete and funds are supported
proper with complete and
documents; and properly signed
existing documents that would
requirements on establish
enrolment and validity/regularity, and
fund liquidation exact accountability on
were not RRP-CCAM cash
consistently advances and
applied upon and liquidation transactions.
submitted to the
Audit Team for
review
XIII Absence of Project - Section 2 of The Regional Undermining the Management to:
Timelines and Financial the P.D No. Interim Guidelines timely
Reporting 1445 as well as the implementation and a. enhance the SIA by
Requirements for RRP- Specific sustainable providing salient
CCAM Implementation objectives of the information such as
Agreement projects, which also timelines of project
duration and the
between the resulted in the non-
specific provisions on
DSWD and the recognition of the
the maintenance of
implementing labor cost projects/activities
Local Government component of the implemented in order
Units have no project. to achieve its
provisions on the sustainability and
timelines of impact in addressing
project issues on Climate
implementation, Change Adaptation,
project ownership Mitigation and Disaster
and maintenance Risk Reduction; and
requirement, as
well as, the b. include in their
issuance of program
financial reporting
guidelines the
requirements of
provision on the
infrastructure financial reporting
projects, requirements and
project ownership of
149
completed
infrastructure projects.
XIII Inconsistent Photo Section 124 Most of the Casting doubt on Management to:
Documentation of RRP- of PD No. pictures the reliability of the
CCAM CFW Activities 1445 presented pictures presented a. install appropriate
supporting the and validity of the monitoring controls
Cash for Work claims paid. on inspection and
project
claims were not
accomplishment
consistent as to
documentations and:
the area point
taken before, b. require the PDOs to
during and after of strictly require that
work undertaken pictures are to be
indicating that taken (before, during
monitoring and after) at
controls including advantage point to
inspection and ensure clear and
documentation of proper
work documentation of
accomplished community work
were not in place activities;
or not working c. require the indication
of specific dates on
the pictures taken, to
validate the daily
work output/activities
done. For best
monitoring controls,
geo-tagging of
projects/activities is
highly recommended;
and
d. require the DSWD

logo to be indicated
in every page of the
documents for
control purposes and
to avoid the use of
documents/pictures
for other
intent/purposes.
XIII Inappropriate Project - Section 124 The lack of a Defeating the Management to:
Area for RRP-CCAM of PD No. certain valid land purpose of the a. conduct an
Activities 1445 document RRP-CCAM adequate planning
requirement and program that and coordination with
the lapse in the consequently the appropriate
identification of resulted to a waste authorities in the
appropriate area of government identification of
for project funds. project location; and
implementation
150
due to b. require the project
inadequate/absen beneficiaries to
ce of thorough provide a valid land
coordination with document or a
the right certification from the
authorities during appropriate office for
planning stage, RRP-CCAM projects
lead to a CFW to ensure a publicly
activity in a owned land, and to
privately-owned avoid waste of
lot government funds.
Total Amount ₱61,696,300.00
84. The DSWD FOs commented the following:
Implementation of Core Shelter Assistance Program (CSAP):
CAR - In the implementation of the CSAP, the agency adopted the NASA scheme to be
able to help strengthen community organization and encourage building a
community. With no permanent staff to oversee the implementation of the CSAP
and the changes in the staffing and program focal, management recognized the
need to reinforce the monitoring functions and install strategies to monitor the
implementation. Management will draft a plan to consider the recommendation.
II - The concerned division has been coordinating with the concerned LGUs and
NASAs for the completion of the said core shelters.
V- The management of FO V cites that:
a. The City Social Welfare Office (CSWDO) is the one in charge of the replacement
of beneficiaries based on the eligibility requirements. Meetings and letters were
done before the beneficiaries are replaced. The 500-hour requirement is one of the
agreements by the CSWDO with beneficiaries and NASA officials.
b. The role of the DSWD is to monitor the construction of the shelter units with the
labor counterpart of the beneficiaries. The management have given a lot of
consideration to the beneficiaries considering their difficulty in shouldering the
labor counterpart and distance of their residence to the site. This was the reason
why the implementation and completion took more than a year.
c. Meetings and monitoring visits were conducted to help them resolve the issue on
the access road which hampered the delivery of materials and construction of
shelter units. It took months to resolve the said issue as LGU had coordinated with
NHA to expedite the construction of access road upon consultation with the
neighboring lot owners.
151
d. As to the unavailability of materials, LGU committed to lobbying with the Office
of the Mayor to shoulder the lacking materials. This was documented by LGU
during the meeting.
e. From the very start, it was clear that the downloaded funds were intended for the
purchase of the construction materials and not to be utilized for labor cost since
DSWD has provided funds for the Cash for Work. With this, the CSWDO was
requested to submit a Liquidation Report on the utilization of CSAP funds. Letters
were sent to them to submit documents. Likewise, they were told to fast track the
completion of shelter units and provide additional funds for the materials and labor
cost. They were notified of the deadline for completion on or before December
2019.
f. DSWD conducted a consultation meeting with LGU to prioritize these concerns as
part of their counterpart to make the site safe and livable.
Implementation of Cash for Work (CFW)-Climate Change Adaptation and
Mitigation
II - The observations in Cash for Work- Climate Mitigation were the acceptable activities
before. However, Management informed the audit team already discouraged such
activities for the current year and onwards; and assured the strict monitoring and
compliance therewith. Also, they will focus more on activities that have great impact
in the environment like tree planting and conduct strict monitoring of the work
accomplishment of the beneficiaries.
XIII - The identified projects and activities by the recipient LGUs were based on the menu
stipulated in the memorandum dated February 2018 signed by OIC Secretary, which
stated “ CFW encourages projects and activities with long-term impacts on the
development of the physical and natural assets of the recipient-communities which
may include but not limited to the following:
a. Mitigation and preparedness measures such as but not limited to sustainable

communal gardening, fleet farming rehabilitation of mangrove plantation, tree
planting or reforestation, carbon sequestration.
b. Rehabilitation and/or repair of small scale community infrastructure such as but not
limited to slope protection, desilting of waterways.
c. Projects and activities implemented by other government agencies such as the
DENR, DA, etc. requiring CFW support to climate change adaptation and
mitigation and risk reduction.
They added that after two (2) years of implementing RRP-CCAM, their Office could
somehow affirm that activities stipulated in the issued memorandum lack of long-
term impact. Thus, as an initiative of the field office to ensure that the proposed
project/activity are sustainable and suitable to the program guideline, a Strategic
152
Assessment and Planning Workshop was conducted in January this year to improve
the implementation of RRP-CCAM. It was agreed during the activity to delist the
unsustainable activities such as canal declogging, communal gardening, coastal
clean-up, among others.
On the other hand, the Management will raise this concern to the Central Office and
will officially follow up the issuance of the program guidelines.
On the second recommendation, Management would like to request that a

Certification will be required from the LGUs that the proposed projects/activities are
anchored and linked to their Local Climate Change Action Plan (LCCAP) to be
verified by the assigned PDO, instead of them submitting a copy of the said plan.
As regards with the inconsistent photo documentation, Management commented that

the implementation of the RRP-CCAM in 2019 was assisted by the LGUs and
barangay officials since there is only one (1) PDO handling five to eleven (5-11)
municipalities. As part of their deliverables, they were instructed to monitor the daily
activities as well as capturing the before, during, and after pictures following the
same vantage point. Unfortunately, low quality of pictures and inconsistent photo
angles and vantage points were submitted. However, the management will initiate to
geotag the photos for the 2020 implementation since the Central Office already
provided additional staff for the program. Recommendations are well taken and will
be implemented.
Self-Employment Assistance – Kaunlaran (SEA-K) Program
85. Reported project accounts were non-existent and irregularities in the accounts
and transactions of SEA-K funds were not prevented, detected and corrected, due to
inadequacy and breakdown of controls in the project implementation, monitoring,
and recording of accounts and transactions, contrary to Sections 4 (8) and 124 of PD
1445; thereby, resulting in the wastage and/or misuse of government funds in the
total amount of ₱10.028 million, hence, depriving the beneficiaries of the benefits that
could be derived therefrom.
86. Section 124 of PD 1445 stated that “it shall be the direct responsibility of the
agency head to install, implement, and monitor a sound system of internal control.”
Internal control is the plan of organization and all the coordinate methods and measures
adopted within an organization or agency to safeguard its assets, check the accuracy and
reliability of its accounting data, and encourage adherence to prescribed managerial
policies. While it is also fundamental that financial transactions and operations of
government should be governed by generally accepted principles and practices of
accounting as well as of sound management and fiscal administration, provided that they
do not contravene existing laws and regulations.
87. The SEA-K Program is a capability program in coordination with the LGUs. The
Department has been implementing SEA-K as its frontline program on livelihood
153
assistance for four (4) decades until 2015. SEA-K is designed to enhance the socio-
economic skills of the poor families to establish and self-manage a sustainable
community-based micro-credit organization for entrepreneurial development.
88. The Capital Seed Fund (CSF) extended to the SEA-K Kaunlaran Association (SKA)
shall be rolled back from the SKA to the DSWD within two years, with a one (1) month
grace period, following the SEA-K scheme. Repayments shall be in the form of monthly
amortization to the DSWD SEA-K Revolving and Settlement Account (RSF) through
inter-branch deposit following a pre-approved amortization schedule. The CSF is not
really considered a loan but part of the capacity building strategy to teach them to help one
another by returning capital assistance they received to roll on to newly organized
SKA/SEA -Kaunlaran Group (SKG). However, on May 3, 2017, the DSWD Secretary
issued a memorandum directing the DSWD field offices to revert all available cash
balances of SEA-RSF account and succeeding collections to the National Treasury and
refrain from using the collections or balances of the SEA-RSF account to fund other SEA-
K associations.
89. Review of the SLP SEA-K operating procedure on the release, collection and
monitoring of grants, as well as, confirmations of account balances and interviews with
SEA-K associations’ representatives in various municipalities/city disclosed irregularities
in the implementation of SEA-K projects, which amount accumulated to more than ₱10
million, as follows:
Prescribed Procedures in DSWD MC No.

Observations Noted 11, Series of 2014 and MC No. 13, Series
of 2015
1. A total of eleven (11) SEA-K associations claimed that The DSWD Memorandum Circular No. 11 s.
they did not receive the SEA-K proceeds totaling 2014 specify that check is issued for the
₱2,910,000.00 as their funding check and pass books were project proposal and is then claimed by the
retained at the custody of the Project Development Officers’ proponents for release and implementation
(PDOs’). They were just directed to sign the withdrawal slips or of their projects. The SEA-K projects are
authorization letters by the PDO. But failed to receive the cash monitored for sustainability.
amount despite assurance given by the MSWDO who was one
of the signatories. (Please see attached Annex “A”) Further, as stipulated in the M.C., the
following are some of the procedures during
On the other hand, four (4) associations claimed that PDO the Resource Mobilization stage:
through the Municipal Link of SLP require them to sign
authorization document to transfer funds from one local rural ▪ No DSWD (e.g. field PDO) and LGU staff
bank to other local rural bank with a higher interest income but shall be receiving rollback from
none of the proceeds was received by the beneficiaries. SKA/SKGs. The field PDO may secure a
copy of the inter-branch deposit slip of
While one association did not remember any instance of signing SKA for monitoring and validation
any document yet there were series of withdrawals taken from purposes;
their account.
▪ The FOs through the SLP-RPMO shall
Lastly, the remaining one (1) association claimed that they implement various strategies to
already turn-over the grant amounting to ₱250,000.00 to the safeguard the proper utilization and of
PDO as evidenced by the acknowledgement receipt signed by capital seed fund to ensure that it will be
the latter. The refund was not reflected in the records of the extended /rolled on to other organized
DSWD FO No. XIII as at December 31, 2019 SKA/SKGs.
154
Prescribed Procedures in DSWD MC No.
Observations Noted 11, Series of 2014 and MC No. 13, Series
of 2015
2. Individual project funds of Associations in the total amount of The DSWD Memorandum Circular No. 13 s.
₱6,486,000.00 were pooled to finance the operation of eight (8) 2015 only stipulates the establishment of
newly created micro-enterprise, which engage in the federations and not the pooling of funds
merchandising, lending, agriculture, and poultry businesses, from the individual project proposals of
different from the original purpose and approved project each association.
proposal. (Please see attached Annex “B”)
Interviewed PDOs manifested that pooling of funds was based

on the instruction of the Regional Program Management Office.
Accordingly, the individual project was not allowed so they were
obliged to invest in the newly created federation in order to avail
of the SEA-K grant.
3. Six (6) SEA-K associations claimed that only portion of the Under DSWD Memorandum Circular No. 13
project funds were utilized for the purpose as the total amount s. 2015 in item 5.3.4, the association
of ₱182,100.00 was given to the PDO and Municipal link of President must monitor the utilization of the
SLP; An amount of ₱300,000.00 was procured for duckling capital assistance. The LGU worker and the
rather than piglets, which was consequently waived and DSWD PDO should conduct their own
returned to the PDO; and an amount of ₱200,000.00 procured monitoring independently to determine the
and delivered fertilizer was put to waste as the same was not efficient utilization of capital following
one of the project requirement. (Annex C) the submitted Project Proposal.
90. Out of 147 SEA-K associations visited, 49 were affected by the foregoing
conditions wherein 40 or 81.63 percent of the associations made no payment in the context
that they did not benefit from the grant.
91. The foregoing observations and deficiencies suggest inadequacy and breakdown of
controls in the implementation and monitoring of the projects, more so that the
implementing PDO was also the monitoring PDO. As such, irregularities in the
implementation of the projects could not be immediately detected.
92. As to recording of accounts, it can also be recalled that in the previous years, it has
been observed that the collectibles from the recipients of SEA-K revolving funds were not
recognized in the books of accounts as receivable, nor were these accounts constantly
monitored through reconciliation and/or confirmation of accounts with the records of the
Associations. Thus, any deficiency or error in the reported project accounts and balances
could not be prevented and detected.
93. Further inquiry with Management relative to the issues identified and/or on-going
investigation or cases of possible misuse of funds under SLP as well as the action taken
thereon by the management, disclosed that the foregoing observations were not yet
identified and investigated despite the dormancy of the SEA-K accounts for several years.
94. As a result of the foregoing, the SEA-K funds in the total amount of ₱10,078,100.00
were put to waste and/or misuse defeating the very objective of SEA-K to provide
sustainable source of income to poor families through a sustainable community-based
155
livelihood projects, thus, depriving the beneficiaries of the benefits that could be derived
therefrom.
95. We recommended and the DSWD-FO-XIII Management agreed to:
a. require the SLP RPMO and Legal Officers to conduct in-depth

investigations on the above observations and take appropriate legal actions
against persons liable to recover the amount wasted or misused under the
SEA-K program;
b. require the Accountant to reconcile the accounting records of SEA-K

accounts with the records of the SEA-K associations; make necessary
adjustments in the books of accounts including the recognition of
receivable for proper monitoring of collections and remittances thereof;
and
c. segregate key duties and functions of project personnel to avoid collusion,

or opportunity to make fraudulent activities; see to it that the
implementing PDO assigned in a certain area will not be also assigned to
monitor the implementation of the project, and collect the amounts due to
the government.
96. Management commented that for years, one of the program’s challenges is on the
monitoring of all the projects due to limited staff. However, despite the lack of manpower,
they were exerting all efforts to deliver what is due to our beneficiaries. Management
assured us of the conduct of an in-depth investigation, prioritizing the observations the
Auditors have noted.
97. Moreover, Management is taking matters seriously. In fact, the SLP-RPMO and
Legal Unit have already conducted appropriate actions to those involved personnel in the
misuse of funds. Two (2) former staff have ongoing cases filed with the Prosecutor’s
Office with five (5) and two (2) counts of criminal cases, respectively. Furthermore, there
are five (5) persons who have pending cases for committing fraudulent acts. As of the
moment, the Legal Unit is in the process of further investigating by securing pieces of
evidence for the filing of cases with the Prosecutors Office.
Unutilized Proceeds of SEA-K Grant
98. Unutilized proceeds of SEA-K grant as well as repayments of grants

accumulating to ₱2.676 million at the Associations’ bank accounts were already
dormant for years and not returned/deposited to the accounts of the National
Treasury, contrary to Section 2.2 of Treasury Circular No. 03-2014 dated June 16,
2014 and Section 4.5.3 of COA Circular No. 2007-001 dated October 25, 2007, thus,
defeating the purpose for which the funds were allotted and depriving the
government from the use of such resources.
156
99. Section 2.2 of Treasury Circular No. 03-2014 requires that each government agency
shall deposit its National Collections to the bank account number opened by the Bureau of
Treasury.
100. Likewise, a memorandum was issued last May 3, 2017 which directed DSWD FOs
to:
a. Revert all available cash balances of SEA-RSF account to the National

Treasury except for certain amount as maintaining balance;
b. Retain/maintain the said account solely for accepting payments of SEA-K

associations for their loan balances granted in 2015 and prior years;
c. Revert all succeeding collections from SEA-K associations to the National

Treasury except for the maintaining balance; and
d. Refrain from using the collections or balances of the SEA-RSF account to fund
other SEA-K associations.
101. Moreover, Section 4.5.3 (m) of COA Circular No. 2007-001 dated October 25,
2007 provides the return by the NGO/PO to the granting Government Organization of any
amount not utilized for the project, including interest, if any.
102. Audit disclosed that unutilized proceeds of SEA-K grant as well as repayments of
grants accumulating to ₱2,675,926.14 at the Associations’ bank accounts were already
dormant for years and not returned/deposited to the accounts of the National Treasury.
103. Interview with the SEA-K beneficiaries revealed that repayments made and
balances of the grants received in the previous years were deposited up to their local bank
accounts only and not remitted to the accounts of the DSWD.
104. Based on the passbook presented by the 45 SEA-K Associations, the said dormant
accounts were deposited in rural and universal banks, such as (1) Cantilan Bank, (2) One
Network Rural Bank, Incorporated, (3) People’s Bank of Caraga, (4) Eastwest Rural Bank,
(5) Pilar Multipurpose Cooperative, and (6) Metrobank.
105. Some of these associations were already non-operational. Moreover, one

association failed to utilize the fund granted since they were not timely informed of the
release.
106. Inquiry with the PDO regarding the repayment method of the SKA revealed that
due to geographical distances of various Associations to the authorized depository bank of
the DSWD, it was directed to deposit first the instalment payments to their local bank
accounts, which will later on be deposited to LBP DSWD-RSF account.
157
107. However, after the lapse of years, associations became dysfunctional, dissolved or
non-operational, thus, repayments maintained in the bank accounts of the Associations
became dormant and unattended, exposing the government funds to unnecessary charges
and depriving the government of the use of such resources.
108. The foregoing instances manifest inadequacy of requisite activities in the social
preparation, monitoring of project implementation or fund utilization either due to lack of
manpower resources or adequate monitoring controls on the repayments of the funds
granted to the beneficiaries.
109. We recommended and DSWD-FO-XIII Management agreed to require:
a. the SLP Regional Program Coordinator to conduct further evaluation on

the observations noted above, and identify other issues and causes
particularly on monitoring of project implementation, utilization of funds
as well as remittance of CSF roll-back or loan repayments for
enhancement of controls in the implementation of SEA-K Program; and
b. the Accountant to reconcile the SEA-K account balances, monitor and

confirm repayments, and direct SLP-RPMO to coordinate with the focal
persons of the associations with dormant accounts in returning the
dormant account balances.
110. Management commented that the SLP is limited to 26 Project Development

Officers to implement the 401 funded projects for the first semester of CY 2020 but are
determined to uphold quality in the delivery of the program services. Thus, the SLP will
be coordinating with the LTWG to aid in monitoring the SLP projects. Moreover, after the
validation and reconciliation by the Accounting Section of the records on the balances of
the SEA-K Associations with dormant accounts, the SLP-RPMO will assist in returning
the said funds to the Bureau of the Treasury.
111. The Accounting Section has already coordinated with the SLP RPMO and PDOS on
the schedule and availability of the SEA-K Associations for validation and reconciliation.
Errors and abnormal balances in the SEA-K
112. Errors and abnormal balances in the SEA-K accounts in the total amount of
₱1.168 million due to overpayment and erroneous posting of repayments from 32
SKAs were not timely detected and corrected in the absence of proper accounting
controls, in violation of Section 124 of PD 1445, thereby, casting doubt on the
accuracy of the account balances of SEA-K receivables as presented in the certified
Statement of Releases, Repayments and Balances and the Financial Statements.
113. Section 124 of PD 1445 stated that “it shall be the direct responsibility of the
agency head to install, implement, and monitor a sound system of internal control.”
Internal control is the plan of organization and all the coordinate methods and measures
158
adopted within an organization or agency to safeguard its assets, check the accuracy and
reliability of its accounting data, and encourage adherence to prescribed managerial
policies.
114. Inquiry and confirmation of account balances with the Associations’ representatives
revealed discrepancies in the recorded repayments in the Statement of Releases,
Repayments & Balances as at September 30, 2019.
115. Out of 147 associations inquired from 18 pilot municipalities/city, 32 SKAs did not
confirm the balances due to unrecorded repayments, overpayment and errors in
posting/recording of transactions, as follows:
116. The repayments of 17 SKAs in the total amount of ₱315,050.00 were not recorded
in the schedules or Statement of Releases, Repayments & Balances of the DSWD. In
addition, Sampaguita ng Bayugan 3 SKA from Rosario, Agusan del Sur and Movers SKA
from Maug, Butuan City also claimed that their repayments in the amount of ₱20,633.35
and ₱5,000.00, respectively, were also unrecorded in the books of the DSWD Field Office.
117. Initial verifications of available documents showed erroneous data in the validated
on-call slip as well as non-recording and non-reconciliation of accounts of the DSWD, to
wit:
a. The name of the payor that was indicated on the machine validated on-call slip
was the name of the representative of the Association rather than the name of
the Association, and the List of depositors forwarded by the bank to DSWD
bore the name of the Associations’ representatives rather than the name of the
Associations, thus, the repayments cannot be recorded on the account balances
of respective Associations in the absence/inadequacy of references.
b. There were repayments shown supported with properly filled up deposit slips
which were not yet reflected in the records of the DSWD.
c. The Accounting Unit failed to submit the reconciliation statement for the SEA-
K accounts upon request. However, they assured that all collections were
properly recorded in their schedule of repayments and tallied with the total
collection reported by the Land bank as deposited to their account. The
accounting unit failed to consider that unauthorized collections may be
occurring in the project sites, thus, the need to install detecting controls like
confirmation and reconciliation of the account balances.
118. Moreover, verification of validated LBP on-call deposit slips and other documents
showed errors in posting of payments and overpayment from three (3) SKAs in the total
amount of ₱121,329.00, thus, resulting in abnormal balances of some SEA-K accounts.
Comparison of the balances between the DSWD and Associations’ records, on sampling
basis, showed a total difference of ₱731,538.00 from 10 SKAs.
159
119. Had there been proper monitoring of collections and remittances, recognition of
receivables in the books of accounts, and periodic reconciliations, the discrepancies could
have been timely detected and corrected. These controls are also deterring factors for
individuals to commit irregular activities to defraud the government from its resources.
120. In effect of the unrecorded repayments, overpayment, erroneous recording/posting,

and unreconciled balances, the accuracy of account balances as reported in the Statement
of Releases, Repayments and Balances is doubtful, more so that these transactions were
not recognized in the books of accounts.
121. We recommended and DSWD-FO-XIII Management agreed to require the

Accountant to:
a. reconcile the balances of DSWD with the records of the SKAs, and take
appropriate adjustments in the Statement of Releases, Repayments and
Balances as well as in the books of accounts to fairly present the accounts
and transactions of SEA-K in the Financial Statements; and
b. enhance controls in the monitoring of SEA-K accounts specifically on the

recognition of receivables, collections and remittances, and periodic
reconciliation of accounts to avoid recurring the same errors.
122. Management commented that the Statement of Releases, Repayments and Balances
report was based mainly on the Schedule of Collections from the Land Bank of the
Philippines (LBP). However, they stated that observations and recommendations are duly
noted. Accounting staff will be having a series of field visits to validated the balances of
SKAs and reconcile the records. Appropriate actions and adjustments will be made for
any unreconciled balances.
123. The SLP and Accounting Section will be constantly coordinating with each other
and will be conducting a meeting to level off the SEA-K balances and to enhance the
monitoring tools to avoid the recurrence of the said concern.
Undisclosed SEA-K Collectibles
124. Events in the SEA-K collectibles with significant impact to the users of the
financial information were not recognized and disclosed in the financial statements, a
departure from Section 15, Chapter 1 of the Government Accounting Manual,
Volume 1, thus, SEA-K accounts and transactions are not faithfully and fairly
presented in the financial statements.
125. Section 15, Chapter 1 of the GAM Volume 1 provides that:
“Financial statements shall present fairly the financial position, financial

performance and cash flows of an entity. Fair presentation requires the faithful
representation of the effects of transactions, other events, and conditions in
160
accordance with the definitions and recognition criteria for assets, liabilities,
revenue, and expenses set out in PPSASs. xxx (Par. 27, PPSAS 1)”
126. Interviews and confirmation of balances with SKA representatives showed

differences in balances, which variance, based on the samples gathered, consisted of
unremitted payments to the accounts of the respective Associations. These payments were
collected allegedly by the former Project Development Officers (PDO) of the DSWD in
prior years.
127. Further inquiry on the matter disclosed Management’s ongoing fact-finding

investigation on the unremitted payments of various SEA-K Associations. Based on the
letter-reply, an aggregate amount of not less than P5,962,889.01 was not remitted by the
previous PDO to the account of the DSWD, and legal measures had already been initiated
to recover the amounts and make the concerned personnel accountable thereto.
128. These events, which have a significant impact to the users of the financial
information like the program implementers, Commission on Audit and other stakeholders,
were not recognized in the books of accounts nor disclosed in the notes to financial
statements.
129. Also, the non-recognition of SEA-K receivables as asset of the agency, which was
brought to the Government Accounting Services of the Commission on Audit for
resolution of the differing opinions between the DSWD Field Office and the Audit Team
on the recognition of asset for proper monitoring of collections and deposits, was not
disclosed in the Notes to the Financial Statements (NFS).
130. Such conditions suggest gaps in the communication line or transfer of information
from the Regional Program Management Office to the Accounting Unit as well as
proficiency on the events that require adjustments in the books of accounts and disclosures
in the NFS, as provided in the Philippine Public Sector Accounting Standards No. 1.
131. Thus, the SEA-K receivables or collectibles are not faithfully presented in the
financial statements as at December 31, 2019 in accordance with the substance of the
transactions and other events.
132. We recommended and DSWD-FO-XIII Management agreed to install a system

wherein all events-adjusting or non-adjusting, with significant impact to the faithful
presentation of accounts and transactions are properly communicated and disclosed
in the financial statements by the concerned personnel.
133. Management commented that Accounting personnel have already coordinated with
the SLP Regional Program Management Office (RPMO) and its PDOs for the validation
of the unreconciled balances scheduled in March 2020 after the completion and
submission of all the annual reportorial requirements. Thus, there is still no available
information on the actual details to be included in the NFS.
161
134. Again, on the recommendation on the SEA-K collectibles as receivables, this was
disclosed in the NFS per previous agreement of the DSWD with the COA as to the
accounting treatment of the account for uniformity and consistency of application. Also,
Management has already elucidated the actions taken in the previous responses and
submitted to the Auditor. As of now, Management is awaiting updates, if any.
135. It is duly noted to disclose Management’s ongoing fact-finding investigation on the

fraudulent activities by some concerned staff. Henceforth, the Accounting Section will
include it in the quarterly submission of the NFS starting the first quarter of CY 2020.
Assistance to Communities in Need (ACN) Projects
136. DSWD-Caraga had incurred substantial delays ranging from one (1) year up
to two (2) years, in the implementation of their Assistance to Communities in Need
(ACN) projects, thus, preventing the timely delivery of benefits that could have been
derived from the said poverty reduction projects intended for the vulnerable
communities.
137. The ACN under the Protective Services Program (PSP) is intended for those
communities affected by disasters or are experiencing crisis or displacement due to
eviction, demolition or requiring intervention for sector specific support. It is the provision
of the Construction/Repair/Improvement of Child Development or Day Care Centers
(DCCs) and Construction/Repair/Improvement of Senior Citizens’ Centers (SCC) for
communities in need of such support, facilities or structures.
138. The ACN aims to deliver the basic rights of the vulnerable sectors which are
survival, protection, participation and development. It also contributes to the fulfilment of
one of the five (5) Organizational Outcomes of DSWD under 002 Rights of the Poor and
the vulnerable sectors promoted and protected.
139. The Day Care Service provides the early stage of socialization of children. It also
supports the provision of supplementary parental care to 3-5 year old children of parents
who find it difficult to fully take care of the children during their work days.
140. On the other hand, the Construction/Repair/Improvement of Senior Citizens Center

is a place for the recreational education, health and social programs and facilities designed
for the full enjoyment and benefit of the senior citizens. The center also provides
continuing opportunities for the elderly to share their talents, issues and concerns and
socialization between and among them.
141. Section 2 of the Presidential Decree No. 1445 states that it is also the declared
policy of the State that all resources of the government shall be managed, expended or
utilized in accordance with law and regulations, and safeguarded against loss or wastage
through illegal or improper disposition, with a view to ensuring efficiency, economy and
effectiveness in the operations of government. The responsibility to take care that such
162
policy is faithfully adhered to, rests directly with the chief or head of the government
agency concerned.
142. Section 4.2.3 and 4.2.4 of DSWD Memorandum Circular No. 4 series of 2015 states
that the Construction and Repair/Improvement of DCCs and SCCs shall be in accordance
with agreed timelines. In case of delays due to force majeure or extreme situation,
extension shall not be beyond three (3) months.
143. Moreover, Section 7.2.3.5 states that the focal person of the Field Office in
coordination with the partnered LGUs shall conduct monthly monitoring on the
implementation of the project and provide status report to DSWD Central Office.
144. Furthermore, it was indicated in the Memorandum of Agreement (MOA) between

DSWD-FO XIII and the Municipal/City Mayor that the latter shall ensure the
implementation and completion of the project based on the project duration reflected in the
approved Program of Works (POW), or not later than the agreed timeline.
145. The Annual Accomplishment Report of DSWD-Field Office No. XIII for PSP-ACN
disclosed that it has initiated a total of 92 projects with total project cost of
P72,300,000.00, in partnership with the LGUs. The P70,600,000.00 of which were already
disbursed, while the balance of P1,700,000.00 is yet to be disbursed, as at December 31,
2019. Out of the 92 ACN projects for the program year 2015 to 2018, there were 68 or 74
percent completed; 18 or 20 percent were ongoing; while the six (6) or 6 percent
represented the unimplemented ACN projects as at December 31, 2019.
Table 24. Annual Accomplishment Report

Total No. Year of Fund Project Status
Program Project Total Project
of Transferred On- Not Yet
Year Composition Cost Completed
Projects to LGUs going Implemented
2015 12 12 DCCs 9,600,000.00 2016-2019 11 1 -
2016 49 46 DCCs & 3 SCCs 36,700,000.00 2016-2019 44 5 -
2017 28 23 DCCs & 5 SCCs 23,400,000.00 2017-2019 11 12 5
2018 3 2 DCCs & 1 SCCs 2,600,000.00 2018-2019 2 - 1
TOTAL 92 72,300,000.00 68 18 6
146. As can be gleaned from Table 24 above, there were more completed ACN projects
as compared to the on-going and not yet implemented projects. However, further scrutiny
revealed that completed projects consisted mostly of funds released in tranches in year
2015-2017 to the implementing LGUs, which were not immediately implemented and
some were just completed in year 2019. The delay in the implementation was also the
reason why succeeding tranches were not released immediately to the LGUs.
163
147. It showed that the 2nd and 3rd tranche were released after one (1) up to two (2) years
from receipt of the preceding tranche. It took more than a year for most of the projects in
program year 2015-2017 to be completed. The same is also true with 18 on-going projects.
It exceeded beyond the allowed extension period of at most three (3) months. Thus, the
said projects were not completed within the agreed timelines and standard project duration
for the construction of Day Care Centers and Senior Citizens Centers, which ideally
should have been finished within 75 to 120 calendar days only.
148. Analysis of the unliquidated/unrefunded amounts, which consisted the balance of

Due from LGUs account, showed that: (i) out of 68 completed projects, 24 projects have
unsubmitted final liquidation and five (5) have unreturned unused balance; (ii) 16 on-
going projects have an outstanding balance of ₱9,180,357.65 as at December 31, 2019;
and (iii) the six (6) unimplemented projects in CY 2017 with a total amount of
P4,500,00.00 were just recently (March 18, 2019) negotiated in the bank for
implementation, of which, four (4) projects are still at the procurement stage while the
funds for the two (2) projects have just been transferred to them on March and August
2019.
149. Inquiry with the ACN focal person uncovered the following reasons for the delay in
the implementation of projects, as follows:
a. The unfavorable weather condition in the area hampered the start of project
construction/repair;
b. Failure of the project contractors to start the construction immediately;
c. The inactive processing of the required documents and in the implementation
of projects by the concerned LGUs; and
d. Limited personnel complement to monitor the projects in the field.
150. In effect of the foregoing conditions, releases of succeeding tranches, which

requires liquidation of previous tranches, were also delayed resulting in the substantial
delay in the full completion of the projects. Thus, this prevented the timely delivery of
benefits that could have been derived from the said poverty reduction projects intended for
the vulnerable communities.
151. We recommended that DSWD-FO-XIII Management require:
a. the ACN focal persons to intensify and fast-track their coordination,

inspection and regular monitoring in the field to be able to immediately
address the gaps identified under the program; and
b. the concerned LGUs to prioritize the prompt implementation of ACN

projects, in compliance with the MOA and expedite the submission of
necessary documents to fast track release of funds.
152. Management commented that the ACN staff intensified their coordination and
monitoring with the implementing LGUs based on the status of the projects. As at
164
February 24, 2020, there were 80 completed projects; 10 ongoing projects and 2 projects
in the procurement process. Moreover, a thorough follow-up and lobbying with the
implementing LGUs has been implemented as evident in the Project Conferences that
were conducted in their City/Municipality.
153. As a rejoinder, we maintain that while there was an increased

accomplishment/implementation for the year 2019, the fact remained that most completed
projects exceeded the allowed extension period of at most three (3) months and were
delayed from one (1) year up to two (2) years, thereby preventing the timely delivery of
benefits that could have been derived from the said poverty reduction projects.
Disaster Risk Reduction and Management Fund
154. DRRM Fund was used in paying salaries and wages of non-permanent
employees in the total amount of ₱911,738.95 and other activities that were not
disaster risk management related, instead of charging the same against their regular
appropriations, contrary to Section 22 of RA 10121.
155. Section 22 of RA 10121 or the Philippine Disaster Risk Reduction and Management
Act of 2010 provides the sources and utilization of the National Disaster Risk Reduction
and Management Fund. This section specifically states that said funds shall be used for
disaster risk reduction or mitigation, prevention and preparedness activities such as but not
limited to training of personnel, procurement of equipment, and capital expenditures. It
can also be utilized for relief, recovery, reconstruction, and other work or services in
connection with natural or human-induced calamities which may occur during the budget
year or those that occurred in the past two (2) years from the budget year.
156. In the course of our audit of the DRRM Fund for calendar years 2018-2019, we
observed that the DSWD Field Office V used the subject fund in paying for the salaries of
non-permanent or job order employees assigned in the different sections of the field office
other than disaster unit.
157. The records showed that of the ₱11,998,401.20 calamity fund for 2018,
₱4,936,199.22 was expended from February 2018 to October 2018, with ₱911,738.95 used
to pay for the salaries of job order workers assigned in other units of the agency with
functions unrelated to disaster activities. The use of the subject DRRM funds for the
payment of the salaries of job order workers was ‘irregular’ since it was outside the
purpose for which the calamity fund was intended. More so, the charges were not among
those considered to be part of the disaster risk management activities as defined in RA
10121.
158. COA Circular No. 2012-003, dated October 29, 2012, defines irregular expenditure
as follows:
“The term irregular expenditures signifies an expenditure incurred without

adhering to established rules, regulations, procedural guidelines, policies,
165
principles, or practices that have gained recognition in law. Irregular
expenditures are incurred if funds are disbursed without conforming to prescribed
usages and rules of discipline. There is no observance of an established pattern,
course, mode of action, behavior, or conduct in a manner that deviates or departs
from, or which does not comply with standards set, is deemed irregular. A
transaction, which fails to follow or violates appropriate rules of procedure is,
likewise irregular.”
159. Other expenses improperly charged to DRRMF included: travels to the provinces of
Masbate, Camarines Sur and Camarines Norte to conduct pay-out of social pension; Food
for the conduct of Supplementary Feeding Program; Reimbursement of traveling expenses
re Internal Budget Hearing among others. These were not among the authorized expenses
to be charged against the fund and are not directly related to risk disaster. Unauthorized
expenditures may deplete the calamity fund for disaster preparation and could be
disallowed in the audit.
160. Disbursement vouchers of payments out of DRRMF during the period November
2018 to December 2019 were included in the accounts not yet submitted for audit to the
Audit Team as discussed in the separate AOM issued to DSWD FOV management.
161. We recommended that DSWD-FO-V Management strictly abide by the

existing provisions for the utilization of the NDRRM Fund, and refrain from
incurring and charging expenses not related to disaster risk reduction management
activities of the DRRM Fund.
162. In a letter dated February 24, 2020, the Agency Head commented that:
“The DRRM Fund was not used in paying salaries and wages of non-permanent
employees and other activities that are not disaster risk management related. Upon
verification of the data that was used to come up with this observation, it was
revealed that the transactions noted in the subject AOM were not charged to
DRRM Fund, but rather to the appropriate fund source.”
163. As a rejoinder, the subject data mentioned by Management in its comment as a

basis of the observation refers to the list of charges to DRRM Funds that were furnished to
the Audit Team (AT) by the Regional Accountant. However, the observation is the result
of the post-audit of paid DVs based on the SAOB report from the Budget Section and not
based on the subject list of the Regional Accountant.
164. As of this report, DVs for December 2018 charged to DRRM has been submitted
with similar observations noted. This increased the amount used to pay salaries of JOs to
P1,648,673.21 out of DRRM Funds for CY 2018.
165. Per Statement of Allotment, Obligation and Balances (SAOB) 2019, show that of
the ₱11,998,401.20 calamity fund, ₱4,936,199.22 was expended from January to October
2019, with ₱911,738.95 were used to pay for the salaries of job order workers.
166
166. As a rejoinder, we maintain our recommendation until its full compliance.
167. Lapses in reporting, accounting, and utilization of the DRRMF is not in

conformity with COA Circular No. 2014-002, which hindered the timely audit of
accounts related to calamity funds, and precluded transparency and accountability in
the use of disaster relief aid/donations and NDRRMF.
168. Item A.1, Section V of COA Circular No. 2014-002 dated April 15, 2014, provides
that:
“The national and local government agencies with DRRMF allocation from the
GAA and/or cash donations received from local and/or foreign sources shall
prepare and submit to NDRRMC through the Office of the Civil Defense (OC), on
the 5th day following the end of each month, the Report on the Receipt and
Utilization of the DRRMF sourced from GAA (Annex H) and Report on the Receipt
and Utilization of Cash Donations (Annex I). The reports shall be furnished the
respective COA Auditor”.
169. Item C of the same section further states that the required reports on the receipt and
utilization of DRRMF sourced from GAA and donations in cash and in-kind shall be
posted on the official websites of the implementing/donee-agency, OCD and NDRRMC.
170. Records showed that the reports on receipt and utilization of DRRMF sourced from
the General Appropriations Act (GAA) and on the receipt and utilization of cash donations
were never furnished to the Auditor’s Office. Only the ‘Relief Distribution Sheets’ are
being submitted to the Audit Team (AT) to support the issuance of family food packs to
local government units.
171. One of the budget personnel informed us that there was no separate posting of
DRRM funds in the Registry of Allotments and Obligations-DRRM (RAOMO-DRRM or
RAOCO-DRRM) which is the basis for the preparation of the above disaster report.
172. A visit to the agency’s website also showed the absence of reports about the receipt
and use of disaster funds even from prior years. A review of financial reports available in
the electronic accounting system also revealed non-receipt of cash or collection that may
be held in trust for Disaster Risk Reduction and Management for the year in audit and
even in the past years.
173. Failure of Management to submit the above-stated reports and non-maintenance of

the registries for DRRM funds prescribed by COA Circular No. 2014-002 hindered the
timely review and evaluation of the charges against the DRRM funds from the current and
continuing appropriation including unspent DRRMF from the previous years and cash
donations.
167
174. The existing deficiency is not in compliance with the above-stated regulation. It
also failed to provide transparency and accountability in the use of disaster relief
aid/donations and NDRRMF for the benefit of donors, the public, and other stakeholders
175. We recommended that DSWD-FO-V Management require:
a. the preparation and submission of the DRRM reports as prescribed in

COA Circular No. 2014-002 to the Office of the Auditor for the timely
review and evaluation of the same; and
b. the concerned agency officials to adopt the accounting and reporting

guidelines prescribed by COA Circular No. 2014-002.
176. In a letter dated February 24, 2020, the Agency Head commented that the Budget
Section had already submitted the pertinent 2018 DRRM reports to the Office of the
Auditor last year. For the 2019 DRRM reports, the same will be submitted within the week
along with the 2019 Registry of Allotments and Obligations for MOOE (RAOMO) of the
DRRM fund. Management also hopes that after reviewing the submitted RAOMO, the
auditors will be able to confirm that indeed the DRRM Fund was not used for
disbursements/expenses that were not disaster risk management related.
177. As a rejoinder, no Report on the Receipt and Utilization of the DRRMF sourced
from GAA and Report on the Receipt and Utilization of Cash Donations required under
Item A.1 Section V of COA Circular No. 2014-002 has been submitted for audit, as of this
report.
KALAHI CIDSS-NCDDP completed subprojects not operational/functional and ineligible

– P42.776 million and P1.601 million, respectively
178. Validation as to existence, functionality and accountability of 27 subprojects in

DSWD FOs V, VI and XI costing ₱42.776 million were either not operational or
functional due to failure to adequately maintain the subprojects, and the absence of
proper turn-over of completed subprojects as required in the Community-Based
Infrastructure Manual, thus, may result to wastage of government funds/non-
sustainability of the subprojects, and unrealized objectives of the program.
Moreover, FO V funded three ineligible Kalahi subprojects amounting to P1.601
million located at selected barangays of Buhi, Camarines Sur, which is not in keeping
with Section 1.2.4, Volume 1 of the Revised Community-Based Infrastructure
Manual, and Section 29, Article VI of the 1987 Philippine Constitution.
179. Kapit-Bisig Laban sa Kahirapan - Comprehensive and Integrated Delivery of

Social Services - National Community- Driven Development Program otherwise known as
KALAHI CIDSS-NCDDP or KC-NCDDP, is one of the poverty alleviation programs of
the Philippine Government being implemented by the DSWD. It uses the community-
driven development approach, a globally recognized strategy for achieving service
delivery, poverty reduction, and good governance outcomes.
168
180. We conducted a review of the related documents including actual site validation of
the selected subprojects to evaluate the effectiveness, efficiency, economy, and
sustainability of various completed projects implemented.
181. The subprojects were also evaluated to ensure adherence to Section 2 of PD 1445
which provides that all resources of the government shall be managed, expended or
utilized in accordance with laws, rules and regulations, and safeguarded against loss or
wastage through illegal or improper disposition of government property.
a) Completed subprojects not operational/functional and ineligible – ₱42.776 million
182. Validation disclosed that the following subprojects costing ₱42,775,802.38 were not
operational/functional despite project completion:
Table 25. Validation of project completion

Proponent/
Subproject Cost Date Completed Status
Location
FO V
1) Brgy. San Installation of Solar ₱636,753.00 CY 2018 Eight out of 14 units were
Pedro, Buhi, Powered Streetlights already not functioning
Camarines Less than 2 months after installation, no
Sur years action on the part of the
contractor despite demand
from the Kalahi staff and
barangay volunteers
2) Brgy. San Installation of Solar 464,341.00 Two months after installation,
Roque (Pob.), Powered Streetlights some units were already not
Buhi, functioning
Camarines
Sur
3) Brgy. Installation of Solar 544,110.00 Solar lights were only
Buenaventura Powered Streetlights functioning from April to
, Buhi, December 2018, as of the
Camarines current date, all 12 units are
Sur not functioning.
4) Brgy. Rehabilitation and 2,068,000.00 Out of 19 units of street
Malodbalod, Improvement of lights, only one unit was
Tigaon, Streetlights functioning months after
Camarines installation.
Sur
5) Brgy. San Construction of Solar 667,532.80 August 16, 2018 The project was not yet
Mateo, Powered Street turned over to the Barangay
Camaligan, Lights Less than 2 due to incomplete and
Cam Sur years missing documents.
6) Brgy. San Construction of Solar 767,792.00 May 21, 2018 The project was not yet
Roque, Powered Street turned over to the Barangay
Camaligan, Lights Less than 2 due to incomplete and
Cam Sur years missing documents.
7) Brgy. San Construction of Solar 2,066,356.67 June 30, 2018 The project was not yet
Juan-San Powered Street turned over to the Barangay
Ramon, Lights Less than 2 due to incomplete and
169
Proponent/
Location
Camaligan, years missing documents.
Cam Sur
8) Brgy. Repair/Improvement 3,789,742.00 November 29, Brgy. Chairman refused to
Ibayugan, of Riprap 2018 accept turnover due to issues
Buhi, Cam on missing equipment and
Sur Less than 2 materials used during the
years implementation
9) Brgy. San Repair/Improvement 744,895.00 May 26, 2018 No turnover yet due to
Vicente, Buhi, of Tribal Hall Less than 2 unsettled issues on Land
Cam Sur years Title
10) Brgy. San Repair/Improvement 139,082.00 May 24, 2018 No turnover yet, issues on
Isidro, Buhi, of RipRap equipment purchased not
Cam Sur Less than 2 settled
years
Subtotal for FO V 11,888,604.47
FO VI
11) Brgy. Construction of 1,271,344.32 February 18, The non-observance of the
Mambugsay, Health Station and 2016 required Road Right of Way
Cauayan, Construction of (RROW) in the construction
Negros Concrete Foot Bridge. of KALAHI-CIDSS sub-
Occidental projects in the Municipality
12) Brgy. Construction of 1,690,570.15 No data resulted in the impending
Inayawan, Health Station demolition of the Health
Cauayan, Centers due to the road
Negros widening project of DPWH
Occidental per FY 2019 GAA, hence,
may result in the wastage of
government funds.
13) Brgy. San Flood Prevention 1,476,364.00 May 2017 In view of the CY 2019
Pedro, San through Community- DPWH project Construction
Jose, Antique managed of Revetment along Sibalom
Construction of River Bantayan-San Pedro-
Gabion Dike Cubay Road, wherein a
concrete slope protection and
series of gabion spur dikes
will be constructed, the
demolition of the existing
Kalahi CIDSS subproject is
necessary.
14) Brgy. Baybay, Environmental 2,787,880.00 No data Overlapping of the CY 2019
Pandan, Protection through DPWH project Construction
Antique Community-managed of Flood Mitigation Structure-
Construction of Construction of Flood
Seawall Control.
15) Brgy. Pagpanami Sang 2,500,325.00 No data Crack and scaling in some
Balabag, Dalan sa Brgy. parts of the concrete road
Anilao, Iloilo Balabag, Anilao, Iloilo
Paagi Sa Pag
Pakonkreto Sini Agod
Mangin Masulhay
Ang Pag-agi Sang
Mga Tawo Kag Mga
Salakyan Pakadto Sa
170
Proponent/
Location
Banwa
16) Brgy. Solar Street Lights for 2,062,000.00 No data After one year, the solar
Sambag, People's Safety and street lights tend to start
Culob, San Improvement performing poorly.
Carlos and
Dangulaan,
Anilao, Iloilo
17) Brgy. To Ensure Easy 2,216,000.00 No data
Poblacion, Access, Safety,
Anilao, Iloilo Security and Minimize
Accidents and Crimes
By Installation of
Solar Street Lights
18) Brgy. Construction of 1 unit 870,045.45 No data One of the comfort rooms is
Poblacion, Daycare Center with not functional
Cauayan, Amenities
Negros
Occidental
19) Brgy. Construction of 1 unit 870,045.45 No data
Masaling, Daycare Center with
Cauayan, Amenities
Negros
Occidental
20) Brgy. Lina-on, Construction of 1,226,175.00 No data The production center on fish
Cauayan, Production Center on processing is not operational
Negros Fish Processing w/
Occidental skills Training for
Micro Enterprise
Development
21) Brgy. Buang, Improving Access to 1,850,000.00 No data The ceiling is not evenly
Pandan, Quality Basic painted.
Antique Education through Door knob is damaged.
Community Managed Wall finished poorly.
Construction of 1 Unit Low grade ceramic
2-CL Primary School tiles installed.
Building with
Amenities
22) Brgy. Baybay Risk Reduction of 1,361,145.54 No data The subproject was
Norte, Miag- Ravaging Sea Waves uncompleted/as-built due to
ao, Iloilo During Typhoon the loan closing date. SP was
Through Community- partially damaged by strong
managed waves due to southwest
Construction of Sea monsoon.
Wall
Subtotal for FO VI 20,181,894.91
FO XI
23) Brgy. Construction of Corn 1,543,481.00 May 12, 2017 Easily gets damaged every
Patulang, Mill Building with time it is being used;
Jose Abad Provision of Corn Mill Less than 3
Santos, Machine years Spare parts (fixed grinding
Davao stone) are not available;
Occidental
Not managed well and not
171
Proponent/
Location
registered as an association
24) Brgy. Construction Of 1,745,000.00 Jan. 19, 2018 No longer functional since
Salingcomot, Potable Water October 2018;
Banganga, System (Level II) Less than 2
Davao years With issue on unauthorized
Oriental tapping;
Damaged by fire due to

kaingin by the owner of the
land
25) Brgy, Construction of Multi- 1,637,308.00 Apr. 6, 2018 No utilities and other
Poblacion, Purpose Building necessary facilities yet in the
Malita, Davao Less than 2 area;
Occidental years
Located far from the
community;
Main purpose is for

evacuation
26) Brgy. Mangile, Construction of 1,861,916.00 Apr. 17, 2018 Fully operational only for two
Jose Abad Potable Water months;
Santos, System Level II Less than 2
Davao years Only two tap stands are
Occidental functional due to
unauthorized tapping
27) Brgy. Construction of 3,917,598.00 Apr. 12, 2019 Not yet used due to delay in
Igangon, San Community Multi- downloading the last tranche,
Isidro, Davao Purpose Center 8 months thus payment was not made
del Norte to the Contractor;
Contractor refused to turn-

over the keys
Subtotal for FO XI 10,705,303.00
Total ₱42,775,802.38
183. As for the KC-NCDDP funded Health Station in Brgy. Mambugsay, the DPWH had
already assessed the replacement cost of the structure to be deposited to the account of the
Municipality of Cauayan, Negros Occidental. In the case of Barangay Inayawan, the
assessment of DPWH was not yet made. The LGU had already conducted consultation
with stakeholders and the area/land where the new Health Stations will be constructed
were also in place.
184. Although the DPWH will provide the replacement cost of the structure, the
demolition of the Health Station is considered as a wastage of government funds, which
could have been avoided, if the width requirement on national roads was considered in the
construction of the KC sub-project.
185. Moreover, the efficient and effective use of the noted eight subprojects may be
compromised, thus, immediate corrective measures are necessary to maintain the
functionality and sustainability of the sub-projects.
172
186. The existing defects/condition of the completed subprojects only manifest improper
asset management by the different project recipients attributed to the following factors:
a. Poor transfer of responsibilities from the BSPMC to the completed project’s

operation and maintenance committee which could either be from the barangay
or association or even from the community as a whole where the projects were
implemented;
b. Lack of capacity building and monitoring of completed subprojects to ensure

that subprojects are implemented and completed according to plan and in
compliance with the program’s manual;
c. Absence of specific operation and maintenance policies to be crafted for the said
KALAHI projects, instead maintenance is solely dependent on the Barangay’s
Development Fund, which is also insufficient; and
d. In most cases, the change in leadership affects the maintenance of completed

subprojects.
187. The sustainability of the subprojects depends on how they are maintained
throughout the expected lifespan of the subproject. While many subprojects have been
implemented, constructed, and completed, these projects will be in vain if beneficiaries fail
to consider the operations and maintenance phase. The life of the subprojects does not end
at completion, much less when it is turned over to the intended beneficiaries.
b) Ineligible subprojects –₱1.601 million
188. Section 1.2.4, Volume 1 of the Revised Community-Based Infrastructure Manual of

Kalahi-CIDDS NCDDP dated June 2016 enumerated the list of infrastructure subprojects
that are not eligible for funding which included construction and repair of government
offices, meeting halls and places of worship unless Disaster Risk Management (DRM) has
been triggered.
189. Section 29, Article VI of the 1987 Philippine Constitution also stated that “No
public money or property shall be appropriated, applied, paid, or employed, directly or
indirectly, for the use, benefit, or support of any sect, church, denomination, sectarian
institution, or system of religion, or any priest, preacher, minister, other religious
teachers, or dignitary as such, except when such priest, preacher, minister, or dignitary is
assigned to the armed forces, or any penal institution, or government orphanage or such
priest, preacher, minister, or dignitary is assigned to the armed forces, or any penal
institution, or government orphanage or leprosarium.”
190. Field validation disclosed three subprojects implemented during CY 2018 in Buhi,
Camarines Sur that were not allowed for funding under the Kalahi Program, with details as
follows:
173
Table 26. Details of Subprojects implemented
Date
Location Project Name
Started Completed Total Project Cost
Brgy. San Jose Salay, REPAIR/ IMPROVEMENT OF 5/16/2018 6/23/2018 ₱369,586.00
Buhi, Camarines Sur BARANGAY CHAPEL
Brgy. Ipil (Fatima), Buhi, REPAIR/ IMPROVEMENT OF 5/7/2018 6/9/2018 341,535.00
Camarines Sur BARANGAY CHAPEL
Brgy. Santa Cruz, Buhi, REPAIR/ IMPROVEMENT OF 5/20/2018 11/28/2018 890,317.00
Camarines Sur BARANGAY CHAPEL
Grand Total ₱1,601,438.00
191. There was no information that the foregoing subprojects were implemented to serve
as administrative space for disaster and relief operations and information dissemination of
those barangays.
192. Interview with the volunteers and residents of the barangay also raised issues on the
allocation of Operations and Maintenance Fund of the above subprojects. Although those
chapels were turned over to the concerned barangay officials, these were not considered
properties of the barangay. Its continued maintenance depends on the income generated
from the churchgoers.
193. Kalahi subprojects are designed to provide infrastructures and services to the needs
of the community, who in return is responsible for the sustainable operation and
maintenance of the subproject after they have been completed. However, since the
foregoing subject projects are not eligible for government funding, its sustainability cannot
be assured even with the existence of the Mutual Partnership Agreement both signed by
the Barangay Local Government Unit (BLGU) and the DSWD FO V.
194. The above circumstance is not in keeping with the existing law and regulations such
that the responsible officials may be held liable for the violations identified.
195. We recommended and Management agreed to require the DSWD Regional

Project Management Office of KALAHI-CIDSS in:
a. FO V to:
(i) capacitate communities using existing KC Manual designed for the proper
implementation of the program and look into the subprojects with noted
defects and make representations with proper authorities including LGUs
concerned towards possible remedial measures;
(ii) require Kalahi personnel to turn over records under his custody before
separation from the agency;
(iii) coordinate and advise the Barangay Council to allocate sufficient O&M
funds for the regular maintenance of the subproject requirements of the
project to achieve proper turn-over of SPs and maintain complete
separate records; and
174
(iv) assist the BLGUs and O&M committees in the implementation of the
Operations & Maintenance Plan;
(v) discontinue funding projects not eligible for the agency’s Kalahi program,
otherwise they should be held liable for disbursing public funds for illegal
projects;
b. FO VI to:
(i) strictly observe the required Road Right of Way in the construction of
KALAHI-CIDSS sub-projects along national and local roads to avoid its
demolition due to the road widening projects of the DPWH in the
construction of future projects, and provide technical assistance to LGU-
Cauayan, Negros Occidental so that the construction of the new Health
Stations will be immediately implemented; and
(ii) ensure that the community-identified priority projects are not the
potential development sites of the DPWH infrastructure projects to avoid
the demolition of the completed KC sub-projects so that its maximum
utilization could be fully attained; and
c. FOs VI and XI to make the necessary representations with the Barangays/

Municipalities to monitor/revisit the different completed subprojects to
ascertain the functionality of the different subprojects.
196. FO V Management commented that Buhi, Camarines Sur was declared under the
state of Calamity last December 31, 2016, by the National Disaster Risk Reduction and
Management Council. With the declaration of the State of Calamity, it was agreed during
the Municipal Inter Barangay Forum to shift from standard CEAC to Disaster Response
Operations Procedures allowing the said sub-projects. Included in the MIBF resolution is
that the sub-projects will also be used during disaster operations and as temporary shelters.
197. FO VI Management commented that the RPMO will strengthen the safeguard
mechanisms of the program such as close coordination with DPWH and other agencies;
and provide manpower and technical assistance to the LGU to ensure that the project will
be implemented on time and within the prescribed quality and standards of KALAHI-
CIDSS.
198. As for the noted deficient eight subprojects, FO VI Management explained that
despite these efforts by the program, there were still defective sub-projects, thus, the
RPMO will create a Team of technical persons to provide technical assistance to the
concerned communities with defective sub-projects. The Team will verify the main causes
why the sub-projects were defective/not functioning properly after it was turned-over to
the community. Further, they will look into whether the Operation and Maintenance
Groups are functioning effectively and the funds committed for operation and maintenance
are provided.
175
Core Shelter Assistance Program (CSAP) – ₱74.641 million
199. Poor implementation and monitoring of CSAP in FOs II and V resulted in the
delay of the construction/completion of the project and non-attainment of the
objective of the program that deprived the beneficiaries of the immediate use of the
typhoon resistant indigenous shelters costing P74.641 million and exposed
government funds to misuse and wastage.
200. Core Shelter Assistance Project is one of the interventions of DSWD under the
Disaster Mitigation and Preparedness which aims to provide environment-friendly,
structurally strong shelter units that can withstand up to 220 kilometers per hour (kph)
wind velocity, earthquakes up to intensity 4 of the Richter scale and other similar natural
hazards in relocation sites provided by the national or local government units using locally
available materials to revitalize the local economy.
201. Administrative Order No. 101, series of 1989 enumerates the objectives of the Core
Shelter Project, as follows:
a. To reduce the number of families rendered homeless every year by providing a

structurally strong indigenous shelter which can withstand approximately 160 kph
wind velocity, earthquake with moderate intensity and other similar natural
hazards;
b. To maximize the participation and draw the commitments of the beneficiaries and
the neighborhood to make the core shelter livable and maintain its structurally
strong standards; and
c. To develop and promote the value of self-reliance among the beneficiaries and the
community.
202. DSWD FOs II and V released CSAP funds to various LGUs and Neighborhood
Association Shelter Assistance (NASA) for CYs 2010-2014 and 2016, respectively, for the
construction of various core shelter units. However, despite the lapse of time of over three
to nine years, a total of 919 core shelter units costing P74,640,700.00 were still left
unfinished and some were not yet started as presented in the Table 27.
Table 27. Schedule of unfinished core shelter

Region No. of LGUs Year Granted Unfinished Units Cost
II 13 2010-2014 825 P59,325,750.00
V 1 2016 94 15,314,950.00
Total 14 919 P74,640,700.00
203. The monitoring/validation of some of the Core shelter sites showed poor
implementation of the program to the disadvantaged of the identified beneficiaries that
resulted in the non-attainment of the objectives of the program and further resulted in the
loss and wastage of government funds.
176
204. The Audit of core shelter units in select municipalities in the Provinces of Cagayan,
Isabela and Quirino, Region II, disclosed the following observations and deficiencies, as
follows:
Location Deficiencies
CSAP Allacapan, It has been more than 10 years since the fund was released for the construction of 30 units
Cagayan core shelter houses amounting to ₱2,100,000.00; however, the result of our
monitoring/validation disclosed meager performance by the project. The construction of the
core shelter units was not in accordance with the plans and specifications for core shelters as
provided by the Central Office.
During the monitoring/validation of the project, it was further noted that there were no
partitions, facia boards and the toilets have no walls although the toilet bowls were mounted
on the septic tanks. Some of the beneficiaries moved in to the core shelters despite its
condition just to have a roof above their heads. Some beneficiaries who can afford to
improve the house improved it gradually. For those who could not afford to improve or finish
the construction, they did not occupy the houses, hence, some units remained unoccupied as
of the time of monitoring/validation.
CSAP Iguig, It has been eight years since the fund was released to the different NASA amounting to
Cagayan ₱11,500,000.00; however, the result of our monitoring/validation for Barangay Malabbac
NASA showed the poor and frustrating project condition.
Although the present state of the core shelters show that these were not fit for occupancy, the
core shelters which were started were gradually improved by interested beneficiaries.
Validation disclosed that there were some units which were destroyed by the recent typhoons
which only shows that the constructed core shelters were not typhoon-resistant. There were
also units which were only 10% constructed and the rest were not fully completed which
resulted in wastage of government funds at the advantage of some people who had a hand in
the implementation of the project and to the disadvantage of the intended beneficiaries.
It was also gathered that the beneficiaries did not receive the intended cash for work for them
as their wages to construct their own houses. Moreover, they claim that the materials were
not delivered on time and the steel bars were undersized. Short deliveries of the materials
were also noted by the beneficiaries which resulted in the non-completion of the construction
of the core shelters. Construction of the core shelters has long been stopped.
CSAP Piat It has been eight long years since the fund was released for the construction of 50 units core
Cagayan shelter houses amounting to ₱3,500,000.00; however, as of the monitoring/validation date,
only 35 units were constructed but not yet 100% completed while the remaining 15 units has
not yet started construction. Of the 35 constructed units, none was 100% completed. All of
the houses constructed were not plastered finished, not painted, no facia boards, no doors
and windows, no partitions, no electrical wirings installed, no septic tank and comfort rooms.
The units with fabricated windows were through the efforts of the owner/beneficiary in their
desire to finish their housing unit.
The present condition of the core shelters is not fit for occupancy. The core shelter site
project has no electricity and water system which should have been part of its social
preparation that hinders the owner/beneficiaries to construct their units and reside thereat as
these are the basic necessities of everyday life.
CSAP Sto. Nino, The 30 core shelter units were all constructed although not all were 100% completed as per
Cagayan plans and specifications. There were some units which have no partition walls, no doors and
windows fabricated, no fascia boards, no toilets and the electrical wirings were not installed.
As a result, the identified beneficiaries could not occupy it because of its condition. The
present residents exclaimed that the housing units were not yet awarded to them. It was also
gathered that the beneficiaries improved their units on their own in their desire to make it fit
for occupancy.
177
CSAP Tuao, A total of ₱2,100,000.00 has been released in this LGU sometime in CY 2009 or over 10
Cagayan years already for the construction of 30 core shelter units. However, the result of our
monitoring/validation is poor. The construction of the core shelter units were not in
accordance with the plans and specification of the core shelter.
The proposed 30 units core shelters were not fully constructed and completed and the
constructions have long been stopped and the project was already abandoned. Some of the
units were even damaged during typhoons Lawin and Ompong which only proved that the
constructed core shelter units were not typhoon resistant.
CSAP Sta. Maria, In CY 2011 or over eight years already, a total of ₱21,000,000.00 for the construction of 300
Isabela core shelter units in the municipality. However, it was noted that of the 300 core shelter units,
only 153 units were constructed although not fully completed and the remaining 147 units
were not yet started. The constructed core shelters has no fascia boards, no windows and
door jambs, no partitions, electrical wirings were not installed, no toilets and septic tanks, no
flooring, and the walls were not plastered finish and painted. Some of the roofings were
already damaged during the typhoons Lawin and Ompong, a proof that the constructed core
shelters were not typhoon resistant as envisioned by the Program.
Although the concrete roads have been constructed by the National Housing Authority (NHA),
there are no electricity and water systems at the CSAP sites which should have been the
counterpart of the LGU as social preparation. The site is a little bit far from the town proper
wherein the electricity and water system are very vital in the construction of the core shelters
and is a necessity in the daily lives of the intended beneficiaries.
The CSAP project has long been abandoned without any progress in construction that left the
core shelters deteriorate and not fit for occupancy. The failure in the implementation was also
attributed to poor monitoring by the Source Agency resulting to the wastage government
resources to the disadvantage of the intended recipients.
CSAP Sto. Tomas, A total of ₱1,750,000.00 was released in CY 2011 or over eight years already for the
Isabela construction of 25 core shelter units in the municipality. However, only seven units were
estimated to have been 75% constructed and some were partially constructed and the rest
were not erected.
The construction has long been stopped and the core shelter project was already abandoned,
that resulted to the non-attainment of the objective of the program and the intended indigent
beneficiaries were deprived of the benefits from the said program.
The constructed core shelters have no facia boards, no windows and door jambs, no
partitions, electrical wirings were not installed, no toilets and septic tanks, no flooring, and the
walls were not plastered finish and painted. The present condition/state of the constructed
core shelters is not fit for occupancy. Moreover, the CSAP site is a little bit far from the town
proper and no electricity was tapped and water system was installed as part of the social
preparation.
CSAP Delfin FO II released the amount of ₱21,000,000.00 in CY 2011or over eight years already for the
Albano, Isabela construction of 300 units core shelters in four CSAP sites, namely: Barangays San Juan, San
Antonio, Andarayan and Carmencita core shelters.
All core shelter units were not fully completed as per plans and specifications. Most of the
housing units were not painted, no fascia boards, some units remained unoccupied, some
core shelters were also renovated to become two storey houses and bungalows altering the
original plan of the shelter. Moreover, the core shelter units were not yet awarded to the
beneficiaries.
CSAP Mallig, The amount of ₱2,450,000.00 was released in CY 2014 or over five years already, for the
Isabela construction of 35 units core shelter houses at Barangay Rang-ayan.
178
All the 35 units were constructed although not all were fully completed as per plans and
specifications. All the constructed units have no facia boards. There were some units with
minor deficiencies such as no partitions, no electrical wirings installed and no toilets. The
beneficiaries, in their desire to occupy the units having no house to live, had gradually
improved their houses up to its present condition at the time of the validation and monitoring.
CSAP Roxas, FO II has released the amount of ₱14,000,000.00, for the construction of 200 units core
Isabela shelter houses in CY 2011 and another P14,000,000.00 in CY 2014 also for the construction
of 200 units core shelter houses in Barangays San Placido and Marcos, respectively, both of
Roxas, Isabela.
All the constructed core shelter units were noted to have no fascia boards and there were
some units which remained unoccupied. Some of the original beneficiaries had sold their
rights to other persons and the Certificates of Ownership were not yet awarded to the
beneficiaries after almost nine years in the CSAP site.
Likewise, the CSAP project in Barangay Marcos is poor and frustrating signifying that the
project fund was wasted to the disadvantage of the government and the indigent
beneficiaries, as well. The design of the core shelter units is different from the standard
design of core shelter houses of DSWD. Due to the scarcity of lumber brought about by the
strict implementation of log ban policy by the National Government, the LGU requested for a
design using concrete for walls and roof slab, which was subsequently approved by DSWD
Central Office.
All core shelters were not fully completed, and some were not yet erected. The constructed
units were roughly finished and not plastered, no window/door jambs, no partitions and
electrical wirings were not installed. Despite the condition of the core shelters, the
beneficiaries occupied their units because they have nowhere to live so that they just covered
the doors and windows with old sacks, old and crumpled galvanized iron sheets and canvass
(lona) to protect them from rain, thunderstorm and sunlight. The CSAP has a big fund for the
purpose but it apparently went to waste.
CSAP For CYs 2011 – 2014, the LGU received CSAP funds amounting to ₱33,110,000.00 for the
Cabarroguis, construction of 473 core shelters in four various core shelter sites. Of the 473 core shelter
Quirino units, 414 units were completed and awarded while the remaining 59 units were not yet fully
completed. Some were not yet erected and the construction has long been stopped.
205. In FO V, verification disclosed that the foregoing CSAP funds were released by the
agency in November 2016. Consequently, the project was expected to end by September
2017. However, out of the 200 core shelter units targeted in Sorsogon City, 94 units were
still ongoing thereby showing delays of almost two years from its target date of full
completion. The project implementation delays incurred were attributed to the following
deficiencies:
a. Irregular replacement of CSAP beneficiaries;

b. Unavailability of construction materials;
c. Improper and uncertain use of funds; and
d. Lack of electric and water facilities.
206. Material lapses have adversely affected the implementation of CSAP, thereby,
depriving displaced families on the immediate use of the shelter units, posing dangers to
them in the event of natural calamities resulting in wastage of government funds and
properties.
179
of:
a. FOs II and V to create a committee composed of officials or employees

from the DRRM, Accounting Office and Engineering Division to conduct
a thorough evaluation of the project vis-à-vis fund released and
accomplishment;
b. FO II to:
(i) determine the persons found to be liable for its non-completion and
hold them accountable and responsible for its completion as per
plans and specifications, thereafter, file of an administrative and/or
criminal and/or civil liability case against persons found to be
accountable and liable, if warranted; and
(ii) award the long completed core shelter units to the identified and
qualified beneficiaries; and
c. FO V to make representations with the LGU to remind concerned local
officials of its existing obligation under MOA to provide fund counterpart
for any shortages or need for additional construction materials to
complete the CSAP.
208. On February 6, 2020, the incumbent Regional Director of FO II received a letter

from the Municipal Social Welfare and Development Officer, noted by the Municipal
Mayor thereat to inform that through the convergence effort of the LGU in Sto Nino,
Cagayan, DSWD, Barangay Officials and CSAP beneficiaries, the Core Shelter Assistance
Project has already been completed and will be awarded on February 24, 2020.
209. FO II Management also informed us that the concerned division has been
coordinating with the concerned LGUs and NASAs for the completion of the said core
shelters.
Sustainable Livelihood Program (SLP)
210. Irregularities in the implementation of SLP Projects with significant

unaccounted and missing funds resulted in the loss and wastage of government
resources, and deprived the identified project-recipients of the maximum benefits
thereof in FO V. Also, inadequate monitoring of the projects and non-compliance
with the program guidelines in FO VII affected the effectiveness and sustainability of
17 SLP projects amounting to ₱6.891 million, thus, defeating the objectives of the
program.
211. The SLP which was first introduced in 2011 under the DSWD Admin. Order No. 11
series of 2011 provides identified poor and vulnerable families and individuals the
appropriate income-generating opportunities to help improve their level of economic
sufficiency. The program should cover Pantawid Pamilya families, engaging the family
180
member(s) who are most capable and willing to undergo the program activities to be able
to:
a. Enter into and retain his/her employment;

b. Participate in the establishment (or enhancement) and management of a group
enterprise;
c. Establish (or enhance) and manage his / her enterprise.
212. Non-Pantawid Pamilya families that are identified as poor families based on the
Listahanan may still be covered by the program. Non-Pantawid Pamilya families that are
not included in the Listahanan database of poor families may still be covered by the
program if a certificate of indigence is issued by the C/MSWDO, or if they are identified
as part of a vulnerable group (e.g. PWDs, older persons, OSYs, disaster-affected).
213. The program’s six main stages of implementation are: (1) Area Identification; (2)
Participant Identification; (3) Project Identification; (4) Project Review and Approval; (5)
Project Implementation; and (6) Monitoring and Evaluation. Stages 1 to 3 should be
considered simultaneously with the main objective of identifying the right projects at the
right place for the right participants.
214. Key implementers and co-implementers of the SLP are presented in the Table
below.
Official/Office Responsibility
City / Municipal PDO Leads the program implementation at the city- / municipal-level and the
barangay-level
Pantawid Pamilya City / Municipal Link, Closely coordinates with the PDO to be able to converge the initiatives
the KC-NCDDP Area Coordinator, and of the programs and have a more effective and efficient implementation
the KC-NCDDP Community Facilitator
Community Core Group (CCG) Barangay-based volunteer group organized to provide support to the
PDO from the identification of areas, participants, and projects until
project implementation and monitoring composed of the ff.: C/MAT,
Pantawid Pamilya Parent Leaders in the identified barangays, old SKA
Officers, Barangay Sub-Project Management Committee (BSPMC)
leaders, cooperative leaders, and Barangay Health Workers / Barangay
Nutrition Scholars. Other local community members may also become
part of the CCG.
City / Municipal Inter-Agency Provides direction and support to the city / municipal implementation of
Committee the program
Provincial Coordinator Leads program operations at the provincial level by providing support
and assistance to the City / Municipal PDOs
Regional Program Management Office Leads program operations by providing support and assistance to the
(RPMO) Provincial Coordinators and the City / Municipal PDOs
National Program Management Office Enables program operations by providing support and assistance to the
RPMO
215. In the Monitoring and Evaluation (M&E) Manual for SLP, the Regional Program
Coordinator’s (RPC) duties include assuring that the required inputs/resources are being
utilized properly, the required SLP processes are conducted and feedback on the progress
of the activities of the program are immediately communicated to the Regional Director as
181
the Project Director and Assistant Regional Director for Operations as the Program
Manager. These key officials along with other DSWD personnel/unit (M&E Officers, data
encoder, data focal, Community-Driven Enterprise Development Officer, Field PDOs, and
Regional Information and Communication Technology Unit) compose the SLP-RPMO
which is responsible for the implementation of the SLP in the entire region.
216. The same manual clearly states that the monitoring of SLP participants and SLPAs
shall cease to those who have quality livelihoods and/or jobs for two consecutive quarters,
in line with the program’s end of program outcome. For this, the involvement of partners
in the project cycle is a must for sustainability and organizational capacity building of
SLPAs should be undertaken.
a) Irregularities in the project implementation in FO V
217. During the first semester of CY 2019, we continued the validation of 41 SLP
Projects implemented in CYs 2016 and 2017 in the different municipalities of the
provinces of Albay, Camarines Sur, Camarines Norte, Catanduanes, and Masbate. The
validation included an interview with the beneficiaries, and project implementers and
ocular inspection to confirm the existence, sustainability, and functionality of the subject
program. This audit activity was also undertaken to determine whether the adoption of
cash assistance payroll (CAP) in prior years as alleged by DSWD FOV Management
facilitated the implementation of the subject program.
218. Major observations and limitations during the conduct of validation are summarized
below:
a. Implementing PDOs of the validated skills training (ST) were no longer

around for interview and confirmation. Frequent turnover of these personnel is
noted considering that they were employed by the agency on contractual status
only.
b. Payroll for the individual cash assistance was signed in full by the
beneficiaries but the whole amount was never given to them. Instead, only the
allocated cost for either of their food and transportation allowance for the
whole training duration or both was given to the participants. The cost for the
tuition, starter kits/tools, and assessment fees were allegedly collected for
payment to the training institution or supplier as identified and selected by the
implementing PDOs.
c. Beneficiaries who were usually Pantawid members never hesitated to sign the
CAP as instructed by the implementing PDO because they were afraid that
non-cooperation will cause their removal from the 4Ps.
d. The contents and quantities of the starter kits were not uniformly distributed to
the trainees. Some alleged that its actual cost is very much lower than the
estimated cost of tools/kits per proposal. Yet, no refund has been received
182
from the implementing PDO despite the expected savings on the purchased
kits. Likewise, the exact amount spent on the tools/starter kits for the validated
SLP projects cannot be accounted for. Just like in the SLP validated in the
prior year, documents such as official receipts or delivery receipts were no
longer available for confirmation. Besides, most of them no longer remember
the exact quantity and brand of tools/starter kits distributed. Some of these kits
were no longer present for the inspection.
e. Period of training was shortened from 38 to 25 days for the Skills Training on
SMAW NC I-Mercedes, Camarines Norte that the trainees were required to
work until 10 pm just to finish the training activity. The saving generated due
to this scheme is not accounted for.
f. Eight out of 41 SLP Projects that were validated were not operational due to
incomplete starter kits delivered by the implementing partner, incomplete and
different design of delivered fiberglass boat, absence of a market for the
mushrooms produced and beneficiaries believed that the greenhouse project is
not suitable to their location which is near the coastline. Some beneficiaries
claimed that the SLP projects were suggested by the PDO and not identified by
them.
g. Four SLP Projects in the Province of Camarines Norte that was granted in CYs
2016 and 2017 are not yet implemented allegedly due to missing funds and
non-availability of program participants.
h. Former implementing PDO of the Province of Camarines Norte, exceeded in

her duty by allegedly manipulating and borrowing the funds intended for the
implementation of the SLP projects in that province thus, causing the delay,
and or non-implementation of the projects, thereby depriving the beneficiaries
of the benefits they should have received.
219. The former PDO’s contract has already ended last January 1, 2019, however, the
DSWD FOV Management failed to compel her to request for clearance from
accountability before payment of her last salary in December 2018.
220. Results of cash count made to the Special Disbursing Officer (SDO) of the agency
showed that the material balance of cash advance on those SLP projects under her
accountability remains unsettled. The SDO alleged that some of the documents needed to
settle these cash advances were kept by the former PDO, who, despite verbal demands,
refused to surrender the subject liquidation documents. Detailed discussion on this issue is
presented in the concerned accountable officer’s cash examination report.
221. Adverse results of the program validation raised suspicion that the concerned
implementers including the monitoring and evaluation team had been remiss in their duties
to see to it that the program is implemented following the agency’s SLP operation manual.
183
222. Regular monitoring of these projects must have permitted responsible officials to be
aware of the issues happening in the field that should have allowed them to act promptly to
correct the same to avoid wastage of scarce government resources. Present SLP officials in
the provincial office explained that feedback reports had been made to report on the
problems encountered in the program implementation but it was not known how the top
management officials acted on the matter.
223. The use of CAPs scheme to fund the skills training that requires the mobilization of
SDOs may have facilitated the release of funds. However, it also permitted DSWD
officials to handle a significant amount of cash that is so attractive making it susceptible to
theft and misappropriation.
224. Consequently, concerned DSWD officials may be held responsible for the
irregularities noted in SLP upon findings of negligence in discharging their duties as the
program implementer.
b) Inadequate monitoring of projects and various non-compliance in FO VII
225. Field validation and inspection of 39 SLP projects in selected municipalities Cebu,
Bohol, Siquijor and Negros Oriental disclosed 17 projects which are either ineffective or
sustainability is at risk due to the noted deficiencies, thereby, attainment of the program’s
objective of actively facilitating or linking the poor households to economic opportunities
that will facilitate the transition from state of survival to self-sufficiency is not ensured.
Details of the SLP projects are as follows.
Table 28. Details of SLP Projects

Project
Modality/
Implementing Partner Cost/DSWD Status of Project
SLP Project
Grant
1 SCF-Provision of Seed Capital Boljoon Trisikad Driver’s 250,000.00 Project not implemented/ refund
Fund for Boljoon Trisikad SLPA (Boljoon, Cebu) made to DSWD-FO VII.
Driver’s SLPA
2 Skills Training (ST) on Retail Lower Becerril Pantawid 300,768.00 Project not sustained due to
Trade Management Mini SLPA (Boljoon, Cebu) loosing condition of the mini
Grocery Store grocery store.
3 CBLA-Preparation of Cambaol Farmers 339,735.00 Project not sustained due to conflict
Communal Garden and Organization/Vegetable and misunderstanding among the
Planting Corn and Mongo with Growers SLP Association members of the association.
Organic and Inorganic (Cambaol, Alicia, Bohol)
Fertilizer
4 CBLA-Establishment of LGU-Bohol 966,570.00 There was a problem in marketing
Contour Hedgerows for Ube the excess harvest of the product.
Production Beneficiaries are requesting for
provision of some farm implements
like fertilizers, seeds and farming
equipment.
5 ST ON House-keeping NC II Center for Healthcare 682,200.00 Beneficiaries have completed the
Professions Cebu, Inc. course but not all were employed.
(Siaton, Negros Oriental)
184
Project
Modality/
SLP Project
Grant
6 SCF on Production of High Janay-Janay Pantawid 540,000.00 SLP project was implemented and
Value Vegetable and Herbs in SLPA sustained despite the lack of
Greenhouse (Janay-Janay, San Jose, technical assistance from LGU. No
Negros Oriental) training/ seminar conducted before
the project started. Beneficiaries
are requesting for attendance to
training on gardening/ agriculture
and how to prepare organic
fertilizer considering the acidic
content of the soil in the area.
7 ST on Security Services Pre- Café-Gonzales Security 512,927.72 License of some program
Licensing Course cum Training Academy, Inc. participants were not yet received
Provision of Starter Kit (Manjuyod, Negros from service provider Café Security
Oriental) Services.
8 ST on Dressmaking NC II St. James Academy of 477,600.00 CARS and NC II were not yet
Skill Technology, Inc. released to 23 beneficiaries due to
(Argao, Cebu/various the far distance of St. James
barangays) Academy in Compostela, Cebu and
TESDA, Cebu City from Argao,
Cebu and the problem on
transportation fare to be
shouldered by the beneficiaries.
Six beneficiaries from Brgy.
Lingigon, Argao, Cebu were not
able to use the sewing machine
provided to them because the
machine would not operate.
Only two beneficiaries were able to
employ their knowledge in
dressmaking.
10 ST on Electrical Installation Bais City 557,200.00 Program participants completed the
and Maintenance NC II (selected barangays) course in May 2018 and
assessment was scheduled by the
service provider on June 17, 2019
in Compostela, Cebu.
Not all program participants were
able to take the assessment test
due to the venue of the exam which
is very far from their residence and
not all were provided with
transportation fare.
11 ST on Multi-Certification and Ayungon, Negros Oriental 496,875.00 Not all program participants were
Preparedness on Carpentry (selected barangays) able to take the assessment test.
NC II, Scaffolding NC II and Some program participants who
Masonry NC II for Construction have taken the assessment test
Industry Employment Batch 1 have not yet received their NC II
certificates.
12 ST on Multi-Certification and Canlaon City 79,500.00 Training was conducted in
Preparedness on Carpentry (selected barangays) February 27, 2019. Program
NC II, Scaffolding NC II and participants were not able to take
Masonry NC II for Construction the assessment test conducted in
Industry Employment Batch 2 Lapulapu City in Cebu due to
financial constraint.
185
Project
Modality/
SLP Project
Grant
Only one participant was assessed
in Canlaon City.
The service provider instructed the
participants to shoulder the
transportation expenses in going to
the venue of the assessment test in
Lapulapu City, Cebu.
Transportation expenses incurred
by the program participants to be
refunded by the service provider
upon release of funds from DSWD-
FO VII to St. James Academy.
13 ST on Electrical Installation Argao, Cebu 298,500.00 Beneficiary Mario Zamora was not
and Maintenance (selected barangays) able to take the assessment test
due to misinformation on the
schedule of assessment. He was
asked the amount of P3,500.00 by
personnel of St. James Academy
before he could be scheduled for
another assessment test.
14 SCF-Provision for Gawi Gawi Women’s Worker 480,000.00 Fund for the implementation of the
Women’s Worker SLPA SLPA project was released on June 29,
(Gawi, Oslob, Cebu) 2018 but the project has not yet
started as of the date of
evaluation/validation. Construction
of the building as counterpart of the
barangay is still on-going.
15 SCF-Carenderia of Dona Dona Aurora SLPA 250,000.00 Beneficiaries were not aware of the
Aurora SLPA (Santander, Cebu) proposed project which was
“carenderia or mini mart”. The
association had proposed a project
on “livestock raising”, but the
proposed project that was
approved was “carenderia or mini
mart” which was different from the
project proposal previously agreed
by the association thereby not
meeting the needs of the
beneficiaries.
Majority of the beneficiaries used
the money grant by the SLP
(P10,000.00 each) on ‘livestock
raising’ instead of ‘carenderia”
which is not in accordance with the
proposed project proposal
approved by DSWD-FO VII.
16 SCF-Buy and Sell of Cattle Calangahan 1 240,000.00 Cattle delivered to the beneficiaries
Sustainable Livelihood were sickly. Beneficiary was not
Beneficiaries Association able to claim insurance on the
death of one head cattle due to
beneficiary’s lack of knowledge
pertaining to the procedures in
availing insurance claims on the
186
Project
Modality/
SLP Project
Grant
death of cattle.
No briefing was conducted
regarding insurance claims in case
of death of livestock.
17 SCF-Various Micro-Enterprise Poblacion Vieja 419,053.00 Out of the 28 program participants,
Projects Sustainable Livelihood only 13 beneficiaries received the
Beneficiaries Association assistance of P15,000.00 each,
while 15 beneficiaries did not
receive said amount due to their
withdrawal and no longer interested
in the proposed project “Motorela”.
Total Project Cost 6,890,928.72
226. Presented below are the reasons noted, among others, on the failure to implement
the said projects and its sustainability not attained:
Project Present Condition Remarks

Provision for Seed Capital Fund for Only four members are left who are no longer The amount of ₱250,000.00
Boljoon Trisikad Driver’s in Boljoon, interested on the project because the had been returned by the
Cebu proposed SLP project was already outmoded said association to FO VII on
with the new motored “trisikad.” Moreover, the December 27, 2019 per OR
unit prize of the proposed “trisikad” have No. 1082245.
already increased from an estimated
₱10,000.00 per unit in 2017 to an estimated
of not less than ₱11,000.00 per unit in 2018.
Skills Training (ST) on Retail Trade The mini grocery store already stopped selling The association agreed to
Management Mini Grocery Store in due to its loosing condition. Sales on account continue the operation of the
Lower Becerril, Boljoon, Cebu estimated at ₱200,000.00 remained mini grocery store and exert
uncollected from the debtors. extra effort to collect the
The remaining inventory showed that sacks of receivables from the debtors
animal feeds were already infested with lice and partially collected
and other insects, canned sardines with expiry P16,382.00 as at December
dates on year 2021 have already started to 20, 2019.
rust while some other unsold items/goods
found in the grocery store have also started to
deteriorate and showed signs of spoilage.
SLP project in Cambaol, Alicia, The project was not successful due to
Bohol misunderstanding within the association and
conflict among its members attributed to
allegations that there was no transparency
pertaining to financial matters of the
association. The farm land being used for the
communal garden was abandoned without
plants/vegetation.
Skills training conducted by service Some of the program

provider St. James Academy of participants/beneficiaries failed to secure their
Skills Technology, Inc. NC II, which could have helped them in
applying for employment, contrary to the
provisions of DSWD Memorandum Circular
11, Series of 2014, thus, defeating the
187
Project Present Condition Remarks
effectiveness of the program.
227. Overall, the absence of regular monitoring of the program which was supposed to
be conducted by the PDOs assigned to the said projects, pursuant to the provisions
contained in the guidelines for the implementation of the SLP resulted in various
deficiencies and problems encountered by the program participants/beneficiaries.
228. We recommended that Management require the Regional Directors of:
a. FO V to:
(i) assist the officials of the SLP Associations to compel the former PDO
to account for and return the funds borrowed to continue the
project;
(ii) provide control measures that will prohibit the implementing PDOs
and PCs from manipulating the funds of the SLP beneficiaries;
(iii) review the feasibility of the SLP project being proposed by the PDO
to be implemented in the field;
(iv) reiterate the essential roles and responsibilities enumerated in the

existing DSWD SLP Monitoring Sub-Manual of the members of the
Regional Project Monitoring Office that shall ensure the success of
the program for the benefit of the less fortunate members of our
community; and
(v) conduct the investigation, and if warranted, file appropriate charges

against those responsible for the noted irregularities;
b. FO VII to:
(i) act on the identified problems encountered by the program

participants and provide the audit team with updated status of
compliance by the SLP associations with the measures undertaken
on the noted deficiencies, to ensure project sustainability; and
(ii) adhere strictly to the provisions of the guidelines on the

implementation of the SLP specifically on the regular and
continuous monitoring by concerned PDOs on SLP projects to
achieve the program’s objectives;
(iii) conduct an investigation and take appropriate action on the

deficiencies noted pertaining to SLP Skills Training Program and
188
determine whether there was any violation committed by said
service provider per contract agreement signed between St. James
Academy of Skills Technology, Inc. and DSWD-FO VII on the
conduct of assessment test to the program participants who have
completed the skills training; and
(iv) act on the problems encountered by the program participants with

regard to their failure to take the NC II assessment test and require
the service provider St. James Academy of Skills Technology, Inc. to
schedule and conduct NC II assessment test to these program
participants who have completed the course but was unable to take
said assessment test, pursuant to the contract agreement signed
between the said service provider and DSWD-FO VII.
229. FO V Management commented as follows:
a. Primary consideration of frequent turnover of personnel (Implementing PDOs)

is due to the status of employment as contractual/MOA, however, the
program’s dynamic thrusts and priorities are also the main factors.
b. A program’s re-orientation or SLPA meeting is being held prior to the release
of fund usually with the presence of Pantawid Pamilya Program’s staff and
Barangay/ Municipal officials/livelihood workers, the activity shall clarify that
the whole amount reflected on the payroll, as signed and acknowledged by the
program participants, shall be given by the SDO/paymaster. Participants
conduct procurement activities in identifying the service providers/suppliers
such as serving canvass. Hence, payment for tuition, starter kits/tools, and
assessment fees due to participant-identified service providers and suppliers
shall be done by the participants themselves without any direct intervention or
manipulation of program implementers.
c. The number of training days for a training course is derived from the minimum
number of hours that a certain training course requires, hence, modifications
may be allowed within the set standard of the training (e.g. TESDA-accredited
training course or trainers) and as agreed between and among the participants,
trainers, and program implementers.
d. Non-operational of some projects due to various factors are inevitable,

nonetheless, program implementers shall provide appropriate technical
assistance to program participants to revive and ensure the sustainability of the
livelihood projects as part of the participant mainstreaming stage.
e. Non-implemented projects due to alleged missing funds and non-availability of

program participants are currently being validated, and shall be dealt with
following program guidelines.
189
f. The unsettled cash advances of the SDO on SLP projects with allegations that
some of the documents needed to settle such accountability are being kept by
the former PDO, was neither officially reported nor acknowledged to and by
the RPMO, thus, it was the risk taken by the SDO in entrusting funds to the
PDO.
g. Feedback reports submitted by present SLP officials in the province of

Camarines Norte have been acknowledged by the RPMO and top management
officials, have acted to address the concerns such as the issuance of series of
demand letters to SDO as the accountable officer for the immediate settlement
of such accountabilities as well as the issuance of a memorandum directing her
to report to RPM Office effective 25 March 2019 to solely focus on the
settlement of her unliquidated cash advances.
230. Results of investigation were duly submitted by FO VII to the Audit Team on
February 6, 2020 and still subject for validation by the AT.
Assistance to Individuals in Crisis Situation (AICS) program
231. Financial assistance was released to the beneficiaries of AICS program by the
Social Worker and Development (SWAD) Office in Dumaguete City even if the Petty
Cash Vouchers and other required documents lacked the signatures and did not bear
the approval of proper officials, in violation of Paragraph 5, Section 4 of PD 1445,
and Section 14, Chapter 6 of the GAM for NGAs, Volume I, thereby, casting doubt
on the validity and the regularity of the transactions, and resulted in unreplenished
disbursement of the fund amounting to ₱4,630,850.00 depleting the petty cash fund
balance in the hands of the Accountable Officer (AO).
232. Paragraph 5, Section 4 of PD 1445 provides the fundamental principle that

disbursements or disposition of government funds or property shall invariably bear the
approval of proper officials. Likewise, Section 14, Chapter 6 of the GAM for NGAs,
Volume I states that “All payments shall be covered by duly approved DVs/payrolls/petty
cash vouchers (PCVs).”
233. Memorandum Circular No. 15, Series of 2014 also requires that “Financial
assistance amounting to not more that ₱5,000.00 may be released immediately in cash to
the beneficiary, duly approved by the CIU in the CO, FOs, or the provincial satellite
office.”
234. The cash examination/cash count conducted on the cash and accounts of Special
Disbursing Officer (SDO) of the SWAD in Dumaguete City showed total accountability of
P5,000,000.00 representing Petty Cash Fund (PCF) intended for the granting of financial
assistance to the beneficiaries of AICS program under FO VII. The said amount consisted
of cash on hand amounting ₱222,250.00 cash items of ₱4,630,850.00 and replenishments
amounting to ₱146,900.00 that were still pending and in process at the accounting unit of
FO VII as of the date of cash count on July 10, 2019.
190
235. Inventory of cash items conducted by the Audit Team on the cash and accounts of
the said AO on July 10, 2019 amounted to ₱4,630,850.00 that consisted of paid PCVs still
pending in the hands of the said AO that remained unreplenished due to lack of signatures
and approval of proper officials.
236. Verification of paid PCVs showed that despite the lack of signatures/approval of
proper officials, financial assistance was oftentimes released to beneficiaries of the said
program. Cash items/paid PCVs found in the hands of the SDO during the cash count
conducted on July 10, 2019 were still subject for signature/approval by the head of the
SWAD Office in Dumaguete City who was still on official travel on said date. Moreover,
there was no designated alternate signatory/approving official who could take over the
duty of signing/approving the PCVs in case of unavailability of the designated approving
officer of the said satellite office, so that releases of financial assistance to beneficiaries
could be properly done only after said PCVs are accomplished, completely signed and
duly approved by proper officials in accordance with DSWD Memorandum Circular No.
15, series of 2014.
237. The lack of signatures on paid PCVs still in the hands of the accountable officer
resulted in the accumulation of DVs amounting to ₱4,630,850.00 that remained
unreplenished as of the date of the cash count. The said amount represents 93% of the total
amount of PCF of ₱5,000,000.00 accountability in the hands of the AO. Replenishment of
PCF should have been made when disbursements reached 70% or ₱3,500,000.00 of the
total amount of PCF of ₱5,000,000.00 as required per Memorandum Circular No. 2, Series
of 2014 which states that “To ensure availability of cash in the Satellite CIU offices,
immediate liquidation shall be submitted to the Field Office (FO) when 70% disbursement
has already been achieved.”
238. Furthermore, it was also noted during the cash count conducted by the Audit Team
that replenishment of the fund totaling ₱146,900.00 had been submitted and still pending
at the accounting unit of FO VII. This represents 2.9% disbursement of the PCF
amounting ₱5,000,000.00 that is contrary to the 70% disbursement of the fund as required
per Memorandum Circular No. 2, Series of 2014.
239. The practice of releasing financial assistance to beneficiaries of the AICS without
the approval of proper officials violates the abovementioned provisions of PD 1445 and
the GAM, Volume I. Further, such practice is contrary to the guidelines set forth on the
aforesaid Memorandum Circular No. 15, Series of 2014.
240. Moreover, the accumulation of unreplenished DVs amounting to ₱4,630,850.00

depleted the PCF balance in the hands of the AO, thus, may affect the objective of the
program in providing financial assistance to individuals in a crisis situation.
191
241. We recommended that Management:
a. adhere strictly to the provisions of Paragraph 5 of Section 4 of PD 1445

and Section 14, Chapter 6 of GAM, Volume I by requiring the concerned
personnel of SWAD Office in Dumaguete City to release financial
assistance to beneficiaries only after the required PCVs have been
completed and duly approved by proper officials;
b. designate an alternate signatory/approving official who can take over the

duty of signing/approving the PCVs in case of unavailability of the
designated approving official in order to achieve continuity of the
operation of the SWAD Office in Dumaguete City; and
c. require the concerned personnel of SWAD Office in Dumaguete City to

strictly follow the provisions of DSWD Memorandum Circular No. 2,
Series of 2014 requiring replenishment when disbursement reaches 70%
on the amount of petty cash fund, in order to avoid depletion of the said
fund in the hands of the accountable officer that may affect the
sustainability on the operations of the SWAD Office.
242. The SWAD Team Leader commented that there were three existing alternate
signatories designated per Special Order No. 92-AK dated April 2, 2018, however, based
on Administrative Order No. 8, Series of 2018 or the DSWD Manual of Delegation of
Authority, only one staff who is an officer with equivalent of salary grade 15 can sign the
PCVs in the person of AO designated as SWAD Alternate Team Leader and alternate
signatory, in case the latter is not available (on official travel or on-leave). The numerous
activities like the acted referred court, jail visits, disbursement of salary of validators,
trainings/seminars attended and Social Pension pay-outs in May to July 2019 which
required the presence of the SWAD Team Leader/designated signatory, contributed to the
backlogs of unsigned PCVs and other documents. Likewise, the Alternate Team
Leader/alternate signatory was also equally occupied due to her caseload and activities.
243. Moreover, the Team Leader of SWAD-Negros Oriental replied that due to its
geographic location and the risk in bringing cash from FO VII, SWAD-Negros Oriental
requested for a cash advance of ₱5,000,000.00 under the accountability of the AO, which
can be fully utilized due to the increasing demand of clients seeking financial assistance.
They plan to liquidate the amount of ₱4,630,850.00 instead of requesting replenishment
pending consultation from Management. Hence, the petty cash disbursement vouchers
dated May 10, 2019 onwards were not forwarded to DSWD-FO VII for replenishment.
244. The aforesaid reply of Management on the audit recommendations had been
validated by the Audit Team; however, monitoring of Management’s continuous
compliance with the abovementioned audit recommendations will still be made by the
Audit Team.
192
Infrastructure project
245. Various completed infrastructure projects in FO 1 with an aggregate amount

of ₱28,779,360.51 remained unutilized and one (1) project amounting to
P4,707,653.05 remained incomplete exceeding the delivery date specified in the
contract, which is not in compliance with Section 2 of PD 1445, which in effect could
give an impression that the objectives of the programs and projects related thereto
were not fully achieved.
246. Section 2 of PD 1445 mandates that: Section 2. Declaration of Policy. It is the

declared policy of the State that all resources of the government shall be managed,
expended or utilized in accordance with law and regulations, and safeguard against loss
or wastage through illegal or improper disposition, with a view to ensuring efficiency,
economy and effectiveness in the operations of government. The responsibility to take care
that such policy is faithfully adhered to rests directly with the chief or head of the
government agency concerned.
247. Records showed that ₱28,779,360.51 worth of building and structures were built
and completed but were not yet utilized despite their completion.
248. In the inspection conducted, it was noted that these buildings and structures were
idle despite their completion and availability for occupancy. Being so, it would give the
impression that these were constructed despite the absence of a well-planned and specific
purpose which could have included a target table when this can be in full operation and
beneficiaries already identified. It could not be avoided to conclude that there might have
been certain lapses in the proper coordination among the involved divisions, which could
have jeopardized the whole operation and consequently affecting the achievement of
DSWD’s mandate.
249. In addition, Construction of Sheltered Workshop Building, Regional Rehabilitation

Center for the Youth (RRCY) Bauang, La Union which was started on January 29, 2018
and with contract duration of 185 days remained incomplete.
250. As the exposure of the buildings to wear and tear or deterioration is inevitable, it
would seem that resources were not efficiently and effectively utilized, aside from the fact
that it defeated the purpose for which these were constructed; hence, is not compliant with
Section 2 of PD 1445.
251. We recommended and Management agreed to require the Regional Director of

FO 1 to strictly adhere to the mandate provided under Section 2 of PD 1445,
requiring that all resources of the government shall be managed, expended or utilized
in accordance with law and regulations, and safeguarded against loss or wastage
through illegal or improper disposition, with a view to ensuring efficiency, economy
and effectiveness in the operations of government. In adherence to this, Management
is required to ensure that proper planning, study and assessment be made prior to
the implementation and execution of a particular project.
193
252. Management commented that the absence of a fire exit caused delays in the
occupancy of Sheltered Workshop as DSWD cannot avail an occupancy permit.
253. With regards the Records Building, DSWD is trying to secure a building permit.
254. MOA could not be finalized for the Home of the Elderly because of issues on the
terms of occupancy on the lot based on the prerogative of the Governor.
255. As a rejoinder, we maintain that Management must secure the required

documents/permits.
Risk Resiliency Program-Climate Change Adaptation and Mitigation (RRP-CCAM)
256. Various deficiencies were noted in the implementation of RRP-CCAM in FO

XIII which includes: (a) sustainability of program activities not ensured; (b)
inequitable program fund allocation; (c) incomplete documentation to support the
validity and regularity of claims; (d) absence of project timelines and financial
reporting requirements; (e) inconsistent photo documentation of program activities;
and (f) inappropriate project area for program activities primarily due to the
absence of specific program guidelines for uniformity of implementation; hence,
defeating the sole purpose and objective of the program.
257. Republic Act No. 10121 or the Philippine Disaster Risk Reduction and
Management (DRRM) Act of 2010 mandates the strengthening of disaster management in
the Philippines.
258. Likewise, the National Climate Change Action Plan (NCCAP) in 2011 provides the
long-term roadmap for climate action for reaching its two ultimate outcomes: (i) enhanced
adaptive capacity of communities, resilience of natural ecosystems and sustainability of
built environment to climate change, and (ii) successful transition towards green growth.
259. The Climate Change Adaptation and Mitigation- Disaster Risk Reduction (CCAM-
DRR) Roadmap has the overall goal of establishing climate and disaster-resilient
communities supporting equitable and sustainable development.
260. As aligned to the roadmap of inclusive growth and poverty reduction, DSWD
implements the RRP-CCAM to strengthen the resiliency of both natural systems and the
urban built environment as well as the adaptive capacities of vulnerable groups and
communities to short and long-term risks through CASH-FOR-WORK (CFW) modality.
261. In CY 2019, a total of ₱116,455,170.00 have been allotted for the beneficiaries of
the program in FO XIII intended for the 58 municipalities and over 48,563 beneficiaries
for the entire Caraga Region. Moreover, an additional allotment amounting to
P5,500,800.00, intended for the implementation of RRP-CCAM thru Cash-for-Work
program was released by DSWD Central Office to the region on October 2019 which
brought the total program fund to ₱121,955,970.00.
194
262. DSWD Central Office has not yet issued a specific and standard guideline on the
implementation of RRP-CCAM Program, instead, the agency anchored its project
implementation on the available guideline for CFW which is the DSWD Administrative
Order (AO) No. 15 s. of 2008.
263. The salient points in the project implementation in reference to the above-
mentioned DSWD Administrative Order were stated in the Memorandum of the OIC-
Secretary dated February 9, 2018, with the subject: Risk Resiliency Program thru Cash-
For Work Projects and Activities for Climate Change Adaptation and Mitigation-Disaster
Risk Reduction.
264. Moreover, as a result of a series of consultation meetings and workshops on the

implementation of CFW under RRP-CCAM, Memorandum from DSWD Central Office
was issued on July 2, 2019 to DSWD FOs, bearing the subject: Clarification on the
Implementation of the Cash for Work under the RRP-CCAM and Disaster Risk Resiliency
for CY 2019. However, based on information given by the Focal Person of RRP-CCAM,
the above-mentioned memorandum is not yet effective or implementation thereof was held
in abeyance.
265. The absence of specific program guidelines resulted in the following deficiencies:
a) sustainability of program activities not ensured
266. The following RRP-CCAM CFW activities lack the long-term sustainability and
impact in addressing Climate Change Adaptation, Mitigation and Disaster Risk
Reduction as most of the activities implemented have only temporary or short-term
impact, thereby defeating the purpose of alleviating the plight of the poor and
vulnerable communities from the long-term impacts of climate change:
a. Environmental protection and preservation such as tree planting / reforestation,

coastal clean-up, others;
b. Support to construction or repair of small scale community infrastructures such
as irrigation canals, deep well or water system, pit drainage, water reservoir,
others;
c. Food security intervention such as communal gardening, agricultural
production, others; and
d. Other climate and disaster mitigation and preparedness activities.
267. Likewise, per unnumbered memorandum of the OIC-Secretary dated February 9,

2018 addressed to the Regional Directors of DSWD Field Offices, it stated that CFW
encourages projects and activities with long-term impacts on the development of the
physical and natural assets of the recipient-communities which may include but not limited
to the following:
195
a. Mitigation and preparedness measures such as but not limited to sustainable
communal gardening, fleet farming, rehabilitation of mangrove plantation, tree
planting or reforestation, carbon sequestration;
b. Rehabilitation and/or repair of small scale community infrastructures such as
but not limited to slope protection, desilting of waterways; and
c. Projects and activities implemented by other government agencies such as the
DENR, DA, etc. requiring CFW support to climate change adaptation and
mitigation & risk reduction.
268. Although there are given types of projects/activities stipulated in the memos, there
are no specific parameters set, to clearly and properly define the scope and limitations for
DSWD RRP-CCAM CFW activities for implementation and to avoid projects/activities
not geared towards RRP-CCAM.
269. Given the fact that majority of the types of CFW activities implemented by DSWD-
FO XIII for RRP-CCAM were mostly communal gardening and clean-up undertakings, it
appeared that these RRP-CCAM CFW activities lack the long-term sustainability and
impact in addressing Climate Change Adaptation, Mitigation and Disaster Risk Reduction
mainly because these types of activities have only temporary or short-term impact and
could not continually support the adaptive capacities of vulnerable groups and
communities in terms of food security (for communal gardening) and protection from
climate-induced disasters (clearing/de-clogging/cleaning activities), if not properly and
regularly maintained.
270. DSWD should rather give priority in supporting CFW to target LGUs/NGAs with
protective and disaster-resilient projects that would lead to the achievement of measurable
outcomes. Community defined projects/activities that are sustainable in nature and give
impact reduction in the loss of life due to climate related risks; reduction of damage to
property/physical assets through prioritized protective and resilient infrastructures like: (1)
construction or rehabilitation and/or repair of small scale community infrastructures; (2)
environmental protection and preservation such as tree planting and other disaster
mitigations and preparedness activities specified/approved by DENR.
b) inequitable program fund allocation
271. Dinagat Islands, which is among the third potential priority province in Caraga
Region susceptible to multiple climate hazards and poverty incidence was given the least
budget allocation of only ₱14,044,800.00 or 12% of the total ₱121,955,970.00 RRP-
CCAM budget allocation for CY 2019, thereby defeating the purpose of equitably
addressing the adverse impact of Climate Change Adaptation, Mitigation and Disaster
Risk Reduction in identified potential priority provinces.
272. However, Dinagat Islands which is the third most potential priority province in
Caraga Region based on susceptibility to multiple climate hazards, poverty incidence, and
government priority was given the least priority in terms of program fund allocation, as
follows:
196
Actual
Potential
Budget Additional TOTAL Budget
Provinces Budget % Priority
Allocated Allotment ALLOCATION Allocation
Provinces
Rank
Surigao del Norte 34,108,800.00 1,440,000.00 35,548,800.00 29% 1ST 1ST
Surigao del Sur 32,193,600.00 2,174,400.00 34,368,000.00 28% 2nd 2nd
Agusan del Sur 20,064,000.00 - 20,064,000.00 16% 3rd

Agusan del Norte 16,043,970.00 1,886,400.00 17,930,370.00 15% 4th
Dinagat Islands 14,044,800.00 - 14,044,800.00 12% 5th 3rd
Total 116,455,170.00 5,500,800.00 121,955,970.00 100%
273. While it is considered that the region could cover other areas apart from the
identified three provinces, budget allocation should have been proportionately allocated
and the top three provinces should have been given utmost budget priority among others.
274. As a result, the purpose of addressing the adverse impact of Climate Change
Adaptation, Mitigation and Disaster Risk Reduction in most identified potential priority
provinces was defeated.
c) incomplete documentation to support the validity and regularity of claims
275. Claims for projects and activities were not supported with complete and proper
documents; and existing requirements on enrolment and fund liquidation were not
consistently applied upon and submitted to the Audit Team for review, contrary to Section
4(6) of PD 1445, thus, regularity/validity of the claims and accountability on the
preparation and verification thereof could not be readily established.
276. Section 4(6) of PD 1445 provides that claims against government funds shall be
supported with complete documentation.
277. Review of existing guideline on Risk Resiliency Program thru Cash-For Work
Projects and Activities for Climate Change Adaptation and Mitigation-Disaster Risk
Reduction disclosed that the DSWD Central Office unnumbered memorandum dated July
2019 and DSWD-FO No. XIII Regional Interim Guidelines regarding RRP-CCAM have
different documentary requirements upon enrolment in the program and liquidation
thereof, as follows:
DSWD Central Office Requirement DSWD FO XIII Requirements

1. Project Proposal submitted and signed by 1. Specific Implementation Agreement (SIA)- signed by
the LCE or designated alternate officer and the DSWD RD and LGU/Municipality LCE;
recommended for approval by the
Chief/Head of the Disaster Response 2. Project Proposal - signed by LCE or designated
Management Division (DRMD) and for alternate officer (LSWDO) and recommended for
approval by the Regional Director (RD). approval by the Chief of Disaster Response
Management Division and for approval by the RD
2. Master List of Beneficiaries shall be
197
certified and signed by the LCE or 3. Master List of Beneficiaries - certified and signed by
designated alternate officer (Local Social the LCE or designated alternate officer, recommending
Welfare Development Office Head), approval by DRRMD Head and approved by RD;
recommended for approval by the DRMD
Head and approved by the Regional 4. Sangguniang Bayan Resolution (SBR) - a resolution
Director. authorizing the LCE to sign the SIA/MOA with DSWD for
the implementation of RRP-CCAM thru CFW;
5. Pictures of areas in the barangay to be work
3. Signed Cash Assistance Payroll (CAP); 6. Cash Assistance Payroll;

and
7. Time Tally Sheets;
4. Photo documentation of the community
works undertaken before, during and after 8. Photo documentation of the community works
the project implementation. undertaken during and after the project;
9. Work Accomplishment Report.
278. We recognize the stringent enrolment and payout/liquidating documents required in

the Regional Interim Guidelines issued by the FO XIII compared to the documentary
requirements per Memo from DSWD Central Office issued on July 2, 2019. But the same
was not put into effect for its inconsistent application and non-attachment of the
documents to the claims submitted for audit.
279. The foregoing gap is contrary to Section 4(6) of PD 1445, thus, regularity/validity
of the claims and accountability on the preparation and verification thereof could not be
readily established.
d) absence of project timelines and financial reporting requirements
280. The Regional Interim Guidelines as well as the Specific Implementation Agreement
between the DSWD and the implementing LGUs have no provisions on the timelines of
project implementation, project ownership and maintenance requirement, as well as, the
financial reporting requirements of infrastructure projects, inconsistent with Section 2 of
the PD 1445, thus, undermining the timely implementation and sustainable objectives of
the projects, which also resulted in the non-recognition of the labor cost component of the
project.
281. It is the declared policy of the State that all resources of the government shall be
managed, expended or utilized in accordance with law and regulations, and safeguard
against loss or wastage through illegal or improper disposition, with a view to ensuring
efficiency, economy and effectiveness in the operations of government. The responsibility
to take care that such policy is faithfully adhered to rests directly with the chief or head of
the government agency concerned.
282. Review of the Specific Implementation Agreement (SIA) between the DSWD and
the implementing LGU showed that it has no indicated specific timelines. Although it is
198
known that the CFW is a 10-day maximum period activity, still, the need to clearly
stipulate the total duration of the activities from the time of enrolment documents
preparation up to the submission of required documents before and after program
implementation is essential, in order to have an efficient program implementation.
283. Likewise, the SIA did not include the important sustainability aspect of the RRP-
CCAM program/activities. No mention on who is responsible in maintaining the same as
well as the fund allocation for the maintenance.
284. Moreover, the important financial reporting policies/requirements as well as the

project ownership after the completion of the small scale infrastructure projects which
should have been in place to ensure the effective and efficient program implementation
were not specifically stated.
285. The foregoing gap is inconsistent with Section 2 of the PD 1445, thus, undermining
the timely implementation and sustainability of the projects, which also resulted in the
non-recognition of the labor cost component of the project.
e) inconsistent photo documentation of program activities
286. Most of the pictures presented supporting the Cash for Work claims were not
consistent as to the area point taken before, during and after of work undertaken indicating
that monitoring controls including inspection and documentation of work accomplished
were not in place or not working contrary to Section 124 of PD 1445, thereby, casting
doubt on the reliability of the pictures presented and validity of the claims paid.
287. It shall be the direct responsibility of the agency head to install, implement, and
monitor a sound system of internal control.
288. Internal control is the plan of organization and all the coordinate methods and
measures adopted within an organization or agency to safeguard its assets, check the
accuracy and reliability of its accounting data, and encourage adherence to prescribed
managerial policies.
289. Random verification of the pictures kept at the RRP-CCAM office pertaining to the
CFW activities showed that most were just taken at any forms/angles of the areas or
activity site in the barangay. There is no consistent view area taken during and after
implementation to be compared with the pictures taken before CFW activities were started,
thereby defeating the purpose of documenting the daily progress of activities conducted by
the beneficiaries.
290. Although it was recently informed by the focal person of RRP-CCAM that in their
latest orientation conducted with the implementing LGUs, they now require that photo
documentation to be submitted has to be taken at vantage point, still, the reliability of the
prior CFW activities particularly those that were not inspected and monitored by the
199
Project Development Officers (PDOs) due to numerous areas being handled, would be
difficult to establish.
291. On the other hand, it was found out that the pictures taken during implementation
have no specific dates to properly identify the daily documentation of the CFW activities
being done.
292. While written documentation will always be an important part of reporting, a visual
record of progress done thru photo documentation is equally very important, as it gives the
visual tracking progress and problems on any stage of project /program/activities
implementation.
293. Furthermore, the pictures and even the Time Tally Sheets and Work
Accomplishment Reports could not be exclusively identified as DSWD-RRP-CCAM
projects as the same were not indicated on the face of every page, for distinct identification
purposes.
294. The foregoing gap is contrary to Section 124 of PD 1445, thereby casting doubt on
the reliability of the information presented and validity of the claims paid.
f) inappropriate project area in the conduct of program activities
295. The lack of a certain valid land document requirement and the lapse in the
identification of appropriate area for project implementation due to inadequate/absence of
thorough coordination with the right authorities during planning stage, lead to a CFW
activity in a privately-owned lot, thereby defeating the purpose of the RRP-CCAM
program that consequently resulted to a waste of government funds.
296. Planning is very important for an effective and efficient implementation of every
project/program/activity, irrespective of its size, type and objectives. It facilitates proper
coordination and it helps in taking the necessary precautions to avoid or reduce possible
risks.
297. CFW activity located in Barangay Colorado Purok 4, Jabonga, Agusan del Norte
revealed that a privately owned lot was used for RRP-CCAM CFW activities, particularly
for a communal garden. The said area has been vacant long before and they thought that
the same was qualified for CFW activities. However, months after the CFW activity had
started in 2018, it was later used by the owner and was constructed with their house.
298. The absence of a valid land document requirement and the lapse in the
identification of appropriate area for implementation due to inadequate/absence of
thorough coordination with the right authorities during planning stage lead to a CFW
activity in a privately-owned lot, thereby defeating the purpose of the RRP-CCAM
program that consequently resulted to a waste of government funds.
200
299. We recommended and Management agreed to require the FO XIII Regional
Director to:
a. make representations with the Central Office to hasten the issuance of a

specific program guidelines intended for the RRP-CCAM for uniformity
of implementation which should include project specifications (menu) and
parameters to avoid projects/activities not geared towards RRP-CCAM
and for easy guidance to all implementing agencies and LGUs;
b. ensure that the proposed projects/activities of the implementing LGUs are

anchored and link to their Local Climate Change Action Plan (LCCAP)
by requiring the proponent LGUs to submit the same prior to project
approval. Also, conduct thorough evaluation of the proposed
projects/activities together with supporting documents before its approval
to ensure sustainability and attainment of RRP-CCAM objectives and
outcomes;
c. ensure equitable budget allocation based on the most identified priority

provinces susceptible to multiple climate hazard and poverty incidence.
Consideration should particularly focus on municipalities and barangays
in the identified provinces with historical high incidence of disaster
hazards;
d. observe uniform application of documentary requirements for its RRP-

CCAM transactions; and ensure that claims against government funds are
supported with complete and properly signed documents that would
establish validity/ regularity, and exact accountability on RRP-CCAM
cash advances and liquidation transactions;
e. enhance the SIA by providing salient information such as timelines of

project duration and the specific provisions on the maintenance of
projects/activities implemented in order to achieve its sustainability and
impact in addressing issues on Climate Change Adaptation, Mitigation
and Disaster Risk Reduction;
f. include in the issuance of program guidelines the provision on the

financial reporting requirements and project ownership of completed
infrastructure projects;
g. require the PDOs to strictly ensure that pictures are to be taken (before,
during and after) at vantage point to ensure clear and proper
documentation of community work activities. Likewise, require the
indication of specific dates on the pictures taken, to validate the daily
work output/activities done. For best monitoring controls, geo-tagging of
projects/activities is highly recommended;
201
h. require the DSWD logo to be indicated in every page of the documents for
control purposes and to avoid the use of documents/pictures for other
intent/purposes; and
i. conduct an adequate planning and coordination with the appropriate

authorities in the identification of project location and require the project
beneficiaries a valid land document or a certification from the
appropriate office for RRP-CCAM projects to ensure a publicly owned
land and to avoid waste of government funds.
Idle/Unutilized Inventory for Distribution
300. A total of 395 units of serviceable mobile phones with undetermined value that
were returned by the end-users in FO VII, remained unused and left idle at the
Supply and Property Unit, thus, exposed to the elements that could cause rapid
deterioration/damage thereof and may result in the waste of government resources if
continued to be unutilized, contrary to the provisions of Section 2 of PD 1445.
301. Section 2 of PD 1445 states that “It is the declared policy of the State that all
resources of the government shall be managed, expended and utilized in accordance with
law and regulations, and safeguarded against loss or wastage through illegal or improper
disposition, with the view of ensuring efficiency, economy and effectiveness in the
operations of the government. The responsibility to take care that such policy is faithfully
adhered to rests directly with the chief of the government agency concerned.”
302. Several mobile phone units were acquired by FO VII in CY 2015 from the Regional
Project Management Office (RPMO) of KC-NCDDP in Central Office intended for use in
KC-NCDDP operations. Review and verification, however, of the Inventory Report on
Cellphone Distribution showed that there were 395 units of serviceable mobile phones
found at the Supply and Property Unit that were unused and left idle. These mobile phone
units were returned to the Supply and Property Unit by the end-users who have resigned
from the service or whose contract of service have already ended and was not renewed or
rehired by Management.
303. As of this report, the 395 mobile phone units were reported to be still serviceable
and these are kept in the Supply and Property Unit. If these remain idle and unused for a
long time, said units being exposed to the elements will deteriorate which may cause
damage thereto, thus, resulting in waste of government resources.
304. We recommended and Management agreed to require the FO VII Regional

Director to take appropriate action with regard to the utilization of the 395 units of
cellular phones, and institute necessary measures to prevent the rapid deterioration
and damage of said cellphone units, so that these could be used for its intended
purpose, and adhere strictly to the provisions of Section 2 of PD 1445.
202
305. The 395 units of serviceable mobile phones were already secured and transferred by
assigned personnel of the Supply Unit to a safe location free from elements that would
cause rapid deterioration/damage.
306. Inspection and validation on the aforesaid Management’s action had been made by
the Audit Team. However, with regard to the utilization of the said 395 units of
serviceable mobile phones, the Audit Team will continue to monitor Management’s action
and full implementation of the audit recommendation.
Unutilized/lapsed NCA and NTA
307. Of the total cash allocation for five (5) DSWD offices of ₱98.834 billion
received during the year, 95.35 percent or ₱90.423 billion was utilized/disbursed
while the remaining undisbursed balance of 4.65 percent or ₱4.411 billion were
automatically reverted to the BTr pursuant to DBM Circular Letter No. 2019-3.
308. Section 2.1 of Department of Budget and Management (DBM) Circular Letter No.
2019-3 dated January 4, 2019 provides that effective January 3, 2019, the validity of
Notice of Cash Allocation (NCA) credited to Regular MDS sub-accounts for any month,
whether part of the comprehensive releases or constituting additional NCA releases, shall
continue to be valid until the last working day of the 3rd month of that quarter covered.
NCAs released during the quarter, e.g., February and March, shall be valid up to March
31, etc.
309. Section 2.3 of the same DBM Circular Letter also provides that all NCA balances at
the end of each quarter are considered lapsed after the last working hour of said quarter.
310. Report of NCA receipts and disbursements in CY 2019 disclosed lapsed NCAs
under the regular and special MDS Account in the following DSWD offices:
Table 29. Summary NCA Receipts, Disbursements and Balances

Balance/Reverted
Office NCA/NTA Received Disbursements % of Unutilized
to BTr
CO ₱85,746,578,522.47 ₱ 82,109,998,391.40 ₱3,636,580,131.07 4.24
CAR 1,649,454,066.40 1,585,527,186.58 63,926,879.82 3.88
IVB 2,293,099,946.94 1,784,292,945.58 508,807,001.36 22.19
XI 1,499,829,381.67 1,494,615,285.68 5,214,095.99 0.35
XII 3,645,557,214.06 3,449,035,447.62 196,521,766.44 5.39
Total ₱ 94,834,519,131.54 ₱ 90,423,469,256.86 ₱4,411,049,874.68 4.65
311. Reasons cited for the reversion of unutilized NCA were as follows:
Office Reasons for Reversion of Unutilized NCA

CO It may be recalled that the Fiscal Year 2019 General Appropriation Act was only signed by
President Rodrigo Roa Duterte on April 15, 2019 and was published in the Official Gazette on
April 29, 2020. On May 2, 2020, the National Budget Circular 577 issued by the DBM laid the
Guidelines on the Release of Funds for FY 2019
203
The delay in the issuance of the GAA and other factors affected the timely implementation of the
Department’s PAPs.
CAR The unutilized cash allocation consisted of ₱32,084,462.26 refunds from unutilized cash
advances attributed to:
-Beneficiaries from the typhoon-affected areas are unable to attend pay out schedules
-Replacement of beneficiaries
Reasons for low disbursements were noted from accomplishment reports and justifications as
follows:
- delayed approval and release of GAA 2019
- delayed procurement due to failure of bidding and time constraint
- less staff to implement and monitor the project as no fund transfer to LGUs is allowed
- validation resulting in the decrease of actual beneficiaries
- savings
- undelivered services
- late download of authority to hire personnel
- election ban
- less calamity less disbursement in respect to “Quick Response Fund”
The composition of the amount reverted were for the maintenance and other operating
expenses of various projects.
IVB Very low utilization on the implementation of Supplementary Feeding Program (SFP) and Social
Pension for Indigent Senior Citizen (SocPen) ranging from 53.44 to 99.72 percent unutilized
fund.
SFP - The under-utilization of the SFP was caused by the late orientation on the new
implementation scheme of SFP based on the DSWD Memorandum Circular No.3, series of
2019 which was only disseminated by the end of March 2019 followed by the release of new
template of MOU last April 2019. Based on the Memo, the DSWD FOs will act as the Procuring
Entity of the items, however, procurement process was not commenced immediately because of
the delayed compliance of the LGUs on their requirements due to election ban last May-June
2019. Out of 73 municipalities and cities in the MIMAROPA region, only 59 LGUs submitted
their requirements wherein only 30 LGUs have been successfully awarded to the winning bidder
and the rest was resulted to failure bidding due to lack of qualified suppliers/bidders.
SocPen - The reason behind the low utilization of the said program was because of the
presidential directive they received during the last quarter of 2018 to clean the list of Social
Pension database in lieu of the inclusion and exclusion errors raised by the other sectors. With
this, they conducted a house-to-house validation, however several challenges were faced by
them such as lack of resources (staff, funds, equipment), frequent amendment of validation
forms and SPIS offline version, late downloading of funds and authority to hire validators and
encoders and late downloading of data results as well as inaccuracy of cleansing at the Central
level, thus validation was completed in May 2019. Also, provision of stipend to the validated
beneficiaries started only upon receipt of data results from the mother bureau (Program
Management Bureau), however, data results were received from June 12 to December 15, 2019
and they need at least five working days to crosscheck the downloaded data to lessen or make
sure there were no duplicates or discrepancies on data. Additionally, the limited number of
Special Disbursing Officers (SDOs) was also a factor though the request bondage fund for the
upgrading and additional SDOs was approved still they cannot solely use them as there were
other programs which need SDOs.
XI The amount of ₱4,094,666.24 or 78.53% of the reverted amount was sourced from the Quick
Response Fund (QRF) program which is part of issued NTA dated November 25, 2019. The
NTA is intended to purchase family food packs and non-food items and for the operational
204
expenses of disaster relief operation in response to the 6.6 magnitude earthquake in Davao del
Sur area.
On the other hand, the amount of ₱1,109,211.00 lapsed NTA represents transfer fund from
DSWD CO on December 20, 2019 intended for the conduct of 2019 Nationwide Survey on the
Nature and Extent of Drug Abuse in the Philippines. The Cash Unit, however, explained that the
Notice of Fund Transfer was only received last January 2, 2020 and the in-charge of Pantawid
Pamilyang Pilipino Program was not aware of it.
The remaining P10,218.75 was intended for the Formulation & Development of Plans and
Policies Program for the payment of food and accommodation during the conduct of Learning
Exchange Forum with Media Practitioner. It was not utilized by the program in-charge because
the amount is intended for the payment of taxes.
XII Of the reverted amount, ₱3,229,442.85 represents cancelled/stale checks. Those staled in the
hands of the Cashier were due to payee’s names that were misspelled/different from the bank
account registered names. There were also checks in the custody of the payees not presented
in the bank.
Contributory to the reversion of the cash allocation was the delayed implementation of
programs/projects/activities of the agency.
312. The lapsed NCAs signified that the agency was not able to fully utilize the cash
released for a given quarter based on the Monthly Disbursement Program (MDP) of the
agency. This indicates that there may be programs/projects/activities of the DSWD that
may not be implemented or commitments already served or rendered but still unpaid.
313. Moreover, lapsing of significant amounts of cash allocations indicated that there
was inefficient cash management as available cash were not utilized due to lapses in
planning and programming of activities for the programs, thus, depriving the beneficiaries
of the benefits that could have been derived therefrom.

of the concerned FOs to ensure that programs, projects and activities are ready for
implementation upon the release of the allocated funds; and install budget
performance tracking system to monitor the utilization of allotments in order to
prevent the lapsing of cash allocations.
241. Management commented as follows:
Office Management Comment

CAR Management will stringently monitor its utilizations based on the work and financial plans and its
corresponding Monthly Disbursement Plans.
Management also commented that the bulk of unutilized cash allocation was the release of fund for the
SOCPEN for the 3rd quarter. The late download of the cleansed master list from the CO also contributed
to the unutilized SOCPEN fund. Likewise, replacement for senior citizens who died will still be validated
in the national level. Moreover, the targeted beneficiaries as basis for the download of the fund come
from the CO instead of the FO.
XII Bulk of the amount was contributed by the Social Pension Program’s low utilization of funds vis-a-vis
their approved MDP due to the conduct of data cleansing or revalidation of all beneficiaries which started
on May to June 2019. In compliance with the DSWD Secretary directives, the basis of the payroll
205
generation should be the cleansed data from the Central Office, thus, FO XII could not proceed with the
conduct of payout without the cleansed data. The first batch of the clean list downloaded to FO XII was
on June 2019, thus, cash allocation for the first quarter was not utilized. Succeeding batches of clean
lists were downloaded only on July to September 2019 but out of the 131,991 submitted validated list,
only 114,294 were clean, therefore, allocation for the third quarter was not fully utilized which resulted to
the reversion of cash allocation to the BTr.
Expenditures incurred not in accordance with prescribed rules and regulations
315. Disbursements amounting to ₱6.670 million in three (3) DSWD offices are
either not supported with complete documentary requirements or did not comply
with the established rules, procedural guidelines, policies, principles or practices
resulting in the incurrence of irregular, unnecessary and excessive expenditures.
316. Section 12.13 of COA Circular No. 2012-003 dated October 29, 2012 further states
that COA adheres to the policy that government funds and property should be fully
protected and conserved, and that IUEEU expenditures or uses of such funds and property
should be prevented.
Table 30. Definition of different types of IUEEI Expenditures

Type of
Definition per COA Circular No. 2012-003
Expenditure
Irregular The term "irregular expenditure" signifies an expenditure incurred without adhering to
Expenditure established rules, regulations, procedural guidelines, policies, principles or practices that
have gained recognition in laws. Irregular expenditures are incurred if funds are disbursed
without conforming to prescribed usages and rules of discipline. There is no observance of
an established pattern, course, mode of action, behavior, or conduct in the incurrence of an
irregular expenditure. A transaction conducted in a manner that deviates or departs from, or
which does not comply with standards set is deemed irregular. A transaction which fails to
follow or violates appropriate rules of procedure is, irregular.
Unnecessary The term pertains to expenditures which could not pass the test of prudence or the diligence
Expenditure of a good father of a family, thereby denoting non-responsiveness to the exigencies of the
service. Unnecessary expenditures are those not supportive of the implementation of the
objectives and mission of the agency relative to the nature of its operation. This would also
include incurrence of expenditure not dictated by the demands of good government, and
those the utility of which cannot be ascertained at a specific time. An expenditure that is not
essential or that which can be dispensed with without loss or damage to property is
considered unnecessary. The mission and thrusts of the agency incurring the expenditures
must be considered in determining whether or not an expenditure is necessary.
Excessive The term "excessive expenditures" signifies unreasonable expense or expenses incurred at
Expenditure an immoderate quantity and exorbitant price. It also includes expenses which exceed what
is usual or proper, as well as expenses which are unreasonably high and beyond just
measure or amount. They also include expenses in excess of reasonable limits.
Extravagant The term "extravagant expenditure" signifies those incurred without restraint, judiciousness
Expenditure and economy. Extravagant expenditures exceed the bounds of propriety. These
expenditures are immoderate, prodigal, lavish, luxurious, grossly excessive, and injudicious.
Unconscionable The term • · unconscionable expenditures" pertains to expenditures which are
Expenditure unreasonable and immoderate, and which no man in his right sense would make, nor a l~1ir
and honest man would accept as reasonable, and those incurred in violation of ethical and
moral standards.
206
317. In CY 2019, payment of transactions amounting to ₱6,670,926.00 were considered
irregular, unnecessary and excessive expenditures.
Table 31. Payment transactions not supported and/or considered IUEEU

Laws, Rules and
Office Account Affected Nature of Transaction Regulations Amount
Violated
Unnecessary Expenditures
II Training Expense Training and Seminars could have been Section 4.1 of COA Not provided
significantly reduced had the Agency Circular 2012-003
refrained from providing unnecessary
meals and accommodation to its local
employee-participants
PM snacks and dinner on the last days

of trainings were still provided, even if
the program of activities shows that the
training/seminar or conference was up
to 12:00 noon only. Moreover, dinner
and accommodations were also
provided during the conduct of
trainings/seminars even if the session
ends at 5:00 PM and no activities
undertaken or conducted at night to
warrant the provision of
accommodation to its participants. It
was also observed that even the
participants who are also DSWD
employees and reside within the same
locality as the training venue were
provided with dinner and
accommodations. Furthermore, the
program of activities shows that there
were no evening activities to warrant
the provision of dinner and
accommodations to participants who
live within the locality
Irregular Expenditures
IVB Telephone Procurement of cell cards through DSWD 5,339,401.54
Expenses-Mobile public bidding and Small Value Administrative Order
Procurement not in accordance with the (AO) No.13, s. 2018
prescribed mode in the grant of cell
card allowance. Memorandum dated
Distribution of cell cards to August 15, 2018 702,188.26
employees/users who were not issued by the
mentioned in the DSWD AO: Assistant Secretary
• ₱17,681.46 load allocations given to from the Office of the
employees who were resigned, Undersecretary for
AWOL and/or leave during the year; GASSG
• Several employees received load
allocations simultaneously from two
different divisions and/or programs;
• Some employees received load
allocations more than the amount of
loads allotted to them for the year
207
Laws, Rules and
Violated
totaling ₱3,299.45;
• ₱55,492.33 was given to some
employees who do not have Regional
Administrative Order (RAO) to
receive such load; and
• ₱653,010.88 of load were given to
employees/staff of different programs
though have RAO to receive load,
however, they are Technical Staff
holding the positions with Salary
Grades below salary grade (SG) 11
to 22, thus, they are not still
considered qualified.
X Other Maintenance Payment of P1,500.00 each to 147 Item 3.0 of COA 220,500.00
and Operating personnel on the basis of the General Circular No. 2012-
Expense Provisions of the GAA for FY 2019 003 dated October
dealing about cultural and athletic 29, 2012
activities.
Item II of COA
However, no supporting documents Circular No. 2013-
evidencing the conduct of cultural and 003 dated January
athletic activities such as the Activity 30, 2013
Design/Program of Activities, Activity
Report, and the Attendance Sheet were Item 10 of COA
submitted, hence, such activities were Circular No. 2012-
deemed not conducted. Further, in the 001 dated June 4,
absence of proof of purchase of 2012
uniforms, costumes and other related
expenses in the conduct of the said Section 48 of the
cultural and athletic activities, the said General Provisions
payments of “cultural allowance” within of RA No. 11260
the purview of the individual personnel
as irregular expense.
Extravagant Expenditures
II Travelling Expense Transportation could have been Section 6.1 of COA -
significantly reduced had the Agency Circular 2012-003
refrained from travelling by air on
official travels to Metro Manila Section 7.1 of DSWD
Administrative Order
It was noted that all DSWD employees, (AO) 2019-013
regardless of employment status,
having official business in Manila,
travels by airplane which ranges from
₱7,000.00 to ₱10,000.00 for round trip
fares. Whereas, the customary mode of
transportation from Tuguegarao to
Manila and vice versa is by bus, which
cost about ₱2,300.00 (Super Deluxe or
Sleeper Bus) for round trip fare and the
most economical, efficient, and
208
Laws, Rules and
Violated
advantageous to the Agency.
Tickets were usually procured just a
few days before the designated travel
even if the Travel Order was signed a
week before or the activity was
scheduled weeks/months ahead
II Communication Acquisition and issuance of new mobile COA Circular 2012- 408,736.20
Expense phones amounting to ₱408,736.20 to 003
some officials of the agency despite the
existence of previously acquired and
issued mobile phones
It was further noted that management

has procured another set of expensive
mobile phones in CY 2019 despite the
existence of the previously acquired
mobile phones in CY 2017 which are
still functioning excellently as the
average life span of smartphone is 4.7
years (Consumer Electronics
Association) and useful life of
communication equipment is 10 years
(COA Circular 2003-007)
Grand
6,670,826.00
Total
318. The above-cited transactions did not conform to applicable laws, rules and
regulations; thereby, affecting their legality, validity and propriety and exposing
government funds and property to possible loss/misuse.
319. We recommended and Management agreed to:
a. strictly observe prudence on the use of government funds for meals and
lodging by ensuring that these are utilized only for expenses which are
regular and necessary;
b. observe economy and austerity on expenses for food and lodging during
trainings by adequately planning the activity and scheduling programs in
the most judicious and practical manner;
c. refrain from providing dinner and/or lodging for trainings/seminars

scheduled at 8:00 AM to 5:00 PM, or those that do not involve evening
activities; and
209
d. conduct seminars/trainings per batches on the basis of work assignment as
much as possible to preclude the agency from conducting live-in
trainings/seminars when there are no evening activities involved.
320. We also recommended that:
a. FO II Management require the concerned officials and employees issued

with more than one (1) mobile phones to return the extra mobile phones,
whether serviceable or not, to the Property and Supply Unit; and for the
Management to issue the serviceable mobile phones to other entitled
officials and employees without mobile communication equipment;
b. FO II Management to refrain from procuring mobile phones especially

when the previously acquired mobile phones are still in good condition
and serviceable to avoid incurrence of excessive and unnecessary
expenditures of government funds; and
c. FO IV-B Regional Director require the BAC Head to stop or discourage

the procurement and distribution of cell cards as a mode of providing
mobile communications and data services allocation; and refund the
amount of ₱702,188.26 load allocations given to the employees who were
not entitled to receive; otherwise, this shall be disallowed in audit.
321. Management provided the following comments:

II
Excessive Expenditure
Management commented that they usually travel by The AT explained to Management that they
airplane because travelling time from Tuguegarao to can travel a day before and after the
Metro Manila and vice versa is 10-12 hours which is scheduled activity in Metro Manila by bus as
very tiring when going to Manila for trainings and this is the customary mode of transportation in
seminars and very burdensome on the Division heads going to Metro Manila in Northern Luzon, and
and other officials who are required to be back to office still be entitled to per diem for them to be well
immediately due to the nature of their work. rested to attend to their official business.
Travelling by air will be allowed only in
meritorious cases. The head of the agency is
likewise enjoined to exercise prudence over
spending of government funds for airline
travels in accordance with DSWD AO 2019-
013, series of 2019
Management commented that there are some places

The Audit Team explained that the newly
where they conduct field work where there is no signal
procured phones are already dual-sim-ready
for Globe or Smart, hence, the need to maintain two with large storage capacity, thus, one mobile
mobile phones. They also justified the need for larger phone will suffice and they are still required to
phone storage because they are required to document return the old mobile phones.
and forward photos during disaster and calamity.
IVB The Procurement Head explained that they already use
Auto Loading System to provide communication
210
allowance in compliance with the DSWD AO but
observed not effective due to complaints from the staff,
which includes non-receipt of the load because of
intermittent network signal in the far-flung areas where
the staff was assigned. He also mentioned that they
sent a letter to the Assistant Secretary for General
Administrative and Support Services Group (GASSG) of
DSWD Central Office dated October 30, 2018,
requesting to allow them to continue the process of
procuring cell cards for mobile communications in 2019,
however, no response was received from the Central
Office.
Nevertheless, Management will adopt the

communication load allocation through Payroll starting
CY 2020.
Procurement Law (RA 9184) and its IRR not strictly observed
322. In seven (7) DWSD offices, certain provisions of RA 9184 and its Revised IRR
were not observed and/or complied with in the procurement of goods and services
amounting to ₱9.286 million.
323. Section 3 - Governing Principles on Government Procurement of the Revised IRR

of RA No. 9184:
The procurement of the GOP shall be governed by these principles:
a) Transparency in the procurement process and in the implementation of

procurement contracts through wide dissemination of bid opportunities and
participation of pertinent non-government organizations.
b) Competitiveness by extending equal opportunity to enable private contracting

parties who are eligible and qualified to participate in public bidding.
c) Streamlined procurement process that will uniformly apply to all government

procurement. The procurement process shall be simple and made adaptable
to advances in modern technology in order to ensure an effective and efficient
method.
d) System of accountability where both the public officials directly or indirectly

involved in the procurement process as well as in the implementation of
procurement contracts and the private parties that deal with GOP are, when
warranted by circumstances, investigated and held liable for their actions
relative thereto.
e) Public monitoring of the procurement process and the implementation of

awarded contracts with the end in view of guaranteeing that these contracts
211
are awarded pursuant to the provisions of the Act and this IRR, and that all
these contracts are performed strictly according to specifications.
Table 32. Summary of Procurement of Goods and

Services not in Accordance with RA No. 9184 and its RIRR
Violated Provisions of RA
Office Particulars Deficiencies Amount
No. 9184 and its RIRR
CO Procurement of Management directly availed the services of Section 3 - Governing ₱27,748,880.00
Airline Tickets one travel agency/airline company since Principles on Government
2012 in procuring plane tickets for their local Procurement of the Revised
travels and for CY 2019 had paid a total of IRR of RA 9184:
P27,748,880.00
NCR Procurement of Goods purchased did not actually purport an Sections 7.1 and 53.2 of the 825,128.48
drugs, medical unforeseen contingency that will qualify Revised IRR of RA 9184
and office under the emergency mode of procurement.
supplies through Hence, the manner of procurement of drugs,
emergency mode medicines and medical supplies through
of procurement petty cash deprived the government to
using the Petty withheld appropriate taxes due thereon and
Cash Fund availment of low price/discounts for bulk
purchases.
Non-imposition of Billings from contractors who incurred Section 68 of Revised IRR -
liquidated significant period of delays in the completion of RA 9184
damages of 27 infrastructure projects were not
imposed with liquidated damages
Qualification of The Head of the Procuring Entity (HoPE) Section 14.2 of Revised IRR -
designated designated a contractual employee as the of RA 9184
official/OIC-BAC official/OIC-BAC Secretariat contrary to the
Secretariat provision of the Revised IRR of RA No. 9184
requiring permanent employee to hold a
position of BAC Secretariat.
Non-responsive The APP for CY 2019 of DSWD-FO-NCR is Section 7 of the IRR of RA -
APP for CY 2019 not responsive to the effective discharge of 9184 and GPPB regulations
day to day operations, thus defeating the
purpose of promoting transparency and
accountability in the procurement process.
CAR Procurement of Not included in the approved Annual Section 7, Article II and 7,423,485.00
goods and Procurement Plan (APP), and were not Section 10, Article IV of RA
services for the subjected to public bidding thereby deterring 9184
subject SLP skills competitive and transparent procurement.
trainings
IVB Non-imposition of Failure to impose liquidated damages for late Section 3, Annex D of the 97,909.00
liquidated delivery of agricultural implements and Revised IRR of RA 9184
damages inputs amounting to P1,266,000.00 and
hand tractors amounting to P300,000.00
VIII Procurement of The procurement Food Supplies, Office Sec. 7, Rule II of the 7,779,016.52
Inventory in Supplies, and Other Supplies and Materials Revised IRR of RA 9184
Excess of the amounting to P34,778,609.46 in excess of
Estimates in the the ABC of P26,999,592.94; hence not in
APP accordance with the approved APP which
could result in the procurement of items
which were not necessary in the
performance of the agency mandate and
212
may have depleted the funds for the
implementation of other programmed
activities.
IX Procurement of 1. Information contained in the APP and Sections 7.3.2 and 7.3.4, 38,068,528.25
17 infrastructure PPMP attached to the infrastructure Rule II of the Revised IRR
projects contracts are inadequate. of RA 9184
2. Contracts were entered into by and
between DSWD FO IX and the
contractors ahead than the Notice of
Award signed by the contractors as Section 37, Rule XI of the
“conforme” and the agency failed to RA 9184 and its RIRR
require the contractor to indicate the date
when the latter conformed.
3. Print out copy posted in the PhilGEPS, Sections 37.1.6 and 37.4.2
and Certification posted in the website of the RA 9184 and its
and in conspicuous place for the Notice RIRR
of Awards, Contracts and Notices to
Proceed were not attached to the
contracts.
4. With incomplete documentary Section 37.2.3 of the 2016
requirements. RIRR of RA 9184
5. Contracts were entered into by the
agency even without the certification by Section 86, PD 1445 and
the Chief Accountant as to availability of Sections 36 and 37,
funds (CAF) Chapter 1 of GAM, Volume
1
XI Procurement of 1. No Detailed Breakdown or Basis for the Section 2, for the 9,342,950.00
Weighing Scale, Approved Budget for the Contracts Procurement Planning as
Height Measuring (ABC) were submitted to support the cited in Manual of
Board and ABC posted for various procurements of Procedures for the
Portable Sound goods. Procurement of Goods and
System for the 2. PhilGEPs account used in all the Services, Volume 2
DSWD transactions posted in PhilGEPS, such
Assistance as posting of ITB was still under the The Help Page of the
name of the previous BAC Secretariat. PhilGEPS Website
3. Inconsistency with the Contact Person pertaining to the “Created
appearing on the Bid Notice Abstract for By” field cited in the Bid
the Invitation to Bid (ITB) posted in the Notice Abstract
PhilGEPS and ITB published in the
DSWD XI Website; Section 14.1.f of Revised
4. The Purchase Requests for the IRR of RA 9184 which
procurement of Weighing Scale and provides one of the
Height Measuring Board were not yet functions and
issued when the Pre-Procurement responsibilities of the BAC
Conference was conducted. Secretariat.
5. The Invitation Letters issued to COA,
UCCP & Davao City Chamber of
Commerce dated December 12, 2018 for Section 13 of Chapter 8,
the procurement of Weighing Scale and GAM, Volume I
Height Measuring Board, which was later
rescheduled, were not communicated to
the Observers.
6. The Supplemental Bid Bulletins on
various changes made during Pre- Bid Section 13.3. of 2016
213
Conference for Technical Specifications Revised IRR of RA 9184
and other information were undated,
thus could not ascertain the timeliness of
its issuance before the submission and
receipt of bids. Section 22.4 of the 2016
7. Deficiencies in posting of Notices for Revised IRR of RA 9184
Various Bidding Activities in PhilGEPs,
Agency Website and in any conspicuous
place in the premises of the Procuring
Entity.
8. The Bid of the winning bidders for the Item 4.2.5 of GPPB Circular
procurement of the three awarded No. 02-2018 dated March 9,
procurements should have been rejected 2018
because the Financial Bid Forms were
not in accordance with the prescribed
form and not all pages were signed.
9. The amount quoted for each item
procured does not provide information
how much was charged to Section 19.1 of the PBDs
transportation, insurance and all other for the Procurement of
cost for delivery, sales prices and other Goods, 5th Edition dated
taxes and cost of incidental services, as August 2016
prescribed in the Bid Form.
10. Contract Agreements for the Section VIII of the Philippine
procurement of weighing scale was Bidding Documents
undated and not properly signed by the
Proprietor. Section 17.1 of the Revised
11. The perfection and signing of the IRR of RA 9184
contracts were delayed.
12. The validity of the performance bond
submitted by the winning bidders for the
procurement of Weighing Scale and Section 37.2.1 of the
Height Measuring Board could not be Revised IRR of RA 9184
ascertained due to the absence of official
receipts attached as proof of payment. Section 39.1 of the Revised
13. Delayed issuance of Notice to Proceed. IRR of RA 9184
14. The functions of TWG were not
maximized since they were not invited to Section 37.4.1 of Revised
attend during the Pre-Procurement, Pre- IRR of RA 9184
Bid Conference, Opening of Bids and Section 2, item 4 for the
Bid Evaluation per submitted minutes of Roles and Responsibilities
the meetings conducted by BAC. as cited in the Guidelines on
15. Documents of the Losing Bidders were Establishing Procurement
not submitted to COA which are also Systems and Organizations
considered necessary in the auditorial Volume I
review of contracts.
Section 3.1.2 of COA
Circular 2009-001
Total P91,285,897.25
324. The payment of the project billing by FO IVB without the deduction of liquidated
damages for the deficiency was an indication of Management’s lack of judiciousness in the
214
handling of government resources to the disadvantage of the agency. Late deliveries also
hampered the implementation of the projects intended for the beneficiaries.
325. We recommended that Management require the Regional Directors of:
a. the NCR Procurement Section to:
(i) require the FO-NCR and Centers to submit PPMP for drugs,
medicines and medical supplies, based on historical data, for
consolidation and procure them under one Purchase Order to
simplify procurement process, reduce the volume of transactions
and withheld appropriate taxes; and
(ii) strictly adhere to the rules and regulations of RA 9184 and its
Revised IRR, specifically on the procurement of goods;
b. the NCR Engineering Unit to validate infrastructure projects that

incurred significant delays in the completion of the projects and to impose
the liquidated damages to the concerned contractors to ensure equitable
compensation to the national government for the delays incurred;
c. the NCR to designate a qualified head of the BAC Secretariat who is a

regular employee to ensure system of accountability in the procurement
process; and henceforth, designate a qualified regular employee to serve
as BAC to strengthen and promote the professionalization of the
organizations’ procuring unit;
d. the NCR BAC Secretariat to formulate an indicative APP for the year in
accordance with Section 7 of the Revised IRR of RA 9184 and GPPB
regulations;
e. the FO CAR to, henceforth, enforce strict compliance with the

Procurement Act in all procurements of the agency;
f. the FO IVB to require the Accountant to impose liquidated damages for

late deliveries pursuant to Section 3, Annex D of the Revised IRR of RA
9184;
g. the FO VIII to require:
(i) the BAC and the Procurement Section to revise the APP as needed
to include all items which were not previously considered and to
strictly procure common use supplies, equipment, goods, services,
and infrastructure projects in accordance with the approved APP;
and
215
(ii) the Budget Officer be required to match the APP with the budget for
supplies and materials, and the Accountant to consider the amounts
in the APP as the approved budget for the contract for all
procurement activities;
h. the FO IX to:
(i) strictly adhere to the provisions of RA 9184 and its 2016 RIRR in all
stages of the procurement of infrastructure projects; and
(ii) if funds are indeed available and to correct the deficiency, secure a
CAF from the accountant for all contracts without the required
certification. Thereafter, require the BAC to ensure that all
contracts are duly supported with CAF; and
i. the FO XI to:
(i) reinforce awareness and comprehension of the BAC, BAC

Secretariat, TWG and other participants in the procurement of
goods thru their attendance to seminars/trainings and updates on
the Procurement Law;
(ii) require the BAC, BAC Secretariat, TWG and others concerned in
the procurement to read and familiarize themselves with the
relevant provisions of the Revised IRR of RA 9184, and other
issuances related thereto, in all stages of the procurement to reduce
errors and/or non-compliance with laws, rules and regulations in
carrying out the procurement activities of the entity; and
(iii) require the BAC, BAC Secretariat and TWG to exercise due
diligence in the conduct of subsequent bidding activities and ensure
that controls are in place and relevant provisions of RA 9184 are
observed in all the procurement processes to preclude disallowance
of transactions.
326. Management commented as follows:
Office Management comment

NCR Management prepared reiteration memo on the proper utilization of Petty Cash Fund on June 8, 2020.
Likewise, the Accounting Section provided technical assistance when and during annual cash count
validation to C/RCF in the past. Management also provided the same through phone calls and every
time custodians are in the office as need arise. Future and schedule validation to include all memos,
guidelines and forms related to PCF will be shortly discussed to PCF custodian to easily understand
and adopt what was supposedly be done and properly accomplished.
DSWD-FO-NCR terminated the designation of the then BAC Secretariat and issued RSO No. 251,
Series of 2020 on February 18, 2020, for the reassignment order of an AO V, who is a regular
employee and 5th ranking permanent employee of the department to function as BAC Secretariat.
216
Office Management comment
However, the then BAC Secretariat Head continuously reporting to BAC Secretariat office up to the
present as support admin staff to settle/complete documentary requirements of prior years for proper
endorsement to the newly designated BAC Secretariat.
CAR Concerned program personnel commented that they were not informed of the required procurement
procedures. As provincial coordinators, they were to supervise the implementation of livelihood projects
in their assigned province by the beneficiary-associations facilitated and supervised by implementing
PDOs. It was their first time to be given cash advances for livelihood projects and allegedly they were
given instructions as to the project implementation in conformity with the approved proposal but none
regarding procurement. It was their understanding that since the funds flow scheme used was the Cash
Assistance Payroll (CAP), they were not required to submit supporting documents other than the
approved project proposal and the payroll, more so undergo competitive bidding or alternative methods
of procurement. Even the PDOs were not advised regarding procurement procedures and
requirements.
The Program Coordinator further explained that in the previous years, the Audit Team observed that the
Sustainable Livelihood Program had a low fund utilization. This was due to problems encountered in
the procurement of goods and services; however, based on the evaluation of procurement, no supplier
was available so they resorted to Cash Assistance Payroll.
The ARDA further commented that they have provided Regional Office Order No. 5 series of 2017 for
the disbursement of funds for the Cash Assistance Payroll where procurement will be conducted by the
Bids and Awards Committee of the Associations.
IVB Management admitted that they became lenient on the imposition of such penalties. They also added
that to comply with the audit recommendation, the agency will not release the amount withheld for the
warranty amounting to ₱89,340.09 to cover such penalties as prescribed. The difference of ₱8,568.91
will be collected from the supplier to settle the balance.
Management has already prepared a letter informing the supplier on the liquidated damages.
327. We maintained, however, that contrary to the understanding of the provincial

coordinators and PDOs in FO CAR, under the CAP scheme, responsibility for
procurement was vested on the PDOs who were mentioned as co-managers and co-
implementers in the SLP Manual. Being persons in authority and with knowledge in
government laws, rules and regulations, they were responsible for all procurements as well
as implementation of the skills trainings. As stated, PDOs have to ensure procurement by
requiring proper documentation, submission of official receipts and other necessary reports
to ensure accountability and proper implementation. Notwithstanding the understanding
and notion of the SLP personnel on the program implementation, the Government
Procurement Act governs all government procurement except for those identified in
Section 4, Article I. The procurement of goods and services in the conduct of SLP
livelihood projects including skills trainings, should comply with the Act.
328. As for the implemented regional guidelines to be followed in procurement, this is

not supported with concurrence/approval from the Government Procurement Policy Board.
Non-reversion of dormant cash, unauthorized accounts and unnecessary fund
329. Cash in Bank-LCCA amounting to ₱32,905,134.38 as at December 31, 2019 in

FO IVB included special accounts which supposed to be remitted to the National
Treasury, inconsistent with COA Circular No. 2015-001 dated January 29, 2015,
thus, depriving the government of the proper disposition of the funds.
217
330. COA Circular No. 2015-001 dated January 29, 2015 prescibes the accounting
guidelines and procedures in the reversion to the General Fund of all dormant cash
balances, unauthorized accounts and unnecessary special and trust funds maintained by
national government agencies (NGAs) with depository bank.
331. Further, Section 10 of FY 2019 General Appropriations Act for reversion, closure
and transfer of balance of Special Accounts, Fiduciary or Trust Funds in any of the
following instances: i) when there is no legal basis; ii) when their terms have been expired;
or iii) when they are no longer necessary for the attainment of the purpose for which funds
were established.
332. The total balance of the Cash in Bank,Local Currency Current Account (CIB-
LCCA) of ₱32,905,134.38 as at December 31, 2019 as per Trial Balance includes the
amount of ₱2,161,244.58 for Self Employment Assistant-Kaunlaran (SEA-K) Revolving
and Settlement Fund.
333. The SEA-K account is a revolving fund used for the collection and loan repayments
from the members as well as the grant of new loans to other SEA-K Associations. Based
on the Memorandum Circular No.13 series of 2015, Guidelines on the Provision of Seed
Capital Fund through the Sustainable Livelihood Fund issued, the Seed Capital Fund
(SCF) released by the DSWD to the SEA-K Associations’ (SKAs) member is no longer
treated as loan but financial assistance. The grant disbursed by DSWD to the
members/participants should be returned to the Sustainable Livelihood Program
Association (SLPA) who will manage the account but the SLPA is no longer required to
return the amount to the DSWD. Also, the funds needed to pay the SCF are sourced from
the General Fund, thus, the purpose for which the trust fund was established is no longer
necessary.
334. Because of this, the CIB-LCCA balance of the SEA-K should be remitted to the
National Treasury so that the amount could be used to other beneficial projects of the
government.
335. We recommended and Management agreed that the Regional Director of FO-
IVB require the Accountant to adopt the prescribed procedures under Section 3 of
COA Circular No. 2015-001 in order to remit to the National Treasury the remaining
balance of the SEA-K Revolving Funds to avoid possible sanctions, pursuant to
Section 5 thereof.
Unliquidated cash advances (CA) and other non-compliance in the custody of CA
336. Cash advances of 17 DSWD Offices were unliquidated. Moreover, various

deficiencies were noted in the custody of cash advances, contrary to COA Circular
No. 97-002, PD 1445 and GAM provisions.
218
337. Section 4.1.3 and Section 5.8 of COA Circular No 97-002 dated February 10, 1997
provides that a cash advance shall be reported on as soon as the purpose for which it has
been given has been served and all cash advances shall be fully liquidated at the end of
each year. Except for petty cash fund, the AO shall refund any unexpended balance to the
Cashier/Collecting Officer who will issue the necessary official receipt.
338. The above-mentioned provisions were not complied with by 17 DSWD Offices
resulted to unliquidated cash advances as at December 31, 2019 as shown in the aging
schedule in Table 33.
Table 33. Aging of unliquidated Cash Advance

Equal and Less
Office Amount More than 1 year Purpose of CA
than 1 year
Cash advance for release of
assistance to individuals/families in
OSEC Crisis Situation (AICS), Financial
₱23,871,514.40 ₱19,584,753.51 ₱4,286,760.89
Assistance to CIU and advances for
travel
Pay out of various programs like
Social Pension (SocPen), Expanded
Assistance to Individuals in Crisis
NCR
201,928,337.12 196,601,513.54 5,326,823.58 Situations (AICS), Cash for work
(CFW) and other operating activities
of the FO.
Cash advances for financial
assistance to CIS clients, cash-for-
work (CFW), Emergency Shelter
CAR 93,854,324.40 91,431,024.24 2,423,300.16 Allowance (ESA) for Typhoon
Ompong victims and SOCPEN
stipend of additional/new
beneficiaries
Pay out of various programs like
Social Pension (SocPen), Expanded
Situations (AICS), and Supplemental
I 366,164,224.02 365,624,513.84 539,710.18 Feeding Program Under Protective
Service Program (PSP); Emergency
Shelter Assistance (ESA) and Cash
for work (CFW) under Disaster
Response Management.
AICS in the form of Financial
Assistance and CFW, ESCAP and
CFW of DRRM (CCAM, El Nino
Phenomenon, QRF, Typhoon "Lawin
and Ompong"), , MCCT, Social
II 355,529,643.44 333,708,387.23 21,821,256.21 Pension Program, Sustainable
Livelihood Program, Supplementary
Feeding Program, Revolving Fund of
Centers, Operational Expenses of
Field Office (Labor and Repairs and
Maintenance), Salaries and Travelling
219
Equal and Less
than 1 year
Expense of
Encoders/Enumerators/Validators,
Vehicle Rent, Meals.
Cash advance for payment of
III 131,108.00 131,108.00 0.00 services of listahanan for the months
of November and December 2019.
CA for the implementation of various
programs SOCPEN, AICS, CFW
IVA 339,728,981.67 328,057,743.67 11,671,238.00 NHTS-PR;
COMPRE; DRRPCC.
Payment for the implementation of

various programs such as but not
limited to SOCPEN, AICS,
IVB 417,433,253.37 414,142,406.21 3,290,847.16
Centenarian, CFW affected by EL
Nino, Livelihood Assistance and
Hauling expenses
Cash Advances for the conduct of
Skills Trainings under Sustainable
Livelihood Program (SLP),
Emergency Shelter Assistance
(ESA), Social Pension for Indigent
V 129,214,966.54 85,233,888.36 43,981,078.18
Senior Citizens, Payment for
Situation (AICs), Payment of Salary
for Cost of services (COs) and Job
Orders (JOs) and Enumerators,
₱27,700.00 - Transportation
allowance for the Community
Volunteers Congress and 5th
National Bayani Ka Awards on
VI 913,752.16 27,700.00 886,052.16 August 5-9, 2019 in Butuan City
₱886,052.16 - Mobilization fee for the

various construction/improvements of
DSWD Centers (RCW, RRCY)
VII 651,833.99 651,833.99 0.00 -
Implementation of the agency's
programs such as Social Pension,
Cash for Work, and Assistance to
VIII 41,887,435.06 22,588,305.04 19,299,130.02
Individuals in Crisis Situations. Also
includes prior years' unidentified
balances.
220
Equal and Less
than 1 year
Amount granted to DSWD bonded

Disbursing Officers both Regular
Disbursing Officers and Special
Disbursing Officers to be used for
special purpose/time-bound activities
of the Field Office 9. This also
represents cash advance granted for
handling, hauling and deliveries
IX 19,270,057.72 19,270,057.72 0.00 under BangUn, financial assistance to
persons in special needs/displaced
persons, ESA for IDPs, financial
assistance to the fire victims of Jolo,
Labuan and Kasanyangan, and
stipend for IOPs. The balances are to
be liquidated and or refunded after
conduct of the pay-out or activity
based on the prescribed
reglementary periods.
Pay-out expenses for Social Pension,
UCT, Taiwan Relief Distribution,
TFSP, and Livelihood Settlement
Grants in Marawi City;
Implementation of PSP-AICS; EO 70
X 218,689,185.11 218,686,219.11 2,966.00 financial assistance; Transitory
Family Support package; CRCF
National PREW and learning visit of
regional directors of FO X; labor,
wages and salary of JO; repairs and
maintenance, travelling expenses
As at December 31, 2019, for
Advances for Payroll, Advances to
Other Operating Expense, Advances
XI 47,108,551.90 47,108,551.90 -
to Special Disbursing Officers,
Advances to Officers and Employees
and Advances to Contractors.
Implementation of the agency’s
programs and projects such as Social
Pension, Assistance to Individual in
Crisis Situation Cash For Work,
Modified Conditional Cash Transfer,
XII 795,865,243.05 792,009,237.85 3,856,005.20 livelihood trainings for Marawi
Siege/Disaster victims and for the
conduct of Skills Training under the
Sustainable Livelihood Program
/4Ps/IPs beneficiaries, Crisis
Intervention Program
221
Equal and Less
than 1 year
Implementation of the agency’s
programs and projects such as Social
Pension, Assistance to Individual in
Crisis Situation Cash For Work,
Modified Conditional Cash Transfer,
XIII 791,872,168.00 791,861,168.00 11,000.00 livelihood trainings for Marawi
Siege/Disaster victims and for the
conduct of Skills Training under the
Sustainable Livelihood Program
/4Ps/IPs beneficiaries, Crisis
Intervention Program
Total ₱3,844,114,579.955 ₱3,726,718,412.21 ₱117,396,167.74
339. Delayed liquidation of cash advances resulted in the accumulation of huge amounts
of cash and delayed recording of liquidation in the books, thereby, casting doubt on the
fair presentation of the affected accounts in the financial statements.
340. Likewise, Article 217 of the Revised Penal Code states in unequivocal terms that:
“The failure of a public officer to have duly forthcoming any public funds or property with
which he is chargeable, upon demand by any duly authorized officer, shall be prima facie
evidence that he has put such missing funds or property to personal use.”
341. Moreover, the following deficiencies were sustained by the following DSWD
offices:
Table 34. Summary of Non-Compliance Issues

Office Particulars LRR Violated Recommendation
CO, Non-Liquidation of Cash COA Circular No. 97-002 section a. Require all SDOs,
NCR,CAR, Advance at year end. 5.8 dated FEBRUARY 10, 1997 officers and
I, II, III, IV, employees
V, VI, VII, Cash advances granted during Section 5.8 – All cash advances concerned to fully
VIII, IX, X, the year, remained unliquidated shall be fully liquidated at the end liquidate all cash
XI, XII, XIII at year-end of each year. Except for petty cash advances at the end
fund, the AO shall refund any of each year, in
unexpended balance to the compliance with
Cashier/Collecting Officer who will Section 5.8 of COA
issue the necessary official receipt. Circular No. 97-002
dated February 10,
Section 5.9 - At the start of an 1997; and
ensuing year, a new cash advance
may be granted, provided that a b. send demand letters
list of expenses against the to the disbursing
previous cash advance is officers who are
resigned or
submitted. However, when no
transferred to other
liquidation of the previous cash
offices to liquidate or
advance is received on or before refund immediately
January 20, the Accountant shall the full amount of the
cause the withholding of the AO's outstanding balance
222
salary. of their cash
advances, and defer
their clearances until
such time that they
have liquidated the
same.
Issuance of CA to SDO in Section 4.4.2 of COA Circular 97- Require the

excess of authorized 002 dated February 10, 1997 concerned DSWD
maximum accountability, FOs to:
outside his authority or The amount of the cash advance
excessive grant of cash shall be limited to the requirements a. grant only the
advance for two months. Within 5 days after maximum cash
the end of each month, the AO advance needed and
NCR Excessive grant of cash shall submit a Report of monitor the
advances for Social Pension Disbursements. Additional cash outstanding/unliquid
Program for Indigent Senior advances shall be granted on the ated cash advances
Citizens Program for three basis of the activity budget or the of SDOs prior to the
years, CYs 2017 to 2019 requirements for two months, preparation of
resulted in the refund totaling whichever is lower. additional cash
P333,095,000. advance;
COA Circular 2009-002 Paragraph
I SDO with maximum cash IV of Section 4.1.3 dated May 18, b. ensure that total
accountability of P75,000,000 2009 cash accountabilities
was granted excess cash are appropriately
advance even with remaining Except for cash advances for covered by approved
balance as at December 31, travel, no officer or employee shall bond, in compliance
2019 amounting to be granted cash advance unless with the pertinent
P99,143,175.00 he is properly bonded in provisions of
accordance with rules or Treasury Circular No.
regulations and that the amount of 02-2009;
VIII The cash advances exceeded cash advance which may be
the maximum cash granted shall not exceed maximum c. avoid granting cash
accountabilities of the cash accountability covered by his advances in excess
Accountable Officers in several bond. of the SDO’s
occasions, in disregard of the maximum
approved bond issued by the Sections 2 and 14, Chapter 6, accountability;
Bureau of Treasury. GAM for NGAs Volume I
d. submit an
X The SDO was granted cash Special Cash Advance – refers to explanation as to the
advances amounting to the amount granted on the explicit reason why cash
P3,642,500.00 for the payment authority of the Head of the advances for
of financial assistance for AICS Agency only to duly designated payments of AICS
clients which is outside her disbursing officers or employees. clients were granted
capacity as SDO being not No cash advance shall be given to the SDO even if
stipulated in the Office Order/ unless for a legally authorized the same were not
Regional Special Orders (RSO) specific purpose. covered by the
issued. issued RSOs; and
Petty Cash Fund – refers to the
The Accountable Officer (AO) amount granted to duly e. amend the RSOs
who was designated as Special designated Petty Cash Fund issued designating
Disbursing Officer also acts as Custodian its personnel as
Petty Cash Custodian despite SDOs, by explicitly
absence of an Office Order stating therein their
designating/authorizing her to areas of assignment
223
assume the function of a Petty and the purpose of
Cash Custodian. the cash advance
such as petty cash,
regular cash
advances, and
special purpose cash
advance, and
explicitly indicate the
effectivity of the
same.
Non-proper bonding of Section 5.1 of Treasury Circular
Accountable Officer (AO) No. 02-2009 dated August 6, 2009
V The fidelity bond of six AOs The amount of bond shall be a. Monitor the fidelity
have already expired before the based on the total accountability bond of every
full settlement of their cash (cash, property, and accountable Accountable Officer
accountability, hence the forms) of the accountable public and demand
remaining unliquidated cash officer as determined by the Head immediately the full
advance of P9,847,693.00 as of of Agency. Provided, the individual settlement of all the
December 31, 2019 is no longer maximum accountability of each cash advances
insured from losses. accountable public officer shall not entrusted to the SDO
exceed One Hundred Million especially when they
Pesos (P100M). However, the will no longer be
XI Various AOs for the second Head of Agency may assign to designated as such;
semester of CY 2019 disclosed other public officers the excess and
that 13 AOs were excessively accountability for which a Separate
bonded for a total amount of Fidelity Bond shall be secured. b. Re-assess the cash
P325,417.50 and one AO was accountability of the
deficient in the amount of AOs through proper
P4,125.00 planning and apply
for the appropriate
amount of fidelity
bond coverage with
the BTr.
Transfer of CA from one AO

to another
CAR Cash advances amounting to Section 4.1.6 of COA Circular No. a. Strictly prohibit the
₱35,000,000.00 granted to an 97-002 dated February 10, 1997 transferring of cash
SDO was transferred to seven advances from one
Crisis Intervention Units Transfer of Cash Advance from AO to another, and
one Accountable Officer (AO) to refrain from re-
IVA 33 SDOs transferred their cash
another shall not be allowed. delegating the
advances to two officers who
themselves had cash advances official function of
for the pay-outs intended to Item g of Section 14, Chapter 6 of AOs, particularly the
beneficiaries of various GAM Volume I custody of cash, to
programs other persons; and
Transfer of cash advance from one
accountable officer to another shall b. that the OIC-
V Transfer of cash advances was not be allowed. Regional Director of
practiced by SDOs and PDOs FO IVA consider
allegedly to facilitate payout. payments of grants
224
XI Four AOs transferred their cash and aides thru debit
advances to other AOs who are cards/ATMs/GCash
not regular employee and with and other cashless
contractual employment. transactions to avoid
Transfer of accountability is also the multiple/
not supported with transfer accumulation/
document. transfer of cash
Section 101, Item 1 of PD 1445 advances, and
XIII The recording of account and
unliquidated
transaction as well as the
Every officer of any government balances as at year-
custody of the fund were re-
agency whose duties permit or end.
delegated by the AO to their
require the possession or custody
respective subordinates who
of government funds or property
may not have proper orientation
shall be accountable therefor and
on the maintenance of cash
for the safekeeping thereof in
books and not even bonded.
conformity with law.
Hence, some transactions were
not recorded and government
funds may not be properly
safeguarded for unauthorized
use or possible loss.
Non/improper maintenance of Section 17, Chapter 6 of GAM
required documents, records Volume I
and reports
V The former Cashier persistently The Disbursing Officer shall a. Give a stern warning
refused to present the required maintain the CDRec (Appendix 40) to erring SDOs to
cashbooks for all collections, to monitor the cash comply with the
check issuances, and cash
advances/payroll, current proper maintenance
disbursements under her
operating expenses, and special of cash book/ CDRec
accountabilities thus,
significantly delayed the purpose/time-bound undertakings to facilitate the
completion of cash examination and prepare the Report of Cash determination of his
for the period. Disbursements (RCDisb) cash accountabilities,
(Appendix 41) to report its and require the use of
utilization. Payments shall be the prescribed format
based on duly approved Payroll in the liquidation of
and shall be posted by the cash advances;
Designated Staff to the IP. The
VII Cash Disbursement Records JEV shall be prepared based on b. Require all AOs to
(CDRec) of Special Disbursing the RD and shall be recorded in ensure the
Officers (SDOs) of the Social the CDJ. completeness of their
Pension (SocPen) Program respective record
were prepared and maintained Item A, Instructions for Appendix books so that their
by the personnel of the Social 41 of GAM Volume II accountabilities are
Pension Monitoring Office
properly accounted
(SPMO) instead of the SDOs,
Report of Cash Disbursements and reconciled with
thus, daily reconciliation of the
(RCDisb)-This report shall be the accounting
book balance with the cash on
prepared by the Disbursing Officer record.
hand of the SDOs and
to liquidate his/her cash advances
immediate recording of
for payment of salaries, wages, c. Conduct proper
transactions could not be made.
honoraria, allowances, and other
orientation of the AOs
personnel benefits, current
X The cashbook maintained by on the laws, rules,
operating expenses, and special
one of the SDO disclosed and regulations that
225
various deficiencies, namely (a) purpose/time-bound undertakings. should be observed
the AO did not start with a new It shall be maintained by fund which include, among
cashbook; (b) only one cluster others, (i) the
cashbook is maintained for handling, custody,
special cash advances and Section 112 of PD 1445 and disposition of the
petty cash fund; (c) cashbook cashbook; (ii) the
adopted by the AO is not in Recording of financial transaction. grant, utilization, and
accordance with the forms Each government agency shall liquidation of cash
prescribed and not record its financial transactions
advances; and (iii)
accomplished in accordance and operations in conformity with
with the instructions provided; their financial
generally accepted accounting
and (d) failure to principles and in accordance with accountability; and
maintain/update cash book pertinent laws and regulations.”
d. Require the personnel
XI Twenty-five (25) AOs failed to Sections 6.1, 6.3 and 6.5 of COA in charge of
prepare the CDRec. Out of Circular No. 97-002 processing the fidelity
which, nine AOs still failed to bonds of the new
comply despite the audit team's A newly-appointed or designated designated AOs to
diligent efforts in reminding AO shall start with a new immediately start
them to submit. cashbook. processing the fidelity
bonds in order that
XIII Liquidation reports of all SDOs The AO shall reconcile the book the new AO can
subjected for cash examination balance with the cash on hand efficiently and
disclosed that they were still daily. He shall foot and close the effectively discharge
using the old form - Report of books at the end of each month.
his/her duties at the
Disbursements by Disbursing
Officers (RDDO) which are time she assumes the
When the AO ceases to be one,
already outdated thereby the cashbook shall be submitted to responsibilities.
omitting essential information the Accountant and shall form part
thereon. of the accounting records. No
clearance shall be issued to an AO
Cash Accountability totaling to if he fails to submit the cashbook
₱46,769.19 was not recorded in as required.
the Cash Disbursement Record
and Petty Cash Record books
of the AOs, thus, rendering the
record books incomplete and
unreconciled with the books of
accounts maintained by the
Accounting Unit.
The financial transactions in the

Cash Disbursement Record of
the newly designated AO were
not properly recorded, footed
and certified at the end of each
month.
The current/newly designated

AO continuously uses the
cashbook of the previous AO in
recording transactions.
Likewise, the use of the name of
the previous AO in transacting
the subsequent disbursements
226
and replenishments of the
current AO even with the
former’s permission due to
pending processing of fidelity
bond and delayed processing of
bank account, is a departure
from sound internal controls.
Custody, safeguarding and a. Provide each AO with
utilization of cash safe/cash vaults for
safekeeping of the
IVA Bundles of cash of other SDOs CA, and away from
amounting to P51,954,196.00 possible unauthorized
were stocked/placed in four access; and
vaults under the custody of
Cashier per cash count b. Stop the practice of
conducted on November 13, using the cash
2019. The bundles were advance other than its
labeled under the name of intended purpose.
various SDOs which according
to the Cashier was entrusted to
her for safekeeping since SDOs
do not have individual vaults to
keep their CA for pay-outs in the
CALABARZON areas.
V Eleven (11) AOs still do not

have their own personal
safe/vault thus exposed
government funds to possible
risk of loss or misuse.
XI Twelve (12) AOs do not have

their own cash vaults for CAs
maintained, instead, available
cash are (i) placed in the
Cashier’s vault for safekeeping;
and (ii) shares safe with other
AO located in an enclosed room
also used as pantry. The
absence of own safe or cash
vaults failed to secure
government funds in the hands
of the AOs and likewise
increases the risk of possible
loss through theft.
XIII The amount of P8,000.00

allotted to repatriated OFWs
was instead used as
encashment for transportation
allowance.
The claims which is under the

CA of another AO was paid by
using her CA intended for the
227
travelling expenses of social
pension validators amounting to
P8,432.50 since the responsible
AO was not around.
Grant of additional cash Item 4.1.2 of COA Circular 97-002 Reiterated, with
advances despite non- dated February 10, 1997 and modification, to refrain
liquidation of previous cash Section 14 (c), Chapter 6, Volume from granting additional
advance I of the GAM cash advances, unless
previous balance has
IVA Eighteen (18) SDOs with No additional cash advance shall been settled and ensure
unliquidated CAs were granted be allowed to any official or that certification is
additional CAs employee unless the previous issued that previous
cash advance given to him/her is cash advances/fund
V Twenty-eight (28) SDOs were first settled/liquidated or a proper transfers had been
given additional cash advances accounting thereof is made. liquidated.
several times although previous
cash advances were not yet
fully liquidated at the time of the
grant. As in the prior year, the
required Accountant’s
certification remains excluded
as supporting documents in the
grant of these cash advances.
VIII Additional cash advances were

granted even if the previous
cash advances were not fully
liquidated and cash advances
were liquidated in part rather
than in full.
X Granted cash advance for travel

to six personnel despite non-
liquidation of previous cash
advance for the same purpose.
XII Cash advances were made to

SDOs despite the existence of
unliquidated cash advances.
No proper turn-over of Sections 75, 77 and 80 of PD 1445 Ensure proper turn-over

accountabilities by replaced/ and accounting of cash
reassigned/retired personnel Section 75. Transfer of funds from and accounts of all
one officer to another. outgoing AOs.
X Transfer of accountability Thereafter, furnish the
between the incoming and Section 77. Invoice and receipt COA Audit Team a copy
outgoing AOs was not properly upon transfer of funds or property. of the turn-over of
documented through the accountabilities for
itemized Invoice and Receipt. Section 80. Final report of reference in the conduct
accountable officers. of cash examination.
XII Reassignment and/or retirement
of AOs has no proper turn-over
of accountabilities between the
incoming and the outgoing
228
personnel, thus the
accountabilities could not be
determined and also preventing
the conduct of the required cash
examinations of the AO
XIII The AT was not immediately

informed by HRMO of the
changes in assignment and
function of the two SDOs who
liquidated/refunded their
accountability since December
29, 2017 and April 3, 2018,
respectively.
VIII 35 cash advances were not Sections 2 and 5 of COA Circ. 97-
liquidated in the year of the 002 dated February 10, 1997
grant which resulted in the
recording of the related 4.1.3 A cash advance shall be
expenses in the incorrect reported on as soon as the purpose
period, which cast doubt on the for which it was given has been
accuracy of the affected served.
accounts in the financial
statements at the end of the 5.7 When a cash advance is
year. no longer needed or has not been
used for a period of two (2) months,
it must be returned to or refunded
immediately to the collecting officer.
5.8 All cash advances shall

be fully liquidated at the end of
each year. Except for petty cash
fund, the AO shall refund any
unexpended balance to the
Cashier/Collecting Officer who will
issue the necessary official receipt.
342. The lack of proper planning by FO XI in the application of bond for each AO
resulted in excessive bond premiums paid and in wastage of government funds, having
paid much higher amounts which is primarily attributed in setting up higher amounts of
maximum accountabilities for these AOs vis-à-vis average monthly cash advances which
are much lesser. Likewise, actual average monthly accountabilities are higher than the
applied amount stated in the bond policy resulting to the deficient bond by one AO. In
effect, there is a risk that the government will not be adequately indemnified in the event
of embezzlement or other kind of losses of the AOs cash and accounts.
343. Moreover, the transfer of cash advances from one AO to another clearly manifest
weak internal controls affect the efficient and effective control over the granting,
utilization and liquidation of cash advances.
344. The above deficiencies signify inadequate control in handling cash advances of the
AO which resulted in the accumulation of huge amounts of tens of million pesos in AOs
229
possession and keeping it for several months to more than three years before full
settlement. Such circumstances exposed scarce government resources to possible loss
through misuse or misappropriation of the subject public funds. It also shows non-
compliance with existing laws, rules, and regulations provided for this financial
transaction. As a result of the lapses found in the handling of cash accountabilities, six
AOs incurred cash shortages at the cutoff date.
345. Management provided the following comments:

NCR One of the reasons for the delayed liquidation was due to Strictly comply with the submission of
the bulk processing of the liquidation documents and the LRs within the prescribed timeline. As
lack of manpower by both the Accounting Section and regards to lack of manpower due to
Program Implementers. The personnel complement of resignations of personnel to Accounting
the FO-NCR cannot keep up with the workloads and Section and Program Implementers, the
paper works brought about by the exigency to serve the Personnel Section to submit hiring plan
beneficiaries. to RD for approval.
Additionally, it is also a known practice of the FO-NCR to
continue granting cash advances towards the end of the
year. On December 2019, the total grants totaled
₱108,649,662.67, liquidated amounted to
P68,789,195.30, hence the amount of ₱38,798,850.00
remained unliquidated and has contributed to the
outstanding unliquidated cash advances as at year-end
CAR Contributory to the unliquidated balance is the granting of In the case of cash advance for
large cash advances in December 2019 which would be SOCPEN stipends, DSWD
difficult to liquidate before the end of the year. The Memorandum Circular No. 04, series of
schedule of unliquidated cash advances as at December 2019 is clear that the release of the
31, 2019 showed that eight SDOS were granted cash SOCPEN stipend will be done every six
advances from December 2 to 6 amounting to months, therefore there will be no
₱98,115,450.00 with partial liquidation of reasons that the cash advance be made
₱35,494,245.00 as at year-end.
on the first or second month of the
semester. Likewise, for the new
As for the ₱35,000,000.00 cash advances, Management
SOCPEN beneficiaries, management
justified that the augmentation fund was downloaded to
can set up a payable in December which
the FO on October 2019, thus, the need to utilize the
can be paid in the ensuing year. This
funds until the end of the year. Also, the limited
will resolve the granting of cash advance
permanent staffs to be bonded as disbursing officers
in the last month of the year to avoid
were one of the reasons for the transfer of cash
unliquidated balance at the yearend.
advances. Nevertheless, the amount was fully liquidated
and recorded in May 2020 financial reports.
The two months’ requirements cannot be
complied in this case since the cash
The Assistant Regional Director for Administration
advance was drawn at year end. Unpaid
(ARDA) also commented that management decided to
claims with approved DVs or payrolls
have the second level permanent employees be bonded
can be made payable for the ensuing
so they can be granted cash advances. In this way, the
year and a new cash advance for the
cash advances will be distributed to several SDOs to
purpose can be drawn for payment of
avoid transfer of CAs.
the same.
I Management stated that the DSWD-Central Office is The Management together with the AT,
studying on requiring the funds not released to be agreed to conduct brainstorming on
returned and record the same as “other payables” developing ways to address this issue.
230
Management will devise a system where they can stop
this practice.
II Management commented that Cash Advances were not
liquidated on time due to the following reasons:
a. fast turnover of employees under the SLP as

Project Development Officers (PDOs) who
conducted the pay-out and implemented the
projects were no longer connected with the
agency resulting to difficulty in retrieving
documents for liquidation;
b. the existence of unpaid claims of beneficiaries

under the SocPen and Emergency Shelter Cash
Assistance Program (ESCAP);
c. lack of manpower under the SLP and SocPen

because numerous projects are being targeted
and implemented, not to mention the
suspension of Fund Transfers to various Local
Government Units (LGUs);
d. that FO2 employees undertake numerous pay-

outs to 93 LGUs which constrained them to
liquidate their cash advances not to mention the
regular duties and functions of those tapped to
augment in the conduct of pay-out; and
e. delayed downloading of program funds.
From the foregoing, management committed to be

stricter in the grant of employees ’ clearances and
document turnovers before signing their clearances and
payment of their last salary. They also assured that they
are taking possible actions to locate and validate the
whereabouts of the beneficiaries with unclaimed
balances.
Management also assured that some of the SDOs have

already submitted some of their liquidation reports in the
Accounting Section for recording and accounting and the
unused and idle cash balances were already remitted to
the Cashier. Moreover, they also commented to go over
and review the long outstanding balances appearing in
the Subsidiary Ledgers which they believed have already
been liquidated.
IVA The Chief Administrative Officer explained that they However, the practice of Management of
resorted to the transferring of CAs from one SDO to giving the stipends directly to
another officer to ensure that pay outs are distributed beneficiaries thru cash pay-outs via CAs
promptly to the Municipalities/Province since most of of various SDOs resulted in the
them are busy in the DSWD Field Office. She assured accumulation/series/multiple/transfer of
the Audit Team that the concerned SDOs are strictly CAs of SDOs, and unliquidated amount
monitoring the utilization of the CAs, and well aware that of P339,501,444.00 as at year-end.
they are the ones primarily responsible for the liquidation
231
thereof.
Also, Management has started to craft policy on the

payments of grants thru debit cards/ATMs in order to
implement the cashless transaction considering also the
effect of COVID-19.
IVB The Accounting Unit sent demand letters to the
concerned Officers and Employees quarterly and the
Field Office already installed corrective measures to stop
the practice of transferring cash advances from one
accountable officer to another personnel. They also
added that they will coordinate to the Field Office -
CALABARZON Region for the remaining Advances to
Officers and Employees which were carried over after
the split-up of Region IV-A and IV-B.
VII During the Spot Cash Examination conducted by the We will validate the implementation of
Accounting Unit and Office of the Regional Director staff, the audit recommendation by requiring
the SDOs were already instructed to maintain and Management to submit the Minutes of
periodically update their respective cashbook/Cash the Meeting with the said SDOs
Disbursement Record. conducted in the last quarter of CY 201.
During the SDO meeting in the last quarter of CY 2019,

the SDOs were already provided with oriental/briefing on
their duties relating to the disbursements of cash
advance received and its corresponding liquidations.
VIII Since CY 2018, they strictly enforced that all accountable The practice of granting additional cash
officers and employees have to submit full liquidation of advances despite the presence of
their cash advances within the reglementary period. outstanding balances resulted in
Likewise, management requires the Accountant to overlapping of cash accountabilities,
appropriately monitor the granting, utilization, and full disregard of the maximum cash
liquidation of the AOs cash advances and facilitate the accountability of the AOs, non-
issuance of demand letter, if warranted. They also added recognition of the expenses in the books
of accounts despite the payment of the
that they are strictly implementing the “No Liquidation,
expenditures, and expose the unused
No Cash Advance” policy. balances to the risk of loss and misuse.
XI Emphasized that the basis for the bonding the AO was
based on the maximum cash accountability granted to
each AO and not on average basis, in anticipation to any
upcoming program’s deliverables where the AO could be
asked to augment, otherwise, if the fidelity bonds will be
lowered, the management could not accomplish all their
deliverables.
Already re-validated the cash accountability of the AOs

and will further discuss during the Regional Management
Committee Meeting the application of the appropriate
amount of fidelity bond coverage based on the bond
premium schedule of the BTr.
Reminded the AOs of the stern prohibition of transferring

cash advances to another AO.
The Regional Cashier is now strictly implementing the
232
turn-over of all cash advances for deposit in the cashier’s
vault.
The AOs were already furnished with a copy of the

prescribed format in the liquidation of cash advances.
Likewise, a Memorandum will be issued by the
management to all SDOs to ensure strict compliance
with the appropriate format in the liquidation of cash
advances.
The Finance Management Division has already

coordinated with the Procurement Section regarding the
market research of safety vaults for immediate purchase
and safety of cash advances at different offices/units.
XII Bulk of the non-liquidated CA was sourced from the -
Social Pension Program. As of this date, CA of SDOs for
the purpose liquidated a total of 92.60% after the
issuance of demand letters from the Accountant. The
CAs granted for the month of December 2019 were not
yet due for liquidation and to be utilized this year
depending on the cleaned list to be downloaded to the
FO from the Central Office.
Cash Shortage of ₱2.013 million in FO VIII
346. The unspent balance of the cash advances for special time-bound undertakings
were not returned/refunded immediately after the purposes were completed or the
projects were implemented, which exposed the cash to the risks of loss and/or misuse,
resulting in a cash shortage of ₱2,013,000.00 by the Special Disbursing Officer of
DSWD Field Office No. VIII, Tacloban City.
347. Sec. 89 of P.D. 1445 states that “No cash advance shall be given unless for a
legally authorized specific purpose. A cash advance shall be reported on and liquidated as
soon as the purpose for which it was given has been served. No additional cash advance
shall be allowed to any official or employee unless the previous cash advance given to him
is first settled or a proper accounting thereof is made”.
Table 35. Statement of Accountability of Accountable Officer

Particulars Amount
Balance, Last Examination - July 27, 2011 ₱ 0
Add: Cash Advances - July 27, 2011 to July 9, 2018 16,029,000.00
Deduct: Liquidations - July 27, 2011 to July 9, 2018 13,741,500.00
Unliquidated Balance - July 9, 2018 2,287,500.00
Cash and Cash Items Presented as of Cash Examination Date on July 9, 2018
Initial Cash Shortage as of Cash Examination date, July 9, 2018 2,287,500.00

Deduct: Cash Items Presented after the Cash Examination from July 10, 2018 to
233
Particulars Amount
August 1, 2018 274,500.00
Amended Cash Shortage dated October 1, 2018 ₱ 2,013,000.00
348. Letter of Demand dated September 14, 2018 was issued for the initial cash shortage
and an amended Letter of Demand dated October 1, 2018 to the SDO for the amended
cash shortage. The SDO requested for an extension to comply with the requirements in her
reply dated October 22, 2018 due to her health condition.
349. According to the SDO, all her cash advances have already been paid out to the
intended beneficiaries and the excess have been refunded to the Cashier. The AO had
submitted additional liquidation documents after the receipt of the Demand Letters.
However, the Accounting Office returned the additional liquidation documents because the
documents lack authorized signatures and were duplicate copies of previously submitted
liquidation reports, which have already been recorded.
350. The Accountant issued a Certification stating that the AO has an unliquidated
balance of ₱2,257,500.00 as of issuance date on December 19, 2018. The certified
unliquidated balance was the initial cash shortage as of cash examination date less Official
Receipt No. 0731516 amounting to ₱30,000.00 dated August 1, 2018, which was
recognized as a cash item.
351. Review and analysis of the dates of the grant, liquidation and refund of the cash
advances disclosed that the AO incurred delays in liquidating her cash advances even if
the purpose for which these were granted were already completed. The liquidations and
refunds took an average of 575 and 238 days, respectively, which exposed the cash to the
risks of loss and misuse.
352. The examination on the cash and accounts of the SDO was the first time to be
conducted since no cash examination had been conducted in the previous years. The AT
issued a Demand Letter dated October 4, 2016 for the outstanding unliquidated cash
advances of ₱9,445,500.00. Subsequent to the demand letter and upon compliance by the
AO, the Accounting Office issued a Certification on March 31, 2017 stating an
unliquidated balance of P3,403,000.00 as at December 31, 2016.
353. Further, the Audit Team of FO VIII issued AOM No. 2017-07 dated February 9,
2017 to inform management of the unliquidated balance of the Advances to Special
Disbursing Officers account amounting to P267.8 million as at November 30, 2016, which
included the SDOs accountability of P3.48 million. This audit observation was
incorporated in the Management Letter (ML) for CY 2016.
354. The Cash Examination Report on the cash and accounts of the SDO was already
forwarded to the Office of the Ombudsman-Visayas by our Regional Director on October
15, 2019.
355. We recommended that Management require the FO VIII Regional Director to:
234
a. require the immediate restitution by the Special Disbursing Officer of the
missing funds in the amount of ₱2,013,000.00, without prejudice to the
filing of appropriate legal charges against the erring Accountable Officer;
and
b. stop the practice of granting cash advances to Accountable Officers unless

the previous cash advance given is first settled or a proper accounting
thereof is made pursuant to Items 4.1.2, 4.1.3, 5.7 and 5.8 of COA Circ. 97-
002 dated February 10, 1997 and Sec. 89 of P.D. 1445.
Non-liquidation of Fund Transfers
356. Fund transfers to National Government Agencies (NGAs), Local Government

Units (LGUs), Government-Owned and Controlled Corporation (GOCCs) and Non-
Governmental Organization/People’s Organization (NGOs/POs) during the year of
the implementation of agency’s projects as well as the fund transfers to Procurement
Service (PS) and Philippine International Trade Center (PITC) for its common office
supplies and equipment requirement of the funds transferred were not liquidated,
contrary to Circular No. 94-013 dated December 13, 1994 and COA Circular No.
2007-001 dated October 25, 2007.
357. COA Circular No. 94-013 dated December 13, 1994 provides the rules and
regulation in the grant, utilization and liquidation of funds transferred to implementing
agencies (IAS). This is to ensure that the transfer is properly taken up in the books of the
Source Agency (SA) and IA and used only for the intended purpose and that proper
accounting and reporting is made on the utilization of the funds.
358. Paragraph 4.6 of said Circular provides that within ten (10) days after the end of
each month/end of the agreed period for the Project, the IA shall submit the Report of
Checks and Issued (RCI) and the Report of Disbursement (RD) to report the utilization of
the funds.
359. Paragraph 4.9 further states that the IA shall return to the SA any unused balance
upon completion of the project while Paragraph 5.4 provides that the SA shall require the
IA to submit the reports and furnish the IA with a copy of the journal entry voucher taking
up the expenditures.
360. Detailed schedules of various inter-agency receivables consist of huge amount of

unliquidated balances, as follows:
Table 36. Schedule of Due from NGAs and LGUs

Aging of Receivables
Office Balance as at 12.31.19
Less than 1 year 1-5 years More than 6 years
Due from NGAs
OSEC 1,212,522,945.91 6,469,513.15 1,206,053,432.76 -
NCR 13,763,922.51 13,763,922.51
235
Aging of Receivables
Office Balance as at 12.31.19
Less than 1 year 1-5 years More than 6 years
CAR 7,430,777.75 - 7,393,828.00 36,949.75
I 13,504,518.97 - 13,504,518.97 -
II 3,804,213.00 1,633,513.52 2,170,699.48
III 46,926,810.56 - 45,969,817.90 956,992.66
IVA 19,997,887.63 3,141,413.22 3,784,028.95 13,072,445.46
IVB 25,401,310.96 11,803,979.70 12,842,832.66 754,498.60

V 344,331,549.54 344,331,549.54
VI 25,000,000.00 25,000,000.00
VII 18,595,986.92 2,511,719.30 1,025,198.34 15,059,069.28
VIII 51,910,261.33 - 51,394,709.67 515,551.66
IX 1,060,634.50 - 1,060,634.50 -
X 149,939.22 - 149,939.22 -
XI 5,425,754.25 2,237,023.92 3,171,526.23 17,204.10
XII 1,206,301.86 - 77,177.44 1,129,124.42
XIII 20,000,000.00 20,000,000.00
Due from LGUs
OSEC 397,706,314.49 366,421,932.68 31,284,381.81
NCR 2,480,014.98 2,480,014.98
CAR 79,756,009.18 - 77,910,851.26 1,845,157.92
I 76,565,536.24 2,474,062.05 73,627,374.44 464,099.75
II 43,060,801.84 135,000.00 42,910,801.84 15,000.00
III 121,029,372.17 - 120,829,372.17 200,000.00
IVA 423,645,601.33 - 419,026,280.89 4,619,320.44
IVB 209,918,895.35 549,155.94 196,439,953.09 12,929,786.32
V 457,148,387.76 449,958,924.49 7,189,463.27
VI 438,958,570.42 3,940,962.00 377,220,408.14 57,797,200.28
VII 325,222,097.11 - 272,622,845.07 52,599,252.04
VIII 1,076,957,387.60 - 1,073,315,771.61 3,641,615.99
IX 86,078,690.16 11,668,392.89 68,870,205.60 5,540,091.67
X 476,357,225.87 32,938,984.02 242,856,232.87 200,562,008.98
XI 136,898,878.52 6,023,163.20 55,470,712.41 75,405,002.91
XII 198,905,241.11 -0- 195,593,139.12 3,312,101.99
XIII 60,313,576.98 6,861,371.84 53,170,650.14 281,555.00
Table 37. Schedule of Due from GOCC and NGOs/POs

Aging of Receivables No Aging
Balance as at
Office Less than 1 More than 6
12.31.19 1-5 years
year years
Due from
GOCCs
NCR 84,458,485.80 - - - 84,458,485.80
V 2,615,200.75 - 2,615,200.75 - -
236
Aging of Receivables No Aging
Balance as at
Office Less than 1 More than 6
12.31.19 1-5 years
year years
*other FO Ml Did not submit aging Schedule
Due from
NGOs/POs
NCR 178,402,883.63 - - - 178,402,883.63
CAR 1,462,718.14 - 884,680.42 578,037.72 -
IVA 4,731,616.74 - 917,119.26 3,814,497.48 -
IVB 37,932,407.44 - 26,273,538.46 11,658,868.98 -
V 33,631,256.59 - 33,631,256.59 - -
VI 22,774,025.90 - - 6,416,802.75 16,357,223.15
VII 12,832,150.98 - 25,886.00 12,806,264.98 -
VIII 29,004,325.46 - - - 29,004,325.46
IX 310,155,604.85 - - - 310,155,604.85
X 366,931,284.17 - - 347,161.65 366,584,122.52
*other FO ML did not submit aging Schedule
361. Further analysis of accounts disclosed the following causes of non-liquidation:
Table 38. Reasons for non-liquidation

Office Reason for Non-Liquidation
Due from NGAs
NCR, IVB, V, Failure of the management as the source agency to enforce the implementation and poor monitoring of
the project.
NCR Persons-in-charge of the inventory were not properly oriented on the proper procedures in the receipt
and acceptance of the delivered items from PS-DBM, hence the Delivery Receipts (DRs) were not
immediately submitted to the Accounting Section for recording
VII, VIII Non-Availability of supporting documents
XI Delayed implementation of the project
XII Failed to enforce the regulation on the liquidation and/or submission of documents
XIII - revision of mode in selecting beneficiaries and livelihood project per memorandum sent on April 16,
2019;
- submission of list of People’s Organizations (PO) names was sent to DSWD for cross matching to
the list of identified poor, however, some names was not tagged as poor, thus, resubmission of list
was still on process;
- there is no final list yet as to the 24 proposed Community-Based Forest Management
(CBFM)/National Greening Program (NGP)-People’s Organizations (POs) beneficiaries in Caraga
Region; and
- finalization of project proposals among POs as well as project site visits is on- going.
Due From LGUs,
NCR, VI, IX Poor monitoring and/or no regular reconciliation of account
237
Office Reason for Non-Liquidation
VIII Non-Availability of supporting documents
IX No proper turn-over from previous administration/management.
XI Non-cooperative LGUs
NGOs/POs,
NCR, IVB, VIII Poor monitoring and no regular reconciliation of account
CAR, VIIII Lack of field personnel in the provinces to follow up required reports and supporting documents
IVA, X NGO’s which are not existing/closed or the location of the NGOs cannot be found
VII Non-Availability of supporting documents
VIII Continuous fund transfer despite of unliquidated balance of NGOs/POs
GOCCs
NCR Poor monitoring and no regular reconciliation
362. Considering that DSWD continues to implement its programs through the same
partner LGUs, slow liquidation of fund transfers will remain a recurring issue.
363. The expected benefits from the supposedly construction of a four-storey office
building project in FO IVB that was not implemented were not fully utilized as timely and
as intended. Furthermore, the money paid to the contractor amounting to ₱1,124,989.43
also turned into a wastage of funds, since the outputs delivered by the consultant could not
probably be used due to possible discontinuance of construction of the building, or if
continued, the reports will be rendered outdated specifically as to the prices of labor and
materials.
364. The accumulation of unliquidated fund transfers is an indication that Management

has been remiss in monitoring the accounting/liquidations of fund transfers contrary to the
terms and conditions stipulated in the MOA and as required under existing COA rules and
regulations, thereby, casting doubt on the fair presentation of receivable accounts at year-
end. Likewise, any unspent amount remained unreturned to the agency.
365. Moreover, considering the length of time that has elapsed, these receivable accounts
still remained as assets of DSWD as the source agency, when in fact some or most of these
accounts were already spent over the lapse of time by the NGAs, GOCCs, LGUs and
NGOs/POs, thus, affecting the validity of the outstanding receivables account reported at
year-end.
366. Likewise, the past due outstanding fund transfers to LGUs and NGOs/POs for over
five years raises uncertainty in the collection and/or liquidation thereof. As for the LGUs,
it is a given fact that the officials therein constantly change their personnel and
administrators without proper turn-over, thus, some projects are stalled and abandoned
238
when political leadership who initiated them change. While for NGOs/POs, closure of
office is inevitable, hence, the difficulty in requiring the submission of liquidation reports.

of the NCR, FOs I, II, III, IV-A, IV-B, V, VII, VIII, IX, XI, XII and XIII to:
a. require the concerned program units and employees in the NGAs, LGUs and
NGOs/POs to strictly comply with the prescribed period in the liquidation of
fund transfers, refund the unutilized fund transfers for
completed/unimplemented projects, if any, and validate pending liquidation
reports for the immediate recognition thereof in the books;
b. require the Accountant to exhaust administrative remedies to collect the

inactive accounts and/or liquidate the fund transfers through periodic
verification, validation of the collectability of the receivables; issue demand
letters to all IAs with overdue unliquidated balances and impose specific
sanctions, when necessary;
c. assign personnel to monitor and follow up utilization reports and supporting

documents for liquidation of the fund transfers to NGOs/POs, and consider
instituting legal action/s against the defaulting NGOs/POs;
d. reassess the status of recovery of the dormant accounts aged over 10 years
and provide allowance for doubtful accounts and impairment losses thereon;
e. formulate controls, policies, and guidelines in the grant of fund transfers,

timely submission of liquidation/utilization reports to regulate increasing
balances and continuously conduct periodic monitoring, analysis and
validation of the projects to ascertain compliance in the implementation and
liquidation; and
f. be cautious in planning and programming of future plans to avoid wastage of

funds which is disadvantageous on the part of the government.
368. Management provided the following comments/actions taken in view of the audit
recommendations:
Office Management Comment/Action Taken Auditor’s Rejoinder

NCR Management has agreed to create a validation team to
revisit and reassess the NGOs/POs’ dormant receivables to
ensure complete documentation on the request for write-off.
Likewise, the then COA Audit Team conducted validation on
the existence of the NGOs/POs, it was then disclosed that
there are NGOs/POs which are still in operation.
Unfortunately, no further actions were done by Management
thus, no additional documents were forwarded to COA-NGS
Cluster 6, Legal Section to support the request for authority
to write-off.
239
CAR Management sent letters to the concerned agencies on
various dates. Recently management issued letters on
February 24, 2020 to the LGUs concerned to submit
liquidation reports, Management added that they will seek
the help of the BLGF if all actions are exhausted.
I Management informed that they are continuously Management can ask
coordinating with LGUs in order that liquidation will be assistance from Department
facilitated. of Interior and Local
Government (DILG) in
requiring LGUs to strictly
adhere to the MOA on
account of their Seal of Good
Governance
IVA The Chief- Finance and Management Division together
with the Accounting Section will exert all efforts to liquidate
the accounts by sending demand letters to NGO/POs.
IVB Management stated that they are doing their best effort to
implement the plan to construct a four-storey building within
the office compound in Malate, Manila. They also added
that last January 10, 2020, the Management had its meeting
with the Assistant Regional Director of DPWH to discuss
more on the implementation and funding of the project.
Moreover, the MOA agreed upon by the DPWH and the
DSWD-MIMAROPA will be subject for review of the DSWD
lawyer.
V With the concurrence of the SLP-National Program
Management Office, the implementation of the various skills
training projects was extended until December 31, 2020. As
part of the compliance to the recommendations of SLP-
NPMO, there is on-going drafting of a supplemental
memorandum of agreement with Bicol University (BU) to
amend the implementation of projects until December 2020.
As practiced, SLP and Bicol University Extension
Management Division shall continue to have its regular
weekly DSWD-BU meetings and Semestral Implementers’
Meeting to ensure prompt updating and monitoring of BU’s
project implementation.
VI The liquidation of funds transferred to LGUs was not closely
monitored due to the significant decrease in the SLP’s
manpower in the previous year. The Management
explained that SLP is currently on the process of hiring a
total of 110 Monitoring PDOs and the follow-up of the
unliquidated fund transfer to the LGUs will be integrated as
one of the performance indicators on their respective
Individual Performance Contract to ensure that the
liquidation of funds by the LGUs is being acted upon.
VII Accounting Section will strictly enforce the liquidation of
fund transfers to NGAs and NGOs/POs thru constant follow-
up of liquidation documents by email, sending of demand
letters and visitation.
For NGAs and NGOs/POs with long overdue unliquidated
240
fund transfer wherein the chance to acquire the liquidation
documents is merely low, accounting section will bring
together the necessary documents required in accordance
with COA Circular 2016-005 for the request for authority to
write-off.
VIII Management plans to redeploy the Liquidation Monitoring
Team by the second to third quarters of this year 2020 to
assist and collect from the LGUs the Liquidation Reports.
Further, management required the Accountant to closely
monitor the granting, utilization, and full liquidation of the
cash advances and facilitate the issuance of demand
letters, if warranted. Currently, management had already
strictly implemented the “No Liquidation, No Cash Advance”
policy.
IX As for the unliquidated fund transfer to NGAs (52nd
Engineering Brigade, Philippine Army), demand letter was
sent by management addressed to the Commander last
March 11, 2020 for liquidation of the fund transfers since
2015 and/or return of the unexpended balance. Moreover,
the General Services Unit of the DSWD FO IX is currently
monitoring the construction of the perimeter fence in
Mampang, Zamboanga City.
While for the Due from LGUs account, Management sent

demand letters dated November 2019 obliging the LGUs to
liquidate the fund transfers made to them and/or refund the
unexpended balances pertaining to the implementation of
Kapit-Bisig Laban sa Kahirapan-Comprehensive and
Integrated Delivery of Social Services (KALAHI-CIDDS)
National Community-Driven Development Program
(NCDDP). Moreover, Management issued memorandum
dated March 12, 2020 to Promotive Services and Protective
Division Chiefs directing them to exert full efforts in the
retrieval of liquidation reports from concerned LGUs and to
submit status of liquidation. Management also sent letters to
other concerned LGUs dated March 5, 2020 demanding
liquidation of fund transfers and return of unexpended
balance.
X The unliquidated balances from various LGUs, NGAs, and
NGO/POs were monitored and followed up by the Program
Focal and field personnel in charge of it. Series of tracers
and demand letters were also sent from the Accounting Unit
to the LGUs duly signed by the Regional Director, copy
furnished the Secretary and Legal Service. Updates are
stated on the Status of Unliquidated Cash Advances report
submitted to the Audit team semi-annually.
As for the NGA and NGO/POs, the in-charge from the

Accounting Unit is on the process of complying with the
requirements for write-off of receivables.
XI The program units were directed to require the IAs to Furnish the concerned Audit
241
provide RCI and RD as supporting documents in reporting Team Leaders of the NGAs
the utilization of funds. Likewise, some LGUs have already and LGUs with a copy of the
refunded the unused/ unutilized balances of fund transfers. demand letters as well as the
Other LGUs have also submitted their reports to the SA for audit team of DSWD FO XI.
review and JEV preparation.
A Task Force was already formed and initiated first-hand

actions in implementing follow-up schedules to the LGUs
and NGAs of their outstanding balances of fund transfers.
The program focal persons were also instructed to follow

strict monitoring of the fund transfers to IAs and were
reminded to refer the specified timelines stated in the MOA
to effectively implement the program funds for the
constituents of the LGUs.
Initially prepared the demand letter to require concerned

NGAs and LGUs for the submission of liquidation of the
overdue fund transfers.
XIII Currently, co-implementation of both agencies to the said
project is still on-going through regular site visit and
inspection to the 24 recipient Project Organizations (POs).
The DSWD SLP Government Sector Partnership Officer
and DENR SLP Focal together with its provincial and
municipal field PDOs and CENRO staffs are directed to
continually provide technical assistance to the POs in terms
of community procurement and liquidation. As per update
on the series of site visits and inspections conducted by
both agencies, the 24 POs are still implementing their
projects and currently processing their liquidation
documents and reports in preparation for their project turn
over which will commence this month of February until
March 2020.
As for the Due from LGUs unliquidated balances, 10 LGUs

that were sent with final demand letters were mostly under
the PAF II, BUB-SLP and BUB-PSU projects with details:
one LGU has fully liquidated, seven LGUs promised to
liquidate/refund within this month, one LGU will refund on
the first week of March and one LGU have written a letter
on their concern on the unliquidated balance. In addition, if
the LGUs fail to liquidate/refund on the said date,
Management will be forwarding this concern to the Central
Office Legal Bureau for appropriate action.
Internal Control Deficiencies
369. Deviation from internal control in FOs I and VII was noted which may expose
government funds to possible loss and misuse as shown in Table 39.
242
Table 39. Schedule of FOs with Internal Control Deviation
Laws/rules/Regulations
FO Deviation Recommendation
violated
I Job Orders and Cost of Service Section 4.1.5 of COA a. Strictly adhere to Section 4.1.5 of
Workers was allowed to handle Circular 97-002 and Section COA Circular 97-002;
cash advance for distribution to 7.2 of CSC-COA-DBM Joint
the beneficiaries of the different Circular No. 1 series of b. Stop allowing JOs and COs to
programs 2017 participate in the disbursement of
cash advances without proper
Staff from Accounting Section supervision from SDOs; and
was permitted to participate in
the distribution of the cash c. Segregate authorization, custody
assistance to clients. Section 50 of Government of assets and its accounting.
Accounting and Auditing
Manual Volume 3.
VII Various KC-NCDDP personnel The Property and Supply a. Require the Supply and Property
who were either separated from Management System Unit to demand from the end-
the service thru resignation, requires that “When the users/accountable officers for the
with AWOL status and COS equipment issued to an return of the abovementioned
whose contracts were officer or employee is no properties and reimburse the
expired/lapsed, failed to return longer needed by him, said DSWD for the lost units;
a total of 38 units of mobile equipment shall be returned
phones with undetermined to the Property Officer.” b. Require the Supply and Property
value while 11 units were lost Unit to strictly follow the Property
with no replacement or and Supply Management
reimbursement made by the System.
end-user, due to inadequate
control and monitoring by the
Supply and Property Unit and
non-adherence to the Property
and Supply Management
System, thus, resulting to
government’s loss and waste of
its resources.
370. Section 124 of Presidential Decree 1445 provides that it shall be the direct
responsibility of the agency head to install, implement, and monitor a sound system of
internal control.
371. Management provided the following comments/action taken in view of the audit
recommendations:

I Management resorted to this scheme due to Brainstorming on how to devise a system that
lack of workforce. would enable the management and SDOs to
dispose their cash advances safely, and properly
administer JOs and COs allowed to assist in
payouts. Management should consider the
volume of clients to be catered and SDOs
authorized to cash advance in framing the
system.
VII The Supply and Property Unit is exerting its
best effort in demanding the end-users for
unreturned mobile phone units.
243
Other Compliance Audit Issues
Gender and Development (GAD)
372. The DSWD was able to formulate GAD Plan and Budget and notably
attributed the programs that are gender-related with allocated funds of ₱78.131
billion and actual expenditures of ₱61.027 billion or 44.74% of the total Budget of the
Agency.
373. Section 32 of the general provision of the General Appropriations Act of 2019
states that all agencies of the government shall formulate a Gender and Development
(GAD) Plan designed to address gender issues within their concerned sectors or mandate
and implement the applicable provisions under R.A. No. 9710 or the Magna Carta of
Women, Convention on the Elimination of All forms of Discrimination Against Women,
the Beijing Platform for Action, the Philippine Plan for Gender-responsive Development
(1995-2025) and the Philippine Development Plan (2017-2022).
374. PCW-NEDA-DBM Joint Circular No. 2012-01 Section 6.01, At least five percent
(5%) of the total budget appropriations authorized under the annual GAA shall correspond
to activities supporting GAD plans and programs. The GAD budget shall be drawn from
the agency’s maintenance and other operating expenses (MOOE), capital outlay (CO), and
personal services (PS). It is understood that the GAD budget does not constitute as
additional budget over as agency’s total budget appropriations.
375. For CY 2019, the DSWD had substantially implemented GAD Plan and Budget
(GPB) with a consolidated budget of ₱78,131,205,349.18 which constitutes 57.27 percent
of the total budget of the Agency of ₱136,415,323,00 and with expenditures for GAD
related projects mainstreamed in the regular activities of DSWD amounting to
₱61,027,589,815.48 or 78.11 percent of the total allocated budget for GAD or 44.74
percent of the total Budget of the Agency.
376. We encourage Management to continue providing adequate allocation of funds

for programs and activities that will uplift the gender issues of officers and employees
as well as implementation of the planned programs and activities for its clients, the
general public.
Allocation and/or utilization of fund for Senior Citizen and Person with Disability (SCPD)
programs/activities
377. The DSWD had substantially complied with Section 33 of the General
Provisions of RA No. 11260, otherwise known as the GAA of FY 2019, in
implementing programs/projects for senior citizens and persons with disability
(PWDs) with the total expenditure through the Social pension Program and activities
relating to the elderly and differently-abled persons except for the deficiency noted
by FO VIII.
244
378. Section 33 of the General Provisions of RA 11260, among others, “all agencies of
the government shall formulate plans, programs and projects intended to address the
concerns of senior citizens and persons with disability, insofar as it relates to their
mandated functions, and integrate the same in their regular activities.”
379. RA No. 7277 of the Magna Carta for PWDs mandates for the rehabilitation, self-
development and self-reliance of disabled persons and their integration into the
mainstream of society and for other purposes. It further defines the rights and privileges of
disabled persons such as equal opportunity for employment, access to quality education,
national health program, auxiliary social services, telecommunications, accessibility
(barrier-free environment), political and civil rights.
380. As provided under RA No. 9994 or the Expanded Senior Citizens Act of 2010, the
Social Pension Program for Indigent Senior Citizens (SPISC) is the major program of the
DSWD, which provides senior citizens entitlement to a monthly stipend of P500 -
effective January 2011.
381. For CY 2019, DSWD implemented programs/projects for senior citizens and
persons with disability except for observation noted by FO VIII that only 109,396
beneficiaries out of the 276,807 targeted senior citizens have received their stipend for CY
2019 representing 39.52% of the target while expenditures for the program accumulated
to 99.86% of the total allocation resulting in high disparity between the spending level and
actual accomplishment, aggravated by the non-provision of ramps and other facilities to
enhance the mobility, safety, and welfare of the senior citizens and differently-abled
persons who visit the office.
382. We recommended that Management require the FO VIII Regional Director to:
a. require the In-charge of the Social Pension Program to adopt a system

that will fast-track and accelerate the payout of the stipend to the senior
citizens on a quarterly basis to assist the beneficiaries in terms of daily
sustenance; and
b. give priority to the implementation of its programs/projects/activities,

particularly the provision of ramps and other facilities which will
reasonably enhance the mobility, safety, and welfare of the senior citizens
and differently-abled persons who visit the office.
Payments to Contractual and Job Orders
383. The DSWSD hired a total of 12,945 workers under MOA/Job Oder basis,
representing an additional 99.36 percent workforce to the regular plantilla employees
of the DSWD.
245
384. In the implementation of its programs, the DSWD needed to augment its plantilla
positions to cope with the exigencies of the Agency. Presented below is the data of
MOA/Job Orders hired for CY 2019.
Table 40. Schedule of Hired MOA/Job Order Personnel per FO
No. of % of MOA/JO
Agency No. of MOA/ to Agency
Office/FO Personnel Job Order Personnel Personnel
CO 920 791 86.00%
NCR 1024 1,222 119.34%
CAR 392 496 126.53%
I 545 584 107.16%
II 388 552 142.27%
III 786 972 123.66%
IV-A 797 704 88.33%
IV-B 569 418 73.46%
V 1012 737 72.83%
VI 881 856 97.16%
VII 866 1,021 117.90%
VIII 792 772 97.47%
IX 1009 691 68.48%
X 917 951 103.71%
XI 793 909 114.77%
XII 774 634 81.91%
XIII 563 635 112.79%
Total 13,028 12,945 99.36%
Compliance with Other Mandatory Accounts
385. In CY 2019, the DSWD, as a whole, complied with the withholding and
remittance of mandatory deductions, pursuant to the regulations issued by the BIR,
GSIS, PHIC, and HDMF. The CO and FOs had faithfully deducted from the salaries
of its personnel the required taxes, premiums and loan installments, and remitted the
same as well as the government share within the prescribed period to the concerned
institutions or agencies.
Table 41. Analysis of Mandatory Accounts

Area Account affected Status
Compliance with Tax Due to BIR For CY 2019, CO and FOs remitted the taxes withheld
Laws amounting to ₱718.783 million from salaries and wages
of employees and from suppliers/creditors in compliance
with BIR regulations, and remitted ₱651.419 million.
Balance unremitted as at year end amounting to
₱67.364 million was remitted in the 1st quarter of
CY2020, except for deficiencies noted in CO and FO.
Compliance with GSIS Due to GSIS For CY 2019, CO and FOs has withheld GSIS
Act of 1997 contributions/premiums of its officials and employees
amounting to ₱837.253 million and remitted ₱813.633
million including the employer’s share of Life &
Retirement premiums as at December 31, 2019. The
246
Area Account affected Status
balance amounted to ₱23.620 million was remitted in
the 1st quarter of CY 2020, except for the deficiencies
noted in CO and FO.
Deduction and Due to PhilHealth During the year, CO and FOs withheld monthly
Remittance of PhilHealth contributions of its officers and employees amounting to
Premiums ₱80.883 million and remitted ₱72.326 million as well as
the government share. The unremitted balance at year-
end amounted to ₱8.556 million were remitted in the 1st
quarter of CY 2020.
Deduction and Due to Pag-IBIG Pag-IBIG contributions of CO and FOs personnel were
remittance of Pag-IBIG monthly withheld amounting to ₱121.991 million and
premiums remitted ₱113.947 million including the amount of
government share. The unremitted balance at year-end
amounted to ₱8.044 million except for the deficiencies
noted in CO and FO.
386. However, other deficiencies were noted in some FOs as presented in the succeeding
Tables:
Due to BIR
Table 42. Summary of Unremitted Taxes Withheld

Office Unremitted Taxes Negative SL
Deficiency/Status
Withheld Balance
CO ₱ 3,510,321.83 - failed to remit in full the amount withheld including
the beginning balance to BIR
CAR 20,684.52 - Withheld in CY 2017 for purchases of good
charged to Japan Social Development Fund-
Community Driven Enterprise Development
(JSDF-CDED).
The project ended and the bank account was

closed on November 11, 2017. The remaining
balance of the fund was returned to the donor,
however, Management overlooked the balance to
be remitted to BIR.
III 937,494.16 ₱2,999,02.58 The Regional Accountant averred that
reconciliation and verification of the account was
on-going.
V 594,987.65 207,258.65 Due to insufficient records, includes long

outstanding taxes withheld in prior years subject to
reconciliation
VI 3,837,771.58 - Pertains to error on the journal entries in CY 2014
and prior years. Reconciliation was difficult due to
the unavailability of records/files such the copy of
TRAs and JEVs.
VIII 5,919,310.37 - The amount of ₱5,735,336.89 represent prior
years’ withholding taxes and balances forwarded
since CY 2013 which are non-moving accounts for
a long period and could no longer be reconciled
due to absence of supporting documents to
substantiate the taxes withheld at source.
247
Office Unremitted Taxes Negative SL
Deficiency/Status
Withheld Balance
IX 4,438,952.85 - Consist of withheld taxes of ₱591,702.58 in CY
2019 and ₱3,847,250.27 dormant for over one to
three years
387. We recommended and Management agreed to require the Accountants of the

concerned FOs to analyze the unremitted and abnormal debit account balances,
remit the unremitted amount and/or make the necessary adjustments in the books, if
warranted. Penalties and interests for the late remittances shall be borne in personal
capacity of the concerned personnel who was remiss in his/her assigned
responsibilities.
Due to GSIS
388. Summary of GSIS Deficiencies noted in FOs were as follows:
Table 43. Summary of Unremitted/Delayed Remittance Premium Contributions

Office Amount Remarks
CO ₱ 1,003,008.83 Not remitted within the reglementary period
CAR 190,931.38 Remitted with delays ranging from 37 to 61 days
II 20,644.65 Unremitted balances pertain to employees’
contributions for prior years
III 365,488.78 Not remitted
V 23,536.66 18 to 179 days delay; remitted in 2020
Table 44. Other Deficiencies in the withholding and remittance to GSIS

Office Deficiency
NCR Subsidiary ledgers of Due to GSIS were not maintained contrary to the suggested sorting of GAM
Volume III, thereby finding difficulty in determining the nature of the account.
CY 2019 DVs revealed that salary deductions for remittance to GSIS were lumped to its GL
account contrary to GAM Volume III, resulting to difficulty in determining the nature of the
unremitted amount as at year-end.
Classifying and recording of deductions subject for remittance to GSIS to sub-accounts was not
practiced since computation and online remittance is made by the HR Unit.
XI The correct amount per GL could not be ascertained due to incorrect entries.
389. Although no penalty was imposed on the delayed/non- remittances, the foregoing
lapses are not in conformity with Section 14 of RA 8291. It could also affect the
employees’ future claims and benefits from that government agency and incurring
penalties and surcharges is always possible.
390. We recommended and Management agreed to require the concerned

Accountants of:
a. the CO, CAR and FOs II, III, and V to ensure that all premiums and
loans, including the government shares will be remitted within the
prescribed period; and
248
b. the NCR to maintain SLs for Due to GSIS account to facilitate account
verification.
Due to Pag-IBIG
391. The Pag-IBIG premium contributions of employees withheld by the following

DSWD offices were not remitted:
Table 45. Summary of unremitted/delayed remittance premium contributions

Office Amount Remarks
II ₱ 10,928.88 Unremitted
III 23,319.88 Unremitted
392. Moreover, SL of Due to Pag-IBIG account in NCR were not maintained contrary to
the suggested sorting of GAM, Volume III, thereby finding difficulty in determining the
nature of the account. CY 2019 DVs revealed that salary deductions for remittance to Pag-
IBIG were lumped to its GL account, contrary to GAM, Volume III, resulting in difficulty
in determining the nature of the unremitted amount as at year-end. Classifying and
recording of deductions subject for remittance to Pag-IBIG to sub-accounts was not
practiced since computation and online remittance is made by the HR Unit.
393. We recommended and Management agreed to make sure that all premiums
and loans, including the government shares, will be remitted within the prescribed
period. We further recommended that Management maintain SLs for Due to Pag-
IBIG account to facilitate account verification.
Non-insurance of physical assets with the GSIS
394. Safety and control measures were not assured because insurance of properties
with the Government Services Insurance System (GSIS) were not made, as required
in COA Circular No. 92-930 dated November 17, 1992, COA Circular 2018-002 dated
May 31, 2018 and Sections 2 and 5 of Republic Act No. 656, otherwise known as
Property Insurance Law.
395. COA Circular No. 92-390 dated November 17, 1992 provides – the inventory of
physical assets, insurance and bonding of risks with the General Insurance fund of the
GSIS as required under RA No. 656, otherwise known as the Property Insurance Law.
396. Further, paragraph 5.1 of COA Circular 2018-002 dated May 31, 2018 provides that
heads of government agencies shall direct the pertinent official under his/her supervision
to secure directly from the GSIS, GIF, all insurance or bonds covering properties,
contracts, rights of action and other insurable risk of their respective offices.
397. Moreover, Section 2 of RA 656 states that in order to indemnify or compensate the
Government as defined in this Act for any damage to, or loss of its properties due to fire,
earthquake, storm or other casualty, there is hereby established the “Property Insurance
249
Fund”, which shall consist of all moneys resulting from the liquidation of the insurance
constituted in Section 350 of the Revised Administrative Code and from premiums and
other incomes.
398. Section 5 further states that “Every government, except a municipal government
below first class, is hereby required to insure its properties, with the Fund against any
insurable risk herein provided and pay the premiums thereon, which, however, shall not
exceed the premiums charged by private insurance companies”.
.
399. Properties for three (3) DSWD Offices were not insured as at December 31, 2019
thus, government properties are not protected from damage or loss for any eventuality that
may occur as seen in table 47.
Table 47. Summary of Uninsured Property

Region Property Insurance premiums
III ₱ 131,803,338.71 P 635,120.16
V 65,711,343.33 521,231.76
XIII No amount provided No amount provided
400. Further, reasons for the non-insurance of property are provided in Table 48.
Table 48. Reason for non-insurance

Cost of Uninsured
Office Reason for Non-compliance
PPE
XI ₱ 8,185,127.79 Represents 4.18 percent of the total Building and Other Structures not
covered/insured with the GIF of GSIS due to non-inclusion in the report of
Inventory of PPE according to the Property/Supply In-charge.
The agency failed to engage an independent appraiser for properties valued at
P10 million and above. Instead, the appraised value of the PPE presented was
based only on the in-house appraised as explained. On the contrary, it was
noted that the reflected amount was the historical cost of the Building and Other
Structures account.
XIII 48,496,920.25 The renewal of insurance coverage of all property and equipment with GSIS is
every June of the year while the newly built Buildings were posted in the books
of accounts on October 2019, thus were not included in June application for
insurance.
401. In effect, the absence of insurance coverage and the unreliable assessment of PPE
insured with the GIF of the GSIS deprived the government of adequate and reliable
protection against any damage to or loss of government properties due to fire, theft, force
majeure and the like, and it would understate/overstate the premiums paid.
402. We recommended and Management agreed to require the Property personnel

to ensure strict compliance with the provisions of COA Circular No. 2018-002.
403. FO XI Management committed to engage the services of an independent appraiser

for the assessment of the insurable properties above ₱10 million. A letter request dated
March 2, 2020 was forwarded to City Mayor Sara Duterte-Carpio thru the City Assessor’s
Office to assist in appraising the DSWD FO XI properties. Furthermore, the uninsured
250
four (4) properties identified in audit shall be covered/insured with the GIF of GSIS
together with renewal of other structures by March 2020.
Enforcement of Settlement of Accounts
404. In the audit of various transactions, we noted the non-compliance with laws,
rules and regulations which resulted in total audit suspensions of ₱10,934.299 million,
disallowances of ₱838.211 million, and charges of ₱8.173 million or a total of
P11,780.684 million suspensions, disallowances, and charges as at December 31, 2019.
405. The total audit suspensions, disallowances and charges found in the audit of various
transactions as at December 31, 2019 based on the Notices of Suspensions (NS) Notices of
Disallowance (ND), Notices of Charge (NC) and Notices of Settlement of Suspension and
Disallowance/Charge (NSSDC) issued by this office, is summarized in Table 49.
Table 49. Schedule of Notice of Suspension, Disallowances and Charges

Beginning Balance Issued This Period
Ending Balance
Particulars (January 1, 2019) (January 1 to December 31, 2019)
(December 31, 2019)
NS/ND/NC NSSDC
Notice of Suspension (NS) ₱2,378,850,994.76 ₱10,449,541,489.97 ₱1,894,093,268.52 ₱10,934,299,216.21
Notice of Disallowance (ND) 825,375,788.24 15,268,410.08 2,432,992.49 838,211,205.83
Notice of Charge (NC) 8,173,866.36 - - 8,173,866.36
Total ₱3,212,400,649.36 ₱10,464,809,900.05 ₱1,896,526,261.01 ₱11,780,684,288.40
Table 50. Details of Notice of Suspension, Disallowances and Charges

Ending Balance
FO Beginning Balance January 1 to December 31, 2019 December 31, 2019
NS/ND/NC NSSDC
Notice of Disallowance
OSEC 453,131,594.86 - - 453,131,594.86
NCR 350,815,140.00 - - 350,815,140.00
CAR 64,814.28 2,602,527.47 - 2,667,341.75
II 3,767,718.71 42,331.07 566,511.42 3,243,538.36
III 4,055,199.00 - 1,128,440.83 2,926,758.17
IVA 100,000.00 - - 100,000.00
IVB 60,983.00 44,040.76 11,674.00 93,349.76
V 3,503,781.50 - 17,377.00 3,486,404.50
VI 5,319,352.11 664,614.72 46,012.00 5,937,954.83
VII 1,381,260.50 7,099.28 1,388,359.78
VIII 830,673.10 11,907,796.78 385,397.64 12,353,072.24
X 1,590,311.77 - - 1,590,311.77
XI 25,826.43 - 5,165.00 20,661.43
XII 115,173.26 - 115,173.26 -
XIII 613,959.72 157,241.34 456,718.38
Total 825,375,788.24 15,268,410.08 2,432,992.49 838,211,205.83
Notice of Suspension
OSEC 189,909,919.22 - - 189,909,919.22
NCR - 112,435,818.67 - 112,435,818.67
251
Ending Balance
FO Beginning Balance January 1 to December 31, 2019 December 31, 2019
CAR 4,332,974.24 68,773,223.87 63,577,178.96 9,529,019.15
I 108,000.00 - - 108,000.00
II 19,408,257.86 775,947.84 10,944,344.64 9,239,861.06
IVB 44,040.76 - 44,040.76 -
V 1,774,850,738.18 2,468,254,297.01 1,512,756,831.93 2,730,348,203.26
VI - 26,582,960.63 26,582,960.63 -
VIII 120,227,896.61 7,772,395,241.95 121,953,353.33 7,770,669,785.23
X 267,719,167.89 - 158,234,558.27 109,484,609.62
XI - 324,000.00 - 324,000.00
XIII 2,250,000.00 - - 2,250,000.00
Total 2,378,850,994.76 10,449,541,489.97 1,894,093,268.52 10,934,299,216.21
Notice of Charge
XI 8,173,866.36 - - 8,173,866.36
Total 8,173,866.36 - - 8,173,866.36
Grand Total 3,212,400,649.36 10,464,809,900.05 1,896,526,261.01 11,780,684,288.40
406. The above balances included NDs issued by the Special Audit Office for CYs 2007
to 2009 covering Priority Development Assistance Fund (PDAF) transactions.
407. ND/NC/NS issued prior to the effectivity of the 2009 Rules and Regulations on
Settlement of Accounts (RRSA) are not included in the reflected balances but are deemed
disallowances/charges, which shall continue to be enforced in accordance with these rules
as provided under Section 28 thereof.
408. We recommended and Management agreed to require the officials concerned

to:
(i) comply with laws, rules, and regulations to avoid audit suspensions,
disallowance and charges; and
(ii) settle the same within the prescribed period to prevent their accumulation
to highly significant amounts.
252
Part III - STATUS OF IMPLEMENTATION OF PRIOR YEARS’
AUDIT RECOMMENDATIONS
We have followed up the actions taken by the Agency to implement the prior years’
audit recommendations and noted the following:
Status of No. of
Implementation Recommendations
Implemented 108
Not Implemented 37
Total 145
Management Results of
Status of
Audit Observations/ Recommendations Ref Comments/ Implementation
Auditor’s
Actions Taken Validation
2018
FINANCIAL AUDIT
A. Accounting Errors and Omissions (CO, NCR, 2018-
CAR, I, III, IVB, V, VI, VII, IX, X, XI) CAAR
Paras.
Various accounts of the Department of Social 5-10
Welfare and Development (DSWD) have Pages
misstatements overstating the reported total Assets 61-65
and Net Assets/Equity by ₱358.092 million and
₱405.420 million, respectively, and understating the
reported total Liabilities by ₱47.328 million, which
represents 0.33 percent, 0.10 percent and 0.66
percent of its total Assets, Liabilities and Net
Assets/Equity, respectively.
a. Management agreed to direct the

Accountants
(i) To make the necessary

adjusting/correcting entries for the CO, FOs VI and X Implemented Prepared the
accounts affected by the erroneous effected the recording adjustments on
recording in the books of accounts; of deliveries as January and
liquidation of fund March of 2019
transfer, reconciling FO III- JEV No.
items, and adjustments 2019-020001530.
of errors in recording
corrections following Reiterated in Part
adjustments thru with modification
journal entry vouchers II of this report,
(JEVs) prepared in pages 66 to 78,
January and March with revised or
2019 updated
FO III -Adjustment information
on the cancellation of
253
Status of
Audit Observations/ Recommendations Ref Comments/ Implementation Auditor’s
stale checks
amounting ₱14,200 on
the cancellation of
stale check was
recorded as of march
2019 trial balance and
Erroneous recording
of Inventories The
adjustment was
reflected in the books
thru JEV No. 2019-
020001530.
All FOs Implemented Reiterated in Part

(ii) observe the highest degree of objectivity with modification
and consistency in keeping of the II of this report,
accounts to safeguard against inaccurate pages 66 to 78,
or misleading information; and with revised or
updated
information
(iii) carefully analyze the transactions before All FOs Implemented Reiterated in Part
these are recorded for proper with modification
classification of accounts and accurate II of this report,
recording of financial transactions; pages 66 to 78,
with revised or
updated
information
b. establish close coordination and strengthen All FOs Implemented Reiterated in Part
linkages among concerned offices to ensure with modification
timely submission of reports as basis of the II of this report,
Accountants in recording transactions; pages 66 to 78,
with revised or
updated
information
c. evaluate and assess the capabilities of All FOs Implemented Gave trainings to
personnel assigned to perform crucial tasks personnel needed
and give appropriate trainings, if necessary, to enhance their
to ensure effective and efficient performance capabilities to
of their tasks and adherence to reporting perform their
requirements; and duties effectively
and efficiently.
254
Status of
However,
condition still
exist in different
FOs.
Reiterated in Part
with modification
II of this report,
pages 66 to 78,
with revised or
updated
information
d. ensure strict adherence to existing rules, All FOs Implemented Adherence to

regulations, policies and guidelines. existing rules and
regulations is
implemented in
some FOs
Reiterated in Part
with modification
II of this report,
pages 66 to 78,
with revised or
updated
information
B. Accounting Deficiencies 2018-

CAAR
Deficiencies amounting to P4,847.443 million in Paras.
keeping of the accounts affecting fair presentation of 11-33
account balances reported in the FSs. Pages
65-77
Cash in Bank-LCCA; Cash in Bank-Foreign Currency, Savings Account; Cash-Modified Disbursement System
a) Payroll Fund not reconciled with the 2018-
liability to officers and employees. 2.209 CAAR
million CO Paras.
12
Management agreed to require the Accountant to Pages Shall remit, if any, Implemented The unreconciled
conduct thorough analysis of the CIB-LCCA, 66 excess from the balance is due to
Payroll fund vis-a-vis the account Due to Officers deposited amount in timing differences
and Employees to determine how much really is Cash -LCCA Payroll on recording the
the outstanding obligation of DSWD to its Fund to the BTR. transactions.
Officers and Employees that needs to be funded There were no
out from the Payroll fund. Thereafter, revert the deficits for the
payables determined to have no actual claims and Due to Officer and
cause the reversion to the BTr of the excess fund. Employees
Account. The
noted alleged
deficit between
255
Status of
the total payroll
recorded and total
payments for CY
2018 already
formed part the
January 1, 2018
beginning balance.
b) Unreconciled variance between balances 2018-
per books and bank 315.973 million CAAR
(NCR, V, VIII) Paras.
12
Management agreed direct the Regional Pages
Directors concerned: 66
a) require their Accountants to prepare the NCR-The Accounting Implemented NCR-Verified the
BRSs on a timely basis, account and validate Section submitted submission of
the unreconciled differences and effect updated BRSs for updated BRSs for
immediately any necessary RSW-1512-1035-09, RSW-1512-1035-
adjustments/corrections on discrepancies or SEA-K – 1512-1022- 09, SEA-K –
identified and valid reconciling items in the 35, MDS – 2151- 1512-1022-35,
books of accounts; and 9002-01 and Trust MDS – 2151-
Receipts – 1512-1023- 9002-01 and Trust
75 Receipts – 1512-
FO VIII-on-going 1023-75.
reconciliation
Reiterated in Part
II of this report,
pages 79 with
revised or updated
information
NCR-The Cash NCR-According

(b) make representation with the depository Section has inquired Implemented to the staff
banks to make available the bank statements with LBP for the preparing the
on time, or give access to authorized enrollment with BRS, snapshots of
personnel to bank’s online viewing facility weAccess online the bank
(Land Bank of the Philippines’ we Access), or viewing facility of statements were
make arrangement that the banks may bank statements. already being
provide snapshots of bank statements so that FO V- for enrolment provided by the
the Accountants can prepare BRS on time. bank.
FO V-access to
weAccess was
already granted by
Landbank.
Reiterated in Part
II of this report,
pages 79 with
revised or updated
information
256
Status of
Due from GOCCs

c) Unreconciled variance between balances 2018-
per books and results of confirmation. CAAR
427.63 million (CO, NCR) Paras.
12
Management agreed to require the Pages
66-67
(a) Supply/Property/ Warehouse Officer to NCR-The Not There is still a
transmit promptly to the Accounting Division Management is having implemented continuous
the delivery documents as basis in recording difficulty in retrieving retrieval of these
receipt of deliveries in the books of accounts; the files most Delivery Receipts
and particularly for those as basis of
handled by retired or recording the
resigned staff. liquidation/adjusti
ng entries.
NCR- On-going
(b) Accountant to reconcile their records with reconciliation with Not There is still a
implementing agencies regularly and effect other government implemented continuous
immediately correcting/ adjusting entries on agencies. However, retrieval of these
discrepancies/reconciling items in the books. they are experiencing Delivery Receipts
the same problem such as basis of
ours. A series of recording the
meeting will be liquidation/adjusti
conducted to ng entries.
brainstorm whatever -
legal remedies to
settlement of these
accounts if not for
write-off.
Due from LGUs
d) Existence of negative balance. 60.400 2018-
million (FOs IVA and VIII) CAAR
Paras.
Management agreed to require the Accountants 12
to Pages
i) maintain updated subsidiary ledgers for 67 FO IVA- SLs for each Implemented Maintained
the funds transferred to LGUs; LGUs with fund updated SL for
transferred are now funds transferred
being maintained. to LGUs
ii) reconcile their records with recipient FO VIII- Accounting Implemented On-going
LGUs and record immediately sent letters to reconciliation of
liquidations already submitted with concerned LGUs accounts.
complete supporting documents; and
Reiterated in Part
II of this report,
page 80, with
257
Status of
revised or updated
information
iii) monitor closely the submission of FO VIII- Accounting Implemented On-going

liquidations for appropriate recording sent letters to reconciliation of
against the specific grant amount. concerned LGUs accounts
Reiterated in Part
II of this report,
pages 80, with
revised or updated
information
e) Lack of verification and review on the 2018-

completeness of signatures of authorized CAAR
signatories of released checks covering Paras.
fund transfers. 8.508 million (FO VII) 12
Pages
Management agreed to direct the Regional 67
Director to:
(a) require the authorized officials/ signatories On Feb. 27, 2019, Implemented Submitted the
and concerned personnel of the Cashiering management had sent memorandum to
Unit to check and review properly the a memorandum to all COA about the
completeness of signatures of checks before designated releasing instructions given
releasing them to the payees; and staff at the Cash to Cash section
Section and to all and Swad Team.
SWAD Team Leaders The checking and
instructing them to reviewing of
examine carefully the signatures of
check on the checks is properly
completeness of done before
signatories prior to its releasing them.
release.
b) assess the manpower requirement in the The Cashier had re- Implemented The procedures
Cashiering Unit in view of the voluminous oriented the staff are completely
transactions handled by the assigned assigned on the proper adhered and
personnel so that procedures on the release way of releasing the strictly followed
of checks to payees could be completely checks and to be now by the
adhered to and strictly followed. extremely careful that cashiering unit
no more check will be upon validation.
released on the same
sort
f) Liquidations not properly supported with 2018-
duly certified, approved and audited RCIs CAAR
198.259 (FO X) Paras.
12
Management agreed to direct the Regional Pages Management stated in Implemented The RCI’s were
Director to require the IAs to submit RCI and/or 67 their letter-response submitted by the
258
Status of
RD, certified correct by the Accountants, that the liquidation management in
approved by the Heads of the Agency and reports submitted to accordance with
duly/stamped received by the Auditors of the IA them by the IAs were the
recommendations.
stamped received and
deemed as post-
audited, unless a
Notice of Suspension
for monitoring or a
Notice of
Disallowance will be
furnished to the SA
Auditor, for
adjustment in the
books of accounts.
Due from NGOs/POs

g) Liquidations not properly supported with 2018-
required documents, verified by the CAAR
authorized KALAHI–CIDSS NCDDP Paras.
officials, lack of signatures; and 12
unsubmitted vouchers. 10.226 million (FO Pages
VII) 68
Management agreed to require the Regional Accounting Unit Implemented The DVs/
Director concerned to instruct the KALAHI- already instructed the liquidation and
CIDSS NCDDP and concerned personnel to concerned personnel supporting
ensure proper checking and review on the DVs/ to conduct proper documents were
liquidations and other supporting documents checking and review submitted to COA
before submitting them to COA; and to submit on the on March 27,
the DVs/liquidations and supporting documents DVs/liquidations and 2019. The review
other supporting and checking of
documents before documents are
submitting them to now properly
COA, so that complied.
suspensions/
disallowances in audit
could be avoided.
Other Receivables
h) Subsidiary Ledger (SL) balance could not 2018-

be traced as to its complete details 113.519 CAAR
million (FO VII) Paras.
12
Management agreed to instruct the Regional Pages The JEV together with Implemented The supporting
Director to require the Accounting Unit to 68 the supporting documents were
provide the Audit Team complete details of the documents were submitted to COA
account. already submitted to to complete the
COA.
259
Status of
details of the SL
account.
Loans Receivable-Others
i) Doubtful collection/ diminishing collection 2018-
rate of loans granted to identified CAAR
beneficiaries under the PGMA Micro- Paras.
financing and Enterprise Development 12
Program 2.432 million (FO XI and XIII) Pages
68-69
Management agreed to require the Regional
Director concerned to:
Not
(a) cause the evaluation and reconciliation of FO XIII- Foundation implemented FO XIII-Request
all overdue accounts to determine its no longer holds office for write-off was
proper disposition and/or request for at its known address already submitted
write-off of dormant or non-collectible to the Auditor’s
and the foundation
accounts pursuant to the requirements Office last
under COA Circular No. 2016-005 dated could no longer pay its December 26,
December 19, 2016; and obligations to the 2019 and the same
government since it is still for review.
was already disbanded
and its officials were
either dead or can no
longer be found.
FO XI-Despite of
limited staff Not
(b) Install adequate controls on the collection,
management has, implemented
accounting (recognition of receivable and FO XI- No request
repayments), monitoring and enforcement of they made efforts to for write off.
the collections due to the government, for verify this project but Submitted update
every programs extending receivables or collection is not on the status of
grants with re-payment schemes. possible as per our Loans Receivable-
Others last July
area visits and 2019. No updates
collateral interview, thereafter.
hence are asking
consideration to write
off this case and shall
provide necessary
documents as required
under COA Circular
No. 2016-005.
This project has been

implemented 10 years
ago and the
management tried best
260
Status of
efforts to comply with
the recommendations.
Based on the
home visits conducted
in coordination with
the City Social
Services and
Development Office
(CSSDO) and
Municipal Social
Welfare Development
(MSWDO), mostly no
record nor turned-over
of cases relative to
PGMA project;
SLP Cluster
office made effort to
retrieve documents but
no record can be found
in the present SLP
office;
Per area
visitation, some of the
members are not
residing anymore in
the area; some were
displaced due to the
onslaught of Typhoon
Pablo in the affected
areas of Davao region;
The previous
staff who has the
knowledge on this
project were no longer
connected with the
department;
Inventories
j) Unreconciled variance between balances 2018-

per books and RPCI CAAR
261
Status of
Paras.
(millions) 12
CO 212.432 Pages
NCR 34.760 69
CAR 40.601
I 82.043
II 9.888
III 5.044
IVB 43.422
V No data
VI 12.483
VIII No data
IX 4.343
X 209.175
XI 9.197
XII No data
XIII 17.789
Management agreed to instruct the Regional

Directors concerned to require the:
(a) Property Division to conduct a complete All concerned FO Implemented Submitted RPCI
physical count of inventories and prepare a conducted Physical
report thereon; Count of Inventories
Reiterated in Part
II of this report,
page 81, with
revised or updated
information
(b) Property and Accounting Divisions to NCR- Provided Implemented NCR-The format
diligently prepare, maintain and update technical assistance to specified in GAM
their Inventory records, forms and reports to FO property is already being
facilitate conduct of periodic reconciliation custodians including followed.
of balances and to correct promptly any those from centers
deficiency noted; and /institutions in filling
out the correct Reiterated in Part
inventory account II of this report,
titles as prescribed in page 81, with
the preparation of revised or updated
Report of Physical information
Count of Inventories
(RPCI).
FO III- to exercise
due diligence in the
performance of their
262
Status of
functions and analyze
each transaction to
avoid error
FO V- Implemented
c) Accountants to prepare necessary NCR- Delayed Not NCR-The

adjustments in the books of accounts for the submission of source Implemented Accounting could
deficiencies noted after reconciliation. documents by the end- not record the
users. disposed welfare
CO- No actions were goods due to
noted by the audit incomplete
FO III- An Adjusting documentation.
entry was made to The Custodians
correct the erroneous assigned in the
adjustment by debiting centers as well as
Welfare Goods for the staff in-charge
Distribution and of consolidating
crediting the report assured
Accumulated that she is
Surplus/Deficit correcting the
amounting to inventory account
P324,000.00 as per before submitting
JEV No. 2019-02-727. the RPCI.
FO III-
Implemented as
per JEV No. 2019-
02-727.
Reiterated in Part
II of this report,
page 81, with
revised or updated
information
k) Purchases of inventories were expensed 2018-

outright CAAR
Paras.
(in millions) 12
CO 3.290 Pages
NCR 20.874 69
III 15.734
XII 885.191
Management agreed to instruct the Heads of CO-Management Implemented CO- some of the
Offices concerned to require their respective agreed with purchases were
Accountants to record all purchases in their recommendation directly recorded
respective inventory accounts and issuances as as expense.
expenses in accordance with the perpetual
inventory method of recording; and to observe FO III- The FO III- The audit
the use of weighted average method of costing Accounting Section team conducted a
inventories. drafted a follow up
263
Status of
memorandum to the validation
Disaster and Response regarding the
Management Division accounting of the
requiring the issuance of family
submission of the food packs. As per
report on Monthly validation, the
Unissued/ Unreleased Management
Welfare Goods for already stopped
Distribution every 5th their erroneous
day of the month. practice, instead,
they are now
FO XII-Accounting charging the cost
Unit has started to of family food
record all purchases in packs to expense
their respective upon issuance to
inventory account and end-users and not
issuances as expenses upon repacking.
'manually' based on
the RIS/RSMI Reiterated in Part
submitted by the II of this report,
PAMS. However, they page 83 to 84, with
have proposed an revised or updated
automated inventory information
system which is on-
the-process of system
and design analysis
l) Discrepancy in quantity and cost per books 2018-
and RPCI CAAR
(CO) 320.763 million Paras.
12
Pages
69
To observe the use of weighted average method No action Not Management did
of costing inventories. implemented not use weighted
average in costing
inventories. No
reconciliation has
been made to
adjust unit cost of
inventory to
weighted average.
m) Excessive purchases of office supplies 2018-
0.297 million (FO IVB) CAAR
Paras.
Management agreed to instruct the Regional 12
Director to: Pages
69 Last September 4-6, Implemented The Property
(a) require attendance of the Property/Supply 2019, the Supply and supply officer
Officer to the seminar on Property and Property Officer have attended the
Supplies Management System to become together with the seminar on
Management Audit Property Supplies
264
Status of
more responsible in periodic assessment of Analyst attended the Management
the inventory movements; and training on Appraisal System and now
and Disposal of carefully
Government monitoring the
Properties movement of
inventories
For the improvement Implemented The new

(b) compel the Procurement Section Head to of the business system/process is
properly plan the procurement of supplies process of now being
equivalent to two—month requirement of the Procurement Unit implemented to
agency. and to avoid the properly monitor
overstocking of the procurement
supplies, they of supplies for
installed a system proper planning of
that all request of agency’s
supplies and office procurement of
equipment should be supplies.
checked first by the
Supply and Property
Unit and the purchase
of the supplies is on
quarterly basis.
Property, Plant and Equipment

n) Unreconciled variance between PPE 2018-
balances per books and Report of Physical CAAR
Count of PPE (RPCPPE) Paras.
12
(In Millions) Pages
CO 98.507 70-71
NCR 13.623
CAR 14.228
I 0.138
II 0.155
III 1.021
IVB 21.751
V 44.048
VII 5.026
VII 50.453
X 0.051
XI 36.520
XII 63.922
XIII 0.937
Total 350.380

Directors concerned to:
265
Status of
a. immediately return to the CO the signed PSAMD regularly Not FMS will prepare
Property Transfer Report (PTR) for follows up unreturned implemented memorandum for
transferred equipment as basis of the latter in Property Transfer this to closely
derecognition thereof; reports. Furthermore, coordinate with
field offices, through field offices and to
their accounting resolve the issues
sections and in on derecognition
coordination with their of PPE.
property sections, will
be required to send
advance copies of
their signed PTRs via
email, to be used as
basis for recording the
transfer.
NCR-To ensure that

necessary adjustment
on reclassification of
b. require the Accounting and Property Units semi-expendable Not NCR-The updated
to: equipment/ items be implemented PPELC are those
executed in the PPE pertaining to the
(i) use common reference identical property books of accounts. newly acquired/
numbers and regularly maintain and CO- To reconcile transferred PPE,
update PPELC and PC for each category different property and they are still
of PPE for ease in reconciliation: numbers to accounting reconciling the
and property and act PYs’ balances.
on them accordingly.
Currently using CO-Property No.
PPELC and is updated between PC and
automatically every PPELC remain not
time the transactions is the same.
recorded.
CO-Reconciliation of
accounts will be done
regularly by the
Property division and
accounting division.
(ii) after the conduct of physical count Management Not Accounting and
reconcile records to identify the causes of strategized the process Implemented Property records
the differences and adjust accordingly; in recording PPE by were
minimizing the time of unreconciled.
processing and
(iii) come up with an effective Property processing of Implemented
Accounting System for prompt recording documents effectively The system used
of delivery and receipt and transfer of and efficiently. by the
PPE to account real time; management is
enhanced and can
266
Status of
CO- These vehicles be viewed real
were loaned to the time.
Field Offices III and
VIII. As agreed, the
(iv) verify and validate the whereabouts of Field Office insure Implemented
items not reported in RPCPPE but and register these Whereabouts of
recorded in the books and make the vehicles annually. A the PPE not
necessary adjustments, if warranted; and property transfer reported in the
report will be issued RPCPPE were
to permanently identified. Field
transfer these vehicles Office VIII and III
to field offices. insured the
FO IV-B The vehicle.
Management already
issued a memo to
Accounting unit to
(v) trace the documents evidencing
make the necessary Not Adjusting of
ownership of FO IVB over the four units
adjusting entry to implemented balances is not yet
of one storey-building, conduct ocular
derecognize properties being made in the
inspection to track their whereabouts,
that should not be book.
and make the necessary adjustment in
recorded in the book.
each record, if warranted;
CO - A reconciliation
of reciprocal accounts
between the Central
c. instruct the Accounting personnel to:
Office and Field
Offices is conducted
(i) verify if PPE transferred by CO to FOs
annually before the Implemented PPE transferred by
were already recorded in the books of the
closing of books. The CO to the FOs
FO concerned and consider the same
recorded transfer of with PTR were
during consolidation;
PPE to and from Field already recorded.
Offices is reconciled
with Property Transfer
Report (PTR) as
supporting document
FO III-The JEV
preparer concerned
was reminded on the
careful recording of
transactions and
over/under
(ii) FO III - analyze carefully the recorded
depreciation of PPE Implemented Implemented on
transactions and ensure that proper
accounts. Necessary March 2019
accounting and adjusting entries are
adjusting entries were as per JEV-2019-
taken up;
recorded on March 031984.
2019 as per JEV-
2019-031984.
CO-Regular meetings
were conducted with
267
Status of
designated Property
officers regarding the
d. require the Property personnel to: DSWD policy on
property management.
(i) CO - orient the signatories to the Technical assistance Implemented Technical
Property Acknowledgement Receipt was provided to the assistance was
(PAR) of their accountability and the property officers. provided to
process of transferring to the FOs in property officers
order not to delay the preparation of Adhere to prescribed regarding the
PTR; format and instruction DSWD policy on
will be observed in property
the next reporting management.
period
(ii) NCR - follow the format and instruction Implemented Shortage/Overage

in the preparation of RPCPPE already reflects
prescribed in Appendix 73 of the GAM, the difference
Vol. II; between the
FO III-Necessary property card vs.
adjusting entry was physical count in
recorded by debiting accordance with
Information and Appendix 73 of
GAM Vol II.
Communication
FO III - Management agreed to carefully analyze Technology Implemented
the recorded transactions and ensure that proper Equipment and JEV-2019-032159
accounting entries are taken up. Accordingly, crediting was recorded on
prepare correcting journal entries for items in the Accumulated March 20 2019
PPE that needs to be capitalized and ensure the Surplus/Deficit
issuance of the property acknowledgment receipt
Account amounting to
for control and accountability purposes for the
equipment. P1,148,775.00 which
was reflected in March
2019 financial report
thru JEV-2019-
032159
The Accounting unit

already booked-up the
donated vehicles.
FO IVB - furnish the Accounting Unit the Implemented

authenticated copies of PTR or equivalent The donated
documents as basis in the recognition of donated vehicles were
vehicles in the books. already recorded
in the book.
Due to Officers and Employees
268
Status of
o) No breakdown of payable/non-reconciliation 2018-
with contra account-10.063 million (CO) CAAR
Paras.
Management agreed to require the Accountant 12
to: Pages
71
(i) determine how much really is the Shall remit, if any, Implemented Analysis was done
outstanding obligation of DSWD to its excess from the and the issue was
Officers and Employees that needs to be deposited amount in already resolved.
funded out of the Payroll Fund; and Cash -LCCA Payroll
Fund to the BTR.
Analysis was done
(ii) revert the payables determined to have Implemented and the issue was
no actual claims and cause the reversion already resolved.
to the BTr of the excess fund.
Accounts Payable
p) Non-reversion of Accounts Payable to 2018-
Accumulated Surplus/(Deficit) CAAR
Paras.
IVB - 18.476 million 12
VI - 0.062 million Pages
71
Director concerned to:
(a) ensure that rules and regulations on the FO IVB-The Implemented Rules and
recognition of payables be strictly Management sent regulation are now
adhered to; memo to Mr. Edward strictly complied.
Manaog reminding
him to do his duties
(b) direct the Accountants to review and and responsibilities as Not Reversion of
analyze the validity of the Accounts the Regional Implemented accounts was not
Payable, outstanding for more than two Accountant. They also made
years and if found to have no valid directed the Regional
claims, and cause the reversion of the Accountant to review
same to the Accumulated the correctness and
Surplus/(Deficit) account. validity of Accounts
Payable as of
December 31, 2018.
They also seek the
coordination of Ms.
Sonia de Leon,
Sustainable
Livelihood Program
Supervising
Administrative
Officer, to validate
269
Status of
and check if the said
accounts payable have
no actual claims.
q) Validity of several claims cannot be validated. 2018-
100.741 million (NCR) CAAR
Paras.
Management agreed to require the Regional 12
Director direct the: Pages
72
(a) Accounting and Budget Units to prepare Accounting and Implemented Observed the
the required reports and records to Budget Units submission of
monitor the obligations; submitted monthly monthly FARs to
FAR 1 and FARs 1A DSWD-FMS
to DSWD-FMS
(b) Accounting Unit to process first the The Accounting Unit Not Validation made
claims before recording/ increasing the is continuously implemented by the audit team
payable account; prepare NORSA for exerting its effort to on the APs as of
adjustment to ORS; and stop the practice recall all disbursement December 31,
of recognizing payables without valid vouchers that were 2019 still does not
claims; and recorded in the coincide with the
Accounts Payable for balance in the
CY 2018 but already Statement of
returned to end-user Financial Position.
for compliance. For
CY 2019 Accounting
Unit ensure that all
disbursement
vouchers are process
first before recording
as accounts payable.
Budget Unit assigned
staff to maintain the
subsidiary record Box
C of ORS
Budget Head
(c) Budget Unit to maintain the subsidiary confirmed that they Implemented The maintenance
records Box C or ORS. are maintaining and of the subsidiary
monitoring and record Box C or
updates the subsidiary ORS are now
record Box C of the strictly being
ORS. implemented.
r) Validity and reliability of Accounts Payable 2018-

cannot be ascertained. 639.107 million (FO CAAR
VIII) Paras.
12
Management agreed to instruct the Regional Pages
Director require the: 72
270
Status of
(a) Accountant and Budget Officer to The accounts payable Not On-going
submit DVs properly supported with are in the process of implemented reconciliation
sufficient evidence and submit the same reconciliation
to the audit team for verification and
validation; and
(b) Accountant to update and maintain GL No actions made. Not On-going

and SL to ensure reliable balances posted implemented reconciliation
in the Trial Balance.
s) Improper maintenance of SL. 23.670 million 2018-

(FO V) CAAR
Paras.
Director to order the: Pages
72
(a) e-NGAS Administrator to encode the No action has been Not Required
complete information and details in the made by the implemented information not
SLs to facilitate confirmation as required management. yet appearing in
by the form; and the electronic SLs
(b) Accountant to investigate and/or adjust No action has been Not Account balance
the abnormal and outstanding payable made by the implemented of the related
balance without valid claimant. management. account was not
adjusted.
Other Payables
t) Unsupported and unauthorized liabilities 2018-
CAAR
CAR - 196.901 million Paras.
VII - 0.177 million 12
Pages
Director concerned require the Accountant to:
(a) stop setting up payables without complete FO VII- The Other Implemented The payables are
documentation/ valid claimants; and Payables (2-99-99- now well
990) account balance documented in FO
of ₱176,605.54 was VII.
already reconciled and
reports were already CAR Failed to
submitted to COA. comply with the
recommendation
Reiterated in Part
II of this report,
pages 88, with
revised or updated
information
271
Status of
(b) record the reversion of all payables aged CAR-The accounting Implemented Validated as per
more than two years to Accumulated office derecognizes March 2019 JEV
Surplus/(Deficit) and correct/adjust the the other payables. 19-03-4668
deficiencies noted on the accounts
affected.
u) Discrepancy between TB and Aging presented 2018-
in the Notes to FSs/ Statement of Financial CAAR
Position and the GL (VI- P34.699 million) Paras.
12
Management agreed to instruct the Regional Pages
Director require the Accountant to work back the 73 No action has been Not The Accountant
prior years’ transactions and prepare/maintain made by the implemented finds difficulty in
the SL to determine the correct payable amount management. reconciling the
per creditor/fund source. balance of “Trust
Liabilities” and
“Other Payables”
accounts due to
the non-
availability of
files/records for
CY 2014 and prior
years. Any
unutilized
balances will be
determined after
the reconciliation.
Guaranty/Security Deposits Payable account
v) Unreconciled SL and FSs balances/ discrepancy 2018-
of the SL and the Cash Receipt Journal/ Check CAAR
Disbursement Journal/ lack of SL from prior Paras.
years 3.455 million (FO VIII) 12
Pages
Management agreed to instruct the Regional 73 For reconciliation. Not Ongoing
Director require the Accountant to update SL for implemented reconciliation.
all fund clusters and trace previous completed
contracts which have performance bonds that
have been returned to the contractors, but
erroneously or doubly recorded in the books.
COMPLIANCE AUDIT
Dormant Accounts Balances 2018- CO-A Memorandum
CAAR will be issued
w) Dormant bank accounts balances of P87.987 Paras. requiring the
million for over five years in FOs CAR, V, VIII, 35-40 concerned FOs to
and XIII were not remitted to the Bureau of the Pages remit the balances of
Treasury thus, deprived the government of 73-80 Self-Employment
additional funds for its priority projects. Assistance (SEA)
Likewise, various account balances remained Revolving and
dormant for over 10 to 20 years affecting the Settlement Fund
fair presentation of the account balance in the account to the BTr on
FSs. (including NCR, I, III, IVB, V, VI) a monthly basis
272
Status of
pending the closure of
the accounts;
CAR-Debit
advice/Authority to
debit account was
transmitted to BTr on
December 07, 2018
for the amount of
P39,496,394.68;
FO V - DSWD-SEA
Kaunlaran
Association (SKA)
collection fund was
not recognized in the
books of accounts
since the account is
merely a “designated
collection account” of
SEA Revolving and
Settlement Fund
Account, the latter
being the account
recognized in the
books. Management
will coordinate with
LBP as to the
existence of a balance
of P55,425.00;
FOVIII remitted
balance to treasury
FO XIII - Remitted
the amount of
P9,754,873.19 to the
BTr on March 4, 2019
per check no. 2011314
Management agreed to require the Heads of dated February 28,
concerned Offices to: 2019. The remaining
balance was required
a. cause the closure of dormant and/or by the bank as Implemented FO V-Upon
unauthorized bank accounts and remit maintaining balance. validation from
balances to the National Treasury pursuant the bank, dormant
to Executive Order No. 431 dated May 30, accounts are now
2005; closed.
FO VIII-Remitted
to BTr on
December 7, 2018
FO V- Closed dormant
accounts
273
Status of
b. reassess the status of recovery of the long- FO VIII remitted Not FO V- required
overdue accounts, if warranted, consider the balance to treasury Implemented documentation is
possibility of requesting authority from COA not yet submitted
to write-off the unsettled accounts from the to COA for
books of accounts following the requirements assessment.
under COA Circular No. 2016-005 dated
December 19, 2016;
FO V-located
c. require the Accountant to set allowance for pertinent documents
impairment losses on Receivable accounts for write off Not Request for write-
that had been dormant and/or non-collectible FO XIII- Foundation implemented off was already
as at year-end while awaiting for the approval no longer holds office submitted to the
of write-off; and at its known address Auditor’s Office
and the foundation last December 26,
could no longer pay its 2019 and the same
obligations to the is still for review
government since it
was already disbanded
and its officials were
either dead and can no
longer be found.
NCR-The accounting
section is continuously
retrieving files in the
d. direct the Accounting and Property Units to stockroom that can be Not NCR -On-going
continuously reconcile their records and useful in the Implemented retrieval of the
determine proper disposition, if application for write
reconciliation is not possible due to absence of documents to be
off.
records and documents, request for write-off used in the request
FO VIII- on going
and/or adjustment of account balances from reconciliation for write-off.
the COA may be considered.
Lapses in granting/utilization/liquidation of Cash

Advances (CAs)
2018-
x) Lapses in the granting, utilization and CAAR
liquidation of CAs to Special Disbursing Paras.
Officers (SDOs) for programs and projects and 41-52
for operating expenses of the Social Welfare Pages
Attachés for the International Social Services in 81-84
Foreign Posts resulting in the accumulation of
the affected accounts balances. (FO CO, I, IVB,
V, XIII)
Management agreed to:
a. direct the Accountable Officers/SDOs/

Attaches to
274
Status of
(i) settle/liquidate their cash advances in full CO- The system is Implemented Cannot be
as soon as the purposes for which these already in place to liquidated
were given have been served; and ensure proper and immediately
timely liquidation of because of time
cash advance of constraints.
Attaches. They are (review and
given Technical submission
Assistance prior to (Social Welfare
deployment which Attachés)
includes orientation on
proper liquidation.
Finance division has
identified four
(ii) submit proper and complete supporting personnel dedicated Implemented CO-The Attaché
documents in order to recognize to validate reports are submitting
promptly in the books the liquidations proper and
submitted by
made and to rectify deficiencies noted complete
within the set deadline; Attaches. Set documents,
polices requiring the however, it is not
b. require the Accountants to submission of timely complied.
liquidation reports
(i) demand full liquidation of all long up to 75% of cash Not There are still
outstanding cash advances and the advance; implemented existing
return of excess cash if unused for a certification of the outstanding cash
period of two months; Attaché on the fund advance for
utilization up to liquidation.
75% and
(ii) strengthen the monitoring of cash Implemented FO V- Reiterated
advances and refrain from processing verification of cash in Part II of this
additional cash advances to employees in bank statement report, page 228
with outstanding unliquidated balances not exceeding 25% with revised or
and/or liquidation reports with of fund transfer. updated
incomplete/defective documentation; information
(iii) issue a Certification that previous cash FO V_- No comment Implemented FO V- Reiterated
advances/fund transfers had been or action on part of in Part II of this
liquidated and accounted for in the books the management. report, page 228
of accounts before granting additional with revised or
funds; and updated
information
(iv) facilitate the review of liquidation reports CO- The Accounting Implemented Accounting
and immediately communicate to the Division shall ensure Division is
Attaches/AOs the deficiencies noted for that it would send its communicating
their prompt compliance; findings and
to the attaches
observations to the
head of the ISSO and
any deficiencies
the Attaché concerned noted
within 5 days from
receipt of the
liquidation report, in
order for them to
275
Status of
immediately comply
with any deficiencies
and to submit any
lacking documents.
FO I-The Special The RSO limit the

(v) Limit the grant of cash advance to duly Order of Mr. Ardel Implemented purpose of his
authorized disbursing officer and within Laroya was amended cash advance to
the limit of authority as prescribed under under RSO No. 63, SLP related
COA Circular 97-002 dated February 10, series of 2019. advances only.
1997
CO-The DSWD Accounting
c. reassess its internal control system on cash required all Attachés Implemented Division is
disbursements and adopt measures to ensure including all those communicating to
prudence in the grant of cash advances, who are already the attaches on
immediate implementation of deployed to execute deficiencies noted.
projects/utilization of funds for the purpose instruments in which
these are granted, as well as liquidation they would declare
within a reasonable time, as such cash will not they hold or would
remain in the hands of the disbursing officers hold the funds in
for a long period of time; and foreign bank accounts
under their names in
trust for the DSWD
and authorize the
DSWD Secretary or
his duly-authorized
representative to look
into and even
withdraw funds from
such bank account.
CO - The DSWD
d. require the ISSO to institute additional required all Attachés Implemented DSWD Legal
control measure to safeguard the money of including all those Service is drafting
the government by requiring the SWAtt to who are already needed instrument
issue a waiver or manifestation to be deployed to execute for additional
communicated to the Bank that the fund instruments in which control as
deposited belongs to the DSWD or to the they would declare recommended.
Philippine government. they hold or would
hold the funds in
foreign bank accounts
under their names in
trust for the DSWD
and authorize the
DSWD Secretary or
his duly-authorized
representative to look
into and even
withdraw funds from
such bank account.
276
Status of
Long Outstanding and Unliquidated Receivables
y) The year-end balances of funds transferred to 2018-

NGAs/GOCCs/LGUs/NGOs/POs amounted to CAAR
P40,254.726 million, of which P10,717.358 Paras.
million or 26.62 percent are past due, while 53-62
P29,537.368 million or 73.38 percent are not Pages
yet due for liquidation. (CO, CAR, II, III, VII,) 84-87
Management agreed to require the Implementing

Agencies to:
(i) settle/liquidate their fund transfers in full Management concurs Not No movement in
as soon as the completion of the projects; with all the Implemented the SL balances
recommendations and noted.
(ii) submit proper and complete supporting submitted the updates
documents in order to recognize on the initial/partial Not Partial submission
promptly in the books of accounts the implementation Implemented to some FOs
liquidations made and to rectify thereof by the CO and
deficiencies noted within the set deadline; FOs concerned such as
and CAR, II, IVA, IVB,
VI, VII, IX, XI, XII,
(iii) determine if the projects are still XIII which include
implementable; otherwise, demand the among others, Not Amounts not yet
refund of the amount transferred/excess adjustment of implemented refunded.
amounts; erroneous journal
entries, recording of
a. oblige the respective Program Managers in liquidations,
the CO and focal persons in the FOs to go reconciliation of Implemented The
down to the LGUs to monitor the balances, intensified implementation of
implementation of the program/project, as retrieval of liquidation the monitoring of
well as the liquidation of fund transfers and documents, continued project is
on the initial implementation of future sending of demand continuously
Project ensure that the Area Coordination letters to being followed by
Teams (ACTs) orient the Municipal implementing partners the concerned
Accountants of their roles and actively follow- demanding liquidation officers in the CO
up liquidation documents from the LGUs; of fund transfers, and and LGUs.
and furnish copies of liquidation documents providing guidance
to the Accounting for recording; and and technical
assistance to the FOs
such as monitoring
b. require the Accountants to and coordination with
LGUs for the timely
(i) demand full liquidation of all long submission of reports. Not No movement in
outstanding fund transfers and the Implemented the SL balances
return of excess cash if unused for a noted.
period of two months;
(ii) strengthen the monitoring of fund Implemented Provided guidance

transfers and refrain from processing to and technical
277
Status of
downloading of funds to implementing assistance to FOs
agencies with outstanding unliquidated for timely
balances and/or liquidation reports with submission of
incomplete/defective documentation; reports
Certification is
(iii) issue a Certification that previous fund Implemented issued to grant the
transfers had been liquidated and additional cash
accounted for in the books before advance
granting additional funds; and
Provided guidance
(iv) facilitate the review of liquidation reports Implemented to and technical
and immediately communicate to the IAs assistance to FOs
the deficiencies noted for their prompt for timely
compliance. submission of
reports
Pantawid Pamilyang Pilipino Program (4Ps)
a. Unliquidated fund transfers to LBP
Fund transfers to the LBP-Cash in Bank, LCCA from

the Cash-Modified Disbursement System (MDS)
account for over the counter payment of grants to the 2018-
4Ps beneficiaries recorded under the Due from CAAR
GOCC-LBP showed an unliquidated balance of Paras.
P10,851.548 million, of which P2,843.597 million or 63-68
26.20 percent represent transfers from CYs 2013 to Pages
2017, due to lack of monitoring and follow-up by 88-89
LBP to the conduits and the slow processing of
documents at the Field Offices. (CO)
Management agreed to require:
a.1 Financial Management Service-Special

Project Service to coordinate with LBP to: i) DSWD and LBP Implemented Showed a balance
monitor and follow-up liquidation documents conducted a month- of
from the conduits to comply with the long reconciliation of P5,156,609,809.26
provisions of the MOA; and ii) return records in December on December 31,
immediately the amount not released to 2018. The posting and 2019, compared to
beneficiaries in the ARMM; recording of the last year’s balance
reconciled amounts of 10 billion.
were reflected in the Balance is usually
January and February liquidated the
2019 liquidation following months.
reports resulted in
substantial decrease in
unliquidated balances.
278
Status of
a.2 FOs for the immediate review, validation and Issued a memorandum Implemented FOs are
transmittal of documents to the CO for the in April 2019 to direct implementing the
recording of liquidation; the DSWD field issued
offices to comply with memorandum on
the immediate review April 2019.
validation and
transmittal of
documents.
To return to BTR
a.3 DSWD CO to remit to the BTr the unreleased unreleased amount. Not The balance was
amount intended for ARMM since no conduit implemented not returned to
or individual is willing to take the risk due to BTr.
security reasons while waiting for the release
of cash card thru which beneficiaries shall be
paid.
b. Lack of monitoring on the refunds of conduits 2018-
CAAR
Of the total refunds of P12,593.091 million from the Paras.
LBP conduits in CYs 2013 to 2018, representing 69-76
unclaimed cash grants of 4Ps beneficiaries for over- Pages
the-counter mode of payment, only P733.525 million 89-91
or 5.82 percent was returned to the BTr due to the
failure of Financial Management Service-Special
Project Service (FMS-SPS) to monitor and account
for the re-scheduled pay outs, thus, total amount for
return to BTr could not be determined. (CO)
Management agreed to require:
b.1 FMS-SPS, in coordination with the Cash

Grants Unit of the Field Offices, to monitor The SP-FMS has Implemented The SP-FMS were
and account for the re-scheduled payout, already constantly validating with the
identify the unclaimed cash grants due for coordinated with the CGU as
rescheduling and deduct from the amount cash grant unit of the recommended.
refunded by conduits, thereafter, return in field offices and has
full to the BTr those that are more than two continuously
years from reporting date; and monitored and
accounted for the
rescheduled payouts,
identified the
unclaimed cash grants
are due for
rescheduling and
determine the amount
due for remittance to
the BTR
b.2 National Program Management Office Implemented Management
(NPMO) to conduct over-all assessment and The NPMO conducted conducted a 26
evaluation of the project implementation to a 26 weeks spot check weeks assessment
determine the root cause of the huge amount on key processes that on key processes
279
Status of
refunded by LBP conduits and the includes updating of to ensure the
alternative solution to ensure attainment of household data, non- attainment of the
the program objectives. moving account and program
lifting of child limit. objectives.
c. Unwithdrawn cash grants 2018- Management

CAAR committed to
Forty-four percent or P593.526 million Paras. implement the
corresponding to 521,962 accounts of the balance of 77-89 recommendation with
cash cards of CCT/MCCT beneficiaries amounting Pages regard to the closure of
to P1,347.960 million comprising of 2,307,316 91-95 accounts and
accounts aged 181 to more than 2,190 days are remittance to the
unwithdrawn or idle in the bank, of which P462.605 Bureau of the
million for 391,590 accounts either aged over two Treasury of the
years or have expired, thus warrants the return to the unwithdrawn
BTr. balances. It informed
the Audit Team of the
Management agreed to require the NPMO to: actions taken on this
regard such as:
c.1 coordinate with LBP for the immediate requested the LBP for Implemented Coordinated with
remittance to the BTr of balances of cash the closure of 10,584 LBP.
cards aged 731 days and over, those without accounts with
monetary activity, and expired cards; and unwithdrawn balances
totaling some
c.2 continue and expedite the validation on the P17,800.00, a letter Implemented Validation is done.
eligibility of beneficiaries with accounts aged awaiting the signature
181 to 730 days and update the data base for of the proper DSWD
the non-compliant/delisted beneficiaries to authority requesting
implement letter D of the above NAC LBP to close 7,054
Resolution. accounts with
unwithdrawn balances
totaling
P46,096,810.40,
remittance to the BTr
of only
P283,654,342.37 will
be processed and will
determine dormant
accounts for closure
and amounts for
remittance to the BTR.
Also, validation and
monitoring efforts
were continuously
undertaken at the field.
2018-
d. Payment to double names of 4Ps Beneficiaries CAAR
Paras.
90-95
280
Status of
Payments to beneficiaries of 4Ps with double names Pages
exist in all regions as disclosed from sampled 95-96
payrolls in CYs 2016, 2017 and 2018 totaling 209
beneficiaries and amounting to P3.574 million,
casting doubt on the reliability of the duplicate
checker/detection feature of the computer-based
system (CO)
Management agreed to require the
d.1 National Program Manager (NPM) to look Validated 243 Not Duplicate names
into the list of beneficiaries, isolate double supposedly duplicates implemented still exist.
names and validate if these are the same household for CY
persons, and delist if proven duplicate; and 2016-2018 and
detected 141 unique
names, 51 households
were already detected
duplicates, 16 were
already tagged
duplicate and will no
longer be monitored
and 33 households to
be validated by field
offices for possible
duplication.
The latest double Not Duplicate names

d.2 the FO XIII Director to investigate the alleged entries found is implemented still exist
discrepancies in beneficiaries’ signatures and significantly less than
act accordingly. the corresponding
numbers for previous
years
KALAHI-CIDSS
1. Monitoring and reporting of KC-NCDDP 2018-

Projects CAAR
Paras.
For CY 2018, the implementation of the KC-NCDDP 96-108
registered a 95.63 percent financial accomplishment Pages
which exceeded the targeted threshold of 83.09 96-101
percent per KC-NCDDP Operations Manual;
however, overall accomplishment for the four-year
period recorded only 77.54 percent which is below
the target threshold. Moreover, a huge unutilized
amount of P2,158.496 million remained in the bank
as of December 31, 2018, thus depriving the
community of the immediate benefits due them.
(CO)
Management agreed to require the

NPMO/RPMO to:
281
Status of
a. continue the systematized downloading of Management Implemented The continuous
funds and ensure that the available proceeds concurred with the systematized
are implemented in accordance with the recommendations and downloading of
approved budget, project milestones, indicated that the fund help reached
performance expectations as well as and overall financial the desired target
maximization of desired benefits within the accomplishment is 89 of the agency.
period of project implementation; and percent rather than
77.54 percent. Hence,
it is still within the
b. regularly prepare the monthly monitoring threshold of 83.09
reports as feedback mechanism to ensure that percent per KC- Implemented All deficiencies
project deficiencies/problems encountered NCDDP operations encountered are
are appropriately/ immediately addressed by manual communicated
concerned officials. with the
concerned
officials,
2. Physical Accomplishment of 85 percent per 2018- (Commendations) The
Results Framework for CY 2018 was CAAR NPMO would like to
attained – KC-NCDDP Paras. inform that the
The KC-NCDDP registered a physical 109- physical
accomplishment of 94.41 percent as of December 31, 118 accomplishment as of
2018, which exceeded the 85 percent threshold per Pages December 31, 2018 is
KC-NCDDP Results Framework requirement for 101- actually 94 percent.
CY 2018 per loan agreement; thus, attaining the 103
objective of the project of providing the selected
community of improved access to services and
infrastructure and participating in more inclusive
Management planning, budgeting and
implementation. (CO)
We commend the DSWD PMO for the increased

accomplishment, however, for the uncompleted
SPs, we recommended and Management agreed
to require the concerned ACTs and RPMOs
personnel to:
a. regularly monitor the on-going and

unimplemented SPs especially those at the Concerned officers are Implemented Fund released
far-flung areas and fast track the completion monitoring the increased during
of the SPs; completion of the SPs. the year to fast
track the
completion of the
projects.
b. seek assistance from the local government in Coordinated with
the acquisition of project sites; other agencies to fast Implemented The local
track the completion government are
of the projects. well coordinated
in the assistance to
acquire project
sites. They even
make proposals to
282
Status of
where the project
c. make representation with the concern be built.
government agencies for the immediate Coordinated with
release of clearances and permits needed for other agencies to fast Implemented Other agencies
the projects; track the completion concerned release
of the projects clearance as
d. enjoin the community to work within the necessary.
timeline of the project implementation; and The concerned
officers are Implemented Other
encouraging the communities used
community to be “Bayanihan” for
enjoined in the the completion of
implementation. the sub project.
e. furnish the BSPMCs with the list of good
standing contractors and suppliers and Concerned officers are
blacklist erring contractors and suppliers. blacklisting erring Implemented Erring contractors
contractors and and supplier are
suppliers. blacklisted.
2018-
3. Subprojects (SPs) with deficiencies CAAR
Paras.
Seventy-three subprojects costing P62.155 million 119-
validated by the DSWD-OSEC Teams and Regional 124
Auditors were found to have deficiencies/issues, due Pages
to failure of RPMO/SRPMO as well as project 103-
proponents to monitor and resolve project issues, 106
thus, may compromise the efficient and effective use
of the facility and not in keeping with KC-NCDDP
Community Empowerment Activity Cycle and
Monitoring and Evaluation Sub-Manual for Program
Implementer.
Management agreed to require the ACT/RPMO

personnel to:
a. closely monitor, supervise and provide Management continue Implemented Majority of the
technical assistance to the BSPMC during to monitor and provide regions complied
project implementation and immediately technical assistance. upon validation.
correct the defects/deficiencies noted for the
full continuity and functionality of the SPs for
the benefits of the intended beneficiaries;
Coordinated with
b. conduct regular coordination with other different government Implemented Majority of the
infrastructure government agencies to avoid agencies. regions complied
overlapping of projects to the extent that upon validation
completed KC projects are inadvertently
removed to make way for other agency’s
(DPWH) infra projects; and
All
RPMO/ACT/BSPMC Implemented
283
Status of
c. institute necessary action against the participated in the Majority of the
RPMO/ACT/BSPMC who will be found monitoring and regions complied
remiss in the monitoring and evaluation of the evaluation of SPs upon validation
SPs.
4. Improper turn-over/Non-recognition of 2018-

assets in the BLGU books CAAR
Paras.
Improper turn-over and/or non-recognition of asset 125- They agreed to
accounts in the BLGU books for completed 134 comply with all the
KALAHI-CIDSS KKB SPs in Regions V and XI Pages recommendations
106-
may result in the absence of funding support for its
107
continuous operation and maintenance, thus, affect
its sustainability and functionality leading to wastage
of government funds.
Management agreed to require the DSWD

Regional Project Management Office of
KALAHI-CIDDS to:
a. require the Barangay Bookkeepers through FO IX- Instead of Implemented Reiterated in Part
the Municipal Accountants to conduct requiring BLGU II of this report,
inventory of all completed sub-projects Bookkeepers to page 123 to 124,
funded under KALAHI-CIDSS and KKB request thru letter to with revised or
Projects and thereafter, record them in their MLGU for inventory updated
books of accounts for easy funding for their of assets, KC NCDDP information.
repairs and maintenance; wrote to all MLGU
LCE thru the Mun.
Accountant and
provided them
inventory of
completed SPs in their
barangays. As of this
writing, 819 or 71% of
all 1,161 subprojects.
Booking of Assets and
reflecting them to
LGUs JEV continues
b. make the necessary representations with the as of this reporting.
LGUs to monitor/revisit the different projects FO IX - Monitored Implemented Reiterated in Part
which were long due implemented in the and revisited the II of this report,
different municipalities and continue the different projects page 123 to 124,
Sustainability Evaluation Test to ascertain implemented in the with revised or
the functionalities of the different sub- different updated
projects; and municipalities. information.
Continued the conduct
of the Sustainability
284
Status of
Evaluation Test
(SET). This tool
evaluates the over-all
functionality of the
sub-projects and
determine actions to
address issues and
concerns.
Continuously
encouraged MLGU
and BLGU to use
SET.
c. elevate to higher authorities of the LGU FO V- Management to Not Sustainability of

sustainability of the KALAHI Projects for the elevate to higher Implemented the projects was
continuance of the O&M and include related authorities the not maintained.
provisions in the MOA for similar sustainability of
undertakings in the future. KALAHI projects.
5. Delays in the implementation of classrooms 2018-
for Indigenous Peoples (IP) CAAR
Paras.
The objective of the Program “Establishment of 135-
New Public Schools for Indigenous Peoples in 150
Mindanao” to facilitate the construction of 605 Pages
classrooms in 251 sites for the new public schools 107-
for Indigenous Peoples to be established in 113
Mindanao, through the DSWD KC-NCDDP was
not attained due to DSWD’s inability and lack of
expertise to implement infrastructure projects as
manifested in the status of implementation of 397
classrooms (CLs), showing 40 percent or 157
completed CLs; 50 percent or 200 CLs on-going;
and 10 percent or 40 CLs not yet started, an unmet
target of 208 CLs. Moreover, of the funds
transferred of P522.301 million, the balance of
P187.762 million or 35.95 percent remained
unliquidated as of December 31, 2018. (CO)
Management agreed to require the:
a. KC-NCDDP National Project Monitoring The NPMO continues Implemented Reiterated in Part
Team/Regional Project Monitoring Team to to provide guidance II of this report,
and technical pages 112 to 124,
establish close coordination with BLGUs to
fast track the implementation of the project assistance through with revised or
to ensure that beneficiaries are not deprived constant monitoring updated
and coordination with information.
from the benefits thereof, and to facilitate
the Regional Offices,
liquidation of fud transfer;
as well as regular
visits to the
285
Status of
b. Program Manager to evaluate and assess the communities to ensure Implemented Reiterated in Part
viability of the remaining projects, identify that the challenges II of this report,
flaws and problems in the implementation, encountered by the pages 111 to 122,
and consider returning the unutilized funds program are well with revised or
to DepEd to free DSWD from obligation; and addressed. updated
information.
Implemented Reiterated in Part

c. Moving forward, ensure that DSWD review
II of this report,
its capacity to implement projects before
pages 111 to 122,
entering into agreements to ensure that
with revised or
project objectives are achieved.
updated
information.
6. Sustainable Livelihood Program (SLP) 2018- Management

CAAR commented that per
The Program registered a low physical and financial Paras. approved
accomplishment in CY 2018 of only 9.71% and 151- Memorandum
51.53%, respectively; thus, the allotted budget to 159 Circular (MC) No. 12
improve the socio-economic status of intended Pages Series 2018 -
recipients was not maximized for the benefit of the 113- Implementation of the
nation as a whole. (CO) (II, VI, VIII, IX, X, XI, XIII) 117 Sustainable
Livelihood Program,
Management agreed to require the FO Directors Section C - Resource
to: Mobilization Stage,
Item 3 - Provision of
a. strictly adhere to the guidelines including RA Modalities, letter a -
No. 9184 and the approved project proposal Micro Enterprise Implemented Management
to establish regularity of the transactions, and Development Track, failed to adhere
exercise due prudence in spending “The grants shall be with the regulation
government funds to prevent irregular, given directly to the Reiterated in Part
unnecessary, excessive and extravagant SLPA or release of II of this report,
expenditures; grants to their bank pages 128 to 129,
account….”. In this with revised or
case, RA 9184 is no updated
longer applicable in information.
the approved .
guidelines of the SLP.
b. conduct monitoring visits and random re- The reason for the
validation of the Loan Utilization Check exclusion of the Not Management
(LUC) to prevent and correct immediately procurement in the Implemented failed to monitor
any misbehavior of PDOs or agency SLP process is to the programs
personnel. Moreover, conduct constant and avoid causes of delays which resulted to
proper coordination, collaboration and in the provision of the delayed
communication with DSWD program interventions to the implementation
implementers in the field and other external program participants. of projects.
partners to monitor the status of Based on the
implementation and ensure that programs experience from the
were properly implemented on time; previous years,
procurement of SLPA
286
Status of
c. review the SLP implementation process and project requirements
enhancements to address the major findings entails six (6) months Not The
as reported in the Assessment Report to to one (1) year which Implemented implementation
ensure that funds allotted for the SLP are resulted in process in FO
maximized and intended recipients may disbandment of the VIII is
improve their socio-economic status that Associations prior to excessively
would redound to the region as a whole; and the provisions of the delayed.
grants. In addition,
d. direct concerned personnel/officials to ensure this will also avoid the
that the documents are complete before possible influence of
payment is made to avoid the project Not Disbursement in
suspensions/disallowances in post-audit. implementers in the Implemented FO XI were not
procurement process sufficiently
for the goods or supported with
services needed to documents.
establish SLPAs
projects.
• In CY 2017,
SLP hired Monitoring
Project Development
Officers (MPDO)
nationwide to conduct
the; (i) quarterly
monitoring of the
progress/gaps of the
SLPAs’ projects and
to provide
interventions to
remedy potential
closure and anomalies
if any, (ii) semestral
assessment of the
Organizations to
assess the
organizational
development and
functionalities of the
created structure and
to provide technical
assistance on the
improvement of the
organization and/or
rehabilitation
depending on the
status of the
associations, and
lastly, at the end of the
incubation period of
two years, (iii) the
Final Assessment
287
Status of
Tools will be
conducted to
determine the capacity
of the SLPAs for
possible
mainstreaming.
• Also, Section
C- Resource
Mobilization Stage of
MC No. 12 Series
2018, provides the
following:
o Item No. 3 -
Provision of
Modalities, the grant
utilization monitoring
is formed part of the
process for all SLP
modalities (Seed
Capital Fund, Skills
Training, Cash for
Building Livelihood
Assets, and
Employment
Assistance Funds).
The grant utilization
report forwarded by
the IPDO will be
checked by the MPDO
for check and balance
purposes, any findings
will be officially
reported to the
Provincial
Coordinator as the
immediate supervisor
copy furnish the
regional office. This
control measures
installed in the SLP
process eliminate
irregularities that
might happen.
o Item No. 1 –
Project Proposal
Preparation, states the
minimum attachments
for the submission of
the Mungkahing
288
Status of
Proyekto for funding.
Further each modality
has its own distinct
additional
requirements to
support the project
proposals requesting
for funding. A series
of review must be
conducted in three
levels, (i)
City/Municipal, (ii)
Provincial and at the
(iii) Regional Office.
Each personnel
conducting review is
obliged to initial on
the proposals for
accountability
purposes.
7. Social Pension Program (SocPen) 2018-
Payments of stipend to beneficiaries of the Social CAAR
Pension (SocPen) Program for Indigent Senior Paras.
Citizens were either delayed or not released on the 160-
first month of every quarter or not on a quarterly 166
basis due to delays in the liquidation of fund transfer Pages
by the LGUs, thus, denying the senior citizens of a 117-
timely benefit due them. Moreover, the procedural 120
controls and documentary requirements in the
assessment/verification, qualification, review and
publication of the beneficiaries in the Social Pension
Program are not strictly adhered to, thereby, casting
doubts on the reliability of information provided in
the Final List of Beneficiaries and validity of claims
paid to the Social Pensioners. (CO, NCR, VI, XIII)
Management agreed to require the Head of Office

in the CO and FO Directors to:
a. make possible representation to the National NCR-As to the Implemented The RSPU
Privacy Commission on the best way to enter concern of sharing of conducted
into “Data Sharing Agreement” with the SSS, data of SSS and GSIS, revalidation on the
GSIS and AFPMBAI with terms that both Armed Forces and list of Social
parties will agree to; Police Mutual Benefit Pensioners as per
Association the instruction of
Incorporated the Office of the
(AFPBMAI): Central President, thereby
Office is crafting reducing the risk
memorandum of of ineligible
agreement to data beneficiaries
sharing for the
289
Status of
efficiency of the social included in the
pension program.
implementation.
CO-Stipends to
b. device a system on the timely implementation SocPen beneficiaries Implemented Social pension
of payout strictly on quarterly basis to comply will now be beneficiaries now
with the issued DSWD MC No. 17 Series of distributed directly by received pay-outs
2015, and in order to give the beneficiaries the the DSWD and no on a semestral
badly needed fund for their sustenance; longer through LGUs; basis and different
stipends will now be pay-out scheme is
released semestral and now being
no longer quarterly; implemented.
and stipends shall now
be delivered using
several schemes-
Direct Cash payout,
door-to-door delivery
and cash card.
The DSWD would no

c. instruct the field personnel to clean/update longer transfer funds Implemented The Management
the list of senior citizen beneficiaries to avoid to LGUs for the is updating the
excessive funds downloaded to LGUs; and to implementation of database from
act promptly on complaints made by delisted SocPen. Also the time to time and
beneficiaries to have immediate resolution; validation of SocPen instructed the
beneficiaries, together concerned field
with the use of the personnel to act
SPIS, shall hopefully promptly on
ensure accurate and complaints by
timely utilization of beneficiaries.
Socpen funds
d. require the LGUs to submit the Birth FO XIII- At the onset Implemented Required
Certificates of eligible senior citizens, filled up of the last quarter of documents were
General Intake Sheets, and Death Certificates 2018, the SPPMO already submitted
of deceased Senior Citizens pensioners and staff had already
by LGUs to
other required documents for replacement, brought to the
and require the eligible senior citizens to attention of the LGUs DSWD SocPen
submit thru the OSCA their individual’s the importance of Office.
consent for the publication of their personal strict adherence to the
information and confirmation thereof with submission of the
the other government or non-government documentary
organizations like the GSIS, SSS and Senior requirements such as
Citizen Organizations; General Intake Sheet
with Birth Certificate
or other documents to
prove age, Death
Certificates for
deceased beneficiaries
and Certificate of
Transfer for
290
Status of
beneficiaries who
transferred to other
e. require the FO personnel to validate the regions/localities The Social
qualifications of eligible senior citizens as FO XIII-Conduct of Implemented Pension staff in
listed in the List submitted by the LGUs the re-validation of all the region,
through ocular inspection, confirmation of Social Pension
together with the
information from the third parties (SSS, Beneficiaries was
GSIS, others), and posting or publication of conducted in the entire field workers, had
the Final List in the locality; and Caraga Region based conducted their
on the new Program revalidation of
Guideline issued by social pensioners
the Central based on the
Office.(MC No. 04, guidelines issued
s.2019
by DSWD Central
Office. Moreover,
they have also
conducted
consultative
dialogue with the
concerned
stakeholders on
March 15, 2019.
f. instruct the FOs to coordinate and require the FO XIII-Per advice Already stated in
OSCA and M/CSWDO through MOA to with Management’s Implemented the latest issued
conduct home visit activities to find (locate) legal officer, he said guideline on the
indigent, neglected, abused, or deprived that the provision is implementation of
senior citizens in their locality and that not necessarily be SocPen Program
priority in the listing has been given to 77 stipulated and
that the OSCA
years old and above eligible senior citizens, specified in the MOA
and state such conduct of activity and considering that this is with the assistance
prioritization in certifications to be issued by already cited in the of the C/MSWDO
OSCA and M/CSWDO. program guidelines. and Senior
As stated in the latest Citizen’s Office
issued guideline on the will conduct the
implementation of the necessary
Social Pension
verification and
Program, the potential
list of beneficiaries home visits to
will be now signed and potential Social
approved by the Pension
Barangay Chapter beneficiaries.
Presidents, OSCA
Head and MSWDO,
thus the LCE will not
be the approving
authority. This will be
implemented
henceforth.
291
Status of
Audit of Yolanda Fund 2018-

CAAR
Lapses were noted in the utilization and liquidation Paras.
of funds, including donations from foreign and local 167-
organizations and individuals, provided for 171
assistance to Typhoon Yolanda victims; thus, Pages
defeated the purpose of the fund for which it was 120-
intended and also deprived the beneficiaries of the 123
benefits they could have gained from the completion
of the projects
Management (IVB) agreed to:
a. require the concerned LGUs to submit valid The Sustainable Implemented The liquidations
explanation why the liquidations of fund Livelihood Program were submitted to
transfers were not yet made, otherwise, already submitted provincial auditor
demand immediate compliance with the valid explanation and already
MOA; and why liquidations of submitted valid
fund transfer were explanation.
not yet made. It is
stated in the
explanation that the
Liquidation Reports
were already
submitted to the
Provincial COA both
on September 6,
2016.
b. refrain from granting additional fund Last October 18, Implemented The certification
transfers to the Municipalities without 2018, the DSWD-CO from the
certification from the Accountant that the issued a memo Accountant is
funds previously transferred to the directing all the strictly
Implementing Agency (IA) has been Regional Directors implemented as a
liquidated and accounted in the books of that no funds shall be requisite of
accounts. transferred/ granting
downloaded to LGUs additional fund
and that this directive transfer
will not affect the
services provided for
Management (FO VI) agreed to direct: the beneficiaries.
As updates as of May
a. Recipient LGUs to submit the liquidation 10, 2019: Implemented Submitted to COA
reports and/or refund the unutilized the Liquidation
• All concerned
Emergency Shelter Assistance funds reports and
amounting to ₱5,230,000.00; and LGUs had 100% full refunded the
liquidation. unutilized funds.
292
Status of
b. Focal person of the Core Shelter Assistance • There were 17 units Implemented The construction
Project to conduct regular monitoring for the completed, 13 units of the Core Shelter
immediate completion/construction of the 80 on-going and 50 Units are already
Core Shelter units. complete.
units which is not
yet constructed but
expected to be
completed by end of
December 2019
Management (FO VIII) agreed to conduct close Implemented Management
and immediate coordination and monitoring As of May 23, 2019, coordinated and
activities with the program’s partners such as the out of the 1,450 units monitored the
LGUs, NGOs/POs, private stakeholders and activities with the
beneficiaries concerned to fast-track the to be constructed, 995 program partners
construction/completion of the remaining 455 were completed, 184 and the remaining
core shelter units. units were still not 455 shelter units
started and the 271 were completed
units were just started
and still on-going.
Emergency Shelter Assistance Yolanda Funds 2018-

CAAR
The accuracy and reliability of the records of Fund Paras.
Transfer of Emergency Shelter Assistance (ESA) 171-
Yolanda Funds released to different LGUs of Region 178
VIII is doubtful due to: a) unrecorded amount of Pages
₽162.230 million; b) incomplete submission of 123-
liquidation documents; and c) significant difference 124
of the unliquidated balance between the Subsidiary
Ledger (SL), Disaster Risk Reduction Management
Report and per audit amounting to ₽7,898.170
million which affected the fair presentation of the
account balance of Due from LGUs.
a. send demand letters to the LGUs and require The Accounting Not Still ongoing
them to liquidate the fund transfers and section sent demand Implemented reconciliation to
return unexpended balances; letters to concerned date
LGUs with the request
b. submit the liquidation reports to the Auditor to liquidate their Submitted to COA
within the period prescribed by COA rules respective fund Implemented the liquidation
and regulations; and transfers. Adjustments reports within the
have already been prescribed period.
made and
reconciliation of the
CY 2017 balances had
c. require the Accountant to review the SLs to been completed Implemented The accountant is
ensure correctness and comparability of all continuously
financial reports. reviewing the
293
Status of
correctness of the
SLs.
Unliquidated OP funds for financial assistance to 2018-
Yolanda victims CAAR
Paras.
Out of the ₱1 billion fund received by DSWD from 179-
the Office of the President (OP) for distribution to 187
Yolanda victims in Regions VI, VII, VIII, and NIR, Pages
only ₱608.822 million or 60.88 percent have been 125-
utilized as of December 31, 2018, leaving the amount 127
of ₱391.178 million or 39.12 percent not distributed
within a period of six (6) months as specified in the
MOA between the DSWD and OP. Furthermore, out
of the utilized amount, only 84.41 percent or
₱513.927 million have been liquidated, leaving an
unliquidated amount of ₱94.895 million as at year-
end. (CO)
a. return the unused fund to the OP Submit the final report Not Remaining
considering that the term of the agreement and return unexpended implemented balance of
has lapsed; balance to the Office P9,075,000.00 is
of the President. found in the
account OP-
5kPFA
b. submit justification on the procurement of Not No justification

the cash cards considering that the benefit to implemented submitted.
be given is for one time only; and
Issued a memorandum
c. require the FOs to submit liquidations and to remit unutilized Implemented Field Offices are
likewise return the excess funds, if any. fund to the bureau of returning excess
treasury. funds and CO
remitted to BTR
Audit of Marawi Fund 2018-
CAAR
Deficiencies were noted in the utilization of Marawi Paras.
Funds which resulted in non-maximization of the 188-
funds, thus, defeats its intended purpose. 193
Pages
Field 127-
Offic Observations Recommendations 130
e
VI The failure of the Management FO VI - The Budget Implemented The management
Budget Officer to agreed to require Officer is conducting closely monitored
monitor the the Budget Quarterly Budget the validity of
validity of Officer/Program Utilization workshop, allotments. No
allotment Focal Persons to monthly provision of lapsing or non-
amounting to monitor closely technical assistance utilization was
₱713,680.00 the validity of and coaching to
294
Status of
intended for the allotments implementing unit as observed during
internally received to avoid well as provision of the current year.
displaced persons its non- feedback thru monthly
affected by the utilization/lapsing. status of fund
armed conflict in utilization report to
Marawi resulted Division Chiefs,
in its non- Assistant Regional
utilization, thus, Directors and
defeats its Regional Directors
intended purpose.
IX Purchases of Management
relief goods agreed to direct
amounting to the:
P17,566,591.90
intended for the a. Procurement
victims of the Unit to FO IX - There were Implemented Procurement unit
Marawi Siege comply with payments made for complied with the
were not covered Section I purchases of items Revised
with Bids and paragraph 2 such as boxes of Implementing
Awards of Annex H corned beef and Rules and
Committee of 2016 sardines, sacks of rice Regulations of RA
(BAC) Revised and various empty 9184 and the
Resolution Implementin sacks for repacking purchases thru
contrary to g Rules and before the cited BAC alternative mode
Section I Regulations Resolution No. 010- 0f procurement
paragraph 2 of of RA 9184 10-2017 dated are now covered
Annex H of the and ensure October 27, 2017 was with BAC
2016 Revised that all even prepared. The resolutions.
Implementing purchases Accounting Unit
Rules and thru processed these
Regulations of alternative payments because of
RA 9184. mode of the certification from
procurement the BAC Chairman
are covered that immediate
with BAC purchase of relief
resolutions; goods has to be made
and for immediate
shipment to Marawi
City to meet the
immediate needs of
the evacuees which
was also approved by
the Head of the
Procuring Entity, the
then Regional
Director, Atty. Araceli
b. Accounting Solamillo. The Implemented The accounting
Unit not to Purchase Orders for did not process
process any these payments were payment without
payment for the necessary
295
Status of
purchases that of items procured supporting
without the before October 2017; documents
necessary specifically the
supporting The Accounting Unit BAC resolution.
documents shall not process any
such as the payment for purchases
BAC without the necessary
resolution. supporting documents
such as the BAC
X A total of Management resolution.
₱83,915,500.00 agreed to require
transportation the FOs Directors
assistance for the to:
Internally
Displaced a. submit
Families due to written FO X - The cash Implemented Submitted
Marawi Siege justification to advance of justifications to
incident the Office of P87,500,000.00 was COA.
remained the Auditor on drawn from Protective
unreleased, the reason/s Services Program
contrary to why the (PSP) funds dated
DSWD MC No. amount of June 7, 2017 project
02, series of ₱87,500,000.0 proposals, using MC
2014, DSWD 0 financial No. 10 S-2017 for
MC No. 16, assistance Food and
series of 2017, remained Transportation
and Section 2 of unreleased to Assistance of
PD 1445, hence, IDPs for Internally Displaced
did not serve its several Families from the
purpose and months with Marawi Siege, per
defeated the significant specific instruction
mandated remaining from Joint Statement
function of amount as of dated June 30, 2017
DSWD to work July 31, 2018 signed between the
towards the of DSWD Secretary Judy
achievement of ₱83,915,500.0 Taguiwalo, DSWD
improved 0, despite the ARMM Secretary
capacities and amended Haroun Al-Rashid A.
opportunities for supplemental Lucman, and Marawi
the poor, guidelines City Mayor Majul
vulnerable and under MC No. Usman Gandamra,
disadvantaged 16, Series No. with the subject
individuals, 2017 dated “Financial Assistance
families and October 23, to Internally Displaced
communities and 2017; and Families Affected by
to enable them to the Armed Conflict in
improve their Marawi City”, where
quality of life the P1,000.00 from the
P5,000.00 is intended
for immediate
assistance for the
296
Status of
b. release the observance of Implemented IDPs are given
financial Ramadan, and food and
assistance to immediate needs for transportation
the remaining non-muslim families. allowance while
IDPs who As of date, the above those who were
were residents balance was deposited not able to avail of
of Marawi to BTr per check No. Kambalingan are
City ground 64212688 dated now sheltered to
zero and who November 29, 2018. different
were not able "transitional
to avail of the shelter;”
Kambalingan
or Balik
Probinsya
programs of
DSWD per
result of
revalidation
conducted by
DSWD FO-10
as of August 3,
2018; submit
physical and
financial
accomplishme
nt for
validation.
XI Unspent Management
donations agreed to require To ensure all cash Implemented COA validated
amounting to the FOs concerned donations are that the
P0.103 million to strictly comply deposited intact with undeposited cash
for victims of with Section 5 of the National Bureau of donations
armed conflict in RA No. 10964, Treasury. amounting
Marawi City otherwise known P103,075.00 for
were not as GAA for FY Marawi Victims
deposited with 2018, to ensure were already
the National that all cash remitted to DSWD
Treasury and donations are CO dated
remained idle for deposited intact February 28,
one (1) and a half with the National 2019.
year, thus, Treasury through
causing delay in remittance to
reaching out to DSWD Central
the intended Office for
beneficiaries automatic
297
Status of
and/or defeating appropriation and
its purpose immediate use for
contrary to its intended
Section 5 of purpose.
Republic Act No.
10964 otherwise
known as the
GAA of FY 2018.
XII Disbursement Management
Vouchers (DVs) require the Paid Disbursement Implemented Submitted to COA
amounting to Accountant and Vouchers were the requested DVs
P422,459,730.74 the Cashier to submitted. and its supporting
(including submit all paid documents.
Marawi DVs) Disbursement
and its supporting Vouchers and its
documents were supporting
not submitted documents and
contrary to strictly comply
existing laws, with Section 5 of
rules and P.D. 1445.
regulations.
XII Welfare Goods Management
for Distribution require the Accounting Unit has Implemented Inventories are
amounting to Accountant to started to record all now recorded
P885,190,904.70 record all purchases in their when received and
were directly purchases in their respective inventory expensed when
charged to respective account and issuances issued.
expense instead inventory account as expenses 'manually'
of recording the and recognize based on the
same to the expense only upon RIS/RSMI submitted
appropriate issuance pursuant by the PAMS.
inventory to Section 9, However, they have
accounts, Chapter 8, of the proposed an
contrary to C GAM, Volume I. automated inventory
Section 9, system which is on-
Chapter 8, of the the-process of system
GAM, Volume I. and design analysis.
- -
OTHER COMPLIANCE ISSUES
1. Gender and Development (GAD) 2018-

CAAR
The DSWD was able to formulate GAD Plan and Paras.
Budget and notably attributed the programs that are 194-
gender-related with allocated funds of P70,147.775 198
million and actual expenditures of P72,431.312 Pages
million. 130-
131
298
Status of
We commend the DSWD for its compliance with Management continue Implemented Substantially
GAD laws and regulations and encourage to provide adequate complied with
Management to continue providing adequate allocation of funds for GAD
allocation of funds for programs and activities program and implementation
that will uplift the gender issues of officers and activities.
employees as well as implementation of the
planned programs and activities for its clients, the
general public.
2. Compliance with Other Mandatory 2018-
Accounts CAAR
Paras.
DSWD, as a whole complied with the withholding 208-
and remittance mandatory deductions pursuant to the 212
regulations issued by the BIR, GSIS, PHIC, and Pages
HDMF. 133-
137
Acc Offi Deficiencies Recommenda
ount ce tions
Due II The accountant Management
to did not agreed to
BIR withhold taxes require the
on FO
compensation Accountants
of overtime concerned to:
services FO II-Management Implemented The deduction of
rendered on a) withhold has already been withholding tax on
disaster related taxes from deducting the overtime pay is
activities compensation corresponding observed during
contrary to and other withholding tax on the current year.
Section 80(A) services overtime pay
of the NIRC rendered and especially for Disaster
(Tax Code). remit intact to related activities.
the BIR in FO X–
III The Agency compliance a) Sudden resignation
did not remit with tax laws of former in-charge
intact taxes of the agency’s Tax
withheld on Computation
gross prompted the
compensation Accountant to
income from ensure that all CY
officials and 2017 tax withheld
employees and were remitted, thus,
government all Due to BIR
purchases from balance pertained to
suppliers/ year-end
contractors recognition of A
showing b) During CY 2017,
variances for there were non-food
each month purchases for
which Marawi Siege
accumulated to victims that were
299
Status of
P1,444,080.06 not yet delivered
for CY 2018, but already
not in accounted for as
accordance Accounts Payable,
with Revenue thus, adjusting
Regulation No. entries were made
10-2008 dated to correct/ remove
July 8, 2008. the recording of the
said purchased
III The agency goods as Accounts
did not Payable. However,
properly remit in the said adjusting
intact taxes entry, the agency
withheld on failed to remove
gross also the
compensation corresponding tax
income from withheld or debit
officials and the Due to BIR
employees and account. Thus, upon
government payment of the
purchases purchased goods in
from CY 2018, the
suppliers/contr account Due to BIR
actors showing was again credited
variances from to recognize the tax
each month withheld which is in
which effect has resulted
accumulated to double entry
P1,444,080.06 affecting the said
for 2018 not in account.
accordance
with Revenue
Regulation1-
2008 dated b) work FO VI- No action Implemented The large portion
July 8, 2008. back the of the
VI The failure of prior years’ unreconciled prior
the Accountant transactions years’ Due to BIR
to reconcile pertaining to might be an error
prior years’ the Due to in the journal
unremitted BIR account, entries in CY 2014
balance of the remit the and prior years.
Due to BIR unremitted The Accountant
account amount finds difficulty in
amounting to and/or make reconciling the
P8.295 million the necessary balances due to the
or 63 percent adjustments unavailability of
of the year-end in the books records/files such
balance of of accounts, as the copy of
P13,198,634.6 if warranted. TRAs and JEVs.
2 rendered the Penalties and Reiterated in Part
reliability of interest for II of this report,
300
Status of
the account the late pages 247 to 248,
doubtful. remittances with revised or
VIII Due to shall be updated
considerable borne by the information.
length of time Accountant
and absence of in her
supporting personal
documents, capacity;
withholding
taxes on c) analyze FO VIII – Not On-going
compensation prior years’ Remittances have Implemented reconciliation
and from records of been made for the
purchases of the account amount withheld
goods and Due to BIR during the year. The
services of aggregating prior year’s balances
P5,637,644.13 ₱5.64 million are in the process of
remained to facilitate reconciliation and on-
unremitted remittance of going analysis of the
BIR. this long ledger. Management
According to outstanding will take up the
the Accounting balance; adjustments, if
Section, these necessary.
balances have
been long d) remit FO III - The Implemented On-going
outstanding to the BIR Accounting and validation of the
and could no the duly Personnel discrepancies.
longer be accounted Administration Overtime request
reconciled due unremitted Sections will verify for three (3)
to absence of taxes the existence of Saturdays last
supporting withheld unremitted amounts December 2019
documents. from prior for withholding taxes was requested to
years or of reconcile the
effect the employees/suppliers. account.
refund of any Reiterated in Part
X The beginning excess taxes II of this report,
balance of withheld to pages 247 to 248,
P13,667,884.7 the with revised or
0 was not concerned updated
properly employee, information.
accounted for supplier or
and remained contractor as
under remitted required
to the BIR under the
contrary to the National
provisions of Internal
the RA No. Revenue
8424, the Code of
NIRC of 1997; 1997; and
DOF-DBM- adjust
COA Joint accounts by
Circular No. 1- debiting Due
301
Status of
2000 dated to BIR and
January 3, crediting
2000, as Accumulated
amended, by Surplus/(Defi
DOF-DBM cit).
Joint Circular
No. 1-2000A
dated July 31,
2001; and
Sections 60 to
61 of Chapter 6
of the GAM,
Volume I.
Due NCR Absence of Management

to schedules to agreed to
GSI support the require the
S ending FO Director
balance. to require the
Reconciliation Accountant/
will be Cash
undertaken and Personnel to:
adjustment of
erroneous a) remit intact NCR- The remaining Implemented NCR-Schedule of
entries may be the amount balance of Due to reconciliation was
made, if any. deducted GSIS is already paid presented to COA.
from its on February 2019.
III The Agency employees, FO III- FO III-On-going
did not remit otherwise, Administration validation of the
intact to the the Sections will verify discrepancies.
GSIS Accountant the existence of Overtime request
employer’s will bear unremitted amounts for three Sundays
and personal the interest for withholding GSIS of December 2019
shares and accruing to employer’s and to reconcile the
loans of the GSIS personal shares and account.
employees due to the loans of employees
leaving an delay in
unremitted remittance;
balance of
P350,978.81 b) reconcile FO VI- Validated
for CY 2018, the GSIS FO VI- Reconciliation Implemented reconciliation
which is not in transaction has been made.
accordance s under the
with RA No. Regular
8291, the GSIS Agency and
Act of 1997. SWDRP
VI The Funds to
Accountant eliminate
failed to the
monitor negative
regularly the and
302
Status of
Due to GSIS positive
account, thus, balances,
resulted in the respectivel
over- y; and
remittance of remit the
the amount balance of
withheld under ₱77,701.62
the Regular and/or
Agency funds make the
and under- necessary
remittance adjustment
under the s in the
SWDRP Funds books, if
by warranted;
P272,795.16
and c) reconcile FO VIII- Not FO VIII-On-going
P350,496.78, the reconciliation of Prior Implemented reconciliation
or a net balances of Year’s balance
unremitted the
amount of subsidiary
P77,701.62 as accounts of
of December Due to
31, 2018. GSIS to
VIII The breakdown determine
of the the cause of
remittances the
showed several negative or
discrepancies in abnormal
the totals of balances
Salary and and effect
Policy Loan the
amortizations necessary
per Agency adjustment
Remittance s, examine
Summary, and review
which is the
completed by accounts
the Personnel thoroughly,
Section, and is and
the basis of the reconcile
journal entry their
for recording in records
the books of GSIS;
accounts, and reclassify
per Official the
Receipt issued remaining
by GSIS. balance of
The accuracy Due to
of the year-end GSIS to the
balance of Due specific
to GSIS of
303
Status of
P1.580 million subsidiary
is doubtful due accounts;
to (a) failure to
reclassify the d) reconstruct FO X-The GLs for Implemented FO X- Submitted
balance of the or locate 2016 and to COA the
controlling the GLs for reconciliation of the reconciliation
account CY 2016 to Due to GSIS account
amounting to facilitate were submitted to
P1.480 million verification COA in March 2020.
to the specific of entries
subsidiary therein and
accounts; (b) the
existence of adjustment
negative s made on
balances the Due to
amounting to GSIS
(P1.870 account
million), and; and correct
(c) accounting the error
errors by
amounting to recording
P1.70 million. the
adjusting
X The beginning journal;
balance and
recorded and
the adjustment e) follow-up FO X - Of the Implemented FO X-
of account Due the BP ₱686,835.06 Reconciliation
to GSIS in CY number of beginning balance of was submitted to
2018 in the the COA
the Due to GSIS
amount of employees
account, ₱224,098.84
P686,835.06 so that the
and remittance was remitted in 2019.
P127,574.24, of their The remaining balance
respectively, total GSIS of ₱462,736.22 is
could not be contributio subject to
remitted due to ns be reconciliation.
lack of facilitated.
documentation Adjustment on the
and erroneous entry made
identification
of employees on the payment of one-
who were year GSIS Group
subjected to Personal Accident
the Insurance for the
withholding of period Feb 15 2018 to
premiums and Feb 15 2019 was
loan
reflected in March
repayments,
thus, the delay 2019 FS;
in remittance
304
Status of
of the same and
the charging of
interest by the
GSIS.
Due NCR Management
Absence of
to agreed to
schedules to
Phil require the
support the
heal Field
ending
th Accountants
balance.
to:
Reconciliation
will be NCR-The accounting Not NCR-Schedule of
a. remit intact
undertaken and unit established a per Implemented reconciliation was
the
adjustment of program basis of presented to COA.
employees
erroneous processing and
and
entries may be
employer’s encoding of
made, if any. transaction for a more FO III- Ongoing
share so as
not to incur effective and efficient validation
penalties, monitoring of payroll
III The Agency otherwise balances.
did not remit the FO III-The
intact to the penalties Accounting and the
PhilHealth the shall be Personnel
employees borne by Administration
personal and the Sections will verify
government personnel the existence of
shares for each who unremitted amounts of
month which is neglected withholding
not in his duties; PhilHealth
accordance contributions.
with R.A No.
7875 as b. draw JEV FO V - adjusted Implemented Effected the JEV
amended by and effect necessary corrections and necessary
R.A No. 9241 the corrections to
(National necessary Philhealth
Health correction/ accounts.
Insurance Act adjusting
0f 1995). entry to
correct the
V The report balance of
year-end Due to
balances of PhilHealth
Due to account;
Philhealth and and
Philhealth
Contributions c. reconstruct FO X- Ongoing Implemented As of December
accounts or locate reconciliation of the 31, 2019, the GL
amounting to the GLs for account Due to for the Due to
P261,373.54 CY 2016 to PhilHealth and PhilHealth
and P4.116 facilitate identification of account for CY
million, verification employees who were 2016 was not
305
Status of
respectively of entries withheld of the presented to the
are unreliable therein. mandatory premiums. Office of Auditor
due to for verification of
erroneous the entries therein.
accounting
entries on the
remittance of
Philhealth
premiums and
contributions
which may
result in
forfeiture of
claims and/or
benefits due to
the members
and/or
employee of
the agency.
X The beginning
balance
recorded in the
amount of
P256,221.46
and the
adjustments in
the amount of
P280,100.62
and
P237,284.98 in
the account
Due to
PhilHealth in
CY 2018 could
not be remitted
due to lack of
documentation
and
identification
of employees
who were
withheld of the
mandatory
premiums, thus
the remittances
of
contributions
were delayed.
306
Status of
Due NCR Absence of
to schedules to Management
Pag- support the agreed to
IBIG ending require the
balance. Field
Reconciliation Accountants
will be to:
undertaken and
adjustment of a. remit intact NCR- Due to Pag- Implemented NCR-Schedule
erroneous the IBIG account has on- was presented to
entries may be employees going reconciliation. COA.
made, if any. and FO III Accounting FO III-On-going
employer’s and the Personnel validation of the
III The Agency share so as Administration discrepancies.
did not remit not to incur Sections will verify Overtime request
intact Pag-Ibig penalties, the existence of for three Sundays
government otherwise unremitted amounts of of December 2019
and personal the withholding Pag-Ibig to reconcile the
shares and penalties contributions. account.
loans of shall be
employees borne by
leaving an the
unremitted personnel
balance of who
₱42,621.85 for neglected
CY, not in his duties;
accordance and
with RA No.
7875, as b. determine FO X- Not FO X-As of
amended by on whose The beginning balance implemented December 31,
RA No. 9679 accounts of Due to Pag-IBIG 2019, the Office of
(Pag-ibig Fund were the account amounting to the Auditor has
Law 2009). total ₱534,253.62 was not received a
amount already accounted/ copy of the List of
X The classified reconciled and DSWD FO-10
outstanding under the adjusted in December employees/
balance of the caption 2018. members whose
Due to Pag- “various” accounts were
IBIG account and the classified under
includes correspond the caption
unidentified ing “Various” and the
various obligations period covered
accounts of made in these have been
DSWD FO 10 favor of outstanding/
members/ Pag-IBIG unremitted, thus,
employees in Fund that could not be
the amount of referred to validated in the
₱534,253.62, in the Aging account Due to
thus, could not of Payables Pag-IBIG.
be validated and the
and may result period it
307
Status of
in the has been
forfeiture of outstanding
claims/benefits /unremitted
due to them. , and make
necessary
adjustment
s, if
warranted
Summary of Reiterated Observations considered as Implemented:

Reference of Observation and
Recommendations as presented Reference Reiteration found in CAAR
above
Financial Audit
Accounting Error- a,b,c,d,e 2018 CAAR page 1 - 65 Paragraph 10 page 77 to 78
Accounting Deficiencies- b,d,j,k,t,x 2018- CAAR Paragraph 13 pages 79 to 84, 88
Paras. 12
Pages 66-84
2018- CAAR Paragraph 341 page 228

Paras. 41-52
Pages 81-84
KALAHI CIDSS
4 2018- CAAR Paragraph 72 page 123 to 124
Paras. 125-134
Pages 106-107
5 2018- CAAR Paragraph 73 page 124
Paras. 135-150
Pages 107-113
Paras. 151-159
Pages 113-117
OTHER COMPLIANCE ISSUES
Paras. 208-212
Pages 133-137
308

014 Dpta en

Uploaded by

Copyright:

Available Formats

You might also like

014 Dpta en

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

014 Dpta en

Uploaded by

Copyright:

Available Formats

Audited Entity Financial Statements

Project Number: 43407-014

PHI: Social Protection Support Project (Additional

Prepared by: Department of Social Welfare and Development

For the Asian Development Bank

DEPARTMENT OF SOCIAL WELFARE

For the Year Ended December 31, 2019

The Department of Social Welfare and Development (DSWD) is mandated to

For CY 2018, the DSWD had a total appropriation of P146,648.573 million

Amounts (in million P)

C. Scope and Objectives of Audit

D. Independent Auditor’s Report

A qualified opinion was rendered on the financial statements of the DSWD as at

Moreover, we noted deficiencies amounting to ₱41,519.287 million in keeping of

E. Significant Observations and Recommendations

Among the audit observations and corresponding recommendations discussed in

We recommended and Management agreed to require the concerned

b. Five DSWD offices failed to submit perfected contracts and supporting

We reiterated our prior year recommendations, with modification, and

a) require the Chief Accountant to:

i. make the necessary adjustments/correcting entries for the

ii. observe the highest degree of objectivity and consistency in

iii. carefully analyze the transactions before these are recorded,

b) establish close coordination and strengthen linkages among

c) evaluate and assess the capabilities of personnel assigned to

d) ensure strict adherence to existing rules, regulations, policies,

c. Six DSWD Offices have paid various transactions amounting ₱738.532

We recommended and Management agreed to require the Head/s of:

c) the NCR BAC Chairperson to require: (i) the contractor to

d) FO IVA ensure that the written conformity and acquiescence of

d. The delayed/non-submission of required report and supporting documents

We recommended and Management agreed to direct the concerned

a) NCR, FOs I, IVB, XI, XIII to immediately submit all the

b) FOs I and XIII to strictly and consistently observe the provisions

c) FO V to cause the submission of DVs, JEVs and all validated

d) FOs VIII and X to submit the required Liquidation Reports

e. Non-attainment/achievement of the objective of the Program,

b) evaluate and assess the viability of the remaining projects,

c) henceforth, ensure that DSWD review its capacity to implement

d) consider that reports are the windows of accomplishments, and

f. Reported project accounts were non-existent and irregularities in the

We recommended and the DSWD-FO-XIII Management agreed to:

a) require the SLP RPMO and Legal Officers to conduct in-depth

b) require the Accountant to reconcile the accounting records of

c) segregate key duties and functions of project personnel to avoid

g. Unutilized proceeds of SEA-K grant, as well as, repayments of grants

We recommended that DSWD-FO-XIII Management:

a) require the SLP Regional Program Coordinator to conduct

b) require the Accountant to reconcile the SEA-K account

We recommended and DSWD-FO-XIII Management agreed to require

i. DSWD-Caraga had incurred substantial delays ranging from one (1) up to

We recommended that DSWD-FO-XIII Management require:

a) the ACN focal persons to intensify and fast track their

b) the concerned LGUs to prioritize the prompt implementation of

j. Lapses on reporting, accounting, and utilization of the DRRMF is not in

We recommended that DSWD-FO-V Management require:

a) the preparation and submission of the DRRM reports as