10-DigosCity2020 Part2-Observations and Recomm

PART II – OBSERVATIONS AND RECOMMENDATIONS
A. FINANCIAL AUDIT
Property, Plant and Equipment – Local Road Asset Management
1. The correctness, existence and completeness of “Road Networks” account in the

amount of P393,313,469.04 could not be ascertained due to the non-transfer of the
local road accounts from the Registry of Public Infrastructure to the books of
account, non-recognition of the cost of each component of the local roads, and non-
reconciliation of accounting records with the Local Road Inventory and Road Map
contrary to COA Circular 2015-008, thereby fairness of the account could not be
relied upon.
COA Circular No. 2015-008 dated November 23, 2015 covers the accounting
guidelines for local road and road network system on initial recognition, subsequent
measurement and derecognition to ensure that all roads are properly valued and recorded,
and also the transitory provisions for the transfer of the local roads accounts from the
Registry of Public Infrastructures to the books of accounts of the LGU responsible for the
management of these roads.
Pertinent provisions of COA Circular 2015-008 provides:
“IV. Accounting Policies”
“19. Road networks carried in the Registry shall be transferred to

the books of accounts.”
“V. Accounting and Reporting Procedures
1. Conduct an inventory of the local roads under the LGU’

jurisdiction.
2. Reconcile the list of inventory per local road inventory report
and road map with those recorded in the Registry of Public
Infrastructure.
3. Segregate and recognize the cost of each component of the
local roads with identified cost.
4. Determine the components of local roads identified in the
inventory without corresponding cost and recognize the cost
of each component at its fair value.
5. Depreciate the carrying amount of existing roads and its
components to reflect the asset in its used condition and shall
serve as the basis for recording in the general ledger.
46
6. Determine the life of the local roads within the range
prescribed by COA taking into consideration the following
factors:
a. Design
b. Users
c. Volume of users
7. Compute separately the depreciation for the road components
taking into consideration the following factors:
a. Initial cost, and
b. Useful life
8. Maintain separate subsidiary ledgers for the road and its
components namely: a) road lot, b) road pavement, c)
drainage and slope protection structures and d) other
miscellaneous structures.
9. Provide complete description of the road and its components
in the subsidiary ledger and reconcile with the Local Road
Inventory and Road Map to ensure completeness.
10. Assess the local road at every reporting date, whether there is
any indication that a component of the local road may be
impaired.
11. Reverse the recognized impairment loss when there is an
increase in the estimated recoverable service amount of the
assets from use.”
Verification of the “Road Networks” account and compliance with the standards
in initial recognition disclosed the following observations:
1. Schedule of “Road Networks” disclosed transactions for the following

periods, to wit:
Year Amount
2008 299,380.82
2009 118,254.50
2011 9,750.00
2012 449,233.43
2013 511,730.32
2016 20,496,256.36
2017 12,283,975.27
2018 23,708,698.40
2019 60,881,136.52
2020 274,555,053.42
Total 393,313,469.04
2. The following documents were not maintained by the City Accounting Office,
to wit:
a. Local Road Network Ledger Card;
47
b. Subsidiary records of roads and road components for
every road network;
3. The City’s existing NGAS accounting system maintained by Euby’s

Computer Programming and Accounting Consultancy (Ecpac System) has no
feature of generating the Registry of Public Infrastructure for roads. As such,
the City Accounting Office was not able to maintain the Registry of Public
Infrastructure for Road to facilitate the recording of the beginning balance of
the local road network and its components in the general ledger and the Local
Road Network Ledger Card, respectively.
4. The City General Services Office (CGSO) does not maintain a Local Road
Inventory and Road Map nor keep a complete local road network property
card for all roads and their components. Mr. Baguio G. Saripada, City General
Services Officer, justified that he does not have records of city road map and
has no access to the records of local road developments being undertaken by
the City, hence it was impossible for him to keep a complete Property Card for
all roads and its components. He then referred the audit team to the City
Planning and Development Office.
5. The City Planning and Development Office (CPDO) prepared and submitted
to the audit team the Roads and Bridges Inventory Report as of June 30, 2019
of the city and barangay roads under the jurisdiction of the City Government
of Digos with the following details/columns:
a. Road Name;
b. Road Category – Brgy. Road/City Road;
c. Surface Type – Gravel, Earth, Concrete, Asphalt;
d. Length in meters
e. Remarks
f. Carriageway width in meters;
g. Road Condition – Fair, Good, Poor, Bad;
h. Road Location;
i. Road Identification (ID);
j. Road Network – Core, Non-Core;
k. City/Municipal Road;
Preparation of the report was in accordance with the Manual of Local Road
Management as required by the Department of Interior and Local Government
(DILG).
Currently, the City Planning and Development Office is still in the process of
updating the City and Barangay Road Maps (Digos City Urban Road Network
and Digos City Road Network) using the Roads and Bridges Inventory System
(RBIS), a web-based system designed to capture local roads and bridges
inventory data.
48
6. The City Engineer’s Office prepares at the end of the year the Local Roads
Inventory covering the city roads under the jurisdiction of the City
Government. The inventory is submitted to the Department of Interior and
Local Government (DILG) for Special Local Road Fund (SLRF) allocation
pursuant to R.A. 8794 or the Motor Vehicle Users’ Charge Law enacted on
June 27, 2000.
7. According to Engr. Dennis C. Almacin, Engineer I, the information on the

costs of roads is not required to be presented in the inventory report being
prepared by their office. He also added that for the time being, their office can
only provide the cost of newly constructed roads. However, records for the
road developments prior to 2006 would take some time to be retrieved.
8. On the other hand, City Engineer Officer-in-Charge, Engr. Salvador L.

Dumogho IV, explained that barangay roads were not yet updated, hence these
were not included in the current inventory report.
Due to the abovementioned circumstances, the following activities were not

conducted pursuant to Section IV and V of COA Circular 2015-008 in the initial
recognition of local road and road network system, to wit:
a. Reconcile the list of inventory per local road inventory report and road map
with those recorded in the Registry of Public Infrastructure;
b. Segregate and recognize the cost of each component of the local roads with
identified cost;
c. Determine the components of local roads identified in the inventory without

corresponding cost and recognize the cost of each component at its fair value;
d. Maintain separate subsidiary ledgers for the road and its components namely:
a) road lot, b) road pavement, c) drainage and slope protection structures and
d) other miscellaneous structures;
e. Provide complete description of the road and its components in the subsidiary
ledger and reconcile with the Local Road Inventory and Road Map to ensure
completeness.
In view thereof, correctness, existence and completeness of “Road Networks”

account in the amount of P393,313,469.04 cannot be ascertained, affecting the fair
presentation of the account in the financial statements.
The same observation was noted in CY 2019, hence this reiteration.
49
Recommendations:
We recommended the Local Chief Executive to enjoin the following City officials
to do the following courses of actions pursuant to COA Circular 2015-008, to wit:
A. City Accountant
1. To transfer in the books of accounts the road networks carried in the

Registry of Public Infrastructure. If not possible, coordinate with the
City Engineer for the complete description and cost segregation of
road components for road projects.
2. Maintain separate subsidiary ledgers for the road and its components
namely: a) road lot, b) road pavement, c) drainage and slope
protection structures, and d) other miscellaneous structures.
3. Reconcile the subsidiary ledger of the road and its components with
the Local Road Inventory and Road Map to ensure completeness.
B. City Engineer
1. Segregate and recognize the cost of each component of the local roads
with identified cost;
2. Determine the components of local roads identified in the inventory

without corresponding cost and recognize the cost of each component
at its fair value;
3. Provide the local accountant and the general services officer with the
complete description and cost segregation of road components for road
projects.
C. City General Services Officer
1. In coordination with the City Planning and Development Officer

maintain a Local Road Inventory and Road Map;
2. Keep a complete Local Road Network Property Card for all roads and
its components.
D. Inventory Committee
1. Conduct physical count and prepare the Report on the Physical Count
of the Road Network system.
50
Management’s Comments:
In a 2019 Agency Action Plan and Status of Implementation (AAPSI) the

management submitted the following explanations:
1. The road networks carried in the Registry of Public Infrastructure were

transferred in the books of accounts as per JEV# 100-2020-02-69020 dated
02/17/20. Coordination with the City Engineer for the complete description and
cost segregation of road components for road projects was done.
2. A written office order to CEO was prepared and endorsed to supply necessary
details to be recognized in the separate subsidiary ledgers for the road and its
components namely: a) road lot, b) road pavement, c) drainage and slope
protection structures, and d) other miscellaneous structures, in order to fully
account road network as under Local Road Inventory Report.
3. The Local Road Inventory and Road Map was not yet endorsed by CEO despite
notification so that reconciliation with the subsidiary ledgers be made.
Maintainance of separate subsidiary ledgers for the road and its components
namely: a) road lot, b) road pavement, c) drainage and slope protection structures,
and d) other miscellaneous structures, under local road inventory report was not
yet done due to lack of necessary details.
Auditor’s Rejoinder:
The audit team will continue to monitor the implementation of the aforesaid
recommendations in the ensuing year.
Property, Plant and Equipment – Construction and Heavy Equipment
2. The reliability of the reported balance of Construction and Heavy Equipment

amounting to P288,877,726.77 as at December 31, 2020 is doubtful due to non-
reconciliation of records between the Accounting and General Service Offices with a
net variance of P69,393,595.58 and failure of management to conduct a physical
count of the said assets; hence, affecting the fair presentation of the financial
statements as at December 31, 2020.
Section 111 of Presidential Decree (PD) No. 15 provides:
“(1) The account of an agency shall be kept in such detail as is 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;”
51
Section C.3, Chapter V of the Manual on Property Custodianship mandates the
following relative to the reconciliation of the result of physical inventory and accounting
records which states:
“xxx. All discrepancies between physical and book inventories must be

investigated, cleared and reconciled immediately. xxx”
Section 124 of NGAS for LGUs Volume 1 state:
“Physical count of property, plant and equipment by type shall be made

annually and reported on the Report on the Physical Count of Property,
Plant and Equipment (RPCPPE). This shall be submitted to the Auditor
not later than January 31 of each year.
As at December 31, 2020, the statement of financial position of the City reported
the amount of P288,877,726.77 for the Construction and Heavy Equipment account.
However, the Inventory Report submitted by the CGSO showed an amount of
P219,484,131.19 resulting in a net variance of P69,393,595.58 or 24% of the total
reported balance. Presented below is the summary of the account with details in Annex F.
Per Accounting
Particulars RPCPPE Variance
Records
Backhoe 13,247,000.00 13,167,317.72 (79,682.28)
Compactor 31,058,418.22 65,664,836.46 34,606,418.24
Dump Truck 61,162,084.00 77,094,910.00 15,932,826.00
Excavator 46,475,000.00 46,383,897.50 (91,102.50)
Loader Truck 17,795,000.00 17,760,129.80 (34,870.20)
Wheel Loader 16,995,000.00 16,868,406.32 (126,593.68)
Fire Truck 876,691.69 876,691.69 0.00
Grader 27,493,563.90 27,493,563.90 0.00
Garbage Truck 0.00 9,805,600.00 9,805,600.00
Payloader 2,757,373.38 12,753,373.38 9,996,000.00
Bulldozer 1,009,000.00 1,009,000.00 0.00
Cargo Truck 300,000.00 0.00 (300,000.00)
Other 315,000.00 0.00 (315,000.00)
Total 219,484,131.19 288,877,726.77 69,393,595.58
The discrepancy could be attributed to the inadequacy of records maintained and

lack of coordination by both offices since there are assets that were recorded by GSO but
not recorded in the accounting books, and there were also purchases of equipment that
were recorded in the accounting ledger but not taken up by the GSO.
We also noted that the acquisition costs of construction and heavy equipment
purchased through long-term loans payable had differed significantly, to wit:
52
Amount
Amount recorded
Particulars recorded by Difference
by GSO
accounting office
Bobcat Back Hoe Loader Model B750
E#D63-EAE2, C#VCEC220DE00270833 10,615,317.72 10,695,000.00 (79,682.28)
Serial #12095743
Volvo Model: SD110B
4 cylinder Turbocharged diesel 7,538,431.64 7,595,000.00 (56,568.36)
ID VCES11BTOC552463
E#GHBE460168BIP,
9,576,173.30 9,595,000.00 (18,826.70)
C#JPCYX30A7JT019945
E#GHBE460565BIP,
9,576,173.30 9,595,000.00 (18,826.70)
C#JPCYX30A6JT019953
UD PKE250 4X2, 6 Wheeler dump truck
E#GHBE460162BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A7JT019962
E#GHBE460164BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A47T019966
E#GHBE460153BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A6JT019970
E#GHBE460084BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A3JT019964
E#GH8E460159BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A5JT019944
E#GH8E460581BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A1JT019942
E#GH8E460154BIP, 7,076,118.00 7,090,000.00 (13,882.00)
C#JPCYX30A2JT019951
Volvo Crawler Excavator Model:
EC220DL 14,361,791.30 14,390,000.00 (28,208.70)
SN: 270833
Volvo Wheel Type Excavator Model:
16,762,082.60 16,795,000.00 (32,917.40)
EW205
Hydraulic Crawler Excavator Volvo EC2
15,260,023.60 15,290,000.00 (29,976.40)
Engine FAMILY G 30723L0476V05
UD CWE370 6X4, 10 Wheeler, Self-
loader truck
17,760,129.80 17,795,000.00 (34,870.20)
E#GH1143872B2L,
C#JPCZBX0D8JT020655
Volvo Wheel Loader Model: L70F
16,868,406.32 16,995,000.00 (126,593.68)
SN: 27047
Total 167,851,355.58 168,375,000.00 (523,644.42)
As can be gleaned from the preceding table, the amount recorded by the City
Accounting Office (CAO) is less than the amount of that of the GSO. We were informed
by Mr. Mark Lester dela Calzada (GSO staff) who presently handled and maintained the
records of the aforementioned assets, that the amounts recorded in their books were the
53
amounts reflected either in the Purchase Orders (POs) or the charge/sales invoices they
received from the suppliers. The CAO, on the other hand, recorded the acquisition cost of
the aforementioned equipment based on the amount released by DBP attributed to
particular equipment. See Annex G for the loan releases of some of the construction and
heavy equipment. As such, attention is invited to Paragraph 30 of IPSAS 17 as to cost
recognition:
“The cost of an item of property, plant, and equipment comprises:
a) Its purchase price, including import duties and non-refundable

purchase taxes, after deducting trade discounts and rebates.”
b) Any costs directly attributable to bringing the asset to the location

and condition necessary for it to be capable of operating in the
manner intended by management. xxx”
Further inquiry with the GSO revealed that the submitted inventory report was not
the result of the physical count but a mere listing of construction and heavy equipment. It
was also learned that the GSO did not conduct a physical inventory during the year
because accordingly, the previous GSO personnel who handled the records and knew the
condition and location of these assets were transferred to its mother office (the City
Treasurer’s Office) in March 2019. It was only during the audit team’s series of physical
validations that they were able to locate and identify all the listed construction and heavy
equipment.
Validation and examination of the inventory report disclosed that five of these
equipment identified as serviceable were actually unserviceable upon ocular inspection,
to wit:
Amount per Inventory

Particulars
Report
DUMPTRUCK - ELF E#4D32-619188; C#FE315BD- 285,000.00
422669(CMO)
DUMPTRUCK - 6 WHEELERS ISUZU FORWARD WITH 500,000.00
6BGI - E#6BGI-761421/C#FRR12DA-3605839/PLATE# SHD-
117(CENRO)
ELF E# 4BEI-8589773; C#NKR58E-7104773; (CMO) 285,000.00
ISUZU ELF,E#4BC-8886159;PLATE # SEN-344; (CMO) 280,000.00
TCM 55B LOADER(FULLY RECON.); E#DA640-547159; 767,485.00
C#55B-00345; (CEO-MAINT)
Total 2,117,485.00
Physical count is an indispensable procedure to ascertain the accuracy of the

account, to check the integrity of property custodianship, and to determine the existence
and conditions/serviceability of the PPE.
54
The effort exerted by management in coming up with an inventory report of the
construction and heavy equipment account was commendable. It must be emphasized,
however, that the submission of the report should not be an end in itself. The
discrepancies, which are the results of the non-reconciliation of GSO and accounting
records and the failure to conduct physical count, should be addressed correspondingly.
As such, the obtaining conditions cast doubt on the reliability of the reported
balance of the construction and heavy equipment account, hence, affect the fair
presentation of the financial statements as at December 31, 2020.
This audit observation was presented to the management for CY 2019, the same
discrepancy had been noted for the year under audit, hence this reiteration.
Recommendations:
We recommended the following courses of actions:
1. Conduct physical count of all PPEs annually and submit RPCPPE to this
Office pursuant to Section 124 of NGAS Manual for LGUs;
2. For the GSO and CAO to perform periodic reconciliation of property records;
and
3. The Disposal Committee or GSO to conduct inspection and appraisal of the

unserviceable properties and recommend for its immediate disposal using the
appropriate mode of disposal.
The 2019 updated AAPSI stated the reason for the non-implementation of the
recommendations:
1. A written request was prepared and endorsed to CGSO for the request of the
copies of Latest Submitted Report on the Physical Count of Property, Plant and
Equipment (RPCPPE) to the Auditor and Inventory and Inspection Report of
Unserviceable Properties. Moreover, periodic reconciliation of property records is
to be conducted upon the schedule set by CGSO.
2. The amount reflected in the books of accounts as per observation was the amount
indicated in the loan proceeds from the bank, since this is the amount considered
for payment by the agency. The net variance will be thoroughly classified upon
endorsement by CGSO copy of the Latest Submitted Report on the Physical
Count of Property, Plant and Equipment (RPCPPE) to the Auditor.
Reclassification of Unserviceable Properties will be accounted for upon
endorsement to our office copy of the latest Inventory and Inspection Report of
Unserviceable Property.
55
recommendations.
Property, Plant and Equipment – Construction in Progress
3. Completed and dormant infrastructure assets with an aggregate amount of

P9,924,132.69 still formed part of the “Construction in Progress (CIP) –
Infrastructure Assets” account having a balance amounting to P80,963,140.51,
thereby casting doubts on the fair presentation of the financial statements.
One of the mandates of the Commission on Audit is to promulgate accounting and

auditing rules. Section 113 of Presidential Decree No. 1445 also provides that “The
Chart of Accounts for government agencies shall be prescribed by the Commission and
shall be so designed as to permit agency heads to review their activities according to
selected areas of responsibility; allow for a clearer definition of obligation accounting
leading to more precise budgetary control xxx.”
In line with the foregoing, COA Circular No. 2015-009 dated December 01, 2015
was issued to promulgate and prescribe the use of the Revised Chart of Accounts for
Local Government Units (RCALGU) in recording and reporting the financial transactions
of local government units (LGUs). Specifically, the Circular provides for a clear
definition for the Construction in Progress – Infrastructure Assets account, as follows:
As of December 31, 2020, the City of Digos reported in its Statement of Financial
Position under General Fund the balance of “Construction in Progress – Infrastructure
Assets” account in the amount of P80,963,140.51.
Verification of the schedule of projects recorded under Construction in Progress–

Infrastructure Assets revealed that 12.26% or P9,924,132.69 represents infrastructures
that were either already completed in the previous years but were not
reclassified/transferred to corresponding infrastructure asset accounts or had been
dormant for over two years. Breakdown of which are as follows:
56
CIP Projects Accumulated Cost Status of Completion
1 Concreting of Lapu-Lapu St., Zone 3 11,200.64 Unidentified/Dormant
2 Concreting of Road Purok Caimito Brgy. San Miguel 15,206.40 Unidentified/Dormant
4 Const. of Drainage System along estrada st. Brgy. Zone 2 66,839.00 Unidentified/Dormant
Const. of Drainage along Lim ext., Brgy. Zone III - (P Unidentified/Dormant
5 4,354.80
1,984,321.21)
6 Const. of Drainage System - Brgy. Matti (P 99,948.60) 90,679.51 Unidentified/Dormant
7 Drainage - Aurora ext.- San Miguel (Florentino-Cadungog Res.) 192,387.20 Unidentified/Dormant
8 Improvement of Road along estrada 2nd, Brgy. Zone II 2,386.40 Unidentified/Dormant

Installation of Culvert - Purok Mabuhay-Brgy. Kibao Rd- Lungag Unidentified/Dormant
9 75,912.00
(P69,928.92)
10 Const. of health center @ Brgy BRGY. BINATON(500T) 485,525.90 Unidentified/Dormant
CONCRETING OF ROAD-ALONG MABINI 4TH & 5TH ST., Unidentified/Dormant
11 238,635.99
ZONE 3
Subtotal 1,183,127.84
1 Const. of Road-Clarion st., Zone 2 (P-2) 801,569.64 679,315.25 Completed
2 Concreting of Sto. Rosario, Sitio Riverside Brgy. Ruparan 428,745.98 Completed
3 Concreting of Road - Purok Nangkaan, kiagot (250T-2018) 94,691.60 Completed
4 Concreting of Road - Brgy. Soong 609,250.67 Completed
5 Concreting of Road - Pier Uno, Colorado 940,153.65 Completed
6 Const. of Box Culvet, Purok 4, Dulangan 754,633.41 Completed
Ground Preparation & Const, of Retaining Wall for New Bus
7 4,728,643.19 Completed
Terminal, Sitio Power, Tres de Mayo (P 4,629)
8 Const. of Bone Niche@Public Cemetery 220,168.70 Completed
9 Const. of Covered Candle Pool@ Cemetery 285,402.40 Completed
Sub-total 8,741,004.85
TOTAL - INFRASTRUCTURE PROJECTS 9,924,132.69
Inquiry and verification with the City Accounting Office (CAO) and City
Engineering Office (CEO) revealed the following obtaining conditions that prevented the
reclassification of CIP-Infrastructure Assets account to corresponding infrastructure asset
accounts:
 Unidentified/Dormant Infrastructure Projects (11 projects with a total

amount of P1,183,127.84) – The City Engineering Office (CEO) could
not identify the status of completion and other details of these projects due
to the unavailability of documents and lapse of time. Engr. Dennis C.
Almacin initially assessed the possibility of termination of some of the
eleven (11) above-listed projects, however, he could not ascertain as to
which particular project was terminated.
On the other hand, the City Accounting Office (CAO) commented that
their office only relies on the documents submitted by the CEO, absence
of which means inaction for the accounting office as far as the
reclassification of CIP is concerned.
57
 Completed Infrastructure Projects (9 projects with a total amount of
P8,741,004.85) - The City Engineering Office (CEO) averred that they
were able to prepare the Certificates of Completion which were already
submitted to the accounting office as one of the supporting documents
attached to disbursement vouchers. However, for infrastructure projects
implemented by administration, the CEO does not usually prepare a
Certificate of Completion. Moreover, no written communication was
prepared and submitted to the accounting office to inform the same with
the completion of the infrastructure projects undertaken by administration.
On the other hand, the accounting personnel assigned to handle the CIP
accounts was amenable that she has not made the corresponding
reclassification entries to transfer accumulated costs of these projects from
CIP to respective infrastructure asset accounts due to the non-submission
of documents to support the adjustment and transfer of the completed
project.
In view of the foregoing, the reliability and accuracy of the CIP-Infrastructure

Assets amounting to P80,963,140.51 could not be ascertained due to the inclusion of
accumulated costs of completed and dormant infrastructure assets to P8,741,004.85 and
P1,183,127.84, respectively, thereby casting doubt on its fair presentation in the financial
statements.
Recommendations:
We recommended to the management the following courses of actions:
1. City Engineering Office (CEO)
 Exhaust all options to identify the details and status of the

abovementioned infrastructure projects that were marked as
“unidentified”. Furnish the accounting office the details retrieved to
facilitate subsequent actions to be undertaken.
 Furnish the accounting office the certificates of completion for the

completed infrastructure projects that were undertaken by contract. For the
completed infrastructure projects undertaken by administration, provide
the accounting office the details such as date started, date completed and
other important details that would be the basis for the reclassification of
CIP-Infrastructure Assets account to its corresponding infrastructure asset
accounts.
 For the ensuing infrastructure projects whether undertaken by contract or

administration, provide the accounting office the details through written
communication including, among others, the certificates of completion
(for projects undertaken by contract), and list/details of infrastructure
58
projects completed and undertaken by administration. With this, the
accounting office will have the basis for the reclassification of CIP-
Infrastructure Assets account to corresponding infrastructure asset
accounts.
2. The City Accounting Office (CAO)
 Request from the CEO the copies of certificates of completion for the
completed infrastructure projects undertaken by contract.
 Request from the CEO the details of the completed infrastructure projects
that were marked as “unidentified”.
 Upon availability of the documents and other details coming from the
CEO, reclassify the completed CIP-Infrastructure Assets account to its
corresponding infrastructure asset accounts.
 For the completed non-infrastructure projects, prepare necessary adjusting

entries to take out the accumulated costs of these projects from the CIP-
Infrastructure Assets account and charged the same against the City’s
government equity.
An updated AAPSI was received in February 2021 and states the following:
1. A written request was prepared and endorsed to CEO for the request of
the copies of certificates of completion for the completed infrastructure
projects undertaken by contract and the details of the completed
infrastructure projects that were marked as “unidentified” from the
CEO, and Report of the status of the completed infrastructure projects
undertaken by administration, with complete details such as date started,
date completed and other important details that would be the basis for
the reclassification of CIP-Infrastructure Assets account to its
corresponding infrastructure asset accounts, duly signed and accounted
for.
2. Since no documents and details was sent by the CEO, reclassification of

the completed CIP-Infrastructure Assets account to its corresponding
infrastructure asset accounts was not yet done. However, the following
projects were traced and existence of such was assured.
59
The audit team will validate the reclassification of the “CIP-Infrastructure Assets”
account to its corresponding infrastructure asset accounts and any adjustments in the
ensuing year pertaining to this account.
Bank Reconciliation Statement – Reconciling items remained unadjusted
4. Reconciling items in the monthly bank reconciliation statements with a total amount
of P1,645,990.51 that were either additions or deductions to book and bank balances
as at December 31, 2020 remained unadjusted in the books, thereby rendering the
accuracy and reliability of the Cash in Bank accounts balance doubtful.
Sec. 74 Presidential Decree 1445 states:
“xxx The head of the agency shall see to it that a reconciliation is made
between the balance shown in the reports and the balance found in the
books of the agency.”
Periodic reconciliation of bank and book balances is a required accounting control

of the agency to ensure the accuracy, validity and reliability of the cash in bank balance.
Review of the submitted Statement of Bank Reconciliation disclosed a number of

reconciling items that remained unadjusted as of cash examination date, September 1,
2020. Details are as follows:
General Fund Proper – DBP Current Account No. 0920-029240-080

Reconciling items in the bank balance
Collections made under account no. 0920-029240-030 OCEEM were
erroneously credited to this account (deducted against the bank balance)
Market - 7/4/17 (30,475.00)
Market - 6/20/17 (47,615.27)
Slaughterhouse - 6/20/17 (59,519.08)
Collections made under acount no. 0920-029240-030 OCEEM-Old (327,881.18)
Market were erroneously credited to this account (deducted against the
bank balance)
Bank error in the encashment of Check No. 58464824 dated 10/4/2018; (37,66
debited in OCEEM DBP Account No. 0920-029240-030 (deducted 7.85)
against the bank balance)
Bank error in posting the following:
Check No. Date Payee Correct Amount Difference

Amount posted by
Bank
58462895 3/16/18 Sezzie 61,656.04 51,656.04 10,000.00
(A-B) Enterprises (10,000.00)
60
58463806 6/20/18 Sur 4,125.03 4,124.70 0.33
(A-G) Telemedia (0.33)
Network
53276820 3/28/17 Dadi 2,780.40 2,780.00 0.40
Ronald’s (0.40)
Marketing
All deducted against the bank balance
Total Bank Errors/Reconciling Items (513,159.11)
General Fund Proper – LBP Current Account No. 0332-1029-58

Bank error in recording the deposit on 1/4/2013. Posted as P10,355.00 0.90
instead of P10,355.90 (added to the bank balance)
OCEEM – DBP Current Account No. 0920-029240-030

Collection for trust fund deposited in this account on 9/14/2017 (190,000.00)
(deducted against the bank balance)
Collections under OCEEM were erroneously posted in GF Proper
Account DBP Current Account No. 0920-029240-080 (added to the
bank balance)
Market 6/20/2017 47,615.27
Slaughterhouse 6/20/2017 59,519.08
Market 7/4/2017 30,475.00
Collections made under this account (Old Market) were erroneously
credited to GF Proper Account DBP Current Account No. 0920-
029240-080 (added to the bank balance) 327,881.18
Bank error in posting the following:
Check Date Payee Amount

No.
5846482 10/4/2018 Samantha's 37,667.85
37,667.85
4 Enterprises
The amount was erroneously debited against this account which should
have been in the GF Proper DBP Current Account No. 0920-029240-
080 (added to the bank balance)
693,158.3
Total Reconciling Items (in absolute value) 8
61
SEF – DBP Current Account No. 0920-029240-032
Deposit of collection on 4/19/2018, erroneously deposited in Trust Fund 124,836.06
– DBP Current Account No. 0920-029240-031 (added to bank balance)
Total Reconciling Items (in absolute value) 124,836.06
Trust Fund – DBP Current Account No. 0920-029240-031

Collection for SEF on 4/20/2018 erroneously deposited in this account (124,836.06)
(deducted against the bank balance)
Collection for TF Proper deposited in OCEEM bank account on 190,000.00
9/14/2017
Total Reconciling Items (in absolute value) 314,836.06
Aggregate amount of reconciling items (in absolute value) 1,645,990.51
In an inquiry with one of the personnel of City Accounting Office (CAO), the
book reconciling items were not immediately adjusted as these became the least priority
every month end due to voluminous transactions to be encoded. The explanation is
unsound as the objective of preparing the bank reconciliation, which is to ensure the
accuracy of the balances of the book and the bank, is defeated. If reconciling items are
left unadjusted, the entity might run the risk of falling victim to fraud and/or unauthorized
withdrawals that can lead to malversation of funds.
On the other hand, the CAO had already indorsed to the City Treasurer’s Office
(CTO) all bank reconciling items so it could be communicated to the banks, however, the
CTO has not notified the bank of such reconciling items yet.
The prevailing practice of just indorsing or informing the CTO of the reconciling
items will not resolve the issue of the incurrence of bank errors unless the bank is notified
and/or advised by the entity that there are such errors.
Recommendation:
We recommended the City Accountant to immediately notify the Bank in writing

of the reconciling items under General Fund Proper – DBP Current Account No. 0920-
029240-080, General Fund Proper – LBP Current Account No. 0332-1029-58, OCEEM
– DBP Current Account No. 0920-029240-030, SEF – DBP Current Account No. 0920-
029240-032, and Trust Fund – DBP Current Account No. 0920-029240-031, in
coordination with the City Treasurer, to adjust or correct the errors for an accurate and
reliable cash account balance every month-end.
Management’s Comment:
In coordination with the City Treasurer, a written notification was already

prepared and endorsed by the City Accounting Office to the respective Banks where
62
reconciling items for adjustment are to be recognized under General Fund Proper – DBP
Current Account No. 0920-029240-080, General Fund Proper – LBP Current Account
No. 0332-1029-58, OCEEM – DBP Current Account No. 0920-029240-030, SEF – DBP
Current Account No. 0920-029240-032, and Trust Fund – DBP Current Account No.
0920-029240-031.
The audit team will continue to monitor the recommendations.
Breeding Stocks
5. The existence, accuracy and reliability of the Breeding Stocks with an account
balance of P1,186,900.00 as of December 31, 2020 is doubtful due to non-
reconciliation of the Inventory Report and the books, and the non-compliance in the
timely submission of required documents in case of loss/death of breeding stocks as
required under Sections 151 and 152 of the Rules and Regulations on Supply and
Property Manual in the Local Government.
Section 266, Volume II of the Government Accounting Manual for Local

Government Units provides:
“Physical Count of PPE. The LGU shall have a periodic physical count of
PPE, which should be done annually and reported on the Report on the
Physical Count of Property, Plant and Equipment as of December 31 of
each year. This shall be submitted to the Auditor concerned not later than
January 31 of the following year. Equipment found at station and losses
discovered during inventory taking shall be incorporated in the report
furnished the Accounting Office for proper accounting/recording.”
Further, pertinent provisions of Sections 151 and 152 of the Rules and
Regulations on Supply and Property Manual in the Local Government provides:
“Section 151. Notice of Loss and Application for Relief –
xxx The request for relief shall be filed with the provincial, city or
municipal auditor by the accountable officer within the statutory period
of thirty (30) days or of such longer period as may be allowed by the
auditor. In general, the request shall be accompanied by the following
documents:
a. the basic notice of loss showing the exact date of filing and
receipt in the office of the auditor concerned or the COA;
b. affidavit of the accountable officer containing a statement of
facts and circumstances of the loss;
63
c. affidavits of two (2) disinterested persons cognizant of the facts
and circumstances of the loss;
d. final investigation report of the office or department head,
proper government investigating agency and the auditor on the
facts and circumstances surrounding the loss;
e. a list and description including book value, date of acquisition,
property number, account classification, condition of the
property, and other additional relevant information of the
properties lost duly certified by the general services officer,
municipal or barangay treasurer, as the case may be;
f. latest inventory and inspection report preceding the loss and
inventory report of properties remaining after the loss, duly
witnessed by the provincial, city or municipal auditor
concerned;
g. comment and/or recommendation of the local chief executive
concerned on the request;
h. exact or accurate amount of government cash or book value of
the property, subject of the request for relief; and
i. Memorandum Receipt, if any, covering the properties subject
of the request. xxx
Section 152. Additional Information in Certain Cases –
x x x 4. death of large cattle and other livestock –
4.1 certificate of death of large cattle issued by proper official

and duly verified by the auditor concerned; and
4.2 autopsy report, if any, of the proper veterinarian x x x
The Breeding Stocks account under the General Fund has a book balance of
P1,186,900.00 as of December 31, 2020. However, submitted Inventory Report for
General Fund Fund of Work – Animal as of December 31, 2020 showed a balance of
P1,024,900.00 showing a difference of P162,000.00, as shown below:
Breeding Stocks December 31, 2020

Per Books (General Fund) 1,186,900.00
Per Inventory Report 1,024,900.00
Difference 162,000.00
Verification of breeding stocks under the accountabilities of the following city

offices disclosed the following results:
A. Office of the City Agriculturist:
Interview with Mr. Socrates A. Geagonia, Agricultural Technologist of the Office

of the City Agriculture (OCA), now in-charge of livestock dispersal disclosed that the
64
following breeding stocks dispersed under the accountability of OCA personnel are no
longer in existence, viz:
Particulars Qty. Book Value Date Acquired OCA Personnel

Lina Flores – Retired
Cattle, male 1 10,000.00 10/01/2003
effective 9/24/2018
Cattle, female 2 20,000.00 10/01/2003 Lina Flores
Cattle, female Edna Tingson, Retired
1 10,000.00 11/19.2004
Upgraded 1 yr. old effective July 31, 2019
Cattle, female Genara Pascual - Deceased
5 50,000.00 11/19.2004
Upgraded 1 yr. old
Roger Masculino, Retired
Goat, Doe 30 75,000.00 01/09/2008
effective 6/27/2019
Goat, Doe 70 175,000.00 10/16/2007 Roger Masculino
Goat, Buck 10 50,000.00 10/16/2007 Roger Masculino
Gilt, Swine 40 300,000.00 01/09/2008 Roger Masculino
Total 159 690,000.00
Mr. Socrates commented that a cattle has a lifespan of four to five years after the
maturity of one year. Hence, the existence of cattle acquired in 2003 and 2004 could no
longer be possible. To date, OCA personnel responsible for the breeding stocks are either
retired or deceased.
Furnished to us by the General Services Office are copies of affidavits executed

by Mr. Roger Masculino and the various recipients of livestock dispersal, to wit:
Executed by Various Executed by Mr.

Livestocks Recipients of Masculino Total
Dispersal (Annex K)
Female Cattle (Annex H) 7 2 9
Goat-Doe (Annex I) 87 6 93
Goat-Buck (Annex J) 12 0 12
Gilt, Swine (Annex K) 37 3 40
The affidavits executed by various recipients of livestock dispersal attested to the

death and disposal of livestock received from the Office of the City Agriculturist for the
livestock dispersal program of the city. The affidavits were executed between June 14-
20, 2019. Causes of death were as follows:
a. Snake bite-Sudden death;

b. Loss of appetite;
c. Liver Fluke;
d. Pneumonia;
e. Swallowed parasite;
f. Bloating; and
g. Short life expectancy and lapse of time from the date of distribution
65
Mr. Masculino executed an affidavit dated May 24, 2019 (Annex L) attesting that
the various livestock dispersed has long been disposed and the non-existence of the
various recipient.
An affidavit (Annex M) was also executed by Ms. Edna P. Tingcon on July 31,
2019 attesting that One (1) Female Cattle Upgraded under her accountability could not be
traced and accounted for due to the life expectancy and lapse of time from the
distribution.
B. Office of the City Veterinarian:
Accountabilities under the Office of City Veterinarian amounted to P201,000.00

are as follows:
Particulars Qty. Book Value Date Acquired

Junior Boar-Pietren Cross Large
1 25,000.00 05/09/2005
White Line 399
Junior Boar 1 26,000.00 09/12/2006
PIC Boar Line 399 Silver 4 150,000.00 02/18/2010
Total 6 201,000.00
Mr. Wendell L. Gomez, Farm Worker II only confirmed the existence of one (1)
junior boar. He also alleged that documents were already submitted to the
GSO/Accounting for the culling of three (3) heads and death of one (1) PIC Boar Line
399 silver.
C. Barangay Igpit under Barangay Captain Flaviano B. Hermoso, Jr.
In an interview with Barangay Captain Flaviano B. Hermoso, Jr. of Barangay

Igpit on August 13, 2019, he confirmed the existence of ten (10) heads of swine dispersed
among his constituents with a book value of P99,900.00. He commented that any
casualty of breeding stocks shall be replaced by the recipient concerned.
However, in the CY 2015 Annual Audit Report on the City of Digos, the result of
validation disclosed that three (3) heads of swine were already dead.
The non-reconciliation of Inventory Report and book balance of Breeding Stocks

as of December 31, 2018 and the confirmation of OCA and City Veterinarian personnel
on the non-existence of breeding stocks under their responsibilities rendered the accuracy
and reliability of the account balance as of June 30, 2019, doubtful.
Further, non-compliance in the timely submission of required documents for the

relief of accountability due to death or loss of breeding stocks placed in doubt the
veracity and truthfulness of the accounts given by the recipients and city personnel as
stated in their affidavits since events that transpired years ago could no longer be verified.
66
Sections 151 of the Rules and Regulations on Supply and Property Manual in the
Local Government provides that request for relief shall be filed by the accountable officer
to the auditor within the statutory period of thirty (30) days or of such longer period as
may be allowed by the auditor.
Likewise, the absence of a certificate of death issued by proper official and

autopsy report of the proper veterinarian as required in Section 152 of the Rules and
Regulations on Supply and Property Manual in the Local Government place in the doubt
the reasons attested by the various recipients for the death of dispersed breeding stocks.
The one-time submission of affidavits by various recipients shows that no

physical count was conducted as reported in the Inventory Report as of December 31,
2018 validating the existence of the breeding stocks contrary to Section 266, Volume II
of the Government Accounting Manual for Local Government Units.
The same observation was noted in CY 2019, hence this reiteration.
Recommendations:
We recommended management to:
1. Direct the City General Services Office to conduct a physical count of the
breeding stocks and coordinate with the Accounting Office to facilitate
reconciliation and/or adjustments in the books of accounts; and
2. Require the focal persons responsible for the breeding stock dispersal of the
City Agriculture/Veterinary Office and barangay for the timely submission of
relief from property accountability and the required documents on the
disposal/death of breeding stocks as required under Sections 151 and 152 of
the Rules and Regulations on Supply and Property Manual in the Local
Government for validation and derecognition of the accounts in the books.
In the 2019 AAPSI, the CAO provided the following justification as to non-
implementation of the recommendations:
1. No updated Inventory Report on Breeding Stocks was yet submitted in the Office
of the City Accountant to duly account updated inventory of Breeding stocks.
Moreover, reclassification for derecognition of dead large cattles and other
livestocks was not yet done since no proper supporting documents/report was yet
endorsed.
2. A letter was prepared and endorsed to the City General Services Office dtd March
2, 2021, copy furnished the City Agriculture/Veterinary Office to require
submission of the updated Inventory Report on Breeding Stocks. To account
67
derecognition of large cattle and other livestock, the following supporting
documents on their reports were also requested: (1) Certificate of death of large
cattle issued by proper official and duly verified by the auditor concerned, and (2)
autopsy report, if any, of the City Veterinarian.
The audit team will continue to monitor the implementation of the

recommendations.
Drugs and medicines held for distribution
6. Drugs and medicines procured for distribution by the City Health Office (CHO)
amounting to P2.9 million were directly charged to expense account contrary to
Section 182 of the Government Accounting Manual for Local Government Units
(LGUs) without proper accountability and accounting in its disposal or utilization,
hence accuracy of expense account and its related inventory account balance could
not be ascertained.
Section 182 of the Government Accounting Manual for Local Government Units
“Perpetual Inventory Method. Inventory records shall be maintained

using the perpetual inventory system. Under the system, an agency
continually updates its inventory records to account for additions
to and subtractions from inventory. The local accountant shall
maintain the Supplies Ledger Card (SLC) for each inventory item
as the perpetual inventory record.”
Also, Section 188 of the same Manual states the policy in recording the receipts
of inventory:
“Upon receipt of the AIR and other supporting documents such as

Purchase Orders, Delivery Receipts and/or Supplier’s Invoice, the
local accountant shall draw a Journal voucher (JV) to record the
Inventories in the Journal of Procurements Received and in the
inventory ledger cards. In case of the inventories acquired thru
non-change transactions, the Report on Receipt of In-Kind
Donations for Inventories shall be the basis for drawing the JV for
the recognition of the Inventories in the books of accounts. The
cost shall be based on the fair value of the goods received.”
The City appropriated P3,000,000.00 from the Bayanihan Grant to Cities and
Municipalities (BGCM) fund for Drugs and Medicines Expenses. During CY 2020,
disbursements from the said fund included purchases for drugs and medicines. Details are
as follows:
68
CHECK AMOUNT
DATE PAYEE
NUMBER (In Php)
5/20/2020 71556871 Peej and Jay-M Enterprises 2,502,500.00
6/29/2020 71557229 Biogenmeds Pharma Center 497,468.00
TOTAL 2,999,968.00
These drugs and medicines were intended to be used by the City Health Office
(CHO) for distribution to the beneficiaries in the locality as one of its responses to the
Covid-19 pandemic.
Review of the accounting entries made for each disbursement vouchers revealed
that the abovementioned expenses were immediately charged to Drugs and Medicines
Expenses account (5-02-03-070) instead of recording in its related inventory account.
This means that all procured items were deemed immediately consumed upon purchase
even if they were not yet fully utilized or distributed.
COA Circular No. 2015-009 dated December 01, 2015 prescribed the specific
description and use of the related accounts in the aforementioned disbursements:
Account Title Drugs and Medicines for Distribution

Account No. 1-04-02-030
Normal Balance Debit
Description This account is used to record the cost of drugs and medicines
purchased/received for distribution. Credit this account for
issuance to end-users, transfers or write down.
Account Title Drugs and Medicines Inventory
Account No. 1-04-04-060
purchased/received for government operations. Credit this
account for issuance to end-users, transfers or other disposal.
Account Title Drugs and Medicines Expenses
Account No. 5-02-03-070
issued to end-users for government operations.
In an inquiry with the City Accounting Office, the said purchases were
automatically recorded as expenses upon payment presuming all drugs and medicines
69
were distributed since no inventory reports from the CHO were submitted to them during
the year. Furthermore, due to the voluminous accounting and non-accounting transactions
attended by the City Accountant especially during these times, the transactions were not
looked into further.
Verification from the CHO disclosed that no inventory reports were being
prepared by them for the aforementioned drugs and medicines instead, reports on daily
dispensing of medicines were presented to the audit team. Furthermore, one of the CHO
personnel gave information that those drugs and medicines were distributed by the City
Special Programs and Management Office (CSPMO) under the Office of the City Mayor.
However, upon inquiry, the CSPMO could not also present any inventory nor monitoring
reports and distribution list for the said supplies. As such, the audit team was unable to
obtain information on the distribution and/or issuance of the said supplies to the intended
beneficiaries.
Due to this practice and the lack of coordination between concerned offices,
management has minimal accounting control in the custodianship and disposition of these
drugs and medicines. On the other hand, adherence to the perpetual inventory system
helps prevent wasteful consumption or utilization of supplies due to the meticulous
accounting from requisition, delivery and issuance. Moreover, it promotes awareness on
the efficient use and safeguarding of the management’s resources.
Following the perpetual inventory method, the supplies and materials procured
should be recorded as inventories upon acquisition and delivery, and the portion
distributed during the accounting period should be recorded as expense. Despite the fact
that there were instances where the consumable supplies and materials had to be
immediately issued to end users supported by Receipt and Issuance Slip (RIS), these
should have been first taken up as assets of the City and recorded in the Inventory
account.
While we recognized the management’s action in expediting their responses in

addressing the current situation, the non-adherence to certain prescribed rules in the
management of supplies, accuracy in the recorded drugs and medicine expense account
and its related inventory account balance could not be ascertained.
Albeit we are caught in the middle of an emergency crisis, necessary controls

must still be in placed to ease the process of monitoring, validation and reconciliation
procedures.
Recommendations:
We recommended to the City Mayor to direct the City Accountant and all
Department Heads to coordinate and adhere to the rules and procedures in accounting for
supplies and materials provided under Chapter 7 of the NGAS Manual.
70
Further, a report on the utilization and disposal of drugs and medicines to end
users/beneficiaries be submitted to support the recording of expense account in the books.
The City Health Officer II explained in her reply letter dated February 17, 2021
that they are fully aware of the perpetual inventory system. However, since their office is
the main responsible for the overall operations of the public health emergency, it has
been an additional workload for her personnel. The current health care teams are doing
multiple assignments for the COVID-19 pandemic, from case investigation, contact
tracing, testing and isolation, not to mention that they are also attending to other public
health programs. She also added that they have incorporated the distribution of drugs and
medicines into the activities related to COVID-19. This main objective in addressing the
patients’ health concerns promptly has been their priority hence the failure to submit
monthly inventory reports. The personnel assigned for the inventory are also involved in
the COVID-19-related activities.
Nevertheless, she also assured that necessary controls will be observed,

particularly the perpetual inventory method, in coordination with other offices, more
particularly with the City Accounting Office.
Isolation Facility
7. Major expenditures in the construction of the Isolation Facility amounting to

P4,355,089.68 were not capitalized but were erroneously charged under Repairs and
Maintenance – Infrastructure Assets account, contrary to International Public
Sector Accounting Standards (IPSAS) No. 17 thereby, understating the related PPE
account and overstating the Repairs and Maintenance account.
IPSAS No. 17 prescribes the accounting treatment for Property, Plant and
Equipment and states:
“The cost of an item of property, plant and equipment shall be

recognized as an asset if, and only if:
(a) It is probable that future economic benefits or service

potential associated with the item will flow to the entity;
and
71
(b) The cost or fair value of the item can be measured
reliably.”
Section 111 of PD 1445 on keeping of accounts emphasized that:
“1. The accounts of the agency shall be kept in such detail as is

necessary to meet the needs of the agency and at the same time
be adequate to furnish the information needed by fiscal or
control agencies of the government; and
2. The highest standards of honesty, objectivity and consistency

shall be observed in the keeping of accounts to safeguard against
inaccurate or misleading information.”
Moreover, Section 61 of the same PD on audit of expense accounts states that:
“The examination of expense accounts shall be undertaken to ascertain

that all expenses incurred have been duly authorized; adequately
funded and documented; properly recorded; all recorded expenses
have been actually incurred; and the classifications of expenses are
appropriate and have been consistently followed.”
The Glossary of Terms from Budget of Expenditures and Sources of Financing

(BESF) FY 2020 of the DBM defined the following:
Expense Class. In this document, refers to the general classification of

expenditures, specifically based on economic classification or the
process/inputs involved in the government’s fulfillment of its
responsibilities, including but not limited to the delivery of
goods/services. These are Personnel Services (PS), Maintenance and
Other Operating Expenses (MOOE), Financial Expenses (FinEx),
Capital Outlays (CO) and Net Lending (NL).
Capital Outlays or Capital Expenditures. An expenditure

category/expense class for the purchase of goods and services, the
benefits of which extend beyond the fiscal year and which add to the
assets of the Government, including investments in the capital stock of
GOCCs and their subsidiaries.
Maintenance and Other Operating Expenses (MOOE). An

expenditure category/expense class for support to the operations of
government agencies such as expenses for supplies and materials;
transportation and travel; utilities (water, power, etc.) and the repairs,
etc.
72
During the CY 2020, the City of Digos, through Supplemental Budget No. 07,
appropriated P6,700,000.00 as capital outlay under its 20% Development Fund for the
construction of its Covid-19 isolation facility located at Barangay Igpit.
Examination of disbursement vouchers (DVs) revealed that total amount of

P4,355,089.68 was disbursed as payment for the construction of the isolation facility.
Said disbursements were recorded under the Repairs and Maintenance – Infrastructure
Asset account. Details of which are as follows:
CHECK
DATE PAYEE PARTICULARS AMOUNT
NUMBER
44 units of kubo-type
9/7/2020 71557785 Sezzie Enterprises 2,099,999.88
rooms
457.40 liters of unleaded
12/7/2020 71558567 Cor Jesu Shell Station 23,784.80
gasoline
12/7/2020 71558565 Cor Jesu Shell Station 1,521 liters of diesel fuel 76,050.00
Davao TCM Various construction
12/7/2020 71558602 2,155,255.00
Hardware materials
TOTAL 4,355,089.68
The aforementioned expenses were not capitalized nor recognized as part of the
carrying cost of the asset. Since these were direct costs in the construction of the isolation
facility, these should have been capitalized and added to the cost of the related PPE
account. Further verification of expenditures disclosed that only the labor component of
the construction was capitalized and accounted for under the Construction in Progress –
Infrastructure Asset account amounting to P374,850.00.
Review of the Statement of Appropriations, Allotments, Obligations and Balances

(SAAOB) as of December 31, 2020 disclosed that all expenditures related to the
construction were classified as capital outlay. However, the account classification stated
in the Obligation Requests, which were prepared by the requesting office, attached in the
DVs showed otherwise.
Inquiry with the City Accountant disclosed that the recording of the expenditures
was based only on the account indicated in the Obligation Requests. However, due to the
urgency of the situation, those DVs were not reviewed further to check the accuracy of
account classification and recording. On the other hand, the Acting City Budget Officer
averred that they were not able to review thoroughly the classification of accounts in the
Obligation Requests, hence, the inconsistencies in the budget and the requesting office’s
records.
In view of the foregoing observation, the non-reconciliation between the

concerned offices in the classification of expense class casts doubt on the accuracy of the
CO and MOOE accounts, therefore, affecting also the City’s Statement of Comparison of
73
Budget and Actual Amounts. The erroneous recording of expenditures resulted in the
understatement of the asset account and the overstatement of the expense account
affecting the accuracy and presentation of income in the financial statements. Moreover,
the management and other users of the financial statements were deprived of accurate
data which may be helpful in their decision-making.
While we acknowledged the efforts of the City in fulfilling its role especially
during this difficult time, it should be emphasized that they must still adhere to the
guidelines set forth in the keeping of accounts to safeguard against inaccurate or
misleading information that could affect the management in its decision-making.
Recommendations:
We recommended the City Mayor to:
1. Direct the CAO, CBO and every requesting office to analyze more the
transactions and see to it that they are correctly classified as to expense class
and recorded in the books of accounts to provide the users of the financial
statements, especially the management, correct and adequate financial data of
the operations of the City; and
2. Direct the City Budget Officer and City Accountant to prepare appropriate
adjusting journal entries in their respective records to correct the
misclassification of the affected accounts. Henceforth, ensure that costs of
major repairs, rehabilitation, improvement and construction of infrastructure
assets should be capitalized or recognized as PPE in accordance with IPSAS
No. 17.
In their reply letter dated March 4, 2021, the Acting City Budget Officer
explained that upon review, the expenses were recorded in their system as capital outlay.
However, due to the exigency of the purchases coupled with the influx of workload and
transition of functions in the said office, the classification of accounts in the Obligation
Requests were overlooked and was erroneously recorded. Such inaccuracy is merely
attributable to human error and did not defeat the whole purpose to which the said
allocation was appropriated.
Nevertheless, the management assured to adhere to the existing rules and

regulations will submit to the recommendations given by the audit team.
74
B. COMPLIANCE AUDIT
Cash Advance
8. Cash advance amounting to P390,799.00, representing financial assistance to

Philippine National Police (PNP)-Digos City Station was granted to non-organic
personnel in contrary to COA Circular 97-002 and COA-DBM-DILG-GCGOCC-
DND Joint Circular 2015-01, thereby exposing the funds to possible loss or misuse.
Sections 4.1.4 and 4.1.5 of COA Circular 97-002 provide the following:
“4.1.4 Only permanently appointed officials shall be designated as
disbursing officers. Elected officials may be granted a cash
advance only for their official traveling expenses.
4.1.5 Only duly appointed or designated disbursing officers may

perform disbursing functions. Officers and employees who are
given cash advances for official travel need not be designated as
Disbursing Officers.”
Correspondingly, Item 6.1.2 of COA-DBM-DILG-GCGOCC-DND Joint Circular

2015-01 dated January 8, 2015 also states:
“Cash advances for CF and/or IF shall be drawn by duly designated and

bonded SDOs or HoA for the implementation of a program, activity, and
project chargeable to the corresponding CF and/or IF of the agency,
upon approval of the HoA. In no case shall cash advance for CF and/or
IF be utilized as reimbursement of the expenses prior to the granting of
cash advance.”
Review of cash advances transaction disclosed that cash advances amounting to

P390,799.00 to PNP-Digos City Station was granted to a PNP Officer, a non-organic
personnel of the City. Details are as follows:
Date Check No Payee Particulars Amount

PLTCOL Vici Cash advance for
02/06/2020 1833484 Anthony Tababa financial assistance to 150,000.00
Digos City Police Station
PLTCOL Vici Cash advance for
02/17/2020 1833375 Anthony Tababa financial assistance to 240,799.00
Digos City Police Station
Total 390,799.00
Both amounts were in a form of donation/financial assistance to the PNP-Digos

City Police Station. Examination of the supporting documents and liquidation reports of
Police Lieutenant Colonel Vici Anthony T. Tababa disclosed the following:
75
 The P150,000.00 was used to conduct a one-month police operation which was
allocated for the following:
Anti-illegal Gambling Operation 20,000.00

Anti-terrorism Campaign 20,000.00
Anti-theft and Robbery 20,000.00
Anti-human Trafficking 20,000.00
Anti-illegal Drugs 40,000.00
ELFAC Activities 30,000.00
Total 150,000.00
 The P240,799.00 was used during the drug bust operation expenses and assistance
of informant for the month of February 2020.
Examination of liquidation reports submitted on March 25, 2020 disclosed that

both cash advances were supported with a summary list of recipients and Reimbursement
Expense Receipt (RER) from the “civilian assets”. The nature of the transactions was
considered highly confidential since the recipients of the funds were all PNP confidential
informants and thus, should have been sourced out from the Confidential Fund of the
City Mayor.
In an inquiry with the City Accountant, they granted Officer Tababa those
amounts due to the urgency of the situation. She also added that during those times, there
was no available cash from the Special Disbursing Officer (SDO) who handled the
Confidential Fund of the City Mayor. She further justified that it was during the early
months of 2020 that burglary was very rampant in some parts of the City, hence, needed
immediate action. PNP-Digos City also needed the fund to finance their enhanced drug
buy-bust operation and other police operations.
Funds released to non-organic personnel may be at risk of loss or misapplication

and any insurance claims from the Bureau of the Treasury could not be availed of since
they are neither an accountable officer nor bonded personnel of the City. More so, if the
Officers failed to liquidate their cash advances, the burden would be shouldered by the
City Mayor and the Accountant.
Recommendation:
We recommended to stop granting cash advances to non-organic personnel in

compliance with COA-DBM-DILG-GCGOCC-DND Joint Circular 2015-01 to avoid loss
or misapplication of funds, otherwise the same shall be suspended/disallowed in audit in
succeeding transactions
In the reply letter received on February 16, 2021, the City Mayor explained the
amount was conscientiously utilized and exhausted for anti-insurgency covert operations.
76
He also added that the City shall always adhere to the existing rules and regulations
issued by the Office.
Bayanihan Grant to Cities and Municipalities (BGCM) Fund
9. Special Account in the General Fund (SAGF) for the Bayanihan Grant to Cities and
Municipalities (BGCM) amounting to P69,682,026.00 was not created nor
maintained in the General Fund books, contrary to DBM Local Budget Circular
(LBC) No. 125, thus, details of charges could not be easily ascertained and deprived
the easy monitoring/tracking of the utilization of said fund.
Item 3.7 of the DBM LBC No. 125 dated April 7, 2020 or the Guidelines on the
Release and Utilization of the Bayanihan Grant to Cities and Municipalities states:
“For easy monitoring/tracking of the utilization of the allocation of

each city and municipality, a special account in the general fund
(SAGF) for the BGCM shall be created through an ordinance by the
local sanggunian pursuant to Section 313 of RA 7160. The creation
of an SAGF for the BGCM may also be done by the local sanggunian
through inclusion in the pertinent appropriation ordinance
authorizing a supplemental budget covering the BGCM.”
In line with Section 4 (g) of Republic Act (RA) No. 11469 (the Bayanihan to Heal
as One Act), the National Government granted P69,682,026.00 as COVID-19 disaster
response aid. With this, the Sangguniang Panlungsod approved Supplemental Budget No.
5 through Resolution No. 2020-123 dated April 16, 2020 for the following priority
expenses:
Particulars Amount
Food Supplies (Relief Goods) 61,000,000.00
Food Supplies (Ready to Eat) 2,000,000.00
Drugs and Medicines 3,000,000.00
Fuel, Oil and Lubricants 2,000,000.00
Other Supplies and Materials Expenses 1,682,026.00
Total 69,682,026.00
However, review of the accounting records disclosed that a special account for the
allocation of the BGCM was not created nor maintained in the General Fund of the City.
77
In an inquiry with the City Accountant, they were not able to create the said
Special Account due to the urgency of the situation. She added that it takes some time to
separate a special account since it requires the opening of a new bank account and setting
up of the special account in their accounting system.
Maintenance of special accounts held in the General Fund is helpful in facilitating

the systematic preparation of financial and accountability reports to provide the vital
information in assessing whether the operations and financial condition of the account are
contributing positively to the entire wellness of the City especially in this time of
pandemic and that funds for this purpose are exclusively used for COVID-19-related
programs, projects, and activities (PPAs).
While we recognized the management’s efforts in addressing the current situation

with a sense of urgency, the non-creation of the Special Account runs counter with the
aforementioned Circular. Accordingly, had the management created the SAGF for the
BGCM, there could have been easy monitoring of the receipts and disbursements from
the BGCM.
Recommendations:
We recommended to the City Mayor to direct the City Accounting Office to create
and maintain the said Special Account in the General Fund in order to easily monitor and
track the utilization of the BGCM in compliance with DBM Local Budget Circular No.
125. Henceforth, comply with the requirements of laws, rules and regulations to support
the National Government’s effort towards a unified, cohesive and orderly implementation
of the national policy to address COVID-19.
The City Accountant replied on February 10, 2021 and stressed the following:
1. The Bayanihan Grant was downloaded directly to their DBP account at the
height of the pandemic. The City was busy providing relief assistance to the 26
barangays due to lockdown.
2. Due to urgency to help their constituents, she was unable to notice that the
grant should be transferred to a special account for easy monitoring/tracking of
the utilization.
3. They want to comply and transfer the balance of the said grant to a special
account now, however, the remaining balance cannot accommodate the
opening of said account.
4. The City Accounting Office apologized and would see to it that even if the
grant was not transferred to a special account, easy monitoring/tracking of the
utilization would be achieved.
78
5. Next time they would comply with the requirements of laws, rules and
regulations.
Donations Received, Distributed and Balances
10. Non-submission of a copy of a Summary/list of Donations Received, Distributed and

Balances required under COA Circular 2020-009, impeded the auditor’s assessment
of the agency's discharge of its fiscal responsibility, thereby assurance that aids and
donations received during the quarantine period are properly accounted for could
not be ascertained.
COA Circular No. 2020-009 dated April 21, 2020 was issued to temporarily relax
the application of certain provisions of COA Circular No. 2014-002 and COA
Memorandum No. 2014-009 during the period of the State of Calamity declared under
Proclamation No. 292 dated March 16, 2020.
In lieu of the existing guidelines in the reporting of Disaster Risk Reduction

Management Fund (DRRMF) sourced from the General Appropriations Act (GAA), the
following guidelines are to be observed for cash and in-kind donations:
A. Donations in-kind from Local and Foreign Sources
1. xxxx
2. To ensure that the aids and donations received by the recipient agencies
during the quarantine are properly accounted for, the recipient agencies shall
be required to submit a Summary/List of Donations Received, Distributed and
Balances. The Summary/List should be categorized (i.e. food, medical
supplies, medicines, etc…) and can be submitted within ten (10) working days
after the end of the quarantine, or if the quarantine exceeds three (3) months,
within ten (10) working days after the end of each quarter, supported with:
(1) Acknowledgment receipts of the donations in-kind;

(2) Prooft of receipt by and distribution to the beneficiaries, not
necessarily in the required form; and
(3) Inventory of Remaining undistributed items, if any.
B. Reporting Guidelines.
79
1. In lieu of the monthly report, the concerned agencies shall submit a one-
time report, separately for cash donations and in-kind donations, within
ten (10) working days after the end of the quarantine to the National
Disaster Risk Reduction and Management Council (NDRRMC), through
the Office of the Civil Defense (OCD), copy furnished the respective COA
Auditors. However, if the quarantine exceeds three (3) months, the report
shall be submitted within ten (10) working days after the end of each
quarter.”
It was also emphasized in the COA Circular No. 2020-009 that all other
provisions in the COA Circular No. 2014-002 and COA Memorandum No. 2014-009
which are necessary controls to ensure that all donations, be it cash or in-kind, are
accounted for shall remain in effect.
Due to the COVID-19 pandemic, the City of Digos received various in-kind
donations from individuals, private groups, establishments and other government offices,
as disclosed by Mr. Samuel J. Miralles, OIC-DRRMO. These items were mostly ready-
to-eat foods and perishable goods, as well as face masks, gloves and other sanitary items.
Mr. Miralles also added that there might be other donations that were received by other
departments/offices of City Government of Digos, that were not coursed through to the
CDRRMO, hence not included in the determination of relief goods to be purchased.
For cash donations, the City received P5,000,000.00 cash assistance from the
Office of the President for the additional units in the isolation facility, as per inquiry with
Mr. Alan F. Basan, OIC-CTO.
However, the City Government of Digos was not able to prepare and submit the
required Summary/List of Donations Received, Distributed and Balances and its
supporting documents for the 2nd to 4th Quarters of CY 2020. In lieu of the said
summary/list, the audit team was provided by the CDRRMO with a list of COVID-19
donations showing the date of donation, name of donee and items donated (Annex N).
This was also supported with a partial list of recipients (Annex O).
A review of the submitted list of donations and the list of recipients disclosed the
following observations:
List of donations
1. Not in the format prescribed in COA Circular 2014-002;

2. Donated items were not categorized (i.e. food, medical supplies, medicines,
etc.);
3. Upon the request of audit team, the official and complete list is yet to be
prepared and submitted to the NDRRMC.
80
List of Recipients
1. The list does not bear the dates of distribution;

2. The list does not have the complete addresses and/or contact information of
the recipients;
3. No clear description of the items distributed to and received by the recipients.
All the lists of recipients only bear an identical description of the item as
“10kls” and no other information were provided
It is noteworthy to emphasize that the records/inventories of donation, be it in-

kind or cash donations, should be endorsed and consolidated in the CDRRMO in order
for the office to consider the same in the determination of the volume of relief goods and
other necessities to be procured. These records are also vital in the preparation of the
Summary/List of Donations Received, Distributed and Balances to be submitted to the
NDRRMC through the Office of the Civil Defense (OCD), copy furnished the audit team.
The non-submission of the Summary/List of Donations Received, Distributed and

Balances, together with the required supporting documents, impeded the assessment of
the audit team in the discharge by the City Government of Digos of its fiscal
responsibility, thus assurance that aids and donations received during the quarantine are
properly accounted for could not be ascertained.
Recommendations:
We recommended to the Local Chief Executive the following:
1. Require each department to submit a list of donations received, as well as the

inventory of items not fully consumed or distributed, to the CDRRMO for
their consideration in the volume of items to be procured, and for
consolidation in their reports.
2. Require the CDRRMO to consolidate the records of the donations received,

and prepare the complete Summary/List of Donations Received, Distributed
and Balances, using the prescribed format. Submit the same to the NDRRMC
and copy furnish the audit team.
3. For the succeeding relief goods distribution, prepare the list of recipients with
complete information as to the purpose of relief goods distribution,
names/address/contact of recipients, and description and quantity of items
distributed.
In their reply letter dated March 2, 2021, the management explained that similar
to other LGUs, the Covid-19 pandemic puts the City Government of Digos in a very
difficult situation that needs urgent critical measures in order not to prevent serious
81
disruption of the functioning of the government. As a result, due to their noble intention
of expediting the release of donated goods and items, the CDRRMO overlooked the
requirement of proper documentation. Nevertheless, the management assured to submit
with the audit team’s recommendations.
Furthermore, the City Mayor already issued a Memorandum Order dated March
1, 2021, ordering all departments and offices to submit a list/report on donated goods and
items to the CDRRMO in order to establish centralized information and data on all
donations received by the City.
Fuel consumption
11. Unfamiliarity with the rules concerning the utilization and documentation of
government procured fuel led to irregular use of fuel as well as incomplete and
deficient supporting documents contrary to COA Circular No. 77-61 dated
September 26, 1977 and may result in the issuance of notices of suspension and
disallowances in the audit of the corresponding fuel expenditures in the amount of
P798,116.13 charged against the Bayanihan Grant to Cities and Municipalities
(BGCM) fund.
COA Circular No. 77-61 dated September 26, 1977 prescribes the use of the
"Manual of Audit for Fuel Consumption of Government Motor Vehicles", which
includes the forms, records, and reports required to support the utilization of, and the fuel
consumption of government vehicles. The Manual basically aims:
“To ascertain that all applicable laws, rules and regulations governing
fuel (gasoline and oil) consumptions use of government motor
transportation are complied with.
To ascertain that wasteful, excessive and unnecessary expenditures for

fuel consumption are minimized.
To ascertain that expenditures for fuel consumption are effectively

controlled and properly accounted for.”
Section 4 (4 and 6) of PD 1445 states:
“4. Fiscal responsibility shall, to the greatest extent, be shared by all

those exercising authority over the financial affairs, transactions, and
operations of the government agency.
82
xxx
6. Claims against government funds shall be supported with complete
documentation.”
It is the City’s internal control that authorized personnel will issue a note or gas
slip to the fuel supplier in order to grant a certain quantity to the requestee or the assigned
driver/s.
Of the P69,682,026.00 BGCM Fund, the amount of P2,000,000.00 was

appropriated for fuel through the approval of Supplemental Budget No. 5. The BGCM
Fund, as stated in the Local Budget Circular 125, shall be exclusively used by the cities
and municipalities for the COVID-19-related programs, projects, and activities (PPAs)
and expenses.
Review and examination of disbursement vouchers (DVs) disclosed the following

deficiencies as discussed below:
1. Fuel consumption of private vehicles
 Several private vehicles were granted diesel and gasoline during the relief goods
distribution. In an inquiry with Assistant City Administrator Raquel Marie L.
Chiong, the owners/sponsors of the private vehicles were volunteers during the
food distribution during the implementation of Enhanced Community Quarantine
(ECQ) so as to augment the logistics of the City. Since the use of vehicles was
rent-free, the City, in turn, provided for fuel consumption. However, there were
no documents in the DVs to support the justification of Ms. Chiong.
The office of the JFC Helpline submitted a list of the private vehicles with their
corresponding plate numbers and assigned drivers (see Annex P, which did not
completely indicate the vehicle type). Cross-referencing of the driver’s trip ticket
to such list disclosed that there were a number of private vehicles and drivers that
were not on the list. More so, there were also some driver’s trip tickets that did
not contain the vehicle’s licensed plate numbers. As such, we could not ascertain
whether these vehicles are authorized to claim the fuel refill. Details are
presented in Annex Q.
The City Administrator also explained that those unidentified drivers and
vehicles were mostly uniformed personnel and volunteers during the first wave
of relief operation. Ms. Chiong, on the other hand, added that those listed in
Annex P pertained to the second wave of relief goods distribution.
Due to this circumstance, it could not be ascertained that the number of liters
granted to every private vehicle not listed in Annex P did not exceed the fuel
tank capacity such as what is discussed in the ensuing paragraph.
83
2. Fuel quantity exceeded vehicle’s tank capacity
The City granted fuel quantity more than the vehicle’s tank capacity. To wit:
Under Vehicle, Type Maximum No. of Balance Total no. Excess

Check Plate number, Fuel Tank ltrs. no. of of liters (no. of
Number Owner/Driver Capacity (in Granted liters in its liters)
liters) tank
A B C D (D – A)
71557266 Bongo 60* 80.11 10 90.11 10.11
120104
Dave Taborda
71557290 Bongo 60* 400 10 410 350
WKN 711
Edmund
Jumawan Jr.
71557313 Forward 200** 206.994 10 216.994 16.994
GSE 201
VM J. Bana
71557313 Bongo 60* 79.36 10 89.36 29.36
120104
Dave Taborda
*https://www.kia.com/aw/showroom/k270018my/specification.html?
fbclid=IwAR2EvXVMY5Z04dygYQMKTI32h4JzTZ0mbjAZWW1LzDKR6khOXmCIUKlKUkA
** http://www.intecophil.com/forward-specs.html
For the 400 liters granted to a bongo vehicle of Mr. Edmund Jumawan, the
management explained that the driver in-charge, at that time, brought a container
upon refilling. Accordingly, the fuel was used for the covert operation of the
Head Quarters-2nd Scout Ranger Battalion in Barangay Tuban, Sta. Cruz Davao
del Sur. The driver’s trip ticket otherwise stated “to assist distribution of relief
goods”. Ms Chiong also stressed that it could not be avoided during this time of
pandemic that there is still insurgency in the upland and remote areas of Digos
City. The 400 liters of fuel they granted to the military was used for the assigned
vehicles in the military headquarters. However, it could not be ascertained
whether the fuels they granted to the military were actually used for the said
purpose.
It should be emphasized that the BGCM Fund should solely be used for the
covid-19 relief operations. Instead, the said transaction should have been charged
to the Peace and Order Program appropriation.
On the other hand, the audit team had not yet received the justification of the
other three items in the preceding table.
3. Driver’s Trip Ticket and Monthly Report of Official Travels
84
 Drivers’ Trip Tickets did not indicate specific purposes such as but not limited
to: “for PNP Operations”, “for City Fire Operation”, “for blood donor”, etc.
Although some trip tickets bear the purpose of “for relief goods operations”, the
number of liters granted to the driver could not be justified since places to be
visited were not indicated.
Item 2 under Specific Rules and Regulations of the Manual - Use of

government vehicles shall be properly controlled and regulated:
“The use of government motor vehicles should be controlled through

properly accomplished and duly approved Driver’s Trip Tickets
(Appendix A) which should be serially numbered, a summary of
which shall be made at the end of the month in a Monthly Report of
Official Travels (Appendix F), for audit purposes.”
 In addition, we also noted that the purpose indicated in the driver’s trip ticket did
not conform to the purpose/s in the Monthly Report of Official Travels. The
latter, which should have been only prepared once every month end, was
submitted by the driver whenever the driver’s trip ticket was submitted.
Correspondingly, Item 6 under Forms, Records and Reports sets instructions

for in the preparation of the Monthly Report of Official Travels
“At the end of the month, a Monthly Report of Official Travels shall
be prepared by the driver’s concerned summarizing in chronological
order his trips for the month. For each vehicle, one report shall be
prepared monthly.”
The City Accountant explained that since most of the vehicles are private-owned,
the corresponding drivers sometimes could not prepare the driver’s trip ticket as
they were not aware of the importance of such a document. To expedite the
completion of the supporting documents to the DV and due to the urgency of the
situation, it was the City’s personnel who filled out the trip ticket without
specifically indicating the place of destination. She also added that it was also
their personnel who seek the drivers’ whereabouts just to secure their signature.
4. Unidentified City-owned motor vehicles
There were also City-owned vehicles that could not be identified in the trip
tickets since they do not bear a red plate as previously communicated through
AOM No. 2019-100-023 dated August 13, 2019.
Thus, the aggregate amount of Php798,116.13 charged to fuel was found to be

deficient as follows with a breakdown of details in Annex Q.
85
Amount
Check Check
Date Payee Particulars with
No. Amount
deficiencies
1258 ltrs. diesel fuel-
COR JESU
71557238 7/6/2020 PR#1606-PO# 0708- 47,302.82 39,721.28
SHELL STATION
(9999-40)
COR JESU
71557240 7/6/2020 PR#1634-PO#696-(9999- 47,302.82 30,845.91
SHELL STATION
40)
COR JESU
71557243 7/6/2020 PR#1639-PO#0701- 47,302.82 41,456.97
SHELL STATION
(9999-40)
COR JESU
71557245 7/6/2020 PR#1636-PO# 0698- 47,302.82 13,906.82
SHELL STATION
(9999-40)
COR JESU
71557246 7/6/2020 PR#1633-PO# 0695- 47,302.82 11,737.08
SHELL STATION
(9999-40)
COR JESU
71557263 7/6/2020 PR#1640-PO#0702- 47,302.82 37,508.08
SHELL STATION
(9999-40)
COR JESU
71557266 7/7/2020 PR#1644-PO# 0706- 47,302.82 43,094.89
SHELL STATION
(9999-40)
COR JESU
71557267 7/7/2020 PR#1613-PO# 0715- 47,302.82 34,905.59
SHELL STATION
(9999-40)
COR JESU
71557268 7/7/2020 PR#1611-PO# 0713- 47,302.82 36,812.10
SHELL STATION
(9999-40)
COR JESU
71557290 7/9/2020 PR#1610-PO# 712- 47,302.82 36,981.83
SHELL STATION
(9999-40)
COR JESU
71557313 7/13/2020 PR#1638-PO#0700- 47,302.82 43,614.49
SHELL STATION
(9999-40)
COR JESU
71557314 7/13/2020 PR#1637-PO#0697- 47,302.82 31,894.81
SHELL STATION
(9999-40)
COR JESU
71557363 7/16/2020 PR#1618-PO# 0720- 47,302.82 24,791.47
SHELL STATION
(9999-40)
COR JESU
71557364 7/16/2020 PR#1620-PO#722-(9999- 47,302.82 25,269.88
SHELL STATION
40)
COR JESU
71557370 7/16/2020 PR#1620-PO# 723- 47,302.82 36,290.00
SHELL STATION
(9999-40)
COR JESU
71557415 7/21/2020 PR#1642-PO# 0704- 47,302.82 18,112.34
SHELL STATION
(9999-40)
71557420 7/21/2020 COR JESU 1258 ltrs. diesel fuel- 47,302.82 37,159.60
86
Amount
Check Check
Date Payee Particulars with
No. Amount
deficiencies
PR#1608-PO# 710-
SHELL STATION
(9999-40)
COR JESU
71557421 7/21/2020 PR#1607-PO# 0709- 47,302.82 39,396.58
SHELL STATION
(9999-40)
COR JESU
71557480 7/27/2020 PR#1619-PO# 0721- 47,302.82 12,735.40
SHELL STATION
(9999-40)
COR JESU
71557481 7/27/2020 PR#1615-PO# 0717- 47,302.82 27,213.94
SHELL STATION
(9999-40)
COR JESU
71557489 7/28/2020 PR#1614-PO# 716- 47,302.82 10,533.39
SHELL STATION
(9999-40)
COR JESU
71557490 7/28/2020 PR#1622-PO# 724- 47,302.82 15,887.55
SHELL STATION
(9999-40)
COR JESU
71557491 7/28/2020 PR#1612-PO# 714- 47,302.82 35,541.12
SHELL STATION
(9999-40)
COR JESU
71557492 7/28/2020 PR#1617-PO# 719- 47,302.82 35,222.18
SHELL STATION
(9999-40)
COR JESU
71557493 7/28/2020 PR#1635-PO# 0699- 47,302.82 36,003.52
SHELL STATION
(9999-40)
COR JESU
71557422 7/21/2020 PR#1605-PO# 0707- 47,678.84 41,479.31
SHELL STATION
(9999-40)
Total 1,230,249.34 798,116.13
The above circumstances pinpoint to the concerned city officials/personnel’s

unfamiliarity with the prescribed rules relevant to government procured fuel which
consequently led to irregular utilization as well as incomplete and deficient supporting
documents of the fuel expenses amounting to P798,116.13 charged against the Bayanihan
Grant to Cities and Municipalities (BGCM) fund, contrary to the above mentioned COA
Circular. This may result in the issuance of notices of suspension and/or disallowances.
While it was understood that the purpose of the abovementioned disbursements

was for the pursuit of fast-tracking the relief operations during this time of pandemic, it
should be emphasized that the City should adhere to the guidelines set forth in the
Manual and PD 1445.
Nevertheless, it is also noteworthy to laud the individuals who showed kindness

and act of volunteerism whereby the City effectively and efficiently delivered the basic
needs of its constituents.
87
Recommendations:
We recommended to the City Mayor to direct:
1. The conduct of in-house training and/or familiarity sessions vis-à-vis COA

Circular No. 77-61 dated September 26, 1977, and other related government
accountability issuances;
2. The City General Services Officer and the City Accountant to compel the
drivers to completely and properly fill-up the Driver’s Trip Ticket and to only
submit the Monthly Report Of Official Travels every end of the month; and
3. The City Budget Officer to charge fuel expenses to its appropriate budget.
In a letter reply dated February 26, 2021, the City Mayor already called the
attention of the personnel concerned such that proper adherence to the rules and
regulations on liquidation, utilization and documentation of government fund, especially
on the procured fuel, must be strictly observed.
Social Amelioration Program
12. Non-exhaustive review of the Social Amelioration Card (SAC) Encoding Template
results on the payment of the Emergency Subsidy Program to 1,108 unlisted
beneficiaries and double payments to twelve others, contrary to Section VIII of
DSWD Memorandum Circular No. 4, series of 2020, thereby, in a way defeating the
purpose for which the fund was granted by the Department of Social Welfare and
Development.
Section VIII of Department of Social Welfare Department (DSWD) Memorandum

Circular (MC) No. 04, series of 2020 provides:
“A. Identification, Eligibility Requirement and Family Profiling of

Beneficiaries under Emergency Subsidy Program (ESP)
The Barangay shall identify and prepare the list of qualified beneficiaries
based on the eligibility requirement provided in these guidelines. The
listed beneficiaries will be profiled through the use of a Social
88
Amelioration Card (SAC). The SAC shall be the mechanism for the
eligible families to access any social amelioration programs from any
government agency, including the DSWD.
Registration/Enrolment in the SAC and the generation of list of eligible

beneficiaries shall be done as follows:
1. The identified personnel of the Barangay will conduct a house-

to-house distribution of the SAC forms to be manually
accomplished by the head of the family;
2. The Barangay personnel shall submit the accomplished SAC

forms to the C/MSWDO for signature and encoding in the
system;
3. The City/Municipality shall review the completeness and
correctness of the data to be submitted to the DSWD-Central
Office (CO) for deduplication.
4. The designated DSWD personnel shall review the endorsed
documents to ensure that no duplication of assistance will be
given to a single family; and
5. The DSWD-CO shall generate the lists of beneficiaries to be
provided assistance and cascade them to the LGUs thru the
DSWDFOs.
xxx
Provided further that in the encoding of SAC forms, the Barangay and
the DSWD may provide personnel augmentation, such as C/MAT/PAT,
in order to address the manpower shortage of the LGUs, C/MAT/PAT
and other field workers shall be under the supervision of SWAD-Team
Leaders.”
Fund transfer in the amount of P194,355,000.00 from the Department of Social

Welfare and Development Field Office XI, Davao City was granted to the City
Government of Digos for the implementation of the Social Amelioration Program.
The amount received was accounted for as follows:
Social Amelioration Program Amount

1. Emergency subsidy to poor and low-income
179,682,000.00
families at Php6,000.00 per family beneficiary.
2, Social Pension Program at Php3,000.00 per
14,238,000.00
qualified beneficiary
3. Remittance of unexpended balance to DSWD XI
Field Officer per undated O.R. No. dated 9395709 435,000.00
Total 194,355,000.00
89
The SAP-emergency subsidy in the amount of Php6,000.00 per family beneficiary
was granted to those assessed to be most affected by the declaration of the State of Public
Health Emergency throughout the country due to COVID-19.
The target beneficiaries are the families that belong to either the poor or informal
sector which are at risk of not earning a living during the Enhanced Community
Quarantine, who may have at least one (1) member belonging to any of the following
vulnerable or disadvantaged sectors:
a. Senior Citizens;
b. Persons with Disability;
c. Pregnant and Lactating Women;
d. Solo parents;
e. Overseas Filipinos (OFs) in distress;
f. Indigent Indigenous Peoples;
g. Underprivileged Sector and homeless citizens
h. Informal Economy Workers
h.1 Directly hired or Occasional workers;
h.2 Subcontracted Workers;
h.3 Homeworkers;
h.4 Househelpers;
H.5 Drivers of pedicab, tricycle, PUJs, UVs, PUBs, taxi,
Transport Network Vehicle Service (TNVS) and
Transport Network Companies (TNC);
h,6 Micro-entrepeneurs and Producers;
h.7 Family Enterprise Owners
h.8 Sub-minimum wage earners;
h.9 Farmers, fisherfolks and farm workers
h.10 Employees affected by “No work, no pay” policy and not
covered by DOLE Order No. 209, series of 2020 or any
DOLE issuances/s on adjustment measures program;
h.11 Stranded workers
In an interview with the various Barangay SAP Focal Persons, the SACs were
accomplished by the family beneficiaries with the assistance of barangay health workers,
barangay enumerators and CSWDO/Department of Social Welfare Department (DSWD)
personnel. In turn, the accomplished SACs were verified by the barangay SAP focal
person/punong barangay and the CSWDO/DSWD.
The lists of SAP beneficiaries per barangay attached to the paid payrolls for SAP
– emergency subsidy were either Certified Correct by Ms. Vivian A. Ferolino, RSW,
OIC-CSWDO or Ms. Shany Lou R. Solatorio, Executive Assistant, OIC-CSWDO. Some
of the lists were Certified Correct by Ms. Lady Jane F. Dela Cruz, RSW, City Link.
90
A soft copy of SAC encoding template was provided to the audit team by the City
Social Welfare Development Office (CSWDO) headed by Officer-in-Charge Ms. Shany
Lou R. Solatorio, Executive Assistant I.
Samples were taken from paid payrolls of three barangays with the largest number
of SAP emergency subsidy beneficiaries. Identified beneficiaries in the paid payrolls
were verified against the SAC encoding template provided by the CSWDO to determine
the completeness and correctness of data which is the basis in the generation of the list of
beneficiaries to be provided assistance and to ascertain that only qualified family
beneficiaries were granted the emergency subsidy.
Results of verification disclosed the following:
a. A number of identified beneficiaries in the paid payrolls were not enrolled in the SAC
encoding template totaling 1,108 as follows:
No. of Not Enrolled in

Barangay Amount
Beneficiaries SAC Template
1. Barangay Zone 3 (Annex R) 3,719 828 4,968,000.00
2. Barangay San Miguel (Annex S) 3,266 130 780,000.00
3. Barangay Tres de Mayo (Annex T) 3,175 150 900,000.00
Total 10,160 1,108 6,648,000.00
b. Double claim/payment were granted to the following identified beneficiaries:
1. Barangay Zone 3 Janea, Losel Jr.

Lanticse, Mary Ann
Macalino, Iris
Martel, Clariza
Lao, Sheila Mae O/Lao Sheila Mae T.
Tolete, Daryl M/Tolete Max
2. Barangay San Miguel Armada, Cristina
Banzon, Lorna C
Gamban, Leonardo T.
Hipolito, Fernando F.
Landasan, Rodel
Uyan, Rafael
When asked for the reason why some of the names in the payroll could not be
found in the SAC encoding template, Mr. Cesar Kent Pantallano, the person in charge of
encoding the SAC into the system informed us that it could be due to the difference in the
spelling of encoded names in the system compared to the names appearing in the payroll.
The non-exhaustive review of the Social Amelioration Card (SAC) Encoding

Template resulted in the payment of the Emergency Subsidy Program to 1,108 unlisted
beneficiaries and double payments to twelve others, contrary to Section VIII of DSWD
91
Memorandum Circular No. 4, series of 2020, thereby, in a way defeating the purpose for
which the fund was granted by the Department of Social Welfare and Development.
Recommendations:
We recommended the following measures:
1. Henceforth, for the CSWD Officer to exhaustively and properly

review the completeness and correctness of data in the SAC Encoding
Template or system to ensure that the generated lists of beneficiaries
are one and the same person named in the SAC encoding template
and payroll;
2. Update the SAC encoding template so as to reflect only qualified

beneficiaries in the system based on the accomplished SAC; and
3. Make use of new technology in the preparation of payrolls to prevent

double claims or payment of grants/benefits to the same person
resulting in the issuance of Notice of Disallowance.
The City Legal Officer explained that all data for the beneficiary of the SAP came
from DSWD-ROXI office which will then be forwarded to the barangays for the final
selection.
The team required the management to submit further justification.
Job Order and Technical Advisers
13. Due to the absence of Organizational Chart and Staffing Pattern Plan, written
policy or manual as a guide in the hiring of personnel compliments, the City
Government of Digos hired more or less two thousand (2,000) job order personnel
and forty-one (41) technical advisers without the contract of service and specific
work of service to accomplish contrary to Section 76 of R.A. 7160, CSC
Memorandum Circular No. 17, s. 2002 and Section 4 (6) of PD 1445, thereby casting
doubts on the propriety of payments for services rendered.
Section 76 of R.A. 7160 or the Local Government Code provides that:
“Organizational Structure and Staffing Pattern – Every local

government unit shall design and implement its own organizational
structure and staffing pattern taking into consideration its service
92
requirements and financial capability, subject to the minimum standards
and guidelines by the Civil Service Commission.”
CSC Memorandum Circular No. 17, s. 2002 promulgated CSC Resolution No.
02-0790 dated June 5, 2002. In the subject resolution, the CSC adopted the policies and
guidelines which shall govern the contract of services and job orders entered into by all
agencies of the government. Pertinent sections of the subject resolution are as follows:
a) Section 1-The contract covers lump sum of work or services such as janitorial
security or consultancy service where no employer-employee relationship
exist, and that the job orders covers a piece of work or intermittent job of
short duration not exceeding six months and paid on a daily basis.
b) Section 2-The employment referred to in Section 1 requires the execution of

either a contract of service or memorandum of agreemenet (MOA) or job
order between the agency concerned and the individual , in accordance with
the rules and regulations of the COA.
Section 4 (6) of PD 1445 or the Government Auditing Code of the Philippines

provides that:
“Claims against the government funds shall be supported with complete

documentation.”
In CY 2020, the City Government of Digos has the following personnel

compliments including more or less two thousand (2,000) job order personnel and forty-
one (41) technical advisers as follows:
STATUS OF EMPLOYMENT NUMBER OF EMPLOYEES

Elective Officials 15
Coterminous 77
Permanent 427
Casual 0
1,989
Job orders
(as of December 31, 2020)
Technical Advisers (Contract of Service) 41
Total 2,549
The City hired job order personnel and technical advisers without determining
first its manpower needs through the preparation of an organizational chart and staffing
plan. Ms. Maximina I. Sampilo of the HRMO also added that there had been no written
policy or manual on hiring as far as contract of services (Technical Advisers) and job
orders are concerned. The manner of hiring was only based on the “necessity” and
expertise of a certain employee.
93
On the other hand, examination of paid payroll for salaries of these employees
disclosed the following deficiencies in the supporting documents:
1. Hiring of Job Order Personnel
For CY 2020, the City hired more or less two thousand (2,000±). The HRMO is yet to
provide the actual number of Job Order Personnel hired during the year, and also the
records of the number of JOs assigned/detailed per office and per program.
Available records disclosed that there was no contract of service or memorandum of

agreement (MOA) or job order between the LGU and the individual. In lieu of these,
the LGU prepared a job order appointment for a specific number of personnel,
approved by the LCE, which indicates the position, pay rate, funding source, the
period covered, and office of deployment, without taking into consideration a specific
lump sum of work or service and piece of work or intermittent job to be performed by
the Job Order Personnel.
Review of the submitted disbursement vouchers disclosed the following deficiencies:
Disbursing
Check No. Date Audit Remarks
Officer
71556541 4/14/2020 R. Abella  Salaries for January and February 2020
of twenty-six (26) JOs under the City
Special Program and Management
Office (CSPMO) with Office Orders
No. 00056-2020, 0046-2020 and 0076-
2020 all dated January 13, 2020 had
the same accomplishments which was
to “conduct monitoring in 26
barangays”/CSPMO program
implementation barangay-based work”;
almost all accomplishment reports
contained erasures and appears to have
written by few persons. The
accomplishments did not specify as to
what barangay they have conducted or
even their actual and specific
accomplishments.
 Accomplishments of Eleven (11) JOs

with undated Office Order No. 2020-08
charged under the Comprehensive
Program to Indigenous People and
Other Marginalized Sector were all
stated “Submit final list of grantees”
94
Disbursing
Check No. Date Audit Remarks
Officer
which was just altered on the daily
time record. It also appears that only
one person had written their DTR and
monthly accomplishment reports.
More so, there was also an

inconsistency of accomplishment of
one of the 11 JOs. The DTR indicates
“Beautification and Maintenance of
Park and Plaza, while the
accomplishment report shows that she
“submitted final list of grantees,
prepare payments to grantees and
monitor and evaluate”.
 Office Order No. 0045-2020 dated

January 13, 2020 employs fourteen
(14) JOs under the CSPMO and serve
as Area Development Officer (ADO)
to perform the following:
a) Assist the Clients in the Hospital to

avail Medical Assistance
b) Conduct validation letter request
every Barangay
c) Conduct Agricultural Livelihood
Orientation
d) Conduct Calamity Assistance
Family Access Card (CAFAC)
e) Program Implementation/Barangay
Based Worker
DTRs were full of erasures and actual

and specific accomplishments were not
stated. What the duties enumerated
above, were all the same with their
accomplishments, no specific barangay
as to where they reported.
As inquired with the personnel concerned, the lapses noted in the attached DTRs were
mainly due to inability of some Job Order Personnel to read and write, and that this
manner of documentations have been the customary practice being followed. Also,
they were amenable that the preparation of the DTRs and the accomplishment reports
were done by a designated personnel in order to fast track the preparation of the
95
supporting documents for the processing of payments to Job Order Personnel. In light
of this, there are those Job Order Personnel who accurately and religiously prepared
their DTRs and accomplishment reports.
2. Hiring of Technical Advisers
The City entered into a contract of service with forty-one (41) technical advisers for
various programs created by the Office of the City Mayor, and also to augment the
manpower requirement of other departments and offices. Review of the available
records relating to technical advisers disclosed the following:
1. The contract of service does not indicate the contract signing date.
2. Notary Acknowledgement does not indicate the instrument’s signing date.
3. Lists of accomplishments in the accomplishment reports are general in nature
and only a mere paraphrase of the duties and functions as indicated in the
contract of service, and not the actual reports, systems, database, policies,
studies and other deliverables that the technical advisers were expected to
accomplish and produce.
4. There were thirty (30) technical advisers who failed to submit Personal Data
Sheet (PDS), certificates of training attended, certificates of eligibility, and
other relevant documents indicating their fields of expertise.
Although contracts without dates are still legal and enforceable, there is no reason not
to indicate proper and essential dates in the contract. This would make the instrument
clearer and transparent to both parties involved. As to the accomplishments of the
technical advisers, individual accomplishment reports are submitted to the Office of
the City Administrators or Office of the City Mayor for signature and approval.
However, there has been no documentation on the assessment and evaluation of the
actual accomplishments of the technical advisers.
With the noted erasures, alterations and ambiguities of the accomplishment

reports of the job order personnel and technical advisers, review and verification of the
actual work accomplished could not be established. These caused difficulty in
determining (1) whether the work accomplished by the Job Order Personnel are actually a
piece of work or intermittent or emergency jobs, and not jobs which are part of the
regular functions of the City, and (2) whether the expertise of the technical advisers are
indeed currently inexistent or already available but not maximized.
Furthermore, the qualification or level of expertise of technical advisers in terms

of educational attainment, training, and eligibilities could not be identified because the
management did not require all the consultants to submit the Personal Data Sheet (PDS),
certificates of training attended, certificate of eligibility, etc. This is to justify that certain
personnel is hired based on one’s expertise and the reasonableness of the monthly rates.
In view thereof, the propriety of expense accounts in payments to Job Order

Personnel and Technical Advisers is doubtful due to the absence of the required
96
documentary requirements as well as the erasures, alterations and ambiguities in the
preparation of the DTRs and Accomplishment Reports.
Recommendations:
1. Direct the HRMO to review and update the Organization Structure and
Staffing Patern, and also create a written policy and manual on hiring Job
Order Personnel and Technical Advisers, in order to properly determine the
additional manpower to be augmented;
2. Direct the personnel in-charge of hiring job orders to execute a contract of

service or memorandum of agreement specifying therein the expected work of
service to be accomplished by the concerned job order which shall be the
basis for the preparation of monthly reports, evaluation and assessment of
their individual performance;
3. Direct the personnel in-charge in the management of Job Order Personnel to

require each and every JOs to properly accomplish their DTRs without
erasures and alterations, and to strategize a system that would facilitate faster
preparation of documents, without sacrificing proper assessment and
transparency;
4. Direct the personnel in-charge of the management of Technical Advisers to

ensure that contract of service indicates the necessary dates for proper
management of the contract more effectively by making record keeping more
accurate.;
5. Direct the personnel in-charge of the assessment of accomplishment of

Technical Advisers to require the latter to properly indicate in their
accomplishment reports the actual work done, indicating the names, titles,
quantities, and other necessary information vital for assessment of
accomplishments. Also, require the personnel in-charge to document its
assessment and verification of the accomplishments of the technical advisers;
and
6. Require the personnel in-charge to direct the technical advisers to submit their
Personal Data Sheet (PDS) and other necessary documents that indicates their
field of expertise.
97
The management replied on March 4, 2021 and stressed the following:
1. Since this city’s transition as a third class municipality and to its eventual
upgrade as a second class city during the year 1999, no upgrade of its
organizational chart has been done. Upon this discovery, the current
administration called to upgrade the organizational chart and staffing pattern.
However, the winning consultancy firm to provide such adequate technical and
professional expertise, ended its contract prematurely due to the Covid-19
pandemic.
2. On the hiring of JO personnel, the City has been requiring job order employees
to comply with the checklist requirements before they are admitted as
employee and claim their salaries. And based on the current practice of the
City, in lieu of contract of service or memorandum of agreement, every job
order employee is required to submit a duly signed job order contract. It is a
document evidencing their wage rate, office assignment and other pertinent
information that are necessary.
3. Moreover, as to the findings on the inconsistency of the accomplishment

reports of 11 job order employees, the management submits that although said
fact is undisputable, it may be deemed just an isolated case. Otherwise, it
would be very much unfair to those job order employees who faithfully
complied with all the requirements set by the City.
4. As to the hiring of technical advisers (TA), based on our own investigation, it

was found out that the non-submission of the PDS of the TAs was an issue
brought during the 2019 AOM and it was properly addressed. The person in-
charge of preparing the documents informed the management that the same
were submitted already to the Mayor’s Office although on a staggered basis.
Likewise, the TAs were decreased to 16 following the previous
recommendations by the audit team. The current observations from your office
may be due to the fact that the first batch of TAs were continued and paid
during the first quarter of 2020. Nevertheless, since the 2020 COA exit
conference and as recommended by the team, all TAs found not qualified were
discontinued.
The management assured that all recommendations provided will faithfully

comply and that they will always remain to be a partner in upholding faithful adherence
to existing rules and regulations.
98
Overtime Services
14. Despite previous audit notification, payments of the overtime services rendered by
the City Engineering Office personnel with an aggregate amount of P169,779.01
were charged against the 20% Development Fund in violation of Section 4, DILG-
DBM JMC No. 2017-1 dated February 22, 2017, thus such payments could be
considered irregular and in consequence may necessitate the issuance of notices of
audit suspensions and/or disallowances.
Section 4.0 of the DILG-DBM JMC No. 2017-1 dated February 22, 2017 or the
Updated Guidelines on the Appropriation and Utilization of the 20% of the Annual IRA
for Development Projects explicitly enumerates the expenditure items not allowed to be
charged against the 20% LDF:
“4.1 Personal Services expenditures, such as salaries, wages,

overtime pay and other personnel benefits;”
Section 3 or the General Policies on Overtime Services of the CSC and DBM
Joint Circular No. 1 dated November 25, 2015 provides that:
“3.1 The rendition of overtime services shall be authorized only when

extremely necessary, such as when a particular work or activity
cannot be completed within the regular work hours and that non-
completion of the same will: a) cause financial loss to the
government or its instrumentalities; b) embarrass the
government due to its inability to meet its commitments; or c)
negate the purposes for which the work or activity was
conceived.”
Moreover, Section 6.0 of the same Joint Circular enumerates government

employees who may be authorized to render overtime services with pay or compensation,
as follows:
“1. Only appointive and salaried civilian government employees

holding regular, contractual, and casual positions of division
chief or equivalent level and below may be authorized to render
overtime services with pay or compensation.
2. Incumbents of positions of division chief or equivalent level and

below, designated as Officers-in-Charge of higher level positions,
may also be authorized to render overtime services as they are
still bound to observe the prescribed work hours in their
respective agencies.”
During the year, some personnel of the City Engineering Office (CEO) were
authorized to render overtime services with an aggregate amount of P169,779.01. Review
99
and examination of disbursement vouchers (DVs), with details in Annex U, and review of
the Registry of Allotments and Obligation (RAO) disclosed the following:
1. Payments of overtime services were charged against the appropriation for the
infrastructure projects undertaken by contract.
The whole amount of P169,779.01 representing overtime pay from January to

September 2020 was charged against the following projects:
NAME OF PROJECT AMOUNT

Road Widening and Construction of Drainage System along
71,972.40
Mabini Street (Rizal Avenue to Digos Bypass Road)
Road Widening and Construction of Drainage System along
96,686.61
Doña Aurora Street (Rizal Avenue to Digos Bypass Road)
Construction of Sidewalk & Parking Bay with Greening Project
and Concrete Fence along Roxas Street, corner Rizal Avenue 1,120.00
and corner Lopez Jaena Street
TOTAL 169,779.01
Section 4.1 of DILG-DBM JMC No. 2017-1 clearly states that this expense should not
be charged to this appropriation hence, tantamount to disallowance in audit. More so,
the manner of recording Personal Services charges to Capital Outlay is considered as
technical malversation.
The City Accountant explained that they are amenable to such error as they only
follow the account title that the City Budget Office indicated in the Obligation
Requests (OBRs).
2. Overtime services rendered were regular and routinary in nature
Evaluation of the accomplishments revealed that works performed were part and
parcel of the regular and routine works of the employees which could be performed
during the regular working days in line with the CEO’s nature of work. Likewise,
there was no indication that the non-completion of the assigned tasks will result in the
exception provided by the abovementioned Joint Circular, such that it will cause
financial loss to the government or its instrumentalities; embarrass the government due
to its inability to meet its commitments; or negate the purposes for which the work or
activity was conceived. Besides, the projects were undertaken by contract hence,
overtime work is no longer necessary.
As such, this violates the abovementioned Section 3 of the CSC-DBM Joint Circular.
3. Job order personnel was authorized to render overtime services with pay
One CE Aide assigned in the CEO who is a job order employee was authorized to
render overtime services with payments amounting to P1,120.00 on June 20-21 and
100
27-28, 2020 to supervise and monitor the implementation of one of the
abovementioned projects. This contravened the provision of Section 6.0 of the same
CSC-DBM Joint Circular thus, considered irregular.
According to Engr. Dennis C. Almacin, it has been their usual practice to charge
overtime expenses against the projects since the office’s budget is insufficient to cover
additional personal services expenditures such as overtime pay. Furthermore, overtime
services were rendered considering the City implements several projects during the
year.
In addition, Annex C of COA Circular No. 2012-003 considered the “grant of

overtime pay for work that is not of urgent nature as to require completion within a
specified time for that can be undertaken during regular office hours” as an
unnecessary expense.
While we acknowledged the City’s efforts in rendering services outside regular

working hours during this time of pandemic, it should be emphasized that the
management should still adhere to the guidelines set forth in the rendition and payment of
overtime services.
In sum, as the payments of the overtime services violated a valid regulation issued
by the DILG and the DBM, the same can be considered irregular and may cause the
issuance of notices of audit suspensions and/or disallowances.
Recommendations:
We recommended for the City Mayor, to direct:
1. The submission of a justification why the mentioned payments of overtime

pay will not be disallowed in audit.
2. All concerned to henceforth strictly adhere to the above-mentioned Joint

Circulars as regards the payment of overtime services.
1. It has been the usual practice of the City Engineering Office (CEO) to include
direct labor cost in the Program of Work (POW) for infrastructure projects.
Moreover, expenditure for services is classified under capital outlay.
2. We deduced that overtime services rendered is part of the direct labor cost of
infrastructure projects. With the current administration’s aggressive direction
towards the build, build, build programs, we consider finishing infrastructure
projects in accordance with the number of days stated in the POW. Due to the
101
exigency of the project coupled with the location of the project and the weather
condition, it necessitates the conduct of frequent supervision and monitoring of
the contractor’s work even beyond regular working hours. It would be
disadvantageous both on the part of the contractor and government if the cause
of negative slippage is due to the absence of the CEO representative in the
project location. Furthermore, infrastructure porject’s timeline is counted by
calendar days which would mean Saturdays and Sundays are included in the
counting.
3. As the personnel have rendered services, we are obligated to pay what is due
them as an act of good faith. Hence, in our exercise of good faith, we deemed it
proper to compensate our hard working employees for the services they have
rendered beyond the regular working hours. Otherwise, if we will not
compensate them, it would appear to be an unjust enrichment on the part of the
government and involuntary servitude on the part of the employees, which is
clearly not the style of the current administration.
4. Nevertheless, the City Government of Digos will faithfully adhere to your

recommendations consistent with the existing rules and laws.
C. PERFORMANCE AUDIT
Donations in kind
15. Donated grocery items with an estimated value of P486,604.00 remained

undistributed more than seven months after receipt due to lack of coordination
among the offices of the City, thereby defeating the mandate of Presidential
Proclamation No. 922 as well depriving the intended beneficiaries of timely
assistance in this time of pandemic.
Paragraph 7 of Proclamation No. 922 (Declaring a State of Public Health

Emergency throughout the Philippines) dated March 8, 2020 states:
“WHEREAS, the declaration of a State of Public Health Emergency would

capacitate government agencies and LGUs to immediately act to prevent
loss of life, utilize appropriate resources to implement urgent critical
measures to contain or prevent the spread of Covid-19, mitigate its effect
and impact the community, and prevent serious disruption of the
functioning of the government and the community; ”
102
Section 2 of PD 1445 also states:
“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.”
In a Facebook post of Joseph F. Cagas (JFC) Helpline on June 11, 2020, the City
Government of Digos, represented by the City Administrator and other LGU personnel
received a total of 334 cases of Nestle products with an estimated value of P486,604.00
from Nestle Philippines, Inc., represented by Mr. Eugene Flores. Details of which are as
follows:
Description Qty. Estimated Expiration

Value* Date
Maggi Magic Sarap 60 (14 pcs. x
27 cases 69,579.00 May 2021
8g) at P2,577.00/case
Bear Brand Pmd Swak (128 pcs. x
97 cases 108,640.00 May 2021
33g) at P1,120.00/case
Koko Krunch Flow Pack 24 (12
29 cases 38,541.00 July 2021
pcs. x 15g) at P1,329.00/case
Chuckie Opti-Grow (60 pcs. x
69 cases 51,750.00 March 2021
110ml at P750.00/case
Nescafe Creamy White Pbg8
87 cases 131,544.00 May 2021
(30 pcs. x 29g) at P1,512.00/case
Milo Activ-Go Winner (504 pcs. x October 2020
25 cases 86,550.00
24g) at P3,462.00/case (already expired)
Total 334 cases 486,604.00

*Prices were obtained through inquiry with G-Mall Digos Supermarket management
The audit team inspected the stock room at the newly-rehabilitated multi-purpose
gymnasium on January 19, 2021 and found out that these items remained undistributed to
beneficiaries.
Examination of 48 boxes (of varying sizes) disclosed that the above items had
already been packed and ready for distribution, albeit there were still three boxes of
Maggi Magic Sarap that remained unopened. Further inspection of the packed goods
disclosed that Milo Activ-Go Winner sachets were already expired. Pictures of inspected
donated goods are shown in the next page:
103
As posted on the same Facebook page, this donation was in line with Nestle’s
Kasambuhay Project 2020 which aims to “assist one million families and thousands of
frontliners, others in need of healthcare, and its own employees and those of its business
partners” while battling COVID-19.
The failure of the agency to distribute these goods could be associated with a lack
of coordination between concerned offices. During our audit, we were passed on from
one office to another upon inquiry with details of these donations. As inquired from the
JFC Helpline, CDRRMC, City Administrator, and CSWD Offices, they all denied any
knowledge of these goods and that they did not know that there were certain goods stored
in the stock room.
As such, the audit team could not obtain information such as the list of
beneficiaries, the target date of distribution, and reasons as to why these goods remained
undistributed as at year-end. In an inquiry with the City Accountant, she was also not
aware that Nestle donated the above-mentioned goods to the City as her Office was also
104
not informed. Had we not informed her of these donations, the food products might be
left expired.
As of this writing, Ms. Grace Maximales (Social Welfare Officer I) reached out to
this Office to inform that she already ordered her staff to distribute some of the food
packs to the households in Brgys. Balabag and Kiagot evacuation centers who were
greatly affected by the series of earthquake in 2019. She also explained that she was not
privy to the said donations in 2020 since she was assigned as a Focal Person for Disaster
and Camp Management.
Due to lack of proper coordination among offices and monitoring as regards to

donations in kind, timely assistance was not availed by economically affected families or
households thereby defeating the purpose of the donation.
Recommendations:
For future donations-in-kind, we recommended to the City Mayor to designate a

focal person to take charge of receiving donated goods as well as coordinate with the
Accountant for the proper recording of donations-in-kind in the books.
We also recommended to the City Mayor to direct the focal person to coordinate
with the CSWD and CDRRMC offices in the selection of beneficiaries for the immediate
distribution of donations-in-kind especially of perishable items with expiry dates.
For proper coordination, the responsibilities of concerned offices be clearly

defined and flow of transactions be presented in a flow chart for the benefit of all
especially during crisis to avoid confusion.
Also, distribute the remaining unexpired food supplies in the stock room to
prevent further wastage of the same and properly dispose of expired items. Proper
documentation and accountability be observed at all times.
The City Mayor replied through their letter dated February 9, 2021 that he had
already called the attention of the offices concerned and ordered for the distribution of the
same pursuant to relevant and existing laws and rules on donations of perishable goods.
Likewise, a designated focal person/office has been already assigned and was ordered to
check on the quality of the products if the same are still in good condition. Furthermore,
all recommendations provided shall be faithfully complied.
105
Hiring Job Orders and Technical Advisers
16. Owing to lack of in-depth evaluation or assessment as to the actual needed number
of personnel, hiring of more or less 2,000 Job Orders (JOs) and forty-one (41)
Technical Advisers, whose functions were redundant and may be done by a few,
resulted in wastage of funds which could have been used for the delivery of basic
services, contrary to Sections 2 and 4 of PD1445.
Section 2 and 4 (4) of PD No. 1445 states:
“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 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 policy is faithfully
adhered to rests directly with the chief or head of the government agency
concerned.
Section 4. Fundamental principles. Financial transactions and

operations of any
government agency shall be governed by the fundamental principles set
forth hereunder, to wit:
xxx
(4) Fiscal responsibility shall, to the greatest extent, be shared by all

those exercising authority over the financial affairs, transactions,
and operations of the government agency.”
As of the fourth quarter of 2020, the Office of the Human Resource Management
Division’s registered a total of 1,989 job order personnel. In addition, consolidated data
of Information and Technology Office’s records showed the following numbers:
Month Number of JOs*

January-February 2,271
February-March 2,135
April-May 2,137
June 1,728
July 1,844
August 231
December 2,019
*duplicate names were removed in the file; no data for September to November
106
Each JO received P280.00 per day regardless of whether licensed professional or
number of years in service. The 41 technical advisers, on the other hand were paid
between P10,000.00 and P40,000.00 per month, which is based on the City Mayor’s
discretion.
A. Job Order Personnel
In the post audit of the submitted liquidation reports of disbursing officers

representing wages of JOs, the following were observed:
1.0 Some JOs had the same functions and with no specific deliverables
We noted that a number of JOs performed the same duties as indicated in their
DTR and monthly accomplishment reports. More so, the same activity was accomplished
all throughout the month. Among others are the following:
Supporting No. of
Duties/Accomplishments
Document JOs
Check no. conduct monitoring in 26 barangays/CSPMO program 30
71556541 dated implementation barangay-based work
4/14/2020 (R. (per Office Orders No. 00056-2020, 0046-2020, 1200, 0116-2020
Abella) and 0076-2020 all dated January 13, 2020)
Submit final list of grantees 11
(per undated Office Order No. 2020-08)
Assist the Clients in the Hospital to avail Medical Assistance, 14
Conduct validation letter request every Barangay, Conduct
Agricultural Livelihood Orientation, Conduct Calamity Assistance
Family Access Card (CAFAC), Program
Implementation/Barangay Based Worker
(Per Office Order No. 0045-2020 dated January 13, 2020)
Report of Prepare payroll for sweepers for JOs, encodes business permit, 6
Disbursement prepare DTR for sweepers of JO (CENRO)
(RD) No. 2020- Conduct CAFAC form to barangays 14
0603, 0604, 0606 CSPMO undated Office Order No. 0037-2020
(cash card) Doing clerical works in the CDRRMO 5
Office Order no. 003B dated 1/17/2020
Monitoring possible emergencies 10
Office Order No. 003B dated 1/17/2020
Report of Assess Senior Citizen skills any capabilities in availing the 10
Disbursement program & services per CSPMO Office Order No. 0178-2020
(RD) No 2020- dated 2/10/2020
0630
Procurement of needed supplies and materials per CSPMO Office 14
Order No. 140, 147
Monitor regular monthly meetings of senior citizens in the 14
barangay level within the city and assist in the implementation of
community based programs for senior citizens per Office Order
02-012, 1746
Submit report on quarterly basis to DSWD elder focal person, all 7
activities conducted by federation of senior citizen program,
registration and data banking of senior citizens per Office Order
107
Supporting No. of
Duties/Accomplishments
Document JOs
No. 1746
Assist and profiling of data for the PWD clients per Office Order 13
no. 0177-2020 dated 2/10/2020
Explain the guidelines and mechanics to all applicants to said 46
program.
Inform public thru barangay leaders and media regarding
scholarship program Prepare payments to schools for all the
scholarship grantees
Conduct qualifying examinations in selecting deserving students
in the province (as per attached job order appointment)
Assist in conducting different activities in livelihood program, and 5
to assist in facilitating livelihood applicant per Office Order No.
024-2020
Profiling PWD, validation & organization of PWD association, 12
assist walk-in applicants per Office Order No. 0195-2020 dated
January 13, 2020
We also observed that the accomplishments of JOs assigned in some departments

had repetitive accomplishment for the whole month hence may be done by other JOs. To
wit:
Supporting
Individual duties/accomplishments of every JO
Document
Office Order No. 01- 1. Delivers communication letters, resolutions, ordinances to concerned
172-20 government and private offices. – 1 JO
Office of the VM 2. Take custody in the operation and maintenance of IT equipment – 2 JOs
No. of JO - 7 3. Record incoming and outgoing papers/documents
RD No. 2020-0603; 4. Follow-up papers (PRs,Payroll, vouchers) -1 JO
0604; 0606 5. Project monitoring of various barangays – 1 JO
6. Compute real property tax and computing RRT of the barangay
Office Order No. 105- 1. To inspect motorized tricycle for hire for its road worthiness – 4 JOs
20 2. To receive and assess applicants’ requirements – 1 JO
Office of the SP Rey 3. To prepare and follow-up payrolls and other papers – 1 JO
Ayo
No. of JO – 6
RD No. 2020-0603;
0604; 0606
Office Order No. 746- 1. Assist as personal aide during special functions – 2 JOs
2020 2. To deliver solicited materials to different barangays – 2 JOs
Office of the SP 3. Receive solicitations and death certificate – 1 JO
Xymber M. Latasa 4. Follow-up and assist paper works in the offices – 1 JO
No. of JO – 8 5. To deliver and install tent in various barangays – 2 JOs
RD No. 2020-0603;
0604; 0606
Office Order No. 010- Monitoring of puroks at Brgy. Kapatagan – 3 JOs
2020
Office of the SP
Juanito O. Morales
No. of JO – 3
RD No. 2020-0603;
0604; 0606
108
Supporting
Document
Office Order No. 01- 1. Receive incoming communications
002-2020 & 01-001- 2. Maintain Cleanliness of the center and assist during
} 4 JOs
2020 meetings and seminars
}
Office of the SP Dr. 3. Monitor barangay/women’s RIC activities in different
Concepcion R. barangays
4 JOs
Cadungog 4. Deliver communication to different barangays
No. of JO – 8
RD No. 2020-0603;
0604; 0606
Office Order No. 01- 1. Receive solicitations and death certificate
03-20 2. Deliver goods for burial assistance and solicited materials
Office of the SP
Salvador L. Dumugho
III
No. of JOs – 2
Check # 71556541
dated 4/14/2020 (R.
Abella)
Office Order No. 1. Conduct ocular visits to the beneficiaries -2 JO

0048-2020 & 0033- 2. Monitor and evaluate beneficiaries – 2 JO
2020 3. Provide immediate medical assistance – 1 JO
CSPMO-Lingap
No. of JOs – 5
Check # 71556541
dated 4/14/2020 (R.
Abella)
Office Order No. 1. Explain the guidelines and mechanics to all applicants to said program. –
0200-2020 2 JOs
CSPMO-scholarship 2. Inform public thru barangay leaders and media regarding scholarship
program program – 1 JO
No. of JOs – 6 3. Prepare payments to schools for all the scholarship grantees – 2 JOs
RD No. 2020-0630 4. Conduct qualifying examinations in selecting deserving students in the
province. – 1 JO
Office Order No. 04- 1. Release solicited items/goods and conduct barangay monitoring of
2020 various barangays – 4 JOs
Office of the SK 2. Records incoming and outgoing solicitations, filing documents of SK
Federation President meetings and communications, conduct consultations with youth
No. of JOs – 5 organizations in various barangays – 1 JO
RD No. 2020-0630
Office Order No. 001- 1. Assess client requirements for approval – 2 JO
2020 2. Require clients to submit requirements – 1 JO
Office of the CSWDO 3. Extend/provide assistance to clients – 1 JO
(Crisin Intervention 4. Facilitate documents of clients- 1 JO
Program)
No. of JOs – 5
RD No. 2020-0630
Office Order No. 1. Inform the public thru barangay leaders & media regarding medical
0250-2020 assistance program – 5 JOs
CSPMO Office Order 2. Explain the guidelines and mechanics to all applicants of the said
No. 0250 program – 5 JOs
No. of JOs – 11 3. Submit final list of grantees -1 JO
109
Supporting
Document
RD No. 2020-0630
Given such accomplishment, it may be understood that the number of JOs hired to
perform the tasks may be reduced since they have similar accomplishments. It may not
also be justified, based on the documents, whether the number of individuals is
reasonable since the accomplishments were not specifically stated and in fact, routinary
and redundant and could be done by a few.
2.0 Projects with significant chunk for JOs’ salaries
Examination of some project designs disclosed that a great chunk was allotted for
the payment of JOs, to wit:
Amount
Project Title Total Amount allotted for Percentage
JOs
Educational Assistance 10,000,000.00 3,696,000.00 36.96%
Program-Scholarship
Senior Citizen Program 3,602,202.04 1,478,400.00 41.04%
Medical Outreach Program 5,000,000.00 1,848,000.00 36.96%
Persons with Disability Program 4,759,614.08 1,478,400.00 31.06%
Comprehensive Assistance 15,000,000.00 7,392,000.00 49.28%
Program to Indigenous People
and Other Marginalized Sectors
(Lingap)
Total 38,361,816.12 15,892,800.00 41.43%
Budget allotted for job orders of various projects represents thirty-one to forty-
nine percent, thus limit the budget for the main purpose of the program as intended. More
so, the project designs for these programs had no statements for the manpower
requirements, nor had any activities that would require the City to hire a number of Job
Order Personnel to implement the designed programs. Reducing the budget for J.O.s
means the City could have more funds for the main thrust of the program.
In an inquiry with Atty. Nikkolo Marco Aurelio Cortes, City Legal Officer and
Mr. Gil S. Gubat, the hiring of JOs were based on the number of personnel needed by the
offices or programs of the City. However, as based on the foregoing observations, the
JOs accomplishments were redundant to other co-Jos, hence, a waste of government
funds and resources.
B. Technical Advisers
Apart from the job order personnel, the City also hired 41 technical advisers, to
wit:
110
Contract
Technical Adviser
Name Duration & Audit Remarks
on
Monthly Salary
No attached PDS and
other essential documents
Livelihood and
Jan-Mar to prove that the
1. Alexander Juane Agricultural
15,000.00 qualifications and work
Development
experiences are related to
the assigned field
Fiscal and Budget Jan-Jun
2. Angelle lcer Same
Affairs 20,000.00
Medical, Financial
Jan-Mar 0
3. Antonio Jariol and Services Same
20,000.00
Assistance
His current assignment
may not be in line with
Youth Development Apr-Dec his work experience since
4. Axl Jympson R. Uy
Programs 15,000.00 he was previously on the
field accounting and
marketing management
No attached PDS and
Jan-Mar to prove that the
5. Buenaventura Bastatas Radio News Affairs
10,000.00 qualifications and work
the assigned field
Education and Jan-Mar
6. Carmen Abajero Same
Culture 20,000.00
Past experience were
Fiscal and Budget Mar-Dec
7. Charles D. Flores related to business and
Affairs 20,000.00
commercial industry
No attached PDS and
Senior Citizen Jan-Jun to prove that the
8. Conception Dumogho
Affairs 10,000.00 qualifications and work
the assigned field
Jan-Mar
Political
Cyril Salvador C. 20,000.00 No deficiency noted per
9. Administrative and
Villarosa Apr-Dec review of PDS
Barangay Affairs
40,000.00
Photography,
10 Videography and Apr-Dec No deficiency noted per
Dan Carlo T. Doneza
. Drone Operation and 15,000.00 review of PDS
Control
No attached PDS and
Jan-Jun
System and Network 25,000.00
11 to prove that the
David Osita Administration and Jul-Dec
. qualifications and work
Development Affairs 20,000.00
the assigned field
12 Sports Development Jan-Dec Same
Disiderio B. Tarle
. Programs 25,000.00
13 Dexter Socuaje Food Management Jan-Mar Same
111
Contract
Technical Adviser
on
Monthly Salary
. Affairs 15,000.00
His current assignment
Sports and Physical may not be in line with
14 Fitness Jan-Mar, Nov- his work experience since
Eduardo V. Megrino
. Developments Dec 25,000.00 he was previously on the
Affairs field of masonry and civil
works.
No attached PDS and
15 Coastal Barangay Jan-Mar to prove that the
Estrella Bedico
. Development 20,000.00 qualifications and work
the assigned field
Community
16
Felimonito B. Villegas Development 20,000.00 same
.
Programs
17 Barangay Political Jan-Dec
Fernando Sacdalan same
. Affairs 25,000.00
18 Project Monitoring Jan-Apr
Gie-An delos Santos Same
. Affairs 15,000.00
Jan-Mar Seminar attended relative
Legal Administrative
19 Howard Ray N. 15,000.00 to procurement is
and Procurement
. Tresplacios Apr-Dec “PhilGEPS training for
Affairs
20,000.00 buyers” only.
No attached PDS and
20 Jan-Mar to prove that the
Jivson Buaya Engineering Surveys
. 15,000.00 qualifications and work
the assigned field
21 Project And Jan-Mar
Josephine Aniñon Same
. Development 40,000.00
Engineering and
22 Aug-Dec
Jose L. Sabud Infrastructure Same
. 20,000.00
Projects Affairs
23 Community Devt. & Feb
Josie Etang Same
. NGO/PO 35,000.00
Cooperative
24 Jan-Mar
Julius Alcomendras Development & Same
. 15,000.00
Livelihood
Psychological
25 Mar-Dec
Lea May P. Galope Counselling Same
. 15,000.00
Programs
26 Jan-Mar
Maimona Dimapundug Muslim Devt. Affairs Same
. 20,000.00
27 Psychosocial First Mar-Dec No deficiency, licensed
Mea Cristine A. Pantil
. Aid 15,000.00 psychometrician
Geographic
28 Jan-Jun
Melissa Amor F. Ang Informations System No deficiency noted
. 40,000.00
(GIS)
29 Mernell Dawn Palma Multimedia Jan-Mar No deficiency noted
. Information and 15,000.00
112
Contract
Technical Adviser
on
Monthly Salary
Communication Apr-Dec
Affairs 20,000.00
No attached PDS and
30 Indigenous People’s Jan-Mar to prove that the
Percilito Macumbo
. Affairs 15,000.00 qualifications and work
the assigned field
Jan-Mar
31 Socio-political 15,000.00
Sanimar Lepornio Same
. Affairs Apr-Dec
20,000.00
32 Jan-Mar
Rashid Saidul Engineering Surveys Same
. 15,000.00
33 City Administrative Jan-Apr
Raquel Marie Chiong Same
. Services and Affairs 40,000.00
34 Reynaldo De Gama Inter-Barangay
20,000.00 Same
. Caballero Affairs
35 Jan-Apr
Robina Gravador Loans and Finance Same
. 15,000.00
She is 74 years old and
Jan-Dec should no longer be hired
36 Human Resource
Roceli P. Rocamora 25,000.00 per Section 4.d of CSC
. Development
Resolution No. 020790
dated June 5, 2002
No attached PDS and
37 Coastal Barangay Jan-Mar to prove that the
Romulo Ganzon
. Affairs 10,000.00 qualifications and work
the assigned field
38 Jan-Mar
Sitii Aisia Nuljaid Muslim Affairs Same
. 25,000.00
Business, Investment,
39 Jan-Mar
Teodorico Dofiles II Tourism & Int’l Same
. 40,00.00
Relations
Experience on internal
40 Internal Audit and auditing in government
Paloma G. Grado 20,000.00
. Legal Affairs operation was not
indicated in the PDS
41 Youth Engagement
Ruby Pearl B. Estrella 20,000.00 Same
. Affairs
Details of disbursements and supporting documents are presented in Annex V and

discussed below is the summary of observation and reiteration of prior year’s narrative
under AOM No. 2020-006 (2019) dated February10, 2020.
 Skills that some consultants possess are available within the management
organization and could not be considered as experts in whatever aspect. Since
the requirements of the various offices and administrative departments where
113
the consultants are assigned do not require technical competence, the desired
outputs or expected deliverables could be provided by regular employees
assigned in their respective offices.
 Examination of the available contract of service disclosed that the duties and
functions are in line with a particular department. Among others, their duties
include:
Usual function of the

Duties and Functions
following department:
Recommend to the City policies, plans and Human Resource
programs concerning Human Resource Management Office
Recommend to the City policies, plans and Local Finance Committee
programs concerning Fiscal and Budget Affairs
Recommend programs and policies in relation to Barangay/City
political, administrative and barangay affairs, Development Council of
and create sustainable development initiatives 26 barangays or
Association of Barangay
Captains President
Recommend to the City policies, plans and Bids and Awards
programs concerning legal administrative and Committee/ City Legal
procurement affair Office
Recommend to the City policies, plans and Sangguniang Kabataan/
programs concerning youth development Office of the SK
programs Federation President
Recommend to the City policies, plans and City Engineer’s Office/
programs concerning Engineering and City Planning and
Infrastructure Project Affairs Development Office
 Since the management did not set performance indicators and basis for
assessment of actual services rendered, some accomplishment reports showed
that the work outputs were considered as mere duplication of the works of
regular employees. Their outputs, among others, include:
Being Performed by
Accomplishments Permanent Personnel under
the following offices
Codified the City Budget Process from City Budget Office, City
incoming to outgoing of documents, Analyzed Accounting Office
the Statement of Allotment, Obligation and
Balances (SAOB)
Organized tasking for the Office of the City Mayor’s Office’s
Mayor's team, Received and Released Secretary or assigned staff
incoming & outgoing documents
Prepared the profile of qualified applicants for Human Resource
all the posted / published vacant positions in Management Office
114
Being Performed by
Accomplishments Permanent Personnel under
the following offices
the different offices of the City Government
of Digos for submission to the Civil Service
Commission RO XI to form part of the
evidentiary requirements of the Prime - HRM
Program
Reviewed project designs and its budgetary City Planning and
requirements of all programs for development Development Office or City
and growth of the city Budget Office
Conducted researches and studies relative to City Cooperative and
livelihood and agricultural development Development Office/ City
Agriculture Office
Assisted in promoting volunteers participation Barangay
through bayanihan at the barangay Officials/Employees
Monitored the Anti - rabies vaccination from City Veterinarians’ Office
the city veterinary office in barangay cogon
Coordinated with the City Local Government Barangay
Operations Office (CLGOO)-Digos City and Officials/Employees and/or
requested the list of all Barangay Officials JOs assigned in one of the
within the 26 barangays of Digos City programs of CSPMO
Atty. Cortez also added that City necessitates hiring these technical advisers as
there was no available personnel who possessed the required expertise. However, we
emphasize the limitation of hiring of the abovementioned personnel under Section 7.0 of
CSC-COA-DBM Joint Circular No. 1 dated June 15, 2017
“xxx
7.2 Contract of service and job order workers should not, in any case,
be made to perform functions which are part of the job description of the
agency’s existing regular employees.”
Based on the foregoing observations, it may be construed that the City may not
have conducted an in-depth evaluation and assessment of the actual number of needed
personnel (be it JOs or technical advisers).
Ergo, payment of such a number of personnel whose functions are either

repetitive and duplication of duties have wasted the City’s funds and would have been
used to augment the funds for the delivery of services to its constituents.
It is also worthy to note that the presence of the JOs and technical advisers had
greatly contributed to the effectiveness of the operation of the City and the timely
response during the community quarantine.
115
Recommendations:
1. We recommended to the City Mayor the following:
 Assess and evaluate the necessity of hiring of JOs and technical advisers
to avoid wastage of funds.
 Minimize hiring of JOs and technical advisers when duties and functions
could be done by a few.
 Make use of the available personnel in the department to avoid duplication

of duties and functions.
2. For the technical advisers, we recommended to further evaluate the

performance and qualifications of technical advisers whose work experiences
were not aligned to the assigned field. Discontinue the contract of service
whose duties are readily available and did not require special skills, their
services can be dispensed with to save government funds and resources.
3. Discontinue hiring individuals who are beyond the retirement age to avoid
audit disallowances.
1. Since this city’s transition as a third class municipality and to its eventual
upgrade as a second class city during the year 1999, Digos City has followed
the virtually under developed organizational structure of the municipal level.
As such, the existing administration called for the immediate need to upgrade
on its personnel and organizational structure to a city level to significantly
cater to its dynamic and developmental process.
2. A consultancy fimr won the public bidding for consulting services to provide
adequate external technical and professional expertise that are beyond the
capability and/or capacity of the government to undertake. However, due to the
Covid-19 pandemic, it was cancelled. Hence the need to hire job order (JO)
personnel and technical advisers to fill the gaps of the government’s
workforce.
3. As to the observation on the JOs similar functions and no specifici deliverables

and to the projects with significant chunk of JOs’ salaries, we have mandated
regular employee representative of each office to supervise the processing of
payrolls. Moreover, a JO orientation was conducted to orient them on the
proper system of filling in forms required in their payrolls.
116
4. On the technical advisers, we have decreased their number to sixteen (16) and
have discontinued the contract of service on those who have not reached the
performance and qualification standards. It may be observed that the previous
system of hiring TAs were continued until the first quarter of 2020. However,
upon the 2020 COA exit conference, the recommendations therein were
followed.
The management assured that all recommendations provided will be faithfully

complied with and that they will always remain to be a partner in upholding faithful
adherence to existing rules and regulations.
Scholarship Program
17. The City’s Educational Assistance Program with a total project cost of
P10,000,000.00, may not be properly implemented owing to the lack of in-depth
assessment and evaluation resulting in the inclusion of scholarship grantees that are
not among the target beneficiaries as required under Section 458 (5) (xi) of RA 7160,
thereby depriving other poor but deserving students the benefits that can be derived
therefrom.
Article XIV, Sessction 2 (3) of the 1987 Philippine Constitutions provides that:
“Section 2. The State shall:
(3) Establish and maintain a system of scholarship grants, student

loan programs, subsidies, and other incentives which shall be
available to deserving students in both public and private schools,
especially to the underprivileged.”
Section 458 (5) (xi) of RA 7160 provides that among the powers, duties and
functions of the Sangguniang Panglungsod is to:
“5. Approve ordinances which shall ensure the efficient and effect delivery
of basic services and facilities as provided for under Section 17 of this
Code, and in addition to said services and facilities, shall:
(xi) Establish a scholarship program fund for poor but deserving

students in schools located within its jurisdiction or for students
residing within the city.”
117
As part of the endeavor of the City of Digos to provide adequate assistance to
infrastructure, health, education, livelihood and peace and order, the City Government
established and created the scholarship program known as the “CITY SCHOLARS”. The
program budgetary requirements are as follows:
Account Codes Account Titles Amount

5-02-03-010 Office Supplies Expenses 50,000.00
5-02-03-090 Fuel, Oil & Lubricants Expenses 124,000.00
5-02-03-990 Other Supplies and Materials Expenses 30,000.00
5-02-12-990 Other General Services 3,696,000.00
5-02-99-030 Representation Expenses 150,000.00
5-02-99-080 DONATIONS (Scholarship Grants) 5,800,000.00
-n- R/M Machinery and Equipment 150,000.00
Total 10,000,000.00
Out of the P10,000,000.00 total program cost, P5.8M was allotted for the
scholarship grants for various students. Based on the documents and data provided by the
CSPMO – Human Resource Development Program, there are a total of eight hundred
eighty-seven (887) scholarship grantees, eight hundred sixty-eight (868) are currently
enrolled in various undergraduate courses, while nineteen (19) are currently enrolled in
post-graduate courses.
Review and verification of the implementation of the scholarship program

revealed the following observations:
1. Scholarship Information Dissemination
As disclosed by the personnel in-charge, the manner of disseminating the

scholarship grants for undergraduates was through a briefing/conference
conducted by forty-six (46) Job Order Personnel in each of the 26 component
barangays of the City, while in the case of scholarship grant for post-graduate
were not publicly announced, as disclosed by Ms. Shany Lou R. Solatorio,
CSPMO-Administrative Officer and currently the Officer-in-Charge of City
Social Welfare and Development Office. She added that due to the limitation of
the grants for post-graduate, they opted not to announce it publicly but instead
through recommendations of acquaintances of the personnel directly related to the
scholarship program.
2. Applicants Screening Procedure
As per the rules and regulations governing the scholarship program, applicants are
required to be a registered Filipino citizen residing in Digos City, enrolled in an
instution/school, physically and mentally fit, and not enjoying any other
government scholarship/study grant. For that reason, an interested applicant is
required to submit BIO DATA/Personal Data Sheet (PDS), Report of rating and
118
enrollment slip for continuing students, HS/SHS report card and enrollment slip
for incoming freshmen, and Certificate of Low Income.
The abovementioned documents were considered in the interview/assessment of

each of the applicants by the scholarship coordinators. Review and verification of
the documents submitted revealed the following observations:
a) There is no definite sets of interview questions that are strategically

formulated to objectively assess whether an applicant is qualified or not. As
disclosed by the scholarship coordinator, they only indicate remarks directly
to the BIO Data or PDS for the responses of the applicants.
b) Majority of the applicants in scholarship for undergraduates and incoming

freshmen failed to present their enrolment slip or certificate of enrolment,
which is one of the documentary requirements for the scholarship grant. Based
on the interview remarks in the BIO Data, some of the applicants are still
“undecided” on the school or course to take.
c) Majority of the Certificate of Indigency or Certificate of Low Income

presented were not indicative of the total annual income of the family or
household. Also, during interview/assessment, there was no inquiry as to the
total amount of the family income, other source of income aside from what
was declared in the BIO Data and PDS and average income thereof, number
of family members who are already earning or working. Thus, it can be
construed that an applicant passed the assessment for financial capacity by
just presenting the abovementioned certificates without further in-depth
assessment.
d) Majority of the BIO DATA and PDS were not properly accomplished. In the
case of the applicants for scholarship for post-graduates, work experience and
work history were usually not accomplished or incomplete. Also, salary rates
were not disclosed to or inquired by the scholarship coordinators.
In view of the abovementioned condition, there were scholarship grantees,

undergraduate and post-graduate, that might not be qualified to receive the scholarship
grant of the City. Based on the available records provided by the scholarship
coordinators, below is the list of scholarship grantees with doubtful qualification for the
said program:
GRANTEE SCHOOL REMARKS

Catherine A. Lorete Cor Jesu College – BS Psychology SK Chairperson – Brgy. Aplaya
Frenzy Grace F. Ampoon Davao Doctor’s College Father is a barangay Kagawad

Currently employed, husband is a
Southeastern College of Padada –
Vyan Dale government employee holding
Units Earned for Education
regular position
119
Employed in PSA – Registration
Princess Shena A. Bueron DSSC – Masteral
Officer I
Southeastern College of Padada – Currently a college professor at
Ronald Glumir U. Balos
MBA UM-Digos College
Currently employed at Franklin
Rommel Balazon Cor Jesu College – MPA Baker, wife is a permanent
employee of the City
Employed by the City as technical
Sanimar Lepornio Cor Jesu College – Juris Doctor adviser on Socio-political Affairs
earning
Not resident of Digos City per PDS
submitted.
Not declared in the BIO data-

Employed by the City as technical
Howard Ray Tresplacios Cor Jesu College – Juris Doctor
adviser on Legal Administrative
and Procurement Affairs
Jan-Mar 2020 - 15,000.00/month

Apr-Dec 2020 - 20,000.00/month
Not declared - Employed by the
City as technical adviser on Youth
Development Programs
Axl Jympson Uy Cor Jesu College – Juris Doctor
Jan-Mar 2020 - 15,000.00/month
Apr-Dec 2020 - 20,000.00/month
Employed by the City of Digos as
Job Order Personnel
Assign in the Screening and

Dexter Canoy Cor Jesu College – Masteral processing of application for
Scholarship
Employment History not declared

in Bio Data
Not declared - Employed by the
City of Digos as Job Order
April Rose Alcala Cor Jesu College – Masteral Personnel
Employment history not declared

Not declared – Employed by the
City of Digos as Executive
Assistant I
Hazel Jane Cubian Cor Jesu College – Masteral
Employment History not declared
Salary P26,000.
Mother is regular employee of the
City of Digos
Princess Joy Palgan UM Digos – Masteral
Currently employed at UM Digos
Rommie Jay Momo UM Digos – Masteral SMCC – Part-time Teacher
PITS – Part-time Teacher
120
Salary not inquired during
screening
Currently Employed in Digos City
Kevin John M. Juban DSSC – Masteral
Hall as encoder in Health Office
Currently employed as college
Ronald Glumir U. Balos DSSC – Masteral
professor in UM Digos
As presented above, there were grantees that already have regular work in private
and public/government institutions, or have spouses or parents that are currently working
for the City Government of Digos and its component barangay. Specifically, there were
grantees for post-graduate scholarship who are currently hired by the City Government of
Digos as Technical Advisers, as well as job order personnel assigned as scholarship
coordinators. These grantees had already graduated from their chosen courses and are
now more capable and equipped to face the difficulties in life. Though it may be true that
some of them are currently facing difficulties in their finances for post-graduate studies,
or their promotion for a particular job, they already have more options to work around
through these challenges, and that efforts should be directed to the most needy and
underprivileged students/grantees.
It is noteworthy to emphasize that the scholarship coordinators failed to provide

the audit team the complete documents of all scholarship grantees. Had all the documents
were presented for review and verification, the audit team could have checked further the
eligibility of the other scholarship grantees.
In view thereof, the Educational Assistance Program of the City of Digos with a
total cost of P10,000,000.00 may not be properly implemented owing to the lack of in-
depth evaluation and assessment resulting in the inclusion of scholarship grantees that are
not among the target beneficiaries as required under Section 458 (5) (xi) of RA 7160,
thereby depriving other poor but deserving students from the benefits that can be derived
from the scholarship program of the City.
Recommendations:
1. For the next batch of scholars for SY 2021-2022, require the personnel in-
charge of the scholarship program to review and re-assess the current
screening and evaluation process, and develop and utilize more strategic
assessment tools that will objectively determine qualified applicants, and are
capable of maintaining proper and complete documentations thereof;
2. Implement an independent verification process to verify the applicants’ claims

as to their indigency or being in the poverty threshold. It may be possible to
utilize the forty-six (46) job order personnel charged against the scholarship
program to perform the verification; and
121
3. Prioritize the poor but deserving, and underprivileged students who wanted to
pursue college, and consider discontinuance of the scholarship grants for post-
graduate students, except for special cases and circumstances.
1. The Constitution and its framers expressly intended that education must be
accessible to all, although we put special treatment or favor towards those who
are underprivileged but deserving students. This is in congruence with the
undersigned’s directive to the City Scholarship Program of the City
Government of Digos to be open to all applicants, in order to adhere to our
constitutional mandate that steps must be made in order to make education
accessible to all.
2. Although the Local Government Code mandates that there shall be an

establishment of scholarship program fund for poor but deserving students,
which was also cited in this AOM, the undersigned would like to respectfully
contend that the term “poor” must be liberally construed.
3. The Magna Carta of the Poor, Section 3, paragraph (f) defined the term “poor”
to refer to individuals or families whose income falls below the poverty
threshold as defined by the NEDA and/or who cannot afford in a sustained
manner to provide them minimum basic needs of food, health, education,
housing, or other essential amenities of life, as defined under RA No. 8425,
otherwise known as the Social Reform and Poverty Avelliation Act. Since
students applied for the said City scholarship grants, it is therefore the humble
opinion of the undersigned that they cannot afford in a sustained mannetr to
provide for their minimum basic need for education notwithstanding that some
of them have work.
4. As our final response, the City Government of Digos did not and never
imposed a cut off limit on the slots for the scholarship grants. Truth be told, the
City even exceeded from our target scholarship grantees.
5. Notwithstanding some minor errors/details, the undersigned would like to

emphasize that the scholarship program is very much open to all interested
applicants, especially to those underprivileged but deserving students who wish
to achieve the educational attainment that they long to accomplish.
6. In closing, it has always been the top most priority of the City to promote the
mandates of the Philippine Constitution and our national government,
especially in providing the public with quality government service that they
needed and deserved. And in doing so, although the City is given the authority
and discretion to establish a scholarship grant suitable to the demand of the
122
constituents, we are always mindful of the limitations imposed by existing laws
and rules.
7. Rest assured that all recommendations laid down in this AOM will be properly
taken into account.
The audit team commended management’s enthusiasm towards helping its youth
to have better access to education. However, we would also emphasize the following
points:
On the third statement, it is as though that the management already assumed that
once a student applied for a scholarship, he or she is already construed as “poor”. The
program-in-charge or management per se should have alternative means of checking
whether such applicant is “poor” and not just merely requiring them to submit barangay
certificates which could be easily obtained by anyone. There should be a check-and-
balance so as to be fair to all applicants.
The fourth statement alleged that the team opted to limit the scholars. The
narrative did not entail that the City should limit the number of scholars. Besides, the
project design did not even mention the number of target beneficiaries hence, we could
not affirm whether the number of grantees really exceeded the target. More so, the
program-in-charge did not even submit all the profiles of the scholars as these were
misplaced when they relocated to another office.
Compliance with Tax Laws
Taxes with a total amount of P15,166,008.06 which were withheld from payment
of salaries and from payment of claims by contractors and suppliers were remitted to the
BIR pursuant to the provisions of Executive Order No. 651 dated February 16, 1981 and
Revenue Memorandum Order No. 8-2003 dated March 3, 2003. The total amount
remitted was P 11,674,926.50. The balance of P 3,491,081.56 pertained to taxes withheld
for the month of December 2020 which is supposed to be paid yet on or before the 10 th
day of January the next year, and some are taxes withheld before December but were not
included in the remittance for December 2020 due to the cut-off period difference of the
Accounting Department’s BIR Remittance Section and PPSAS/Encoding Section.
123
Remittance of mandatory GSIS, PhilHealth and Pag-IBIG contributions and loan
repayments
As at December 31, 2020, the balances of the following aforementioned accounts

are as follows:
Account Amount
Due to GSIS 832,858.31
Due to Pag-ibig 1,156,208.94
Due to PHIC 68,312.23
Total 2,057,379.48
The above balances will be settled in the ensuing year. On the other hand, the
Agency had been compliant in remitting both the employees’ and employer’s share of
premium contributions and the corresponding loan payments.
Enforcement of COA Disallowances and Charges
The reported balance on Notice of Suspension, Notice of Disallowance, and

Notice of Charges as at December 31, 2020 are as follows:
Beginning This Period Ending

Balance January 1 to December Balance
12/31/2019 31, 2020 12/31/2020
NS/ND/NC NSSSDC
Notice of Suspension 970,307.54 4,717,500.00 0.00 5,687,807.54
Notice of Disallowance 417,170.00 0.00 0.00 417,170.00
Notice of Charge 0.00 0.00 0.00 0.00
Total 1,387,477.54 4,717,500.00 0.00 6,104,977.54
Compliance with Programs and Projects related to Gender and Development (GAD)
The City of Digos allocated the amount of P48,798,205.40 for the implementation
of various PPAs under the GAD. Among its utilization is as follows:
Particulars Amount
Other Maintenance & Operating Expenses
Training Expenses - Youth Development Program 97,460.00
Office Supplies Expenses 38,030.00
Office Supplies Expenses - GAD - Lingap 99,989.00
Office Supplies Expenses - Nutrition Program 10,000.00
Office Supplies Expenses - Bahay Kalinga 14,724.00
Office Supplies Expenses - Family & Community Based Welfare 16,375.00
Office Supplies Expenses - Women & Children Protection 99,904.00
124
Particulars Amount
Office Supplies Expenses - Mass Vaccination 40,500.00
Office Supplies Expenses - STI HIV/AIDS 20,000.00
Office Supplies Expenses - Health Promotion 99,924.00
Food Supplies Expenses - COVID-19 Prevention 2,700,000.00
Food Supplies Expenses - Nutrition Program 249,507.50
Food Supplies - Bahay Kalinga 184,142.90
Food Supplies Expenses - Women & Children Protection 223,856.50
Food Supplies Expenses - Children Feeding 179,771.10
Drugs & Medicines Expenses - Bahay Kalinga 6,999.80
Drugs & Medicines Expenses - Mass Vaccination 1,026,090.00
Drugs & Medicines Expenses - STI HIV/AIDS 60,000.00
Drugs & Medicines Expenses - Nutrition Program 405,000.00
Medical, Dental and Laboratory Expenses - Nutrition Program 433,500.00
Medical, Dental and Laboratory Expenses - STI HIV/AIDS 89,975.00
Medical, Dental & Laboratory - Health Promotion 70,790.00
Fuel, Oil & Lubricants Expenses - GAD Lingap 147,742.00
Fuel, Oil & Lubricants Expenses - Health Promotion 18,800.00
Agricultural and Marine Supplies Expenses - Crop Production Program 374,540.00
Agricultural and Marine Supplies Expenses - Corn Production 495,664.32
Agricultural and Marine Supplies Expenses - Integrated Pest Program 228,385.00
Agricultural & Marine Supplies - Vegetable Program 71,250.00
Other Supplies & Materials Expenses - Nutrition Program 27,760.00
Other Supplies & Materials - Bahay Kalinga 269,092.20
Other Supplies & Materials Expenses - Family & Community Based Welfare 49,692.60
Other Supplies & Materials Expenses - COVID-19 Prevention 2,613,400.00
Other Supplies & Materials Expenses - GAD Lingap 49,872.00
Other Supplies & Materials Expenses - Environmental Protection 277,306.00
Other Supplies & Materials Expenses - Mass Vaccination 57,000.00
Other Supplies Expenses - Health Promotion 99,825.00
Membership, Dues & Contribution - Health Promotion 368,442.00
Advertising Expenses - Nutrition Program 1,497.00
Advertising Expenses - Health Promotion 30,000.00
Printing & Publication Expenses - STI HIV/AIDS 49,237.50
Rent Expenses - COVID-19 Prevention 230,706.00
Representation Expenses 19,750.00
Representation Expenses - Nutrition Program 183,937.50
Representation Expenses - Support to Productivity Skills 16,000.00
Representation Expenses - Family & Community Based Welfare 24,800.00
Representation Expenses - Youth Development Program 47,500.00
Representation Expenses - Women & Children Protection 24,800.00
Representation Expenses - STI HIV/AIDS 39,900.00
Representation Expenses - Health Promotion 13,950.00
Prizes - Nutrition Program 87,500.00
Other General Services 38,080.00
Other General Services - Family & Community Bases Welfare 115,309.72
Other General Services - Philhealth 975,373.00
Other General Services - Youth Development Program 363,860.00
Other General Services - Corn Production 243,913.83
Other General Services - COVID-19 Prevention 2,022,683.54
Other General Services - Farm Youth Development 34,158.84
Other General Services - Livelihood Skills Training 69,440.00
Other General Services - Integrated Pest Management 36,960.00
125
Particulars Amount
Other General Services - Support to Productivity Skills 298,814.19
Other General Services - Pauper's Burial 343,140.00
Other General Services - Crop Production Program 552,883.32
Other General Services - Bahay Kalinga 150,780.00
Other General Services - Crisis Intervention 341,851.96
Other General Services - Women & Children Protection 370,020.00
Other General Services - Environmental Protection 132,004.83
Other General Services - Vegetable Program 182,803.00
Other General Services - Mass Vaccination 291,357.48
Other General Services - Children Feeding 265,160.00
Other General Services - Health Promotion 627,022.67
Donations - Family & Community Based Welfare 207,160.00
Donations - Youth Development Program 278,000.00
Donations (Subsidy to LGU) Women & Children protection 380,000.00
Donations - GAD Lingap 3,007,742.97
Donations - Pauper's Burial 1,193,620.00
Donations - Crisis Intervention 725,128.00
Donations - STI HIV/AIDS 260,000.00
Other MOOE (Honoraria) - Support to Productivity Skills 7,200.00
Other MOOE – Philhealth 2,582,400.00
Other MOOE - Youth Development Program 112,350.00
Other MOOE - Women & Children Protection 70,912.50
Other MOOE - Health Promotion 7,000.00
Other MOOE (Honorarium) - Youth Development 15,000.00
Total MOOE 28,387,017.77
Capital Outlay
Furniture and Fixtures - Gabriela Silang 261,000.00
Information and Communication Equipment - Health Promotion 199,000.00
Medical Equipment - Health Promotion 72,000.00
Total Capital Outlay 532,000.00
Total 28,919,017.77
Compliance with Court Decisions on DAP and PDAF
The City of Digos did not receive any Disbursement Acceleration Program (DAP)
and Priority Development Assistance Fund (PDAF) as at December 31, 2020.
126
Allocation for Senior Citizen and Differently-Abled Persons
The City of Digos had total appropriations of P15,158,819.56 for Senior Citizen
and Differently-Abled Persons. Of which, P 11,349,283.48 was utilized during the year.
Details are as follows:
Particulars Amount
Capital Outlay
Other Structures - CSC Steel Signage 150,000.00
Other Structures - City Sports Development 854,050.00
Other Structures - Development Planning Investment 24,595.00
Office Equipment - Senior Citizen 65,000.00
Office Equipment - Protection for Children 25,000.00
Information and Communication Technology - Support to Information and
Communication 100,000.00
Information and Communication Technology - Project Monitoring and Evaluation
System 149,150.00
Information and Communication Technology - Information and Technology
Management System 989,700.00
Information and Communication Technology - Community Development Program 1,514,110.00
Information and Communication Technology - Local Youth Development for
Sangguniang Kabataan 117,500.00
Information and Communication Technology - Persons with Disability 341,000.00
Information and Communication Technology - Protection for Children 69,200.00
Communication Equipment - Local Youth Development for Sangguniang
Kabataan 22,500.00
Communication Equipment - Development Planning 90,000.00
Technical and Scientific Equipment - Information and Technology Management
System 584,000.00
Technical and Scientific Equipment - Local Youth Development for Sangguniang
Kabataan 60,000.00
Total Capital Outlay 5,155,805.00
Maintenance and Other Operating Expenses (MOOE)
Training Expenses 29,380.00
Office Supplies Expenses 87,484.00
Food Supplies Expenses 19,960.30
Other Supplies and Materials Expenses 64,736.40
Fuel, Oil and Lubricants 150,000.00
Water Expenses 630.89
Electricity Expenses 13,579.89
Rent Expenses 25,000.00
Representation Expenses 289,880.00
Other General Services 3,322,900.00
Repairs and Maintenance - Buildings and Other Structures 475,227.00
Donations 977,000.00
Donations (Subsidy to LGU) 240,000.00
Other MOOE (Honorarium) 497,700.00
Total MOOE 6,193,478.48
Total amount utilized 11,349,283.48
127
Investigation pursuant to Ombudsman-Mindanao Joint Resolution dated July 16, 2021
The Team is currently investigating the allegation in the 11 June 2019 Affidavit
Complaint filed by Mr. Gregorio M. Albaño, in relation to the transaction of the
Barangay Government of San Miguel for the purchase, fabrication, and installation of one
hundred fifty street signages for the total amount of One Hundred Fifty Thousand
(Php150,000.00).
128

10-DigosCity2020 Part2-Observations and Recomm

Uploaded by

Copyright:

Available Formats

You might also like

10-DigosCity2020 Part2-Observations and Recomm

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

10-DigosCity2020 Part2-Observations and Recomm

Uploaded by

Copyright:

Available Formats

PART II – OBSERVATIONS AND RECOMMENDATIONS

Property, Plant and Equipment – Local Road Asset Management

1. The correctness, existence and completeness of “Road Networks” account in the

Pertinent provisions of COA Circular 2015-008 provides:

“IV. Accounting Policies”

“19. Road networks carried in the Registry shall be transferred to

“V. Accounting and Reporting Procedures

1. Conduct an inventory of the local roads under the LGU’

1. Schedule of “Road Networks” disclosed transactions for the following

a. Local Road Network Ledger Card;

3. The City’s existing NGAS accounting system maintained by Euby’s

7. According to Engr. Dennis C. Almacin, Engineer I, the information on the

8. On the other hand, City Engineer Officer-in-Charge, Engr. Salvador L.

Due to the abovementioned circumstances, the following activities were not

c. Determine the components of local roads identified in the inventory without

In view thereof, correctness, existence and completeness of “Road Networks”

The same observation was noted in CY 2019, hence this reiteration.

1. To transfer in the books of accounts the road networks carried in the

2. Determine the components of local roads identified in the inventory

C. City General Services Officer

1. In coordination with the City Planning and Development Officer

In a 2019 Agency Action Plan and Status of Implementation (AAPSI) the

1. The road networks carried in the Registry of Public Infrastructure were

Property, Plant and Equipment – Construction and Heavy Equipment

2. The reliability of the reported balance of Construction and Heavy Equipment

Section 111 of Presidential Decree (PD) No. 15 provides:

“(1) The account of an agency shall be kept in such detail as is necessary

“xxx. All discrepancies between physical and book inventories must be

Section 124 of NGAS for LGUs Volume 1 state:

“Physical count of property, plant and equipment by type shall be made

The discrepancy could be attributed to the inadequacy of records maintained and

“The cost of an item of property, plant, and equipment comprises:

a) Its purchase price, including import duties and non-refundable

b) Any costs directly attributable to bringing the asset to the location

Amount per Inventory

Physical count is an indispensable procedure to ascertain the accuracy of the

We recommended the following courses of actions:

3. The Disposal Committee or GSO to conduct inspection and appraisal of the

Property, Plant and Equipment – Construction in Progress

3. Completed and dormant infrastructure assets with an aggregate amount of

One of the mandates of the Commission on Audit is to promulgate accounting and

Verification of the schedule of projects recorded under Construction in Progress–

7 Drainage - Aurora ext.- San Miguel (Florentino-Cadungog Res.) 192,387.20 Unidentified/Dormant

8 Improvement of Road along estrada 2nd, Brgy. Zone II 2,386.40 Unidentified/Dormant

 Unidentified/Dormant Infrastructure Projects (11 projects with a total

In view of the foregoing, the reliability and accuracy of the CIP-Infrastructure

We recommended to the management the following courses of actions:

1. City Engineering Office (CEO)

 Exhaust all options to identify the details and status of the

 Furnish the accounting office the certificates of completion for the

 For the ensuing infrastructure projects whether undertaken by contract or

2. The City Accounting Office (CAO)

 For the completed non-infrastructure projects, prepare necessary adjusting

2. Since no documents and details was sent by the CEO, reclassification of

Bank Reconciliation Statement – Reconciling items remained unadjusted

Sec. 74 Presidential Decree 1445 states:

Periodic reconciliation of bank and book balances is a required accounting control