Republic of the Philippines

Commission on Audit
City Auditor's Office
(City)

MEMORANDUM

FOR : (name)
Supervising Auditor

SUBJECT : Result of examination on the cash and accounts of

Ms. (Name of AO), Local Treasury Operations Officer II assigned
at the City Treasurer’s Office – Taxpayer's Payment Lounge, this
City

DATE : January 21, 2021

In compliance with COA-Quezon City Office Order No. 2020-001 dated October 1,
2020, we respectfully submit the herein Cash Exam report on Ms. (Name of AO), Local
Treasury Operations Officer II assigned at the City Treasurer’s Office – Taxpayer's
Payment Lounge, this City.

The report includes the narrative report, schedules and other supporting documents for
perusal.

(Name)
Audit Team Leader
 NARRATIVE REPORT

PART I- INTRODUCTION

In compliance with COA –Quezon City Office Order No. 2020-001 dated October
1, 2020, the undersigned conducted examination on the cash and accounts of Ms. (Name
of AO) on October 28, 2020 at the City Treasurer’s Office. Ms. xxx was designated as
Collecting Officer per Memorandum dated January 15, 2014 signed by Mr. (Name), City
Treasurer whose duties permit to handle collections, issue official receipts and remit all
collections to the liquidating officer of the City. The accountable officer is bonded under
Bond No. DIIB-20-0280R with a maximum cash accountability of P250,000.00 effective
February 12, 2020.

At the time of the examination, Ms. xxx has a total accountability balance of
P 325,876.19 of which the same amount was actually found on hand consisting of
P 85,558.28 in currency and P240,317.91 in cash items. The details of accountability
are shown below:

PART II - FINDINGS AND RECOMMENDATIONS

Our cash examination disclosed the following observations:

1. The fidelity bond of the AO amounting to P100,000.00 with maximum cash
accountability of P 250,000.00 is not enough to cover her accountabilities as
collecting officer. Examination of her cash and accounts for the period January
1, 2019 to October 28, 2020 disclosed that she held significant amount of cash
from her collections in excess of her maximum accountability ranging from
P253,143.77 to P 50,757,484.73. Treasury Circular No. 02-2009 dated August
6, 2009 provides that: (Annex 6)

The amount of bond shall be based on the total accountability

(cash, property and accountable forms) of the accountable
public officer as determined by the Head of Agency. Provided,
the individual maximum accountability of each accountable
public officer shall not exceed One Hundred Million Pesos
(P100M).

Require that the fidelity bond of the AO be increase to an amount sufficient

to cover his maximum accountability in accordance with the Revised
Schedule of bonds provided by the Bureau of Treasury to protect the interest
of the City in case of loss resulting from unlawful use and negligence in the
safekeeping of government funds.

2. The Accountable Officer (AO) does not maintain a cashbook to record the
collections received from various taxpayers and the subsequent remittances
thereof to the Liquidating Officer of the City as required under Section 26,
Volume II of the NGAS Manual:
 Cashbook for Cash in Treasury shall be used to record
collections (Debit column) and deposits to the bank (Credit
column) based on the RCD. The cashbook shall be maintained
by the Treasurer by fund and shall be updated and balanced
daily. The accountable officer shall, at the end of the month or
when required to do so by proper competent authority, rule
and foot the cashbook. He shall likewise accomplish the
following certification in the cashbook:

I HEREBY CERTIFY that the foregoing is a correct

and complete record of the cash transactions had by me in my
capacity as Treasurer/Cashier of ____during the period
from___, 20____to____, 20___, inclusive, as indicated in the
corresponding columns.
Signature Over Printed Name/Date

Require the AO to maintain a cashbook in the prescribed format and all

transactions for the day shall be recorded immediately in order to reflect the
correct balance of cash on hand as of specific date. Likewise, at every end of
the month, certify the cashbook as to the correctness and completeness of the
recorded transactions.

3. The City Accounting Department did not maintain Subsidiary Ledger (SL) for
the collections received and deposited by each collecting officer pursuant to
Section 10, Chapter 2, Volume 1 of the New Government Accounting System
(NGAS).
Section 10, Chapter 2, Volume I of the Manual on NGAS for LGUs provides
that the SL is a book of final entry containing the details or breakdown of the
balances of the controlling account appearing in the General Ledger and that
the totals of the SL balances shall be reconciled to their respective control
account at the end of every month.

Require the City Accounting Department in coordination with the

Information Technology Development Office to provide the necessary SLs
for each accountable/collecting officer, either in manual or automated form,
so that the balance of the Cash-in-Vault account is duly supported with
necessary details and errors are detected immediately and on a timely basis.
4. The Accountable Forms Unit (AFU) of the City Treasurer’s Office failed to
record the issuance of 2,000 pieces of AF No. 51 bearing the serial nos.
7425001-7427000 to Ms. xxx based on the Accountable Forms Record Card as
of December 18, 2019 which may hinder the proper monitoring of issued
accountable forms. (Annex 11)

Require the Accountable Forms Unit to conduct regular monitoring of

accountable forms to ascertain its completeness and to fully account all
receipts issued to a collecting officer. Also, furnish the Fiscal Verification
Division of the City Treasury Office, copies of Requisition Issue Slip for
reconciliation purposes of their records.
 5. The Fiscal Verification Section of the City Treasurer’s Office also failed to
account as issued the two hundred eighteen (218) pieces of AF No. 51
(Annex 14), thus there were gaps noted in their record which were confirmed
by the City Accounting Department upon verification by this Office. (Annex
13)

Inclusive Serial Nos. No. of Date

From To Issued Remitted Amount
7142396 7142402 7 06/18/2019 P 1,128,113.28
7142610 7142631 22 07/08/2019 3,839,304.12
7216363 7216366 4 08/09/2019 35,447.45
7324770 7324790 21 12/19/2019 200,033.68
7425035 7425041 7 12/28/2019 319,264.86
8008001 8008157 157 07/20/2020
TOTAL 218 P 5,522,163.39

Require the Fiscal Verification Section of the City Treasurer’s Office to

monitor the unissued and issued accountable forms and oversee the prompt
remittance of collections of all collecting officers.

III. APPENDICES

1. Copy of COA –Quezon City Office Order No. 2020-001 dated October 1,
2020
2. Designation as Collecting Officer
3. General Form No. 74-A (Report of Cash Examination)
4. Statement of Accountability of Accountable Forms without Money Value
5. Monthly Statement of Accountability
6. Daily Summary of Collections and Deposits
7. Details of unremitted collections at the time of cash examination
8. Inventory of Cash on Hand and Unused Accountable Forms
9. Inventory of Cash Items
10. Fidelity Bond
11. Accountable Forms Record Card prepared by the Accountable Forms Unit
12. Letter dated November 16, 2020 requesting for information whether the ORs
enumerated in Finding No. 6 of this report are included/ recorded in the
Schedule of Collections
13. CAD Response to our letter-confirmation with copies of JEV
14. Record of Accountable Forms prepared by Fiscal Verification Section

Submitted by: Reviewed by:

 (NAME) (NAME)
State Auditor I State Auditor IV
Audit Team Leader