Samar Executive Summary 2021

Republic of the Philippines
COMMISSION ON AUDIT
Regional Office No. VIII
Candahug, Palo, Leyte
ANNUAL AUDIT REPORT
ON THE
PROVINCE OF SAMAR
For the Year Ended December 31, 2021

REGIONAL OFFICE NO. VIII
March 30, 2022
Hon. REYNOLDS MICHAEL T. TAN

Governor
Province of Samar
Catbalogan City, Samar
Sir:
Pursuant to Section 2, Article IX-D of the Constitution of the Republic of the Philippines, Section 43(2)
of Presidential Decree No. 1445, otherwise known as the “Government Auditing Code of the
Philippines,” and in line with the Commission’s efforts toward informing management on how fiscal
responsibility has been discharged, we are pleased to transmit the report of our Auditor on the audit of
the accounts and operations of the Provincial Government of Samar for the year ended December 31,
2021.
The audit was conducted to ascertain the propriety of financial transactions and compliance of the
agency to prescribed rules and regulations. It was also made to ascertain the accuracy of financial
records and reports, as well as the fairness of presentation of the financial statements.
The Auditor rendered a qualified opinion on the fairness of presentation of the financial statements due
to the audit exceptions noted as indicated in the Independent Auditor’s Report.
We request that the audit observations and recommendations contained in Part II and those which remain
unimplemented as shown in Part III of the attached report be appropriately acted upon and we will
appreciate being informed of the actions taken thereon by submitting the duly accomplished Agency
Action Plan and Status of Implementation (AAPSI) form, within sixty days upon receipt hereof.
We acknowledge the cooperation and support extended to our Audit Team during the audit.
Very truly yours,
FOR THE COMMISSION ON AUDIT:
By:
ATTY. LITA A. ESTIL-DIEZ

Director IV
Regional Director
Copy Furnished:
The Regional Director, DILG, Region VIII, Tacloban City
The Regional Director, BLGF, Region VIII, Tacloban City
March 30, 2022
The Honorable Presiding Officer

and Members of the Sangguniang Panlalawigan
Province of Samar
Ladies and Gentlemen:
Pursuant to Section 2, Article IX-D of the Constitution of the Republic of the Philippines, Section
43(2) of Presidential Decree No. 1445, otherwise known as the “Government Auditing Code of the
Philippines,” and in line with the Commission’s efforts toward informing management on how
fiscal responsibility has been discharged, we are pleased to transmit the report of our Auditor on
the audit of the accounts and operations of the Provincial Government of Samar for the year ended
December 31, 2021.
The audit was conducted to ascertain the propriety of financial transactions and compliance of the
agency to prescribed rules and regulations. It was also made to ascertain the accuracy of financial
records and reports, as well as the fairness of presentation of the financial statements.
The Auditor rendered a qualified opinion on the fairness of presentation of the financial statements
due to the audit exceptions noted as indicated in the Independent Auditor’s Report.
In our transmittal of even date, we requested that the Provincial Governor act on the
recommendations contained herein and those which remain unimplemented in Part III of the
attached report be acted upon immediately.
We acknowledge the cooperation and support extended to our Audit Team during the audit.
Very truly yours,
FOR THE COMMISSION ON AUDIT
By:
ATTY. LITA A. ESTIL-DIEZ

Director IV
Regional Director
EXECUTIVE SUMMARY
Introduction
On June 19, 1965, RA 4221 was passed by Congress dividing Samar Island into three
(3) provinces: Northern Samar with Catarman as capital, Eastern Samar with Borongan as
capital, and Western Samar with Catbalogan as capital. A subsequent legislation passed
on June 21, 1969 (RA 5650) changed the title "Western Samar" to simply Samar.
The Province of Samar (the Province) is composed of 24 municipalities and two

cities, Catbalogan and Calbayog. Catbalogan City is its capital and is the seat of the
Provincial Government of Samar.
The Province, with its approved annual budget, expects to attain the following
objectives:
• Provide accessibility to all basic needs and services requirements of the

constituents of the province;
• Intensify and strengthen economic sustainability through tourism development
and agricultural development;
• Enhance delivery of health care services;
• Provide Stimulus Fund for the immediate social recovery affected by the
COVID-19 pandemic;
• Provide livelihood opportunities; and
• Provide scholarship fund for deserving students.
Under the administration of Hon. Reynolds Michael T. Tan, with the legislative body
composed of 12 members of the Sangguniang Panlalawigan, headed by Hon. Angelica G.
Teodoro, and with 960 permanent and 6,245 job order/contractual employees, the Province
continued to implement programs consistent with its vision of providing a vertical linkage
to national government agencies in addressing the Sustainable Development Goals (SDGs)
such as poverty alleviation and to concretize priority development thrust and strategies in
promoting tourism, health and agri-fishery.
An audit was conducted on the accounts and operations of the Province for CY 2021
in accordance with International Public Sector Standards on Auditing with emphasis on the
audit thrusts for the Local Government Sector on the audit of Financial Statements of the
following accounts - Cash & Cash Equivalents, Property, Plant and Equipment, Loans
Payable, Due to NGAs/LGUs/GOCCs, Due from NGOs/POs and other LGUs, and Other
Significant and Material accounts identified in the Materiality Thresholds.
To determine the extent of implementation of the programs and projects, compliance

with the budget/allocation, procurement regulations, terms and conditions, we likewise
conducted a performance and compliance audit on the following:
1. Fund Transfers from NGAs to LGU
1.1. COVID-19 fund receipt, allocation and utilization
1.2. Fund Transfers from National Government Agencies
1.3. Fund Transfer to Non-Government Organizations/People’s Organization
(NGOs/POs and/ or Other LGUs
1.4. Local Government Support Fund (LGSF)
2. Utilization of 20% Development Fund
3. Utilization of LDRRMF
4. Enforcement of COA Disallowances and Charges
5. Compliance with tax laws
The audit included examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements; assessing the appropriateness of accounting
principles used and the reasonableness of accounting estimates made by management;
verification, reconciliation and analysis of financial accounts; as well as evaluating the
overall presentation of the financial statements. It also involved ocular inspection of
infrastructure projects undertaken; interview with officials/employees concerned; and
other audit procedures and techniques considered necessary under the circumstances.
Financial Highlights
Comparative analysis of the Province’s total assets, liabilities, equity, income and
expenses for CY 2021 and the immediately preceding year showed an increase of the
Assets, Liabilities, Equity, Income, and Expenses as seen in the graphical presentation.
The material increase in assets and liabilities account are attributed to the substantial
increase of the Cash in Local Treasury, Advances for Payroll, Food Supplies for
Distribution, Other Supplies and Materials for Distribution, and Food Supplies Inventory;
and Guaranty/Security Deposits Payable.
Financial Position and Performance

₱10,000,000,000.00
₱9,000,000,000.00
₱8,000,000,000.00
₱7,000,000,000.00
₱6,000,000,000.00
₱5,000,000,000.00
₱4,000,000,000.00
₱3,000,000,000.00
₱2,000,000,000.00
₱1,000,000,000.00
₱0.00
Assets Liabilities Equity Income Expenses
CY 2021 ₱9,249,651, 3,158,147,4 6,091,503,5 2,388,920,1 1,571,694,5
CY 2020 ₱7,841,128, 2,491,947,4 5,349,181,0 2,241,596,7 1,398,441,9
CY 2021 CY 2020
The following graph also illustrates the changes in appropriation, allotments and
obligations during the year which shows an increase in CY 2021 appropriations and
allotments in comparison to CY 2020 data.
Appropriations, Allotments, and Obligations

₱2,500,000,000.00
₱2,000,000,000.00
₱1,500,000,000.00
₱1,000,000,000.00
₱500,000,000.00
₱0.00
Appropriations Allotments Obligations
CY 2021 ₱2,177,707,386.63 2,177,707,386.63 1,810,097,562.77
CY 2020 ₱2,029,795,886.82 2,029,795,886.82 1,740,700,121.98
CY 2021 CY 2020
While the succeeding graphical presentations details the changes in the

appropriations, allotments and obligations according to the classes of expenditures for CY
2020 and 2021.
Appropriations
₱1,200,000,000.00
₱1,000,000,000.00
₱800,000,000.00
₱600,000,000.00
₱400,000,000.00
₱200,000,000.00
₱0.00
PS MOOE CO FE
CY 2021 ₱558,018,506.3 1,036,520,734. 579,598,766.71 3,569,379.00
CY 2020 ₱511,605,160.1 1,016,671,354. 501,519,372.09 0.00
CY 2021 CY 2020
The increase in appropriations and allotment in CY 2021 is due to the increase in

Internal Revenue Allotment (IRA) and consequently, its programs, projects and activities
(PPAs).
Allotments
₱1,200,000,000.00
₱1,000,000,000.00
₱800,000,000.00
₱600,000,000.00
₱400,000,000.00
₱200,000,000.00
₱0.00
PS MOOE CO FE
CY 2021 ₱558,018,506.3 1,036,520,734. 579,598,766.71 3,569,379.00
CY 2020 ₱511,605,160.1 1,016,671,354. 501,519,372.09 0.00
CY 2021 CY 2020
The decrease in Capital Outlay under the obligations is due to unexpended capital
outlay of PPAs for CY 2020 which will form part of the continuing appropriations in CY
2021.
Obligations
₱1,200,000,000.00
₱1,000,000,000.00
₱800,000,000.00
₱600,000,000.00
₱400,000,000.00
₱200,000,000.00
₱0.00
PS MOOE CO FE
CY 2021 ₱557,761,820.0 1,018,663,998 232,396,345.6 1,275,398.26
CY 2020 ₱504,708,843.4 992,261,876.36 243,729,402.17 0.00
CY 2021 CY 2020
Significant Accomplishments of the Provincial Government
The significant PPAs accomplished by the Province in CY 2021 were reported and
certified complete by the Management, as follows:
No. Project Amount

1 Upgrading of Calbiga - Pasigay Road, Calbiga, Samar ₱62,521,235.09
2 Rehab/Improvement of Dolores - Villareal Road, 36,781,074.41
Villareal, Samar
3 Rehab/Improvement of Tulay - Sta. Rita Road, Sta. Rita, 34,260,738.37
Samar
4 Rehabilitation/Improvement of Tulay - Sta. Rita Road 32,283,812.54
(Phase II), Sta. Rita, Samar
5 Repair/Rehab/Improvement of Port/Wharf, Brgy. 28,780,537.21
Botaera, Zumarraga, Samar
6 Repair/Rehabilitation of Provincial Capitol Compound, 24,835,993.60
7 Repair/Rehab/Improvement of Port/Wharf, Poblacion 23,786,584.59
Port, Sta. Rita, Samar
8 Installation of Water Tank, Capitol Compound, 19,535,432.11
9 Repair/Rehabilitation of Provincial Capitol Ground 17,928,000.00
(Phase II), Catbalogan City, Samar
10 Updgrading of Highway - Pinabacdao Road, 17,858,558.58
Pinabacdao, Samar
11 Construction of Shaded Food Park, Capitol Ground, 15,484,982.88
12 Construction of Barangay Poblacion - Baquiw Road, 15,108,996.83
Tagapul-an, Samar
In addition, the following significant accomplishments of the Province for CY 2021

as incorporated in their “Provincial Government of Samar HIGHLIGHTERS 2021” report,
are as follows:
• Vaccination of a total of 317,747 individuals as of December 31, 2021;

• Release of ₱113,711,000.00 to 34,988 informal sector workers in the entire
Province of Samar;
• Opening of the New Imelda Park;
• Launching and conduct of the inaugural YES Awards;
• Launching of the “Sama-samang Itaguyod ang Responsableng Aksyon ng
Kabataan” or SIRAK Kabataan, an organization of a total of 26,000 members
ranging from the age of 15 to 35 years old;
• Provision of Transition/Immediate Assistance, Livelihood Assistance, and
Firearm Renumeration amounting to ₱2,027,000.00 to 191 former rebels (FRs)
under the Localized Social Integration Program of Samar; and
The Provincial Government is also a recipient of various awards, citations and

recognitions for Calendar Year 2021, to wit:
• Certificate of Appreciation presented to Samar Provincial Hospital (SPH) by

the Civil Service Commission for the unrelenting effort and extraordinary
services rendered by their frontliners who are filled with admirable courage and
dedication in performing their sworn duties in the midst of the COVID-19
pandemic.
• 2021 Outstanding Social Worker of the Philippines in the field of Social

Welfare and Development Services to Families and Communities awarded to
Ms. Alma A. Austero, Provincial Social Worker, presented by the Philippine
Association of Social Workers, Inc.
Independent Auditor’s Report on the Financial Statements
The Auditor rendered a qualified opinion on the combined financial statements of

the Province of Samar for the year ended December 31, 2021 due to the exceptions as
stated in the Independent Auditor’s Report and as discussed in Part II of the report.
Summary of Significant Observations and Recommendations
In addition to the exceptions cited, the significant observations and the

corresponding recommendations were as follows:
1. Cash advances totaling ₱66,607,643.97 were reported as liquidated despite the non-
submission of the Report of Disbursements or Liquidation Reports and their
supporting documents, not adherent to Presidential Decree (PD) No. 1445 and
Commission on Audit (COA) Circular No. 97-002 dated February 10, 1997, thus
casting doubt on the existence and propriety of the liquidation and the reliability of
the Advances for Payroll and Advances to Special Disbursing Officer accounts in
the financial statements.
We recommended and Management agreed to simultaneously submit to COA

the related accounts of reported liquidations of cash advances as well as the
Cash Disbursement Journal and General Journal.
2. The year-end balance of Accounts Payable account in the General Fund includes
balances in an aggregate amount of ₱83,769,358.68 despite failure to prove that
these are valid liabilities for the year; various erroneous entries of ₱157,000.00; and
inclusion of a non-bona fide liability of ₱5,000.00, not in adherence to the
International Public Sector Accounting Standards (IPSAS) and COA Circular No.
2015-009 dated December 1, 2015, thus undermining management assertions of
validity and accuracy, and affecting the fair presentation of the balances in the
financial statements.
We recommended and Management agreed to make the necessary

adjustments so as to arrive at the correct balances of the affected accounts in
3. The year-end balance of Due to Officers and Employees account in the Trust Fund
amounting to ₱169,131,861.64 is misstated due to the erroneous recording of
receipt of PhilHealth Fund and the subsequent recording of the related transactions;
and several other erroneous entries, contrary to IPSAS and COA Circular No. 2015-
009 dated December 1, 2015, thus affecting the fair presentation of the balances in
We recommended and Management agreed to make the necessary

adjustments so as to arrive at the correct balances of the affected accounts.
4. Hospital workers were granted Active Hazard Duty Pay (AHDP) and Special Risk
Allowance (SRA) in the total amount of ₱31,226,481.40 without documents
supporting their eligibility and accuracy of the amounts claimed, contrary to
Section 4 of PD No. 1445 and other relevant rules and regulations, thus casting
doubt on the validity and propriety of the payments.
We recommended and Management agreed to submit the complete supporting

documents for the grant of AHDP and SRA.
5. Deficiencies were noted in the implementation of Tulong Panghanapbuhay Para Sa

Ating Disadvantaged/Displaced Workers (TUPAD) programs in the total amount
of ₱48,663,875.00, not in adherence to PD No. 1445 and Department of Labor and
Employment Department Order (DO) No. 210 dated March 18, 2020; DO No. 173
dated February 13, 2017; and DO No. 219 dated October 28, 2020, thus creating
doubt on the efficiency and effectivity of the program implementation.
We recommended that Management:
a) Submit an explanation on the non-inclusion of other city and municipalities

in the availment of TUPAD programs;
b) Require the submission of complete supporting documents on the payment

of the benefits; and
c) Direct the Special Disbursing Officers concerned to immediately liquidate
the outstanding related cash advances and to submit the reports to COA
for audit.
6. The current appropriations of ₱449,890,459.76 and continuing appropriations of

₱286,478,354.77 of the 20% Development Fund (DF) were not optimally utilized
and implemented, and included development projects that were not well-planned
and procurement-and-implementation-ready, not adherent to Joint Memorandum
Circular No. 1 dated November 4, 2020, thus depriving constituents of the benefits
that could be derived therefrom.
We recommended and Management agreed to:
a) Optimally utilize the 20% DF;
b) Expedite the procurement and implementation process to realize the

programmed projects as planned; and
c) Ensure that development projects are well-planned and are procurement-

and-implementation-ready.
7. Thirty-nine (39) out of fifty-nine (59) projects, programs and activities (PPAs)
under the Provincial Disaster Risk Reduction and Management (DRRM) Fund Plan
and Budget totaling ₱23,553,251.28 remained unimplemented, not in adherence to
Section 2 of PD No. 1445 and Section 12 of Republic Act No. 10121, thus may
result in the delay in strengthening the capacity of the province to build the disaster
resilience of communities; to institutionalize arrangements and measures for
reducing disaster risk; and to enhance preparedness and response capabilities at all
levels.
We recommended and Management agreed to direct the Provincial DRRM

Office to:
a) Expedite the implementation of PPAs under the yearly plan to optimize the
available disaster risk reduction fund intended for disaster risk mitigation;
b) Provide justification for the non-implementation of these PPAs; and
c) Provide specific timelines on the PPAs in the Provincial DRRM Fund Plan
and Budget.
Summary of Audit Suspensions, Disallowances and Charges
The total audit suspensions, disallowances and charges found in the audit of the
various transactions of the Province of Samar as of December 31, 2021 were
₱30,442,224.28, ₱116,591,285.74, and ₱0.00, respectively, based on the Notices of
Suspensions, Disallowances, and Charges issued by this Commission.
Status of Implementation of Prior Years’ Unimplemented Audit Recommendations
Of the 42 audit recommendations contained in the CY 2020 and prior years’ Annual
Audit Reports, 16 were fully implemented, while 26 were not acted upon by management.
TABLE OF CONTENTS
Part I – Audited Financial Statements Page No.
Independent Auditor’s Report 1
Statement of Management’s Responsibility for Financial 4

Statements
• Combined Statement of Financial Position 5
• Combined Statement of Changes in Net Assets/ Equity 6
• Combined Statement of Financial Performance 7
• Combined Statement of Cash Flows 8
• Statement of Comparison of Budget and Actual Amounts 9
• Notes to Combined Financial Statements 11
Part II – Detailed Audit Observations and Recommendations 45
Part III – Status of Implementation of Prior Years’ Unimplemented 104

Audit Recommendations
Part IV – Appendices 117

PART I
AUDITED FINANCIAL STATEMENTS

INDEPENDENT AUDITOR’S REPORT
Hon. REYNOLDS MICHAEL T. TAN

Governor
Province of Samar
Qualified Opinion
We have audited the accompanying financial statements of the Province of Samar, which
comprise the Statement of Financial Position as of December 31, 2021 and the Statement
of Financial Performance, Statement of Changes in Net Assets/Equity, Statement of Cash
Flows, and Statement of Comparison of Budget and Actual Amounts for the year then
ended, and Notes to the Financial Statements including a summary of significant
accounting policies and other explanatory information.
In our opinion, except for the effects of the matters described in the Bases for Qualified
Opinion paragraph, the accompanying financial statements present fairly, in all material
respects, the financial position of the Province of Samar as at December 31, 2021, and its
financial performance, its cash flows and its comparison of budget and actual amounts for
the year then ended in accordance with International Public Sector Accounting Standards
(IPSASs).
Bases for Qualified Opinion
As discussed in Part II of this Report, the balances of the accounts affected were unreliable
because:
1. Advances for Payroll and Advances to Special Disbursing Officer accounts is

doubtful due to unsubstantiated recorded liquidations of ₱66,607,643.97;
2. Overstatement of Accounts Payable account by ₱83,769,358.68 due to the

inclusion of various expenditures despite the failure to prove that these are valid
liabilities for the year; various erroneous entries of ₱157,000.00; and inclusion
of a non-bona fide liability of ₱5,000.00; and
1
3. Misstatement of Due to Officers and Employees account in the Trust Fund
amounting to ₱169,131,861.64 due to erroneous recording of receipt of
PhilHealth Fund; the subsequent recording of the related transactions; and
several other erroneous entries.
We conducted our audit in accordance with International Standards of Supreme Audit

Institutions (ISSAIs). Our responsibility under those standards is further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the agency in accordance with the ethical requirements that are
relevant to our audit of the financial statements, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. We believe that the audit evidence
we have obtained is sufficient and appropriate to provide a basis for our qualified opinion.
Key Audit Matters
Except for the matters described in the Bases for Qualified Opinion section, we have
determined that there are no other key audit matters to communicate in our report.
Responsibilities of Management and those Charged with Governance for the Financial
Statements
Management is responsible for the preparation and fair presentation of these financial
statements in accordance with IPSASs, and for such internal control as management
determines is necessary to enable the preparation of the financial statements that are free
from material misstatement, whether due to fraud or error.
Those Charged with governance are responsible for overseeing the LGU’s financial
reporting process
Auditor’s Responsibilities for the Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements
as a whole are free of material misstatements, whether due to fraud or error, and to issue
an auditor’s report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with ISSAIs will
always detect a material misstatement when it exists. Misstatements can arise from fraud
2
or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
COMMISSION ON AUDIT
By:
GRACE G. DIOCAMPO
State Auditor IV
OIC-Supervising Auditor
March 28, 2022
LGS E – Samar Province

Provincial Satellite Auditing Office
3
4
Provincial Government of Samar
Combined Statement of Financial Position
As at December 31, 2021
(With Comparative Figures for CY 2020)
Notes 2021 2020

ASSETS
Current Assets
Cash and Cash Equivalents 4 P 1,613,103,597.22 P 1,707,169,383.05
Investments 5 105,000.00 105,000.00
Receivables 6 267,972,119.84 237,571,427.83
Inventories 7 1,247,975,304.37 1,019,880,376.77
Prepayments and Deferred Charges 8 63,372,960.84 119,245,400.45
Total Current Assets P 3,192,528,982.27 P 3,083,971,588.10
Non-Current Assets
Investments P 0.00 P 0.00
Receivables 0.00 0.00
Investment Property 0.00 0.00
Property, Plant and Equipment 9 6,057,122,035.30 4,757,156,846.78
Total Non-Current Assets P 6,057,122,035.30 P 4,757,156,846.78
TOTAL ASSETS P 9,249,651,017.57 P 7,841,128,434.88
LIABILITIES 10
Current Liabilities
Financial Liabilities P 312,120,347.76 P 342,368,484.86
Inter-Agency Payables 2,122,653,913.01 1,760,699,511.05
Intra-Agency Payables 47,318,261.36 46,379,038.32
Trust Liabilities 314,933,681.71 270,796,777.71
Deferred Credits/Unearned Income 18,199,395.34 24,608,491.78
Other Payables 34,845,080.22 47,095,107.77
Total Current Liabilities P 2,850,070,679.40 P 2,491,947,411.49
Non-Current Liabilities
Financial Liabilities P 308,076,807.71 P 0.00
Trust Liabilities 0.00 0.00
Deferred Credits/Unearned Income 0.00 0.00
Other Payables 0.00 0.00
Total Non-Current Liabilities P 308,076,807.71 P 0.00
TOTAL LIABILITIES P 3,158,147,487.11 P 2,491,947,411.49
NET ASSETS/EQUITY
Government Equity P 6,091,503,530.46 P 5,349,181,023.39
TOTAL LIABILITIES AND NET P 9,249,651,017.57 7,841,128,434.88
ASSETS/EQUITY (See Accompanying Notes to Combined Financial Statements)P
5
Combined Statement of Changes in Net Assets/Equity
2021 2020
Balance at January 1, 2021 P 5,349,181,023.39 P 4,368,996,003.22
Add (Deduct)
Changes in accounting policy 0.00 00.0
Prior Period Errors (201,086,455.16) (206,093,579.49)
Restated Balance P 5,148,094,568.23 P 4,162,902,423.73
Add (Deduct) Changes in net
assets/equity during the year
Adjustment of net revenue recognized P P
0.00 0.00
directly in net assets/equity
Surplus (Deficit) for the period 817,225,632.27 843,154,787.68
Transfer of Property, Plant and
126,183,329.96 298,960,812.07
Equipment
Turn-over of Assets to recipient LGU
under the DILG SALINTUBIG
PROGRAM 0.00 (34,208,920.09)
National Subsidy under Bayanihan
Grants to Provinces 0.00 78,371,920.00
Total recognized revenue and
expenses for the period P 943,408,962.23 P 1,186,278,599.66
Balance at December 31, 2021 P 6,091,503,530.46 P 5,349,181,023.39
6
Combined Statement of Financial Performance
Notes 2021 2020

Revenue
Tax Revenue 11 P 17,553,501.17 P 11,853,530.84
National Tax Allocation (NTA) 2,026,787,512.00 1,891,070,007.00
Other Share from National Taxes 374,520.00 0.00
Service and Business Income 12 7,500,917.07 5,277,368.68
Shares, Grants and Donations 13 500,292.18 0.00
Gains 36,000.00 4,000.00
Other Income 593,610.66 349,021.68
Total Revenue P 2,053,346,353.08 P 1,908,553,928.20
Less: Current Operating Expenses

Personnel Services 14 P 617,652,434.80 P 592,943,423.85
Maintenance and Other Operating
15 791,053,371.11 715,565,220.93
Expenses
Non-cash Expenses 16 123,987,429.38 51,484,085.33
Financial Expenses 17 1,488,656.17 2,345,972.12
Current Operating Expenses P 1,534,181,891.46 P 1,362,338,702.23
Surplus (Deficit) from Current Operation P 519,164,461.62 P 546,215,225.97

Add (Deduct):
Transfers, Assistance and
18 335,573,842.50 333,042,855.60
Subsidy From
Transfers, Assistance and
19 (37,512,671.85) (36,103,293.89)
Subsidy To
Surplus (Deficit) for the period P 817,225,632.27 P 843,154,787.68
(See Accompanying Notes to Combined Financial Statement)
7
Combined Statement of Cash Flows
Cash Flows from Operating Activities 2021 2020

Cash Inflows
Collection from taxpayers P 18,103,501.17 P 12,109,000.47
Share from Internal Revenue
2,026,787,512.00 1,891,251,917.30
Allotment
Receipts from business/service
6,449,627.52 4,197,623.53
income
Interest Income 1,301,190.52 1,204,149.35
Dividend Income 0.00 0.00
Other Receipts 982,037,707.41 1,334,583,358.75
Total Cash Inflows P 3,034,679,538.62 P 3,243,346,049.40
Cash Outflows
Payment of Expense 415,984,817.01 43,852,501.50
Payment to suppliers and
786,374,648.43 956,623,833.45
creditors
Payment to employees 877,350,042.35 586,945,647.46
Interest Expense 1,325,378.46 51,801.04
Other expenses 267,506,442.67 650,087,296.29
Total Cash Outflow P 2,348,541,328.92 P 2,237,561,079.74
Net Cash Flows from Operating
P 686,138,209.70 P 1,005,784,969.66
Activities
Cash Flows from Investing Activities
Cash Outflows
Purchase/Construction of
1,088,280,803.24 580,307,000.89
Property, Plant and Equipment
Total Cash Outflow P 1,088,280,803.24 P 580,307,000.89
Net Cash Flows from Investing
P (1,088,280,803.24) P (580,307,000.89)
Activities
Cash Flows from Financing Activities
Proceeds from Domestic and
308,076,807.71 0.00
Foreign Loans
Net Cash Flows from Financing
P 308,076,807.71 P 0.00
Activities
Total Cash Provided by Operating,
P (94,065,785.83) P 425,477,968.77
Investing and Financing Activities
Add: Cash at the Beginning of the year 1,707,169,383.05 1,281,691,414.28
Cash Balance at the End of the Year P 1,613,103,597.22 P 1,707,169,383.05
8
PROVINCE OF SAMAR
Combined Statement of Comparison of Budget and Actual Amounts
(In Thousands of Pesos)
Particulars Note Budgeted Amount Difference Actual Amount Difference Final

Original and on Comparable Budget and
Original Final Final Budget Basis Actual
Revenue
A. Local Sources
1. Tax Revenue
a. Tax Revenue- Individual and Corporation 41,745.00 41,745.00 - 16,500.00 25,245.00
b. Tax Revenue- Property 8,995,335.46 8,995,335.46 3,896,552.88 5,098,782.58
c.Tax Revenue-Goods and Services 910,116.68 910,116.68 - 877,645.34 (1,635,638.17)
d. Tax Revenue - Fines and Penalties - - - 1,155.00 (1,155.00)
Total Tax Revenue 9,947,197.14 9,947,197.14 - 6,459,962.73 3,487,234.41
2. Non-Tax Revenue
a. Service Income 2,444,678.04 2,444,678.04 - 525,027.50 1,919,650.54
b. Business Income 10,613,937.82 10,613,937.82 - 4,752,341.18 5,861,596.64
c. Other Income and Receipts - 349,021.68 (349,021.68)
Total Non-Tax Revenue 13,058,615.86 13,058,615.86 - 5,626,390.36 7,432,225.50
B. External Sources
1. Share from the National Internal Revenue
1,891,070,007.00 1,891,070,007.00 - 1,891,070,007.00 -
Taxes (IRA)
2. Share from GOCCs/PCSO - - - - -
3. Other Shares from National Tax Collections - -
3. Other Shares from National Tax Collections
a. Share from Ecozone
- - - - -
b. Share from EVAT - - - - -

c. Share from National Wealth - - - - -
d.Share from Tobacco Excise Tax - - - - -

4. Other Receipts
a. Grants and Donations - - - - -
b. Other Subsidy Income - - - - -
5. Inter-Local Transfer - - - - -
6. Capital/Investment Receipts
a. Sale of Capital Assets - - - - -
b. Sale of Investments - - - - -
c. Proceeds from Collections of Loans
Receivable - - - - -
c. Proceeds from Collections of Loans

Receivable
C. Receipts from Borrowings -
- - - -
Total Revenues and Receipts 1,914,075,820.00 1,914,075,820.00 - 1,903,156,360.09 10,919,459.91
Expenditures
General Public Services
Personal Services 185,079,366.00 160,064,437.05 25,014,928.95 155,401,423.95 4,663,013.10
MOOE 102,584,376.60 98,485,186.95 4,099,189.65 48,396,310.18 50,088,876.77
Capital Outlay 4,829,204.00 13,668,874.65 (8,839,670.65) 5,859,460.40 7,809,414.25
Health, Nutrition and Population Control
Personal Services
MOOE
Capital Outlay
Social Services and Social Welfare
Personal Services 265,237,097.00 231,173,425.40 34,063,671.60 227,951,050.86 3,222,374.54
MOOE 688,146,052.00 794,768,466.16 (106,622,414.16) 748,483,407.55 46,285,058.61
Capital Outlay 73,920,000.00 24,346,219.00 0.00 1,221,913.97 23,124,305.03
Economic Services
Personal Services 128,747,816.00 120,367,297.74 8,380,518.26 119,424,991.70 942,306.04
MOOE 95,567,907.00 123,417,701.43 (27,849,794.43) 111,996,344.22 11,421,357.21
Capital Outlay 369,964,001.40 463,504,278.44 (93,540,277.04) 209,355,791.93 254,148,486.51
Other Purposes:
Debt Services - - - - -
Financial Expenses - - -
Amortization - - - - -
General Services (Continuing)

MOOE
Capital Outlay 3,967,342.25 3,967,342.25 0.00 0.00 3,967,342.25
Social Services (Continuing)
MOOE
Capital Outlay 17,509,259.34 17,509,259.34 0.00 0.00 17,509,259.34
Economic Services (Continuing)
MOOE
Capital Outlay 48,844,395.71 48,844,395.71 0.00 0.00 48,844,395.71
Total 1,984,396,817.30 2,100,116,884.12 (165,293,847.82)) 1,628,090,694.76 472,026,189.36 8
Surplus(deficit) for the period 275,065,665.33
Notes to Combined Financial Statements
(All amounts in Philippine Peso unless otherwise stated)
Note 1 - Profile
The Province of Samar, herein referred to as the “LGU” is what remains of the
original province founded by the Spanish authorities in 1768 when on June 19,
1965, Republic Act No. 4221 carved out from it what are now the province of
Northern and Eastern Samar. Located at the western side of Samar Island, it is
composed of twenty-four (24) municipalities and two (2) cities, Catbalogan
and Calbayog, with Catbalogan as its capital, where the Provincial Government
is based.
Presently classified as a first-class province, it serves primarily as a general-

purpose government for the delivery of basic regular and direct services and
effective governance of the constituents within its territorial jurisdiction.
Moreover, this province passed an ordinance to avail the benefits of the

program under Philippine Rural Development Program (PRDP) with the
primary purpose to widen and augment its primary service to constituents
which this note forms an integral part to exemplify the aforesaid program. (See
Note 22)
Note 2 - The combined financial statements of the LGU have been prepared in
accordance with and comply with the Philippine Public Sector Accounting
Standards (PPSAS). The consolidated financial statements are presented in
Philippine pesos, which is the functional and reporting currency of the LGU.
Note 3 - Summary of Significant Accounting Policies
3.1 Basis of accounting
The combined financial statements are prepared on an accrual basis in

accordance with the Philippine Public Sector Accounting Standards (PPSAS).
3.2 Consolidation
The controlled entities (funds) are all those over which the controlling entity
has the power to govern the financial and operating policies. Inter-group
transaction, balances and unrealized gains and losses on transactions between
entities and funds are eliminated in full. The LGU maintains special accounts
under the Trust Fund for the following:
• Samar Provincial Hospital
11
• Calbayog District Hospital
• Gandara District Hospital
• Basey District Hospital
• Tarangnan Municipal Hospital
3.3 Revenue recognition
Revenue from non-exchange transactions
Taxes, fees and fines
The LGU recognizes revenues from taxes and fines when the event occurs and
the asset recognition criteria are met. To the extent that there is a related
condition attached that would give rise to a liability to repay the amount,
liability is recognized instead of revenue. Other non-exchange revenues are
recognized when it is improbable that the future economic benefit or service
potential associated with the asset will flow to the entity and the fair value of
the asset can be measured reliably.
The LGU availed of the 5 – year transitional provision for the recognition of
Tax Revenue- Real Property and Special Education Tax. For the first year, there
will be no change in policy for the recognition of the aforementioned tax
revenue.
Transfers from other government entities
Revenues from other government entities are measured at fair value and
recognized on obtaining control of the asset (cash, goods, services and property)
if the transfer is free from conditions and it is probable that the economic
benefits or service potential related to the asset will flow to the LGU and can
be measured reliably.
Revenue from exchange transactions
Rendering of services
The LGU recognizes revenue from rendering of services by reference to the

stage of completion when the outcome of the transaction can be estimated
reliably. The stage of completion is measured by reference to labor hours
incurred to date as a percentage of total estimated labor hours.
Where the contract outcome cannot be measured reliably, revenue is recognized

only to the extent that the expenses incurred.
12
Sale of goods
Revenue from the sale of goods is recognized when the significant risks and
rewards of ownership have been transferred to the buyer, usually on delivery of
the goods and when the amount of revenue can be measured reliably and it is
probable that the economic benefits or service potential associated with the
transaction will flow to the LGU.
Interest income
Interest income is accrued using the effective yield method. The effective yield
discounts estimated future cash receipts through the expected life of the
financial asset to that asset’s net carrying amount. The method applies this yield
to the principal outstanding to determine interest income each period.
3.4 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and cash at bank which are
readily convertible to known amounts of cash and are subject to insignificant
risk of changes in value. For the purpose of the consolidated statement of cash
flows, cash and cash equivalents consist of cash and short-term deposits as
defined above, net of outstanding bank overdrafts.
3.5 Inventories
Inventory is measured at cost upon initial recognition. To the extent that

inventory was received through non-exchange transactions (for no cost or for a
nominal cost), the cost of the inventory is its fair value at the date of acquisition.
After initial recognition, inventory is measured at the lower of cost and net
realizable value. However, to the extent that a class of inventory is distributed
or deployed at no charge or for a nominal charge, that class of inventory is
measured at the lower of cost and current replacement cost.
Net realizable value is the estimated selling price in the ordinary course of
operations, less the estimated costs necessary to make the sale, exchange, or
distribution. Inventories are recognized as an expense when deployed for
utilization or consumption in the ordinary course of operations of the LGU.
3.6 Property, plant and equipment
All property, plant and equipment are stated at cost less accumulated
depreciation. Cost includes expenditure that is directly attributable to the
acquisition of the items. When significant parts of property, plant and
13
equipment are required to be replaced at intervals, the LGU recognizes such
parts as individual assets with specific useful lives and depreciates them
accordingly. Likewise, when a major inspection is performed, its cost is
recognized in the carrying amount of the plant and equipment as a replacement
if the recognition criteria are satisfied. All other repair and maintenance costs
are recognized in surplus or deficit as incurred. Where an asset is acquired in a
non-exchange transaction for nil or nominal consideration the asset is initially
measured at its fair value.
Depreciation on assets is charged on a straight-line basis over the useful life of

the asset. Residual value amounting to 5% of the cost of the asset is considered.
It is computed starting on the month following the purchase date.
Depreciation is computed on a straight-line basis over the following estimated

useful lives of the assets:
Assets Useful life in years

Books 5
Buildings 30
Flood Control System 20
Hospital and Health Centers 30
Other Structures 30
Power Supply Systems 5
Road Networks 20
School Buildings 30
Seaport Systems 20
Water Supply Systems 20
Office Equipment 5
Information and Communication Technology
5
Equipment
Agricultural and Forestry Equipment 5
Communication Equipment 5
Disaster Response and Rescue Equipment 5
Medical Equipment 10
Other Machinery and Equipment 5
Motor Vehicles 5
20 years or over the
useful life of the
asset to which the
Other Land Improvements improvement was
made, whichever is
shorter
14
Public Infrastructures were not previously recognized in the books. The LGU
availed of the 5-year transitional provision for the recognition of the Public
Infrastructure. For the first year of implementation of the PPSAS, the LGU will
not recognize the public Infrastructure in the books of accounts.
3.7 Changes in accounting policies and estimates
The LGU recognizes the effects of changes in accounting policy

retrospectively. The effects of changes in accounting policy are applied
prospectively if retrospective application is impractical.
The LGU recognizes the effects of changes in accounting estimates

prospectively by including in surplus or deficit.
3.8 Related parties
The LGU regards a related party as a person or an entity with the ability to exert
control individually or jointly, or to exercise significant influence over the
LGU, or vice versa. Members of key management are regarded as related
parties and comprise the Governor, Mayors, Vice-Governors and Vice-Mayors,
Sanggunian Members, Committee Officials and Members, Accountants,
Treasurers, Budget Officers, General Services and all Chiefs of
Departments/Divisions.
3.9 Budget information
The annual budget is prepared on the modified cash basis, that is, all planned
costs and income are presented in a single statement to determine the needs of
the LGU. As a result of the adoption of the Modified cash basis for budgeting
purposes, there are basis, timing or entity differences that would require
reconciliation between the actual comparable amounts and the amounts
presented as a separate additional financial statement in the Statement of
Comparison of Budget and Actual Amounts. Explanatory comments are
provided in the notes to the annual financial statements; first, the reasons for
overall growth or decline in the budget are stated, followed by details of
overspending or under spending on line items.
3.10 Significant judgments and sources of estimation uncertainty
Judgments
In the process of applying the LGU’s accounting policies, management has

made judgments, which have the most significant effect on the amounts
recognized in the consolidated financial statements.
15
Estimates and assumptions
The key assumptions concerning the future and other key sources of estimation
uncertainty at the reporting date, that have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the
next financial year, are described below. The LGU based its assumptions and
estimates on parameters available when the consolidated financial statements
were prepared. However, existing circumstances and assumptions about future
developments may change due to market changes or circumstances arising
beyond the control of the LGU. Such changes are reflected in the assumptions
when they occur.
Useful lives and residual values
The useful lives and residual values of assets are assessed using the following
indicators to inform potential future use and value from disposal:
a) The condition of the asset based on the assessment of experts

employed by the LGU;
b) The nature of the asset, its susceptibility and adaptability to changes

in technology and processes;
c) The nature of the processes in which the asset is deployed; and
d) Changes in the market in relation to the asset
Receivables
Receivables are amounts owed by consumers. The LGU is compelled, by its

constitutional mandate, to provide all of its residents with basic minimum
services, without recourse to an assessment of creditworthiness. There were no
material changes in the exposure to credit risk and its objectives, policies and
processes for managing and measuring the risk during the year under review.
Liquidity risk
Liquidity risk is the risk of the LGU not being able to meet its obligations as
they fall due. The LGU’s approach to managing liquidity risk is to ensure that
sufficient liquidity is available to meet its liabilities when due, without incurring
unacceptable losses or risking damage to the LGU’s reputation.
16
Capital management
The primary objective of managing the LGU’s capital is to ensure that there is
sufficient cash available to support the LGU’s funding requirements, including
capital expenditure, to ensure that the LGU remains financially sound.
Note 4. Cash and Cash Equivalents
The account is composed of the following:
2021 2020
Cash- Local Treasury ₱ 13,877,864.73 ₱ 1,734,572.20
Petty Cash 2,795,743.94 2,913,919.44
Cash in Bank-Local
₱1,596,429,988.55 ₱1,702,520,891.41
Currency, Current Account
TOTAL ₱1,613,103,597.22 ₱1,707,169,383.05
Cash in banks earns interest at the respective bank deposit rates.
Note 5. Investments
The account is comprised of:
2021 2020
Guaranty Deposits ₱105,000.00 ₱105,000.00
TOTAL ₱105,000.00 ₱105,000.00
Note 6. Receivables
The account is composed of:
2021 2020
Loans and Receivable
Accounts
Accounts Receivable ₱25,028.88 ₱25,595.05
Real Property Tax
4,893,625.15 7,556,768.58
Receivable
Special Education Tax
13,301,400.19 9,181,533.08
Receivable
Sub-total ₱18,220,054.22 ₱16,763,896.71
Inter-Agency Receivables
17
2021 2020
Due from National
12,185,058.31 15,477,570.27
Government Agencies
Due from Government
Owned and Controlled 1,000.00 1,000.00
Corporation
Due from Local
5,791,692.93 4,354,129.12
Government Units
Sub-total 17,977,751.24 19,832,699.39
Intra-Agency Receivables
Due from Other Funds 94,925,995.23 88,232,618.15
Sub-total 94,925,995.23 88,232,618.15
Advances
Advances for Operating
457,074.00 457,074.00
Expenses
Advances for Payroll 68,232,199.35 32,672,317.31
Advances to Special
10,117,591.11 7,483,091.11
Disbursing Officer
Advances for Officers and
13,890,165.08 14,054,665.62
Employees
Sub-total 92,697,029.54 54,667,148.04
Other Receivables
Receivables –
39,339.66 80,923.12
Disallowances and Charges
Due from Officers and
15,040.62 8,871.09
Employees
Due from Non-Government
Organizations/People's 43,275,616.79 55,402,031.79
Organizations
Other Receivables 821,292.54 2,583,239.54
Sub-total 44,151,289.61 58,075,065.54
TOTAL ₱267,972,119.84 ₱237,571,427.83
Due from National Government Agencies pertains to subsidy to various

National Government Agencies (NGAs) that remain unliquidated as of
December 31, 2021 and 2020.
Due from Local Government Units (LGUs) pertains to the financial assistance
extended to different LGUs for various projects that remain unliquidated as of
December 31, 2021 and 2020.
18
Due from Other Funds account includes funds receivable from PRDP Trust
Fund representing the project equity share or LGU counterpart for project cost
and project management cost of programs and projects under PRDP. (See Note
1)
Advances for Payroll account pertains to the amount advanced to regular

disbursing officer for payment of salaries, wages, honoraria, allowances and
other personnel benefits made that remain unliquidated as of December 31,
2021 and 2020.
Due from Non-Government Organizations/People's Organizations pertains to

amounts granted to various non-government organizations or people's
organizations for the implementation of projects that remain unliquidated as of
reporting date.
Note 7. Inventories
The account is composed of:
2021 2020
Inventory Held for
Distribution
Food Supplies for
₱16,061,400.00 ₱1,493,900.00
Distribution
Welfare Goods for
17,782,693.65 52,397,115.60
Distribution
Drugs and Medicines for
115,120,228.67 142,375,226.27
Distribution
Medical, Dental and
Laboratory Supplies for 55,140,131.12 54,996,991.12
Distribution
Agricultural and Marine
16,728,193.00 19,953,278.98
Supplies for Distribution
Textbooks and Instructional
5,008,850.00 5,008,850.00
Materials for Distribution
Construction Materials for
5,726,881.00 5,726,881.00
Distribution
Property and Equipment for
24,529,612.00 0.00
Distribution
Other Supplies and materials
for Distribution 8,880,234.75 3,108,546.50
19
2021 2020
Inventory Held for
Consumption
Office Supplies Inventory 16,135,302.82 9,203,531.31
Accountable Forms, Plates
1,149,820.00 1,111,811.00
and Stickers
Non-Accountable Forms
5,018,094.90 5,018,094.90
Inventory
Animal/Zoological Supplies
3,485,000.00 3,485,000.00
Inventory
Food Supplies Inventory 20,520,438.08 8,240,406.83
Drugs and Medicines
430,368,302.33 323,656,724.73
Inventory
Medical, Dental and
Laboratory Supplies 410,805,709.93 298,399,024.34
Inventory
Fuel, Oil and Lubricants
46,915,944.79 43,663,094.14
Inventory
19,083,878.61 19,665,103.61
Supplies Inventory
196,766.00 196,766.00
Materials Inventory
Chemical and Filtering
1,684,080.00 1,684,080.00
Supplies Inventory
Construction Materials
8,503,740.39 8,503,740.39
Inventory
Other Supplies and
19,130,002.33 11,992,210.05
Materials Inventory
TOTAL ₱1,247,975,304.37 ₱1,019,880,376.77
Inventories are carried at cost as at December 31, 2021 and 2020.
No inventory items were pledge as security during the current or prior financial
years.
Note 8. Prepayments and Deferred Charges
This account consists of:
20
2021 2020
Advances to Contractors ₱ 62,660,563.06 ₱118,533,002.67
Other Prepayments 712,397.78 712,397.78
Total ₱63,372,960.84 ₱119,245,400.45
Advances to Contractors account represents payments of mobilization

equivalent to 15% of the total contract price paid to contractors for on-going
projects that remained unrecouped as of December 31, 2021 and 2020.
Note 9. Property, Plant and Equipment
This account is composed of:
2021 2020
Land ₱319,059,441.29 ₱316,829,870.60
Other Land Improvements 32,226,803.97 32,226,803.97
less: Accumulated
Depreciation 306,758.89 108,858.50
Net Book Value 31,920,045.08 32,117,945.47
Road Network 1,448,566,188.06 1,348,466,544.33
less: Accumulated
Depreciation – Road
Networks 55,038,488.61 26,158,451.45
Net Book Value 1,393,527,699.45 1,322,308,092.88
Flood Control Systems 122,024,245.23 111,661,756.69
less: Accumulated
Depreciation – Flood
Control Systems 2,448,093.43 146,121.18
Net Book Value 119,576,151.80 111,515,635.51
Water Supply System 81,030,850.47 66,180,834.80
Less: Accumulated
Depreciation - Water Supply
Systems 2,310,713.75 686,501.80
Net Book Value 78,720,136.72 65,494,333.00
Power Supply System 8,966,622.67 8,966,622.67
Less: Accumulated
Depreciation - Power Supply
Systems 630,293.93 107,163.04
Net Book Value 8,336,328.74 8,859,459.63
Seaport Systems 41,518,909.84 41,518,909.84
21
2021 2020
Less: Accumulated
Depreciation - Seaport
Systems 1,670,013.63 651,866.87
Net Book Value 39,848,896.21 40,867,042.9
Parks, Plazas and
Monuments 54,247,076.60 0.00
Accumulated Depreciation -
Parks, Plazas and
Monuments 5,392,785.16 0.00
Net Book Value 48,854,291.44 0.00
Other Infrastructure Asset 374,421,237.84 355,986,795.91
Accumulated Depreciation -
Other Infrastructure Assets 4,526,108.08 1,726,201.83
Net Book Value 369,895,129.76 354,260,594.08
Buildings 243,118,670.63 200,937,023.91
less: Accumulated
Depreciation 5,464,316.90 1,054,476.95
Net Book Value 237,654,353.73 199,882,546.96
School Buildings 63,786,511.38 63,786,511.38
less: Accumulated
Depreciation 708,464.20 112,449.86
Net Book Value 63,078,047.18 63,674,061.52
Hospitals and Health Centers 67,445,097.89 65,957,366.09
less: Accumulated
Depreciation 898,390.94 713,626.73
Net Book Value 66,546,706.95 65,243,739.36
Other Structures 523,065,666.79 261,534,883.33
Less: Accumulated
Depreciation 36,703,500.92 3,195,851.55
Net Book Value 486,362,165.87 258,339,031.78
Machinery 4,982,223.67 4,901,078.67
Less: Accumulated
Depreciation 1,781,707.19 1,197,061.03
Net Book Value 3,200,516.48 3,704,017.64
Office Equipment 68,081,398.42 58,299,013.42
less: Accumulated
Depreciation 12,359,538.06 8,063,220.89
22
2021 2020
Net Book Value 55,721,860.36 50,235,792.53
ICT Equipment 35,658,230.70 28,591,333.30
less: Accumulated
Depreciation 8,947,306.41 6,829,320.74
Net Book Value 26,710,924.29 21,762,012.56
Agricultural & Forestry
Equipment 21,487,476.00 29,288,475.44
less: Accumulated
Depreciation 4,770,454.96 2,657,655.07
Net Book Value 16,717,021.04 26,630,820.37
Communication Equipment 4,019,800.30 4,019,800.30
less: Accumulated
Depreciation 1,291,153.64 1,267,327.64
Net Book Value 2,728,646.66 2,752,472.66
Construction and Heavy
Equipment 31,124,605.07 31,124,605.07
less: Accumulated
Depreciation 21,918,619.00 21,424,619.00
Net Book Value 9,205,986.07 9,699,986.07
Disaster Response & Rescue
Equipment 62,386,497.00 53,100,465.00
less: Accumulated
Depreciation 12,665,360.64 11,153,942.81
Net Book Value 49,721,136.36 41,946,522.19
Military, Police and Security
Equipment 945,230.00 891,650.00
less: Accumulated
Depreciation 57,088.35 0.00
Net Book Value 888,141.65 891,650.00
Medical Equipment 425,013,658.31 396,938,958.31
less: Accumulated
Depreciation 82,601,087.58 56,418,390.88
Net Book Value 342,412,570.73 340,520,567.43
Sports Equipment 37,135.50 37,135.50
less: Accumulated
Depreciation 0.00 0.00
Net Book Value 37,135.50 37,135.50
23
2021 2020
Technical and Scientific
Equipment 10,105,201.71 9,817,321.71
less: Accumulated
Depreciation 418,974.04 198,373.40
Net Book Value 9,686,227.67 9,618,948.31
Other Machinery and
Equipment 29,295,515.21 20,683,581.21
less: Accumulated
Depreciation 7,450,873.46 6,741,533.68
Net Book Value 21,844,641.75 13,942,047.53
Motor Vehicles 71,930,940.50 64,146,940.50
less: Accumulated
Depreciation 9,072,362.15 5,647,735.98
Net Book Value 62,858,578.35 58,499,204.52
Watercrafts 2,349,290.00 2,349,290.00
less: Accumulated
Depreciation 1,573,236.04 1,573,236.04
Net Book Value 776,053.96 776,053.96
Furniture and Fixtures 13,184,034.58 10,492,895.87
less: Accumulated
Depreciation 2,929,922.58 2,163,897.95
Net Book Value 10,254,112.00 8,328,997.92
Books 375,611.96 276,571.96
less: Accumulated
Depreciation 41,765.57 16,776.52
Net Book Value 333,846.39 259,795.44
Construction in Progress:
CIP- Land Improvement 62,186,829.50 40,744,448.42
CIP - Infrastructure Assets 1,845,536,312.59 1,043,129,465.68
CIP - Buildings & Other
Structures 263,630,330.83 235,382,472.73
Other Property, Plant and
Equipment:
Work/Zoo Animals 924,000.00 924,000.00
less: Accumulated
Depreciation 0.00 0.00
Net Book Value 924,000.00 924,000.00
24
2021 2020
Other Property Plant and
Equipment 9,271,790.83 8,857,390.83
less: Accumulated
Depreciation 904,021.94 879,309.27
Net Book Value 9,291,768.89 7,978,081.56
TOTAL NET BOOK
VALUE ₱6,008,267,743.86 ₱4,757,156,846.78
The LGU uses straight-line method to depreciate assets classified under

Property, Plant and Equipment account using respective useful life for each class
of asset as determined appropriate. The LGU provides for 5% of the cost of the
asset as residual value.
Fully depreciated assets at an undetermined cost are still in use and which the
LGU plan to dispose in the ensuing years.
Note 10. Liabilities
2021 2020
Financial Liabilities
Accounts Payable ₱136,250,303.68 ₱136,639,457.26
Due to Officers and
175,870,044.08 205,729,027.60
Employees
Notes Payable 0.00 0.00
Sub-total 312,120,347.76 342,368,484.86
Inter-Agency Payables
Due to BIR 14,046,186.77 26,741,752.12
Due to GSIS 517,485.54 1,739,137.54
Due to Pag-IBIG 487,583.42 2,352,026.09
Due to PhilHealth 167,415,147.04 167,733,296.68
Due to NGASs 1,911,890,784.11 1,534,535,529.67
Due to GOCCs 1,784,544.61 2,000,964.60
Due to LGUs 27,030,119.82 25,596,804.35
Sub-total ₱2,123,171,851.31 ₱1,760,699,511.05
Accounts Payable account includes amounts due to various suppliers as of

reporting date and which are non-interest bearing and are currently demandable.
25
Due to Officers and Employees includes accrual of various expenses such as
personnel travel expenses, terminal leave benefits, allowances and
reimbursements as well wages and professional fees payable to disbursing
officers that remain outstanding as of reporting date.
Due to BIR accounts pertains to taxes withheld from salaries of the employees
and withholding taxes from payments of purchases to various suppliers and
contractors as of December 31, 2021 and 2020, which are due for remittance to
the Bureau of Internal Revenue (BIR) until after reporting date.
Due to GSIS, Pag-IBIG and PhilHealth accounts represent amounts deducted

from the salaries of officials and employees and are remitted to the respective
government agencies immediately on the month following the month for which
said amounts were deducted.
While the remaining accounts represents balances of funds received by the LGU
for specific purposes.
2021 2020
Intra-Agency Payables
Due to Other Funds ₱46,800,323.06 ₱46,379,038.32
Sub-total 46,800,323.06 46,379,038.32
Trust Liabilities
Trust Liabilities 74,240,215.89 94,294,802.45
Trust Liabilities – DRRM 77,693,287.16 97,694,903.31
Bail Bonds Payable 2,000.00 2,000.00
Guaranty/Security Deposits
Payable 162,998,178.66 78,805,071.95
Sub-total 314,933,681.71 270,796,777.71
Deferred
Credits/Unearned Income
Deferred Real Property Tax 4,893,625.15 11,061,211.78
Deferred Special Education
Tax 13,301,400.19 9,181,533.08
Other Deferred Credits 4,370.00 4,365,746.92
Sub-total 18,199,395.34 24,608,491.78
Other Payables 34,845,080.22 47,095,107.77
TOTAL ₱3,158,147,487.11 ₱2,491,947,411.49
26
Note 11. Tax Revenue
The breakdown of this account is as follow:
2021 2020
Tax Revenue – Individual
and Corporation
Professional tax ₱22,110.00 ₱16,500.00
Tax Revenue – Property
Real Property Tax – Basic 5,512,072.63 3,762,119.06
Special Education Tax 7,779,908.33 5,393,568.11
Real Property Transfer Tax 357,733.71 134,433.82
Tax – Revenue Goods and
Services
Business Tax 0.00 577,187.5
Tax on Sand, Gravel and
3,024,325.06 1,175,641.12
Other Quarry Products
Tax on Delivery Trucks and
4,000.00 0.00
Vans
Tax Revenue – Others
Franchise Tax 847,718.94 792,926.23
Tax Revenue – Fines and
Penalties
Taxes on Individual and
5,632.50 0.00
Corporation
Tax Revenue – Fines and
Penalties – Taxes on Goods 0.00 1,155.00
and services
TOTAL ₱17,553,501.17 ₱11,853,530.84
Note 12. Service and Business Income
This account is comprised of:
2021 2020
Service Income
Permit Fees ₱25,741.00 ₱3,000.00
Registration Fees 0.00 675.00
Clearance and Certificate
Fees 241,700.00 153,260.00
27
Verification and
Authentication Fees 80,700.00 47,700.00
Occupation Fees 990.00 250,340.00
Processing 59,000.00 56,370.00
Fines and Penalties – S I 78,000.00 82.50
Other Service Income 50.00 13,600.00
Business Income
Rent/Lease Income 222,861.23 38,900.00
Hospital Fees 5,740,585.29 3,681,403.50
Interest Income 1,051,289.55 1,032,037.68
Other Business Income 0.00 0.00
TOTAL ₱7,500,917.07 ₱5,277,368.68
Note 13. Share, Grants and Donation
The breakdown of this account is as follow:
2021 2020
GF – Share from PCSO ₱500,292.18 ₱0.00
Miscellaneous Income 0.00 0.00
Total ₱500,292.18 ₱0.00
Note 14. Employee Costs
2020 2020
Personnel Services
Salaries and Wages –
Regular ₱335,565,892.91 ₱298,365,183.71
Salaries and Wages-
Casual/Contractual 23,035,392.66 71,129,551.20
Other Compensation
Personal Economic Relief
allowance 23,001,674.64 22,818,279.12
Representation Allowance 4,413,980.00 4,538,125.00
Transportation Allowance 4,261,875.00 4,538,125.00
Clothing/Uniform
Allowance 5,664,000.00 5,598,000.00
28
2020 2020
Subsistence Allowance 6,424,048.66 6,387,099.32
Laundry Allowance 642,090.23 644,599.80
Quarters Allowance 30,000.00 48,000.00
Productivity Incentive
Allowance 4,737,666.66 4,719,000.00
Honoraria 3,165,313.49 2,448,200.00
Hazard Pay 35,697,653.43 28,203,486.33
Overtime and Night Pay 3,895,425.91 11,015,706.03
Year-End Bonus 27,978,106.2 24,941,777.65
Cash Gift 4,793,720.96 4,739,750.00
Other Bonuses and
Allowances 50,522,252.47 33,189,669.00
Personnel Benefit
Contribution
Retirement and Life
Insurance Premiums 39,676,000.60 35,277,814.73
Pag-Ibig Contribution 1,151,058.32 1,140,086.87
PhilHealth Contribution 4,413,381.48 3,941,703.54
Employees Compensation
Insurance Premiums 1,150,492.31 1,139,152.19
Other Personnel Benefit
Terminal Leave Benefits 32,711,408.87 28,120,114.36
Other Personnel Benefits 4,721,000.00 0.00
TOTAL ₱617,652,434.80 ₱592,943,423.85
Note 15. Maintenance and Other Operating expenses
The account is comprised of:
2021 2020
Traveling Expenses
Traveling Expenses - Local ₱5,713,645.17 ₱6,023,753.01
Training and Scholarship
Expenses
Training Expenses 13,215,906.35 8,288,193.00
Supplies and Material
Expenses
Office Supplies Expense 4,148,069.76 4,726,088.66
29
2021 2020
Accountable Forms Expense 28,850.00 19,040.00
Food Supplies Expense 38,240,433.78 16,764,807.66
Welfare Goods Expenses 0.00 38,082,716.00
Drugs and Medicines
Expenses 136,395,371.70 122,911,897.36
Medical, dental and
Laboratory Supplies
Expenses 72,074,128.14 74,128,080.03
Fuel, Oil and Lubricant
Expenses 5,166,057.34 3,735,061.99
Supplies Expenses 5,387,380.98 17,294,761.61
Materials expenses 0.00 0.00
Military, Police and Traffic
Supplies Expenses 46,530.00 0.00
Other Supplies and Material
Expenses 3,869,290.42 10,978,005.95
Utility Expenses
Water Expenses 4,523,499.85 3,550,436.46
Electricity Expenses 22,246,616.39 13,788,961.87
Communication Expenses
Postage and Courier
Services 41,407.50 44,522.43
Telephone Expenses 1,692,273.52 1,821,998.26
Internet subscription
Expenses 1,212,288.85 864,704.04
Cable, Satellite, Telegraph
and Radio Expenses 44,568.78 33,680.00
Awards/Rewards and
Prizes
Awards/Rewards Expenses 45,000.00 0.00
Prizes 10,000.00 350,000.00
Survey and Research
Expenses
Research, Exploration and
Development Expenses 0.00 872,742.50
30
2021 2020
Demolition and Dredging
Expenses
Desilting and Dredging
Expenses 0.00 105,143.00
Confidential, Intelligence
and Extraordinary
Expenses
Extraordinary and
Miscellaneous 0.00 0.00
Expenses
Professional Services
Auditing Services 89,907.00 55,158.70
Consultancy Services 20,308,758.59 36,193,002.64
Other Professional Services 157,154,284.97 95,498,834.35
General Services
Environment/Sanitary
Services 20,661,875.00 2,847,000.00
Security Services 9,125,121.61 7,151,055.58
Other General Services 139,865,449.15 104,717,289.59
Repairs and Maintenance
Repairs and Maintenance –
Investment Property 0.00 0.00
Repairs and Maintenance -
Infrastructure Assets 0.00 19,750,730.60
Buildings and Other 1,741,487.15 11,629,580.99
Machinery and Equipment 1,464,313.49 967,195.18
Transportation Equipment 3,875,118.47 2,616,786.91
Furniture and Fixtures 0.00 3,766.00
Other Property, Plant and
Equipment 1,422.00 27,440.00
Financial
Assistance/Subsidy
31
2021 2020
Transfers of Unspent
Current Year DRRM Funds
to the Trust Funds 0.00 0.00
Taxes, Insurance
Premiums and Other Fees
Taxes, Duties and Licenses 1,151,491.71 329,529.48
Fidelity Bond Premium 579,675.03 522,337.50
Insurance Premium 336,323.05 204,475.67
Other Maintenance and
Operating Expenses
Advertising Expenses 676,266.00 2,001,224.00
Printing and Publication
Expenses 68,040.00 388,690.00
Transportation and Delivery
Expenses 110,521.36 133,785.00
Rent Expenses 6,010,131.73 3,676,297.37
Membership Due and
Contributions to
Organizations 60,000.00 580,000.00
Subscription Expenses 57,311.00 56,249.50
Donations 64,673,463.00 72,706,876.00
Other Maintenance and
Operating Expense 48,941,092.27 29,123,322.04
TOTAL ₱791,053,371.11 ₱715,565,220.93
Note 16. Non-Cash Expenses
The composition of the account is as follows:
2021 2020
Depreciation - Infrastructure
₱42,540,190.42 ₱18,468,235.10
Assets
Depreciation - Buildings and
38,698,267.87 3,833,746.96
Other Structures
Depreciation - Machinery
38,310,718.19 27,164,656.55
and Equipment
Depreciation -
3,424,626.17 1,403,812.30
Transportation Equipment
32
Depreciation- Furniture,
791,013.68 531,175.92
Fixtures and Books
Depreciation – Land
197,900.39 82,458.50
Improvements
Depreciation – Other
Property, Plant and 24,712.67 0.00
Equipment
TOTAL ₱123,987,429.39 ₱51,484,085.33
Note 17. Financial Expenses
The breakdown of the account is as follows:
2021 2020
Bank Charges ₱3,000.00 ₱600.00
Interest Expenses 1,275,398.26 0.00
Other Financial Charges 210,257.91 2,345,372.12
TOTAL ₱1,488,656.17 ₱2,345,972.12
Note 18. Transfers, Assistance and Subsidies From
This includes transactions from below accounts:
2021 2020
Subsidy from National
₱271,019,791.37 ₱327,293,214.69
Government
Subsidy From LGU 27,151,765.05 5,749,640.91
Subsidy From Other Funds 37,399,286.08 0.00
Subsidy From LGU 3,000.00 0.00
TOTAL ₱335,573,842.50 ₱333,042,855.60
Transfers from other government agencies represent those funds received for
projects undertaken by the LGU for specific purpose. The LGU is contractually
bound to spend these funds only in connection with the projects. Furthermore,
the contracts stipulate that the funds received for the project may only be
applied to the costs incurred for the project, as and when the phases of the
project are certified as complete. The conditions remaining therefore represent
phases of the projects that are yet to be certified as complete. Return of the
unspent portion of the fund is subject to the conditions stated in the respective
Memorandum of Agreements executed between the LGU and the proponent
government agencies.
33
Note 19. Transfers, Assistance and Subsidy To
This includes transactions from below accounts:
2021 2020
Subsidy to National ₱4,691,930.00 ₱1,236,865.00
Government
Transfer to Local 0.00 2,000,000.00
Government Units
Subsidy Other Funds 0.00 0.00
Subsidies – Others 399,335.00 19,978,727.04
Transfers for Project Equity 3,181,833.97 0.00
Share /LGU Counterpart
Transfers of Unspent 29,239,572.88 12,877,701.85
Current Year DRRM Funds
to the Trust Funds
TOTAL ₱37,512,671.85 ₱36,103,293.89
Note 20. Reconciliation of Net Cash Flows from Operating Activities to

Surplus/(Deficit)
2021 2020
Surplus/(Deficit) ₱817,225,632.27 ₱843,154,787.68
Non-cash transactions:
Depreciation 123,987,429.39 51,484,085.33
Gain on Sale (36,000.00) (4,000.00)
Decrease (Increase) in
(30,400,692.01) (15,512,693.42)
receivable
Increase in Inventories (228,094,927.60) (258,861,520.57)
Increase in Prepayments &
55,872,439.61 (57,986,085.60)
Deferred Charges
(Decrease) Increase in
(358,123,267.91) 7,148,876.42
current liabilities
Net Cash Flows from
₱380,430,613.75 ₱569,423,449.84
Operating Activities
34
Note 21. Allocation and Utilization of the Local Disaster Risk Reduction and
Management Fund (LDRRMF)
Pursuant to Section 21 of R.A. No. 10121 or known as “AN ACT

STRENGTHENING THE PHILIPPINE DISASTER RISK REDUCTION AND
MANAGEMENT SYSTEM, PROVIDING FOR THE NATIONAL DISASTER
RISK REDUCTION AND MANAGEMENT FRAMEWORK AND
INSTITUTIONALIZING THE NATIONAL DISASTER RISK REDUCTION
AND MANAGEMENT PLAN, APPROPRIATING FUNDS THEREFOR AND
FOR OTHER PURPOSES”, this province allocated an amount of
Php102,718,930.40 and Php95,703,791.00 which is equivalent to 5% of the
estimated total resources for the Budget Year 2021 and 2020, respectively.
Of the total LDRRM Fund, Php30,815,679.12 and Php28,711,137.30

represent 30% Quick Response Fund of the total PDRRM Fund of 2021 and
2020, respectively. On the other hand, Php71,903,251.28 and
Php66,992,653.70 represent the 70% of the total PDRRM Fund for 2021 and
2020, respectively, allotted for the Pre-Disaster Activities of the LGU.
The amount of Php26,770,135.60 and Php12,887,701.85 representing the

unexpended amount from the MOOE-DRRM Fund for the years 2021 and
2020, respectively, were transferred to the Trust Fund to support the disaster
risk reduction and management activities for a span of five years.
Additional transfer to the Trust Fund was made in the amount of

Php1,002,889.45 and Php1,466,547.83 as savings from the Capital Outlay-
DRRM Fund for the year 2020 and 2021, respectively.
During 2020, the total amount of Php93,955,581.07 out of the total LDRRM
Fund was used for the LGU’s various LDRRM programs and activities to
address the COVID-19 health crisis, such as the purchase of various welfare
goods for distribution to affected residents; medical, dental and laboratory
supplies; construction of isolation facilities; and, support to various testing and
monitoring activities, including health sustenance and personnel protective
equipment of front-liners.
Note 22. Philippine Rural Development Program (PRDP)
Under the PRDP, the LGU maintains three bank accounts solely intended for
the receipts of funds according to its respective financing mix under the two
major program of the PRDP, that is, the IBUILD and IREAP. As of December
31, 2021 and 2020, these bank accounts have balances as follow:
Account Account Name 2020 2020

Number
35
0602110915 IBRD-WB ₱3,540,392.89 ₱2,916,572.73
GOP-
0602110907 613,978.00 536,000.49
COUNTERPART
0602110893 PLGU-EQUITY 6,502,342.76 12,610,931.09
TOTAL ₱10,656,713.65 ₱16,063,504.31
Due from Non-Government Organizations/ People’s Organization refers to

the fund released to proponent group for the implementation of the IREAP
program as stipulated in the MOA and based on the approved work and
financial plan and for which the proponent group is responsible to liquidate the
same to this province. The balance of the account represents the unliquidated
portion as of reporting date.
Due to National Government Agencies represents the sum of all financial

obligation under the financing mix of IBRD-WB and GOP in this province to
PRDP under the IBUILD projects and subject for liquidation on a regular basis
until the identified infrastructure projects are completed.
Due to Other Funds account includes the PLGU counter-part respective to the
financing mixed agreed upon under the IBUILD and IREAP PRDP Program
amounting to Php11,048,348.41 and P10,713,997.83 for 2021 and 2020
respectively; while, the amounts of P1,342,774.26 and P 60,000.00 represent
the remaining fund allotted for management cost and amount required to open
bank account, respectively.
Guaranty or Security Payable (Trust Fund Liability) account represents the

10% of 50% retention policy of the infrastructure project cost under the
IBUILD program as security from the contractor and will be available for
release after one year from the date of completion or upon final acceptance by
the end-user. As of December 31, 2021 and 2020, the amount of
Php3,798,289.04 and Php2,737,143.57, respectively, remain outstanding.
Note 23. Projects, Programs and Activities
The LGU received funding from various national agencies as funds held in
trust by virtue of agreements for the implementation of various livelihood,
infrastructure, and socio-civic programs, projects and activities. In addition,
the LGU has also monitored and implemented during the year several projects
under the Philippine Rural Development Program (PRDP).
23.1 Department of Health (DOH)
The LGU received grants from the Department of Health (DOH) for the
implementation of various health programs such as the Medical Assistance to
36
Indigent and Poor Patients in Government Hospitals (MAIP), Province-wide
Investment Plan for Health, Health Facilities Enhancement Programs (HFEP)
which cover the construction, upgrading, expansion, repaid and rehabilitation
of health care facilities including purchase of equipment.
• Construction of the Samar Provincial Hospital (SPH) and Barangay Health

Stations (BHS)
The LGU received the total amount of Php164,095,250.00 as of

December 31, 2021 under Health Facilities Enhancement Programs
(HFEP) of the DOH for the construction of the Samar Provincial
Hospital (SPH) and Barangay Health Stations (BHS) at various
municipalities of the province. The construction of SPH and BHS
projects are on-going as of December 31, 2021 and 2020, and are lodged
under the Construction in Progress account in the statement of financial
position. (See Note 9)
• Medical Assistance for Indigent Patient (MAIP)
The LGU also received the amount of Php9,000,000 and

Php20,800,000.00 during 2021 and 2020, respectively, for the Medical
Assistance for Indigent Patient (MAIP) program. As of December 31,
2021 and 2020, the balances of the said fund amounted to
Php9,001,637.79 and Php14,640,030.59, respectively.
• Active Hazard Duty Pay (AHDP) and Special Risk Allowance (SRA)
During 2021, the LGU received the total amount of Php31,226,481.42

for the payment of Active Hazard Duty Pay (AHDP) and Special Risk
Allowance (SRA) to health workers under the employ of the health care
facilities of the LGU. The LGU was able to disburse the amount of
Php31,002,942.06 during 2021, and the balance of which was returned
as at December 31, 2021.
• Fixed and Variable for the Annual Operation Plan for the years 2016 to
2020
The amount of Php6,662,793.00 was received by the LGU for the

implementation of Fixed and Variable for the years 2016 to 2020. The
fund will be used to improve and scale up public health interventions
for the elimination and control of infectious diseases. As of December
31, 2021, the balance of Php3,051,868.00 remained unexpended.
37
• Grant for Health Promotion Playbook
During 2021, the amount of Php1,405,600.00 was received for the

Health Promotion Playbook.
23.2 Department of Transportation (DOTr)
The DOTr has allocated fund for the modernization and improvement of
existing Catbalogan Airport as among the priority projects of the National
Government.
The LGU received the total amount of Php347,214,117.38 and

Php490,175,775.06 in 2021 and 2021, respectively, for the implementation of
the project and which covers the acquisitions of land, removal of hill
obstruction and runway extension, construction of terminal area, apron and
taxiway. As of December 31, 2021, the project is in progress and is recorded
under the Construction in progress account in the Property, plant and
equipment account. (See Note 9)
The LGU is also a recipient of various port projects under DOTr Infrastructure
projects per CY 2019 General Appropriation Act. The sum of
Php64,025,000.00 is allocated for the Rehabilitation of Ports in Zumarraga and
Sta. Rita, Samar. As of December 31, 2021, the said port projects are in-
progress.
In 2020, two (2) port rehabilitation projects located at Daram, Samar and
Basey, Samar were completed during the year.
23.3 Department of Interior and Local Government (DILG)
The LGU is granted infrastructure projects by the DILG under its various
programs such as the Bottom-Up Budgeting (BUB), Sagana at Ligtas na Tubig
sa Lahat (SALINTUBIG), Local Government Support Fund (LGSF), and
Conditional Matching Grant to Provinces (CMGP), and Performance
Challenge Fund (PCF). Pertinent transactions during the year in relation to the
above projects are as follow:
• Bottom-Up Budgeting (BUB)
Payment for contractors amounting to Php1,065,472.94 and

Php33,611,404.47 for 2021 and 2020 were made for completed and
recorded under the DILG-BUB program. Completed projects include
water supply systems and construction of evacuation centers in various
municipalities.
38
• Sagana at Ligtas na Tubig sa Lahat (SALINTUBIG)
The LGU disbursed the amount of Php3,666,772.23 and

Php26,957,747.05 in 2021 and 2020, respectively, as payments to
contractors for completed projects and are recorded as assets in the
books. (See Note 9) Completed projects include water supply systems in
the municipalities of Sta. Rita, Matuguinao, Hinabangan and Villareal,
Samar. The unexpended amount of Php62,595.80 was returned to DILG
in 2021.
• Local Government Support Fund (LGSF)
Under the LGSF – Other Financial Assistance to LGUs funded under CY

2019 GAA, the LGU received the amount of Php40,000,000.00 in 2020
for the Rehabilitation/ Improvement of road networks in two (2)
municipalities.
As of December 31, 2021, the Road Rehabilitation/Improvement of

Brgy. Bagacay-Brgy. Concord Road, Municipality of Hinabangan,
Samar project has been physically completed, and the amount of
Php1,133,779.27 remained in the Trust Fund which represent the
retention money and the excess of the fund over the obligated amount.
On the other hand, the project on the Road Rehabilitation/Improvement

of Brgy. Malino is still in-progress as of December 31, 2021. (See Note
9) The amount of Php2,823,833.09 remained in the Trust Fund as of
December 31, 2021 for the said project.
• Conditional Matching Grant to Provinces (CMGP)
During the year, the project on Rehabilitation/Improvement of Dolores -

Villareal Road under the CMGP 2019 is completed. In 2020, two (2) road
network projects amounting to Php90,930,592.10 were completed -
Rehabilitation/Improvement of Brgy. Balugo-Tarangnan Road and the
Rehabilitation/Improvement of San Jose-Blanca Aurora Road.
In 2020, the amount of Php80,679,029.00 was received under the

Procurement of Road Projects FY 2020 CMGP Program for the
Upgrading of Calbiga - Pasigay Road and Upgrading of Highway -
Pinabacdao Road. As of December 31, 2021, the amount of
Php62,558,996.57 was disbursed for the above in-progress projects.
Several projects under this program are still in-progress as of December

31, 2021.
39
• Performance Challenge Fund 2019
During the year, the LGU completed the project on the Improvement/
Concreting of Brgy. New Minarog-Brgy. Posongan FMR, located at
Paranas-Motiong, Samar. The project amounting to Php4,337,151.95 is
funded under the 2019 Performance Challenge Fund from the DILG.
23.4 Department of Agriculture (DA)
The LGU has received several fund transfers from the Department of
Agriculture (DA) for the implementation of various livelihood projects in
various municipalities within the Province. Status of several programs funded
through the agency is as follows:
• Yolanda Rehabilitation and Reconstruction Projects (YRRP)
The total amount of Php46,637,228.20 had been received by the LGU as

financial assistance intended for the rehabilitation of the agricultural
sectors affected by Super Typhoon Yolanda. As of December 31, 2021
and 2020, Php17,408,133.84 and Php27,725,801.13, respectively, has
been disbursed from the funds as payment for expenses of several
projects on-going implementation under YRRP.
• Special Area for Agriculture Development (SAAD)
The amount of Php12,600,000.00 under the Special Area for

Agricultural Development (SAAD) was received by the LGU from the
Department of Agriculture (DA), which is intended to help alleviate
poverty among the marginalized sectors on agriculture and fishery. For
2021, the LGU disbursed the sum of Php421,461.63 for the
implementation of the SAAD program. As of December 31, 2021,
several programs under SAAD projects are on-going implementation.
• Projects Enhancing Food Production and Livelihood
The amount of Php50 Million was received by the LGU for the
implementation of various programs and projects under the Projects
Enhancing Food Production and Livelihood. As of December 31, 2021,
the project is on-going implementation.
23.5 Bureau of Fisheries and Aquatic Resources (BFAR)
The LGU is a recipient of various programs/projects under the Bottom-Up

Budgeting (BUB) Program of the DA-BFAR being undertaken at various
municipalities within the Samar Province. Projects include provision of fishing
40
equipment, gears and supplies, motorboats, infrastructure support to fishery
production, etc. Several of these programs are on-going implementation as of
December 31, 2021.
23.6 Department of Tourism
The LGU was granted funds under the Yolanda Comprehensive Rehabilitation
and Recovery Program (YCRRP) for the implementation of various
infrastructure projects that primarily covers rehabilitation of infrastructure
damaged by Typhoon Yolanda. These projects are completed as of December
31, 2020. In 2021, the LGU returned the unexpended amount of
Php435,407.87.
In 2020, through the Tourism Promotions Board (TPB), the LGU is granted
Php9,962,500.00 under the “Enhancing the Brand Value of the Secret Kitchen
of Samar: A Marketing and Promotions Program for Samar’s Culinary
Heritage Tourism Program”. Additional amount of Php3,062,500.00 was
received by the LGU in 2021 for Product and Capacity Development.
23.7 Department of Labor and Employment (DOLE)
The LGU was granted the amount of Php45,797,375.00 and Php2,866,500.00

in 2021 and 2020, respectively, under the “Tulong Pangkabuhayan sa Ating
Displaced/ Disadvantaged (TUPAD) Workers Program”, pursuant to the
provisions of DO No. 210, series of 2020, as the agency’s assistance to help
workers affected of the closure or slowing down of operations of companies
during the COVID-19 health crisis. As of December 31, 2021 and 2020, the
said program is fully implemented.
23.8 Department of Social Welfare and Development (DSWD)
During the year, the LGU received funds under the DSWD Assistance to
Individual in Crisis Situation (AICS) program in the amount of
Php17,000,000.00. The said fund was fully disbursed as of December 31,
2021.
Note 24. GRANTS IN RESPONSE TO THE COVID-19 PANDEMIC
24.1 Bayanihan Grant To Provinces
Under to Republic Act (RA) No. 11469, otherwise known as the “Bayanihan
to Heal as One Act”, the LGU was granted the amount of SEVENTY-EIGHT
MILLION SEVEN HUNDRED NINETY-FOUR THOUSAND FIVE
HUNDRED EIGHTY-FOUR PESOS (Php78,794,584.00) as augmentation
to the funding requirements for the operation of provincial, district, and other
41
local hospitals operated by the provincial government, and maintenance of
duly established provincial checkpoints related to COVID-19, in support to the
on-going efforts of the Government to respond to the crisis brought about by
the COVID-19 pandemic.
As of December 31, 2021 and 2020, the total amount of Php78,756,920.00 and
Php78,371,920.00, respectively, has already been disbursed. The said fund was
used for the acquisition of various medical equipment, devices, laboratory and
medical supplies to augment health facilities and operation needed to address
and respond to the COVID-19 health crisis situation.
An unexpended amount of Php37,664.00 is reverted back to the Bureau of

Treasury.
24.2 Procurement of Personal Protective Equipment and Disinfectant for the

Implementation of Priority Programs/Projects of Various LGUs in Response
to the Covid-19 Pandemic
On October 2020, the LGU was granted the amount of THIRTY MILLION
PESOS (Php30,000,000.00) deposited in the Trust Fund account of the LGU
for the procurement of personal protective equipment & disinfectant for the
implementation of priority programs/projects of various LGUs in response to
the covid-19 pandemic pursuant to Section 4(q) of the Bayanihan to Recover
as One Act, also known as Republic Act No. 11494.
As of December 31, 2021, the total amount of Php29,382,882.00 has already

been disbursed.
Note 25. DOMESTIC LOANS
In 2020, the LGU entered into term loan agreements with the Development
Bank of the Philippines (DBP) for the implementation of several projects, as
below:
• On August 17, 2020, the LGU entered into a term loan agreement with DBP
for an aggregate principal amount of SIX HUNDRED EIGHTY-NINE
MILLION THREE HUNDRED TWENTY-FOUR THOUSAND NINE
HUNDRED PESOS (Php 689,324,900.00). The proceeds of the said loan
shall be used for the implementation of below listed priority development
projects:
a. Construction of New Samar Provincial Hospital Phase II;

b. Repair, Rehabilitation & Extension of Calbayog District Hospital;
c. Road Opening of Lagundi to San Andres, Catbalogan, City;
42
d. Road Opening of Brgy. Blanca Aurora to Brgy. Tomogbong to Brgy.
Beri to Brgy. San Andres to Brgy. Hinica-an, San Jorge and Motiong,
Samar Phase I; and,
e. Road Opening of Brgy. Literon to Brgy. Guinbonga to Brgy. Antol to
Brgy. Magdawat to Brgy. Buluan to Brgy. Mabini to Brgy. Guirang,
Cabiga, Pinabacdao and Basey, Samar Phase I.
The above term loan is payable for fifteen (15) years, inclusive of three (3)
years grace period on principal repayment and is subject to a fixed interest
rate of 4% per annum payable monthly.
Subject to the fulfillment of the all applicable conditions set forth in the
Term Loan Agreement, DBP is to advance amount of the loan in several
drawdowns for each of the priority projects.
As of December 31, 2021, a total of Php308,076,807.71 of the total loan has

been released to the LGU. Interest expense incurred and paid for 2021
related to this loan amounted to Php1,275,398.26. (See Note 17)
• In November 20, 2020, the LGU also entered into another term loan
agreement with DBP for an aggregate principal amount of ONE BILLION
THREE HUNDRED EIGHTY-THREE MILLION SIX HUNDRED
SEVENTY-FIVE THOUSAND ONE HUNDRED PESOS
(Php1,383,675,100.00). The proceeds of the said loan shall be used for the
implementation of below listed priority development projects:
a. Embankment for Brgy. Mercedes Reclamation Phase I in Catbalogan

City; and,
b. Embankment for Pier 1 to Brgy. Bunuanan Reclamation Phase I in
Catbalogan City
The above term loan is payable for fifteen (15) years, inclusive of three (3)
years grace period on principal repayment and is subject to a fixed interest
rate of 4% per annum payable monthly.
Subject to the fulfillment of the all applicable conditions set forth in the
Term Loan Agreement, DBP is to advance amount of the loan in several
drawdowns for each of the priority projects.
The LGU has not yet received any proceeds of the above loan as of
December 31, 2021.
Note 26. Reconciliation between actual amounts on a comparable basis as

presented in the Statement of Comparison of Budget and Actual
43
Amounts and in the Statement of Financial Performance for the Year
Ended December 31, 2021.
Reconciliation between actual amounts on a comparable basis as presented in this statement and in the Statement of
Financial Performance
Personnel Financial
Income MOOE Capital Outlay
Services Expenses
Comparison
Statement of Budget 2,043,814,580.91 555,438,227.02 595,829,809.95 1,275,398.26 174,533,779.99
and Actual
Entity Differences
Basis Differences:
Income not 1,715,863.84
considered budgetary
items
Non-cash income
Gain on Sale of 36,000.00
Assets
Receipts not
considered as
income
Capital Assets
from National
Government
IRA Differential
receipts recorded as
Income in Prior Years
Non-cash expenses:
Depreciation
Amortization –
Intangible Assets
Impairment Loss
Losses
Debt Service (Loan 210,257.91
Amortization,
Retirement of Debt
Instruments, Bank
Charges)
Interest Expenses
capitalized
Capital Expenditures (32,897,124.52) (174,533,779.99)
Timing Differences:
Accruals 1,757,274.79
Prepayments
charged to current
appropriations
Unconsumed
Inventories charged
to current
appropriations
Consumed
Inventories and
deferred charges
charged to prior
period appropriations
Per Statement of
Financial 2,045,566,444.75 557,195,501.81 562,932,685.43 1,485,656.17 0.00
Performance
44
PART II
AUDIT OBSERVATIONS AND RECOMMENDATIONS
Financial and Compliance Audit
1. Cash advances totaling ₱66,607,643.97 were reported as liquidated despite the

non-submission of the Report of Disbursements (ROD) or Liquidation Reports
(LR) and their supporting documents, not adherent to Presidential Decree
(PD) No. 1445 and Commission on Audit (COA) Circular No. 97-002 dated
February 10, 1997, thus casting doubt on the existence and propriety of the
liquidation and the reliability of the Advances for Payroll and Advances to
Special Disbursing Officer accounts in the financial statements.
1.1 Section 4 of PD No. 1445 provides:
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
(6) Claims against government funds shall be

supported with complete documentation.
xxx
1.2 The relevant provisions of COA Circular No. 97-002 dated February 10, 1997
(Rules and Regulations on the Granting, Utilization, and Liquidation of Cash
Advances) are as follows:
4. GRANTING AND UTILIZATION OF CASH ADVANCES
4.1 General Guidelines
xxx
4.1.3 A cash advance shall be reported on as soon as the

purpose for which it was given has been served.
xxx
xxx
45
4.4 Field/Activity Current Operating Expenses (COE)
xxx
4.4.2 The amount of the cash advance shall be limited to

the requirements for two months. Within 5 days after
the end of each month, the AO shall submit a Report
of Disbursements. x x x
xxx
5. LIQUIDATION OF CASH ADVANCES
5.1 The AO shall liquidate his cash advance as follows:
5.1.1 Salaries, Wages, etc. – within five (5) days after each
fifteen (15) day/end of the month pay period.
5.1.2 Petty Operating Expenses and Field Operating

Expenses – within twenty (20) days after the end of
the year; subject to replenishment as frequently as
necessary during the year.
5.1.3 Official Travel – within sixty (60) days after return

to the Philippines in the case of foreign travel or
within thirty (30) days after return to his permanent
official station in the case of local travel, as provided
for in EO 248 and COA Circular No. 96-004.
xxx
5.2 The AO shall prepare the Report of Disbursements xxx in

three (3) copies and submit the same with duly accomplished
vouchers/payrolls and supporting documents to the
Accountant. For payments based on receipts and invoices
only, he shall also prepare a liquidation voucher which shall
be submitted with the report and supporting documents to
the Accountant. x x x
5.3 Within ten (10) days after receipt of the report and
supporting documents from the AO, the Accountant shall
verify the report, record it in the books and submit the same
with all the vouchers/payrolls and supporting documents to
the Auditor. The cash advance shall be considered
liquidated upon the recording thereof by the Accountant in
46
the books of accounts although not yet audited by the COA
auditor.
xxx
5.7 When a cash advance is no longer needed or has not been

used for a period of two (2) months, it must be returned to or
refunded immediately to the collecting officer.
5.8 All cash advances shall be fully liquidated at the end of each
year. Except for petty cash fund, the AO shall refund any
unexpended balance to the Cashier/Collecting Officer who
will issue the necessary official receipt.
8. RESPONSIBILITY OF THE AGENCY HEAD
It shall be the responsibility of the Head of the Agency to

ensure the proper granting, utilization and liquidation of all cash
advances in accordance with these rules and regulations.
1.3 The Statement of Financial Position (SFPos) of the Province of Samar (the
Province) as at December 31, 2021 reported balances of Advances for Payroll and
Advances to Special Disbursing Officer at ₱68,232,199.35 and ₱10,117,591.11,
respectively.
1.4 Audit of cash disbursement journals (CDJ) and general journals (GJ), however,
revealed that 53 cash advances totaling ₱66,607,643.97 were recorded as liquidated
despite the absence of the related RODs or LRs, and their respective supporting
documents.
Table 1 – Cash Advances Reported as Liquidated in CDJ and GJ without RODs and LRs
and Supporting Documents
Reference Qty. Amount Credited Against -

CDJ 18 ₱46,598,386.87 Advances for Payroll (Appendix E)
GJ 35 20,009,257.10 Advances to Special Disbursing
Officer (Appendix F)
Total 53 ₱66,607,643.97
1.5 Consistent follow-up for the submission of these reports and supporting documents
has been made with the Accounting Office but the same remained unheeded, thus
casting doubt on the existence and propriety thereof.
1.6 The foregoing condition was already reported in audit of the last year’s accounts
and transactions of the Province, but the deficiency still persists, amounting to
failure of the Province to address and fix the issue.
47
1.7 This deficiency further affects the reliability of the balances of Advances for
Payroll and Advances to Special Disbursing Officer accounts in the financial
statements.
1.8 We recommended and Management agreed to simultaneously submit to COA

the related accounts of reported liquidations of cash advances as well as the
CDJ and GJ.
1.9 During the exit conference, the Provincial Accountant averred that due to
voluminous transactions being processed daily, as well as the scanning of these
documents; the bulk of the documents being checked and reviewed; and manpower
constraint, the on-time submission of the related reports and their supporting
documents was affected. They, however, committed to comply with the audit
recommendation and improvement of the current system is allegedly being
undertaken to fast track the submission of the required financial reports and
documents.
2. The year-end balance of Accounts Payable account in the General Fund (GF)
includes balances in an aggregate amount of ₱83,769,358.68 despite failure to
prove that these are valid liabilities for the year; various erroneous entries of
₱157,000.00; and inclusion of a non-bona fide liability of ₱5,000.00, not in
adherence to the International Public Sector Accounting Standards (IPSAS)
and COA Circular No. 2015-009 dated December 1, 2015, thus undermining
management assertions of validity and accuracy, and affecting the fair
presentation of the balances in the financial statements.
2.1 Section 3.10 of IPSAS 1 on the presentation of Financial Statements provides:
Faithful Representation
3.10 To be useful in financial reporting, information must

be faithful representation of the economic and other
phenomena that it purports to represent. Faithful
representation is attained when the depiction of the
phenomena is complete, neutral, and free from
materials error. Information that faithfully
represents an economic or other phenomenon depicts
the substance of the underlying transactions, other
event, activity or circumstance which is not
necessarily always the same as it legal form.
2.2 The Revised Chart of Accounts for Local Government Units (LGUs), which was
prescribed under COA Circular No. 2015-009 dated December 1, 2015, describes
the Accounts Payable and Other Payables accounts as follows:
48
2 LIABILITIES
01 Financial Liabilities
01 Payables
Account Title Accounts Payable

Account Number 2-01-01-010
Normal Balance Credit
Description This account is used to record receipt of goods or
services on account in the normal course of trade and
business operation. Debit this account for payment or
settlement of liabilities.
99 Other Payables
99 Other Payables Account
Account Title Other Payables

Description This account is used to record other liabilities not
falling under any of the specific payable accounts.
Debit this account for settlement of liabilities.
2.3 The SFPos of the Province reported a year-end balance of Accounts Payable in the
amount of ₱134,812,221.57 under the General Fund. Record shows that a total of
₱105,469,399.54 was recognized as Accounts Payable at year end, as per Journal
Entry Voucher (JEV) No. 21-12-D01175-77 dated December 31, 2021, viz:
Table 2 – Entry in JEV No. 21-12-D01175-77 dated December 31, 2021
Account Name Debit Credit

Due from National Government Agencies ₱5,000.00
Due from NGOs/POs 125,000.00
Welfare Goods for Distribution 294,000.00
Other Supplies and Materials for Distribution 3,124,250.00
Office Supplies Inventory 1,907,238.50
Food Supplies Inventory 3,053,161.25
Drugs and Medicines Inventory 1,836,467.00
Medical, Dental and Laboratory Supplies Inventory 5,668,245.00
Fuel, Oil and Lubricants Inventory 2,977,487.29
Other Supplies and Materials Inventory 839,757.00
Other Structures 7,983,662.59
Office Equipment 6,821,300.00
Information and Communication Technology 3,455,514.40
Equipment
Disaster Response and Rescue Equipment 6,792,032.00
49
Medical Equipment 8,794,100.00
Other Machinery and Equipment 6,270,326.00
Furniture and Fixtures 968,833.00
Construction in Progress – Infrastructure Assets 11,552,369.97
Construction in Progress – Buildings and Other 5,224,427.65
Structures
Training Expenses 2,432,172.80
Office Supplies Expenses 678,765.70
Fuel, Oil and Lubricants Expense 133,885.72
Other Supplies and Materials Expenses 127,247.50
Water Expenses 124,315.54
Electricity Expenses 1,965,471.38
Telephone Expenses 89.28
Internet Subscription Expenses 74,938.56
Cable, Satellite, Telegraph and Radio Expenses 2,060.00
Auditing Services 7,660.00
Consultancy Services 840,000.00
Other Professional Services 32,000.00
Security Services 3,631,844.70
Repairs and Maintenance – Machinery and 336,554.25
Equipment
Repairs and Maintenance – Transportation 1,928,953.06
Equipment
Taxes, Duties and Licenses 1,800.00
Printing and Publication Expenses 11,060.00
Subscription Expenses 24,770.00
Donations 583,000.00
Other Maintenance and Operating Expenses 14,839,639.40
Accounts Payable ₱105,469,399.54
2.4 Review of the accounts, however, revealed that there were amounts totaling
₱83,769,358.68 which were included in the Accounts Payable despite non-
consummation of the transactions, failure to prove that these are valid liabilities for
the year, and absence of supporting documents, to wit:
Goods for Distribution and Inventories (Appendix G) - ₱19,700,606.04

Property, Plant and Equipment (Appendix H) - 41,071,375.99
Construction in Progress (Appendix I) - 16,776,797.62
Training Expenses; Office Supplies Expenses; Fuel, Oil and - 3,372,071.72
Lubricants Expense; and Other Supplies and Materials Expense
(Appendix J)
Expenses for Repairs (Appendix K) - 2,265,507.31
Donations for Reimbursement (Appendix L) - 583,000.00
Total ₱83,769,358.68
50
2.5 The following transactions were recorded as Accounts Payable despite the non-
delivery, and non-receipt, of goods:
a. The Goods for Distribution and Inventories account in the total amount of
₱19,700,606.04, consisting of Welfare Goods for Distribution; Other Supplies
and Materials for Distribution; Office Supplies Inventory; Food Supplies
Inventory; Drugs and Medicines Inventory; Medical, Dental and Laboratory
Supplies Inventory; Fuel, Oil and Lubricants Inventory; and Other Supplies and
Materials Inventory;
b. Property, Plant and Equipment (PPE) totaling ₱57,862,565.61, consisting of

Other Structures; Office Equipment; Information and Communication
Technology Equipment; Disaster Response and Rescue Equipment; Medical
Equipment; Other Machinery and Equipment; and Furniture and Fixtures; and
c. Expenses totaling ₱3,372,071.72, consisting of Training Expenses; Office

Supplies Expenses; Fuel, Oil and Lubricants Expense; and Other Supplies and
Materials Expense.
There were no proofs, such as delivery receipts and Acceptance and Inspection
Reports (AIR), that the goods or services were delivered to, or received by, the
Province that would warrant the recording of Accounts Payable. The premature
recording of these items at year end not only resulted in the misstatement of
Accounts Payable, but also affected the reliability of the related asset and
expense accounts.
2.6 The Province likewise recognized Accounts Payable in the total amount of
₱16,776,797.62 for Construction in Progress despite the absence of requests for
payment and statement of work accomplished/progress billings from the contractor,
which should have been subjected first to review and validation. This likewise
resulted in misstatements of both the Construction in Progress and Accounts
Payable accounts.
2.7 Expenses for repairs totaling ₱2,265,507.31 were likewise recorded as Accounts
Payable on the basis of purchase orders only, absent any proof that needed parts
had already been delivered to and received by the Province, and that requested jobs
to be done have been accomplished. Expenses on account should not have been
recorded absent any proof that an expense had already been incurred that gave rise
to an obligation by the Province.
2.8 And finally, donations for reimbursement totaling ₱583,000.00, which pertain to
grant of assistance of various kinds to several claimants, were recognized in the
books as Accounts Payable despite absence of proof of payment to the purported
recipients.
51
2.9 There were also erroneous classifications of the Accounts Payable totaling
₱157,000.00, which should have been recorded as Other Payables, as follows:
a. Due from NGOs/POs amounting to ₱125,000.00, which pertains to

financial assistance to Kabalikat Civicom in the amount of ₱50,000.00, and
subsidy to Philippine Red Cross for CY 2021 amounting to ₱75,000.00; and
b. Honoraria of national government agencies and judiciary personnel,

recorded as Other Professional Services in the amount of ₱32,000.00.
2.10 Moreover, the financial assistance in the amount of ₱5,000.00 for Rolando G.
Barredo, Jr. with a MOA dated January 6, 2022 was recorded as debit to Due from
National Government Agencies and credit to Accounts Payable in CY 2021. Since
the MOA was dated January 6, 2022, obviously, there was no obligation yet
incurred by the Province in CY 2021 that would warrant the recognition of
Accounts Payable.
2.11 Only bona fide obligations incurred by the Province for the year should have been
included in the Accounts Payable to show the correct liabilities as at year end.
2.12 The misstatements challenged management assertions on the validity and accuracy
of the Accounts Payable and other accounts, thus affecting the fair presentation of
the balances of these accounts in the financial statements.
2.13 We recommended and Management agreed to make the necessary

adjustments so as to arrive at the correct balances of the affected accounts in
2.14 During the exit conference, the Provincial Accountant affirmed that the recording
of the related assets and expenses as Accounts Payable, sans the proof of delivery
to or receipt by the Province, was intended to effectively set aside the appropriation
and cash for the purpose as there is certainty of future payments of the same on
account of the approved purchase orders.
2.15 The Audit Team asserted that the due execution and certification of the Obligation
Request for these expenditures, without the need of recording the same as Accounts
Payable, would be sufficient to recognize these obligations.
3. The year-end balance of Due to Officers and Employees account in the Trust
Fund (TF) amounting to ₱169,131,861.64 is misstated due to the erroneous
recording of receipt of PhilHealth Fund and the subsequent recording of the
related transactions; and several other erroneous entries, contrary to IPSAS
and COA Circular No. 2015-009 dated December 1, 2015, thus affecting the
fair presentation of the balances in the financial statements.
52
3.1 Section 3.10 of IPSAS 1 on the presentation of financial statements provides:
Faithful Representation
3.10 To be useful in financial reporting, information must

be faithful representation of the economic and other
phenomena that it purports to represent. Faithful
representation is attained when the depiction of the
phenomena is complete, neutral, and free from
materials error. Information that faithfully
represents an economic or other phenomenon depicts
the substance of the underlying transactions, other
event, activity or circumstance which is not
necessarily always the same as it legal form.
3.2 The Revised Chart of Accounts for LGUs as prescribed under COA Circular No.
2015-009 dated December 1, 2015, provides:
2 LIABILITIES
01 Financial Liabilities
01 Payables
Account Title Due to Officers and Employees

Description This account is used to record incurrence of liability to
officers and employees for salaries, benefits and other
emoluments. Debit this account for settlement or
payment to officers and employees.
04 Trust Liabilities
01 Trust Liabilities
Account Title Trust Liabilities

Description This account is used to record the receipt of amount
held in trust for specific purpose. Debit this account for
payment or settlement of the liability or compliance of
condition.
3.3 The SFPos of the Province as at December 31, 2021 shows a year-end balance of
the Due to Officers and Employees account in the amount of ₱169,131,861.64
under the TF. The subsidiary ledger provides details below:
53
Table 3 – Subsidiary Ledger Details of Due to Officers and Employees account in the Trust Fund
Particulars Debit Credit

Beginning Balance ₱187,105,903.21
Philhealth grant for professional fees – Basey District 11,192,097.00
Hospital (BDH)
Philhealth grant for professional fees – Calbayog 14,596,457.56
District Hospital (CDH)
Philhealth grant for professional fees – Tarangnan 537,603.90
Community Hospital (TCH)
Philhealth grant for professional fees – Samar 14,388,876.00
Provincial Hospital (SPH)
Philhealth grant for professional fees – Gandara District 2,793,442.12
Hospital (GDH)
Subsidy from national government – BDH ₱8,245,127.07
Subsidy from national government – CDH 25,540,327.91
Subsidy from national government – GDH 2,519,649.18
Subsidy from national government – SPH 25,456,429.38
Subsidy from national government – TCH 518,353.65
Cash return of cash advance per Check No. 1423261 250,057.44
dated 12/16/2020
Withdrawal of erroneous deposits 292,281.84
Transfer from TF-Hospital Charges due to inadvertently 642,900.00
erroneous charges against TF-Professional Fee
(Calbayog District Hospital)
Transfer from TF-Hospital Charges due to inadvertently 196,500.00
erroneous charges against TF-Professional Fee (Samar
Provincial Hospital)
Discrepancy in the transfer of credits from closed 193.44
Development Bank of the Philippines (DBP) accounts
for professional fees of five hospitals
Total ₱62,572,169.03 ₱44,598,127.46
Ending Balance ₱169,131,861.64
3.4 Audit of the Due to Officers and Employees account disclosed the following:
a. Receipts of PhilHealth grants by the Province in CY 2021 in the total amount

of ₱43,508,476.58, intended as professional fees for the doctors and other
hospital workers for five hospitals of the Province, were recorded as Due to
Officers and Employees. These should have been recorded as Trust Liabilities
since these are held in trust for a specific purpose, and debit said account upon
compliance with the condition.
Particulars Recorded as Should be

Entry upon receipt of the Cash in Bank, Local Currency, Cash in Bank, Local Currency,
PhilHealth Fund Current Account xx Current Account xx
Due to Officers and Trust Liabilities xx
Employees xx
b. While the disbursements to the medical practitioners were properly recorded,

the subsequent reversion of the Trust Liability as a result of the payment will
54
however be affected since this was previously erroneously recorded as Due to
Officers and Employees. The entry made by the Province and the correct
account are as follows:
Particulars Recorded as Should be

Entry to reverse the Trust Due to Officers and TrustLiabilities xx
Liabilities due to Employees xx Subsidy from National
complianceofthepurpose Subsidy from National Government xx
Government xx
c. The return of excess cash advance amounting to ₱250,057.44 should have

been credited against the advances account that was initially recorded, instead
of the Due to Officers and Employees account.
d. The debited amount of ₱292,281.84, which pertains to reported excess cash

advance that was deposited and subsequently withdrawn, should have been
recorded directly as an expense.
e. The transfer of ₱642,900.00, pertaining to expenditures wrongly charged

against the TF-Professional Fees-CDH, should only be a transfer between
bank accounts and should not affect the account Due to Officers and
Employees, per JEV No. 21-01-001 dated January 15, 2021 under the TF-
CDH (Hospital Charges) as shown in the succeeding accounting entry.

Cash in Bank – LCCA (CDH-Professional Fee) 642,900.00
Cash in Bank – LCCA (Calbayog District Hospital) 642,900.00
f. The amount of ₱196,500.00 was recorded in JEV No. 21-01-001 dated

January 19, 2021 of TF-SPH (Hospital Charges) as a debit to Trust liabilities,
but is still included in the Due to Officers and Employees.
g. And finally, the variance of ₱193.44 was left uncorrected. Details are shown
in Table 4.
Table 4 – Details of Transfer
Particulars Transfer from Transfer to Land Variance

DBP account Bank of the
Philippines
account
BDH ₱580.49 ₱580.49 0.00
TCH 125.67 125.67 0.00
SPH 1,432,639.02 1,432,495.43 143.59
GDH 473,680.98 473,631.13 49.85
CDH 2,652.68 2,652.68 0.00
Total ₱1,909,678.84 ₱1,909,485.40 ₱193.44
55
3.5 The foregoing deficiencies resulted in misstatements, thus affecting the fair
presentation of the balances of these accounts in the financial statements.
3.6 We recommended and Management agreed to make the necessary

adjustments so as to arrive at the correct balances of the affected accounts.
3.7 The Provincial Accountant concurred in the noted misstatements and committed to
make the necessary correcting entries on the affected accounts.
4. Hospital workers were granted Active Hazard Duty Pay (AHDP) and Special
Risk Allowance (SRA) in the total amount of ₱31,226,481.40 without
documents supporting their eligibility and accuracy of the amounts claimed,
contrary to Section 4 of PD No. 1445 and other relevant rules and regulations,
thus casting doubt on the validity and propriety of the payments.

xxx

xxx
4.2 Pursuant to Section 5 of Administrative Order (AO) No. 35 dated November 16,
2020 (Authorizing the Grant of Active Hazard Duty Pay to Human Resources for
Health Serving the Frontlines During the State of National Emergency) the
Department of Budget and Management (DBM) and Department of Health (DOH)
issued Joint Circular No. 1, s. 2020 dated November 25, 2020 (Guidelines on the
Grant of the COVID-19 Active Hazard Duty Pay) which provides, among others,
the following guidelines:
4.0 Guidelines and Conditions on the Grant of the COVID-

19 AHDP
The grant of the COVID-19 AHDP shall be subject to the

following guidelines and conditions:
4.1 The frontline HRHs are either:
56
(i) Civilian employees occupying regular,
contractual, or casual positions, whether full-
time or part-time; or
(ii) Workers directly engaged by agencies

concerned through contract of service (COS)
or job order (JO) basis, including duly
accredited and registered Barangay Health
Workers (BHWs).
In case of LGUs, the list of frontline HRHs,

including BHWs, shall be determined by
their respective local health boards.
4.2 The frontline HRHs are assigned in hospitals,

laboratories, or medical and quarantine facilities.
4.3 The official duties and responsibilities of the frontline

HRHs are directly related to the healthcare response
of the government to COVID-19.
4.4 The frontline HRHs physically report for work at

their assigned work stations on the prescribed official
working hours, as authorized by the head of
agency/office, during the state of national emergency.
xxx
4.3 Likewise, DBM-DOH Joint Circular No. 2, s. 2020 dated November 25, 2020
(Guidelines on the Grant of the COVID-19 Special Risk Allowance to Public and
Private Health Workers) was issued pursuant to Section 5 of AO No. 36 dated
November 16, 2020 (Authorizing the Grant of COVID-19 Special Risk Allowance
to Private and Public Health Workers Directly Catering to or In-Contact With
COVID-19 Patients During the State of National Emergency). The salient
provisions of this Joint Circular are as follows:
4.0 Guidelines and Conditions on the Grant of the COVID-

19 SRA
The grant of the COVID-19 SRA to qualified public and

private HWs shall be subject to the following guidelines and
conditions:
4.1 The public HWs are either:
57
(i) Civilian employees occupying regular,
contractual, or casual positions, whether full-
time or part-time; or
(ii) Workers engaged through contract of service
(COS) or job order (JO) basis, including duly
accredited and registered Barangay Health
Workers (BHWs).
In case of LGUs, the list of public HWs,

including BHWs, shall be determined by
their respective local health boards.
4.2 The public HWs are assigned in hospitals,

laboratories, or medical and quarantine facilities.
xxx
4.4 The public and private HWs provide critical and

urgent services to respond to the public health
emergency during the state of national emergency.
4.5 The public and private HWs physically report for

work at their assigned work stations on the
prescribed official working hours, as authorized by
the head of agency/office, during the state of national
emergency, which place them in direct contact with
COVID-19 patients.
xxx
4.4 Based on the foregoing guidelines, the documentary requirements on the grant of
COVID-19 AHDP and SRA are the following:
a. List of frontline HRHs for the AHDP, and public HWs for the grant of SRA,
duly approved by the local health board;
b. Approved office order on the work assignment and schedule of frontline

HRHs and public HWs, issued by agency head or chief/s of hospital/s;
c. For AHDP, certification from agency head or chief/s of hospital/s that the
frontline HRHs were actually assigned in hospitals, laboratories, or medical
and quarantine facilities, and their official duties and responsibilities were
directly related to the healthcare response of the government to COVID-19;
58
d. For SRA, certification from agency head or chief/s of hospital/s that the
public HWs were actually assigned in hospitals, laboratories, or medical
and quarantine facilities, and that they provided critical and urgent services
to respond to the public health emergency during the state of national
emergency; and
e. Approved daily time records (DTRs).
4.5 The Province received from DOH-Eastern Visayas Center for Health Development
a total of ₱31,226,481.40 for the grant of AHDP and SRA to eligible workers of
the respective hospitals of the Province, to wit:
Table 5 – Amounts Received for AHDP and SRA of Hospital Workers
Name of Hospital AHDP SRA Total

Samar Provincial Hospital ₱3,980,795.46 ₱14,602,032.29 ₱18,582,827.75
Calbayog District Hospital 1,708,222.71 960,907.96 2,669,130.67
Gandara District Hospital 967,602.25 3,098,068.17 4,065,670.42
Basey District Hospital 1,232,583.88 3,406,814.32 4,639,398.20
Tarangnan Community 339,681.68 929,772.68 1,269,454.36
Hospital
Total ₱8,228,885.98 ₱22,997,595.42 ₱31,226,481.40
4.6 Several checks were issued to facilitate the payment of benefits to intended
recipients for the period September 15, 2020 to June 30, 2021. Audit of reports of
disbursements submitted by the respective hospitals, however, disclosed only the
liquidation documents indicated in Table 6.
Table 6 – Documents Supporting the Liquidation of AHDP and SRA
Name of Hospital AHDP SRA

Samar Provincial Hospital Approved and signed Approved and signed
payrolls, and DTRs payrolls, and DTRs
Calbayog District Hospital Approved and signed Approved and signed
payrolls, and DTRs payrolls, and DTRs
Gandara District Hospital Approved and signed Approved and signed
payrolls, office orders, and payrolls, office orders,
DTRs and DTRs
Basey District Hospital Approved and signed Approved and signed
payrolls only payrolls only
Tarangnan Community Approved and signed No submission
Hospital payrolls only
4.7 Owing to the lack of complete office orders on work assignment, necessary
certifications from the agency head or chiefs of hospitals, and approved list of
purported beneficiaries coming from the local health board, the Audit Team was
59
precluded from determining if the recipients were the ones contemplated by the
rules as “frontline HRHs” and “public HWs”.
4.8 The absence of office orders on work schedule likewise made it impossible for the
Audit Team to ascertain the “prescribed official working hours, as authorized by
the head of agency/office,” as compared with the data reported on the DTRs and
payrolls.
4.9 In view of the foregoing deficiencies, both the eligibility of the beneficiaries and
the accuracy of the amounts of benefits claimed could not be established, thus
casting doubt on the validity and propriety of payments.
4.10 We recommended and Management agreed to submit the complete supporting

documents for the grant of AHDP and SRA.
4.11 During the exit conference, the OIC-Chief of Hospital of SPH averred that the
deficiency was caused by the drastic downloading of funds by the DOH and the
requirement of the latter to immediately distribute the benefits to the intended
beneficiaries, which they complied but at the expense of complete documentation.
Nonetheless, Management committed to subsequently submit the necessary
supporting documents.
5. Deficiencies were noted in the implementation of Tulong Panghanapbuhay

Para Sa Ating Disadvantaged/Displaced Workers (TUPAD) programs in the
total amount of ₱48,663,875.00, not in adherence to PD No. 1445 and
Department of Labor and Employment (DOLE) Department Order (DO) No.
210 dated March 18, 2020; DO No. 173 dated February 13, 2017; and DO No.
219 dated October 28, 2020, thus creating doubt on the efficiency and
effectivity of the program implementation.
5.1 Pertinent provisions of PD No. 1445 state:
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.

60
xxx

xxx
5.2 Pursuant to Proclamation No. (PN) 922 dated March 8, 2020 (Declaring a State of
Public Health Emergency Throughout the Philippines) and PN 929 dated March
16, 2020 (Declaring a State of Calamity Throughout the Philippines Due to Corona
Virus Disease 2019), DOLE issued DO No. 210, series of 2020, dated March 18,
2020 [Guidelines for the Implementation of Tulong Panghanapbuhay Para Sa Ating
Disadvantaged/Displaced Workers Program (TUPAD) #Barangay Ko, Bahay Ko
(TUPAD #BKBK) Disinfecting/Sanitation Project] to cushion/mitigate the impacts
of the COVID-19 to the livelihood/business and worker sector. Pertinent
provisions of DO No. 210 are as follows:
Section 2. Mechanisms of Implementation
The implementation of the TUPAD #BKBK shall be in accordance

with the provisions of the DO 173-17 (Revised Guidelines in the
Implementation of the DOLE Integrated Livelihood and Emergency
Employment Program). x x x
A. Qualified Beneficiaries
The qualified beneficiaries are the underemployed, self-

employed workers and displaced marginalized workers who
have lost their livelihood or whose earnings were affected
due to the Enhanced Community Quarantine against
COVID-19.
B. Duration of Work
The duration of work under the TUPAD Program shall be

limited to ten (10) days.
E. Requirements for Availment of TUPAD Program
The proponent shall prepare and submit the requirements

specified in Section 19.B of DO173-17 to avail of assistance
under the TUPAD Program.
61
5.3 The relevant provisions of DO No. 173 are as follows:
Section 19. Requirements for Availment of DILEEP by ACP
The following requirements shall be submitted by the ACP

to the nearest DOLE Regional/Provincial/Field Office.
B. TUPAD PROGRAM
For Local Government Units (LGUs) as ACP
1. Application Letter by the LGU duly signed by the

Local Chief Executive (LCE) addressed to the DOLE
Regional Director;
2. Detailed and duly signed TUPAD Project Proposal

and Work Program, indicating an equity equivalent
to at least 20% of the total project cost in the form of
equipment, tools and jigs; (templates are provided as
ANNEX AA);
3. Certification from the LGU/Barangay or DSWD that

the target beneficiaries are underemployed, or
victims of natural disaster/calamity or armed
conflict. For laid-off or terminated workers,
Certification of displacement from the
company/establishment;
4. Individual Beneficiary Profile and Proponent ACP

Profile;
5. Board or Sangguniang Bayan (SB) Resolution

authorizing the LCE to enter into a MOA to avail of
DOLE programs;
6. Memorandum of Agreement (MOA) between the

DOLE RO and the LGU;
7. For LGUs, City/Provincial/Municipal, copy of the

portion of their Local Development Plan referring to
Labor and Employment/Social Services, with
detailed estimates of Approved Project Expenditures
or Estimated Expenses; and
8. Certification of no unliquidated cash advances

and/or grants from DOLE.
62
5.4 Subsequently, DOLE issued DO No. 219 dated October 28, 2020 [Guidelines on
the Implementation of Tulong Panghanapbuhay Para Sa Ating
Disadvantaged/Displaced Workers Program (TUPAD) under the Bayanihan to
Recover as One Act], salient provisions of which are as follows:
ARTICLE V
PROGRAM ASSISTANCE
The following services and assistance shall be provided to eligible

beneficiaries:
Section 2. Implementation Phase
d. The duration of work under the TUPAD Program shall be

limited to fourteen to sixteen (14-16) days for four (4) hours
a day only to reduce the possible risk of exposure of
beneficiaries to COVID-19, pursuant to the following
schedule:
Regional Duration
Offices of Work
8 15
ARTICLE VI
PROGRAM IMPLEMENTATION
Section 1. General Procedural Guidelines
a. Eligibility Requirements
i. The following are eligible to avail of assistance under

the TUPAD program:
(b) Workers in the informal sector particularly the

self-employed including those with elementary
occupations and the unpaid family workers
(c) Senior Citizens who are not beyond 75 years of

age provided that they are fit to work and are not
receiving pensions except for Social Pension for
Indigent Filipino Senior Citizen. As part of
precautionary measure, a certificate of fitness to
work issued by the local health unit will be
required to be presented prior to engagement to
work.
63
b. Documentary Requirements
The following are the requirements for availment of the

program:
ii. LGU/ACP
Phases of Requirements
Implementation
Pre- 1. Letter of Intent (Annex J)
implementation 2. TUPAD Work Program (OSEC-
Phase FMS Form No. 3)
3. Summary of List of Beneficiaries
(Enhanced OSEC-FMS Form No. 4)
For LGUs as ACP
• Memorandum of Agreement
(Annex K)
• Contract of Service between the
LGU and the TUPAD workers
or Oath of Undertaking (Annex
L)
• Board or Sangguniang Bayan
(SB) Resolution authorizing the
LCE to enter into a MOA with
to avail of DOLE programs
• Certification of no unliquidated
cash advances and/or grants
from DOLE
During/Post- Certification from the Barangay/LGU
Implementation that the beneficiaries have performed the
work under the TUPAD Program.
5.5 The Province received from DOLE Regional Office No. 8 a total of ₱48,663,875.00
for the implementation of TUPAD programs, both under the Bayanihan to Heal as
One Act (BAYANIHAN 1) and Bayanihan to Recover as One Act (BAYANIHAN
2), with a total number of 13,370 intended beneficiaries, as shown in Table 7.
Table 7 – Fund Transfers for the Implementation of TUPAD Programs
Official Reference Amount No. of Intended Beneficiaries

Receipt (OR No.)
(OR) Date
Total Breakdown
BAYANIHAN 1 – TUPAD #BKBK Disinfecting/Sanitation Project
05/18/2020 3071284 ₱2,866,500.00 882 Basey – 322;
Calbiga – 140;
Daram – 57;
Jiabong – 111;
Marabut – 50;
64
Official Reference Amount No. of Intended Beneficiaries
Receipt (OR No.)
(OR) Date
Total Breakdown
Motiong – 40;
Paranas – 52;
Pinabacdao – 40;
San Jose De Buan – 26;
Sta. Rita – 44
01/05/2021 8065683 2,678,000.00 824 Catbalogan – 200;
Hinabangan – 186;
Villareal – 438
Subtotal ₱5,544,500.00 1,706
BAYANIHAN 2 – TUPAD
01/05/2021 8065679 4,343,625.00 891 Pinabacdao – 208;
Sta. Rita – 683
01/05/2021 8065680 2,603,250.00 534 Calbiga – 309;
Pinabacdao – 225
01/05/2021 8065681 4,343,625.00 891 Hinabangan – 891
01/05/2021 8065682 4,343,625.00 891 Hinabangan – 891
05/07/2021 8339344 1,664,000.00 512 Hinabangan – 512
05/07/2021 8339345 832,000.00 256 Hinabangan – 6;
Zumarraga – 250
09/02/2021 8339370 4,163,250.00 1,281 Pagsanghan – 613;
Zumarraga – 668
09/02/2021 8339371 20,826,000.00 6,408 Basey – 1865;
Calbiga – 8;
Daram – 1556;
Jiabong – 755;
Motiong – 507;
Paranas – 1367;
San Sebastian – 350
Subtotal ₱43,119,375.00 11,664
Total ₱48,663,875.00 13,370
5.6 The above table shows that displaced/disadvantaged workers of the following
LGUs under the Province (ten out of 26 LGUs) were not tapped or included to avail
of the benefits of the TUPAD programs:
1. Calbayog City
2. Sto. Niño
3. Almagro
4. Tagapul-an
5. Gandara
6. Sta. Margarita
7. Tarangnan
8. San Jorge
9. Talalora
65
10. Matuguinao
5.7 Considering the vast and extensive effects of COVID-19, the Province should have
endeavored to cover all cities and municipalities of Samar Province in the availment
of benefits of the program as it aims to mitigate the economic impact on the workers
in the informal sector, regardless of location.
5.8 Several checks for cash advances were issued to facilitate the payment of the
benefits as shown in Table 8.
Table 8 – Check Payments for TUPAD
No. Date Check Amount

No.
1 7/7/2020 51411301 ₱2,866,500.00
2 1/29/2011 51411303 9,624,875.00
3 1/29/2021 51411304 8,687,250.00
4 5/18/2021 51411306 2,496,000.00
5 9/13/2021 51411308 2,171,000.00
6 9/13/2021 51411309 6,061,250.00
7 9/13/2021 51411310 5,057,000.00
8 9/13/2021 51411311 1,647,750.00
9 9/13/2021 51411312 1,992,250.00
10 9/13/2021 51411313 4,442,750.00
11 9/13/2021 51411314 2,453,750.00
12 9/13/2021 51411315 1,137,500.00
13 12/7/2021 51411316 26,000.00
Total ₱48,663,875.00
5.9 Out of thirteen cash advances granted, nine thereof bearing the Checks Nos.
51411308 to 51411316 totaling ₱24,989,250.00 were unliquidated as of year end.
Nonetheless, audit of the reports of disbursements already submitted for audit
disclosed the following deficiencies:
a. For the implementation of TUPAD #BKBK Disinfecting/Sanitation

Project, the necessary supporting documents were not submitted:
• Summary of list of beneficiaries;

• Certification from the LGU/Barangay or DSWD that the target
beneficiaries are underemployed, or victims of natural disaster/calamity
or armed conflict. For laid-off or terminated workers, Certification of
displacement from the company/establishment; and
• Complete service/job contracts between the Province and TUPAD
workers.
66
b. For the implementation of TUPAD under the BAYANIHAN 2, the related
reports of disbursements were not fully supported with the following
documents:
• Summary of List of Beneficiaries;

• Complete contracts of service between the LGU and the TUPAD
workers or Oath of Undertaking;
• For Senior Citizens, Certificate of fitness to work issued by the local
health unit will be required to be presented prior to engagement to
work; and
• Certification from the Barangay/LGU that the beneficiaries have
performed the work under the TUPAD Program.
5.10 The absence of certificates of displacement from the respective

companies/establishments of the displaced workers/beneficiaries cast doubt on the
recipients’ entitlement to the said assistance.
5.11 Certificates of fitness to work for senior citizens beneficiaries were wanting,
thereby forming reservation as to their capacity to undertake the projects.
5.12 The lacking summary of list of beneficiaries and contracts of service barred the
Audit Team from establishing if the claimants appearing on the pertinent payrolls
were the ones authorized and contracted to work and entitled to receive the
assistance under the TUPAD program.
5.13 Due to insufficient documentation, the eligibility of the beneficiaries could not be
established, thus casting doubt on the validity and propriety of payments.
5.14 In view of the foregoing deficiencies, the effectivity of the program and the
efficiency of the implementation by the Province are thus challenged.
5.15 We recommended that Management:
a) Submit an explanation on the non-inclusion of other city and

municipalities in the availment of TUPAD programs;
b) Require the submission of complete supporting documents on the payment

of the benefits; and
c) Direct the Special Disbursing Officers concerned to immediately liquidate

the outstanding related cash advances and to submit the reports to COA
for audit.
5.16 During the exit conference, the Public Employment Service Office Manager
explained that the implementation of TUPAD programs was not solely dependent
67
on the Province, as these programs can be implemented directly by the DOLE itself
and other accredited ACP. Allegedly, DOLE provided a list detailing the cities and
municipalities and their fund source for the implementation of TUPAD, thus only
those not included in the list were selected by the Province as TUPAD beneficiaries.
In regard to lacking supporting documents and the liquidation of the related cash
advances, Management committed to comply with the audit recommendations.
5.17 The said DOLE list is yet to be provided to COA for evaluation.
6. The current appropriations of ₱449,890,459.76 and continuing appropriations

of ₱286,478,354.77 of the 20% Development Fund (DF) were not optimally
utilized and implemented, and included development projects that were not
well-planned and procurement-and-implementation-ready, not adherent to
Joint Memorandum Circular (JMC) No. 1 dated November 4, 2020, thus
depriving constituents of the benefits that could be derived therefrom.
6.1 Department of Budget and Management (DBM), Department of Finance (DOF),

and Department of Interior and Local Government (DILG) issued JMC No. 1 dated
November 4, 2020 [Revised Guidelines on the Appropriation and Utilization of the
Twenty Percent (20%) of the Annual Internal Revenue Allotment for Development
Projects], the salient provisions of which are as follows:
3.0 GENERAL GUIDELINES
3.1 In accordance with Section 287 of RA No. 7160,

each LGU shall appropriate in its annual budget no
less than twenty percent (20%) of its annual IRA for
development projects.
3.2 The LGUs are enjoined to observe the following

policies and guidelines in the appropriation and
utilization of the 20% DF:
xxx
3.2.2 The development projects that may be

included under the 20% DF shall be those that
are necessary, appropriate, or incidental to
efficient and effective local governance, and
those which are essential to the promotion of
the general welfare of the people.
3.2.3 The LGUs shall ensure that the development

projects to be funded out of the 20% DF are
68
well-planned and procurement-and-
implementation-ready.
xxx
4.0 RESPONSIBILITY AND ACCOUNTABILITY
The responsibility and accountability in ensuring that the

development projects funded under the 20% DF comply with
the guidelines under this JMC and optimally contribute to
the attainment of desirable socio-economic targets and
outcomes of the LGU shall rest upon the local chief
executive and other officials concerned.
The utilization of the 20% DF, whether willfully or through

negligence, for the disallowed expenditure items shall
subject the erring LGU officials and personnel to penalties
under existing laws.
6.0 MONITORING
The LGUs shall prepare quarterly reports on the utilization

of the 20% DF, consistent with the reporting requirements
prescribed by the DOF-BLGF.
xxx
6.2 Records show that the Province appropriated a total of ₱405,357,502.40, equivalent
to 20% of the Internal Revenue Allotment (IRA), as its DF for CY 2021 to finance
its 146 priority development projects, as incorporated in its Annual Investment
Program of said year. A number of five supplemental budgets were later approved
and enacted, bringing the total budget for 20% DF to ₱449,890,459.76 with 192
programmed development projects for implementation.
6.3 Review on the eligibility of the programmed projects disclosed that these projects
are necessary, appropriate, or incidental to efficient and effective local governance,
and essential to the promotion of the general welfare of the people.
6.4 However, audit of the submitted “20% Development Fund NTA Utilization FY
2021” and the related data in the Report on Government Programs, Projects, and
Activities for CY 2021 revealed the following:
a. Of the total appropriations of ₱449,890,459.76 for CY 2021 20% DF, only

₱182,974,189.09 or 40.67% thereof was utilized, thus leaving a substantial
69
amount of unutilized balance of ₱266,916,269.67, indicating non-optimal
utilization of the fund.
b. Out of 192 programmed projects, 49 of which, with total project allocations

of ₱126,732,957.36 (Appendix M), remained unimplemented as of year-
end, thus a non-implementation rate of 25.52%, signifying want of
exhaustive efforts to fully realize the benefits that could be derived from the
use of these projects.
c. A number of twenty projects totaling ₱70,700,000.00 were replaced by the

Province, through the process of reversion, due to reasons indicating that
said projects were not well-planned and were not procurement-and-
implementation-ready, viz:
Table 9 – Development Projects Not Well-Planned and Not Procurement-and-

Implementation-Ready
Reason Project Name Project

for
Allocation
Reversion/
No.
No Available Site for the Construction of the Proposed Project
1 Construction of Multi-Purpose Building, Brgy. ₱1,500,000.00
Lambao, Sta. Margarita
2 Construction of Multi-Purpose Hall, Brgy. Cambaye, 2,000,000.00
Pagsanghan
3 Construction of 2-Storey Multi-Purpose Building, 2,000,000.00
Brgy. San Jose, Gandara
4 Construction of Multi-Purpose Hall, Brgy. Poblacion 1,500,000.00
B, Tarangnan, Samar
Change of Project Name
Brgy. Buao, Gandara
6 Construction of Multi-Purpose Civic Center, Brgy. 2,500,000.00
Hitaasan, San Sebastian
Double Entry in CY 2021 Annual Budget (Possible Duplication
of Project)
7 Construction of Evacuation Center Cum Multi- 1,500,000.00
Purpose Civic Center, Brgy. Salvacion, Basey, Samar
Insufficiency of Funds Due to Cost of Materials
8 Construction of Brgy. Pathway with Material 700,000.00
Handling, Brgy. Balocawe, Gandara
9 Construction of Water System, Brgy. Mahayag, Sta. 2,000,000.00
Margarita
Problem in the Completion of Required Preparatory Documents
10 Lot Acquisition for the Development of Spark Samar 30,000,000.00
Sports Complex, Catbalogan City
Project Not-Implementable or Not Implementation-Ready
11 Installation of Perimeter Fence along Residential 10,000,000.00
Areas in the Reclaimed Areas of Mercedes and
Bunuanan, Catbalogan City
70
Reason Project Name Project
for
Allocation
Reversion/
No.
Project to be Undertaken by the Barangay
12 Repair of Multi-Purpose Civic Center, Brgy. Malayog, 1,000,000.00
Calbayog City
Project Already Undertaken by the Barangay/ DPWH 2 nd
District/ Municipality
Brgy. Canlapwas, Pagsanghan
14 Construction of Slope Protection, Brgy. Balogo, San 1,500,000.00
Sebastian
15 Repair of Roofing, Flooring, Bench and Canal of 2,000,000.00
Multi-Purpose Building, Brgy. Osmeña, Hinabangan
Requested by Barangay Officials for other Development Projects
Brgy. Bangon, Pagsanghan
17 Construction of Bridge, Brgy. Tulay, Daram 1,000,000.00
Road Right-of-Way Problem
18 Construction of Box Culvert with Pathway, Brgy. 2,000,000.00
Cansolabao, Hinabangan
Water Source is not Feasible/ Water Source Insufficient to
Supply the Community
19 Construction of Water System, Brgy. Campeig, Sta. 2,000,000.00
Margarita
20 Construction of Water System, Brgy. Cinco, Sta. 2,000,000.00
Margarita
Total ₱70,700,000.00
While it is a management prerogative on the part of the Province to replace

the programmed projects as deemed suitable under the circumstances,
careful planning and efforts should have been made, as early as the period
for budget hearing, to ensure non-reversal of the projects, and to afford
implementation of the same in the year these were planned to materialize.
d. The reports on the utilization of the 20% DF submitted did not include the
continuing appropriations of prior years, which could have afforded the
Audit Team to properly evaluate the status of implementation of the
development projects funded from the 20% DF continuing appropriations.
Nonetheless, based on the “Registry of Appropriation, Allotment, and

Obligation FY 2021” submitted by the Provincial Budget Officer, it was
ascertained that a significant amount of ₱115,526,874.36 remained
unutilized at year end, as shown in Table 10.
71
Table 10 – Continuing Appropriations of 20% DF
Object of Beginning Reversion Obligation/ Ending

Expenditure Balance Utilization in Balance
CY 2021
CY 2017
₱1,152,097.39 ₱643,686.87 ₱508,410.52
CY 2018
Road 286,506.47 286,506.47
Networks
Flood 17,435.00 17,435.00
Control
Systems
Other 22,889,964.43 22,889,964.43
Structures
CY 2019
Other Land 6,000,000.00 1,039,923.52 4,960,076.48
Improvement
s
Road 17,695,099.15 1,058,764.37 16,636,334.78
Networks
Water Supply 32,298.31 32,298.31
Systems
Seaport 26,891.80 26,891.80
Systems
Buildings 4,406,408.87 1,396,610.49 3,009,798.38
School 100,261.33 100,261.33
Buildings
Markets 529,483.78 529,483.78
Other 44,443,480.31 15,116,476.85 29,327,003.46
Structures
CY 2020
Road 24,495,990.93 2,000,000.00 11,855,652.76 10,640,338.17
Networks
Flood 11,531,502.18 1,000,000.00 10,137,955.83 393,546.35
Control
Systems
Water Supply 6,951,164.55 6,730,581.99 220,582.56
Systems
Buildings 39,803,852.58 19,900,000.00 6,146,275.35 13,757,577.23
Other 106,115,917.69 1,500,000.00 92,425,552.38 12,190,365.31
Structures
Total ₱286,478,354.77 ₱24,400,000.00 ₱146,551,480.41 ₱115,526,874.36
However, due to the insufficient data given, the Audit Team was precluded
from determining the quantity and identity of the ongoing and/or
unimplemented projects under the 20% DF continuing appropriations.
The substantial balance of unutilized DF reinforces the fact of non-optimal

utilization of the fund and the non-implementation, or slow implementation,
72
of the programmed development projects by the Province, as discussed in
paragraph 6.4 (a) and (b) hereof.
6.5 The foregoing deficiencies undermined the purpose of the fund in attaining
desirable socio-economic targets and outcomes, and deprived the constituents of
the benefits that could be derived therefrom.
6.6 We recommended and Management agreed to:
a) Optimally utilize the 20% DF;
b) Expedite the procurement and implementation process to realize the

programmed projects as planned; and
c) Ensure that development projects are well-planned and are procurement-

and-implementation-ready.
6.7 During the exit conference, the Provincial Planning Development Officer asserted
that the reasons for the reversion of some programs, projects and activities (PPAs)
in the 20% DF have become apparent only in the implementation stage, and this
information was not available during the planning stage. They, however,
committed to endeavor to optimally utilize and implement the 20% DF.
7. Thirty-nine (39) out of fifty-nine (59) PPAs under the Provincial Disaster Risk
Reduction and Management (DRRM) Fund Plan and Budget totaling
₱23,553,251.28 remained unimplemented, not in adherence to Section 2 of PD
No. 1445 and Section 12 of Republic Act (RA) No. 10121, thus may result in
the delay in strengthening the capacity of the province to build the disaster
resilience of communities; to institutionalize arrangements and measures for
reducing disaster risk; and to enhance preparedness and response capabilities
at all levels.
7.1 Section 2 of PD No. 1445 states:

safeguard against loss or wastage through illegal or improper
7.2 While Section 12 of RA No. 10121 provides:
73
Section 12. Local Disaster Risk Reduction and Management Office
(LDRRMO) – (a) There shall be established an LDRRMO in every
province, city and municipality xxx which shall be responsible for
setting the direction, development, implementation and
coordination of disaster risk management programs within their
territorial jurisdiction.
xxx
(c) The provincial, city and municipal DRRMOs or BDRRMCs

shall perform the following functions with impartiality given
the emerging challenges brought by disasters of our times:
xxx
(6) Formulate and implement a comprehensive and

integrated LDRRMP in accordance with the national,
regional and provincial framework, and policies on
disaster risk reduction in close coordination with the
local development councils (LDCs);
7.3 Records show that the Province appropriated a total of ₱102,718,930.40, equivalent
to 5% of the total estimated budget of ₱2,054,378,608.00 for CY 2021 for Local
DRRM Fund. Of this amount, 30% or ₱30,815,679.12 was allocated for Quick
Response Fund, while 70% or ₱71,903,251.28 was set aside for PPAs under the
four thematic areas of disaster risk reduction and management: disaster prevention
and mitigation, disaster preparedness, disaster response, and disaster rehabilitation
and recovery; DRRM and Climate Change Adaptation (CCA) Capacity
Development; and Disaster Risk Reduction (DRR) Equipment and Tools, which
were all incorporated in the CY 2021 Provincial DRRM Fund Plan and Budget, as
summarized in Table 11.
Table 11 – Summary of Fund Allocation and PPAs charged against Local DRRM Fund
Fund Name of PPAs No. of Amount

Allocation PPAs
30% Quick Response ₱30,815,679.12
70% Disaster Activities 71,903,251.28
Breakdown:
Disaster Construction of Shoreline Protection (various 8 16,000,000.00
Prevention locations)
and Construction of Seawall 1 2,000,000.00
Mitigation Implementation of Walk the Fault Program 1 200,000.00
Program Establishment/Logistic Support on Early 1 200,000.00
Warning System Guides
Subtotal 11 ₱18,400,000.00
74
Fund Name of PPAs No. of Amount
Allocation PPAs
Disaster Construction of Evacuation Center (various 12 30,000,000.00
Preparedness locations)
Program Provision of Personnel Protective Equipment 1 500,000.00
(PPEs)/ safety gears and equipment
Prepositioning of food supplies, medicines and 2 5,700,000.00
other non-food supplies
Search and Rescue Jamboree 1 100,000.00
Forecast-Based Resiliency Program 1 300,000.00
Operations/Logistic Support for Operation 1 153,251.28
Center
Acquisition of communications devices, etc. 1 100,000.00
Subtotal 19 ₱36,853,251.28
Disaster Mandatory Evacuation/ Quick 3 250,000.00
Response Response/Mobilization Support/ Emergency
Program Operation Center
Accident Insurance 1 20,000.00
Fuel for Emergency Operations 1 1,000,000.00
Subtotal 5 ₱1,270,000.00
Disaster Acquisition of Additional Hand-held Radios 1 50,000.00
Rehabilitation Provision of construction materials to affected 1 200,000.00
and Recovery communities
(Build Back Psycho-social intervention 1 50,000.00
Better) Rapid Damage Needs Assessment and Post- 1 100,000.00
Damage Needs Assessment
Subtotal 4 ₱400,000.00
DRRM and Trainings/Workshops 11 3,600,000.00
CCA Capacity Subtotal 11 ₱3,600,000.00
Development
Program
DRR Water Rescue Vessel (1) 1 2,500,000.00
Equipment Rescue Vehicle (5) 1 7,700,000.00
and Tools Wheelbarrow (1), Hand Truck (1) 2 10,000.00
Fire Extinguisher (10), Tents (24), Flashlights 5 1,170,000.00
(2), Rescue ropes (100 m.), cadaver bags (40)
Subtotal 9 ₱11,380,000.00
Total – 70% Disaster Fund 59 ₱70,903,251.28
Grand Total – Local DRRM Fund ₱102,718,930.40
7.4 Audit of the Province’s implementation of the PPAs under the Local DRRM Fund,
however, revealed the following:
a. Of the eleven PPAs under the Disaster Prevention and Mitigation Program,
five were not implemented, with total allocation of ₱6,400,000.00,
comprising of three projects on Construction of Shoreline Protection, Walk
the Fault Program and Establishment/Logistic Support on Early Warning
System Guides.
The non-implementation of the said PPAs, especially the Construction of

Shoreline Protection in various locations in the Province, defeated the
75
purpose on establishing measures that would lessen or limit, if not avoid,
the adverse impacts of hazards and related disasters.
b. A number of eight out of nineteen programmed PPAs under the Disaster

Preparedness Program, with total allocation of ₱2,053,251.28, was not
implemented during the year, among which are four projects on the
Construction of Evacuation Centers in the municipalities of Gandara (1),
San Jorge (2), and Sta. Margarita (1), Samar; the Provision of PPEs, safety
gears and other equipment; the conduct of Provincial Search and Rescue
Jamboree; Forecast-Based Resiliency Program; and Logistic Support to
Operations Center.
The non-implementation of these PPAs negated the purpose on building the

capacities needed to efficiently manage all types of emergencies.
c. Except for the Purchase of Fuel for Emergency Operations, all other four
PPAs under the Disaster Response Program, with total allocation of
₱270,000.00, were unimplemented, manifesting lack of immediate
response, or slow response, by the Province in providing emergency
services and public assistance during or after a disaster.
d. All four PPAs under the Disaster Rehabilitation and Recovery (Build Back
Better) Program, with total allocation of ₱400,000.00, were
unimplemented, thus showing the Province’s lack of efforts to reduce
disaster risk factors among affected communities.
e. Except for Updating of Provincial DRRM Plan and Conduct of Workshop

for the Updating of Climate and Disaster Risk Assessment, all other nine
training courses or workshops under the DRRM and CCA Capacity
Development Program totaling ₱3,050,000.00, which were intended to
build and develop capacities to effectively and efficiently anticipate,
respond to, manage, and recover from the hazardous impacts of disasters,
were not implemented, thus undermining the purpose of the program.
f. None of the PPAs on acquisition of heavy equipment, multi-power tools,

and emergency vehicles under the DRR Equipment and Tools Program,
with total allocation of ₱11,380,000.00, was implemented, thus
demonstrating the Province’s low regard in strengthening and enhancing the
preparedness and capacity of its disaster response.
7.5 As a recap, a number of 39 out of 59 PPAs under the Local DRRM Fund, with total
allocations of ₱23,553,251.28, were not implemented by the Province.
7.6 The significant number of unimplemented PPAs may be attributed to lack of careful
and organized planning with regard to execution and implementation of PPAs, as
76
review of the CY 2021 Provincial DRRM Fund Plan and Budget disclosed an
indeterminate schedule of implementation. The “Schedule of Implementation”
portion on the Provincial DRRM Fund Plan and Budget merely provided an
encompassing schedule of “1st quarter to 4th quarter,” without stating the specific
period of implementation of all PPAs under the Local DRRM Fund.
7.7 Non-implementation of PPAs may result in the delay in strengthening the capacity
of the Province, together with its partner stakeholders, to build the disaster
resilience of communities; institutionalize arrangements and measures for reducing
disaster risk; and enhance preparedness and response capabilities at all levels.
7.8 We recommended and Management agreed to direct the Provincial DRRM

Office (PDRRMO) to:
a) Expedite the implementation of PPAs under the yearly plan to optimize the
available disaster risk reduction fund intended for disaster risk mitigation;
b) Provide justification for the non-implementation of these PPAs; and
c) Provide specific timelines on the PPAs in the Provincial DRRM Fund Plan
and Budget.
7.9 The Letter-Reply dated March 25, 2022 of the PDRRMO is hereunder quoted
verbatim:
x x x below are the main reasons for the non-implementation of some

PPAs:
a. Under the Disaster Prevention and Mitigation Program:
i. Construction of Shoreline Protection in various locations. As

per coordination with the Provincial Engineering Office for
the monitoring of the said projects identified were already
awarded and bidded. Among these, only those located in
Brgy. 1, San Sebastion and Brgy. Talib, Zumarraga were
billed by the contractor for 75% as per December 2021
reporting. Others were marked as no billing;
ii. Walk for the Fault Program. This aims to identify the definite
locations of active fault lines/lineaments within the province.
The implementation of the said program needs guidance and
expertise of PHIVOLCS. The office has been coordinating
with the above-mentioned agency and we have been waiting
for their response on our request for technical assistance;
and
77
iii. Establishment/Logistic Support on Early Warning System
Guides under the same program. We are still in the process
of enhancing a better and more comprehensive EWS guides
for our communities in far-flung areas. However, we already
have established EWS guides for all the identified hazard in
the province like flood, landslide, earthquake, typhoon and
storm surge. Rest assured that the office will strategically put
up more EWS guides within the province to increase
knowledge and awareness of the communities in the future
years.
b. Under Disaster Preparedness Program:
i. Construction of Evacuation Center cum Multi-purpose

centers in the municipalities of Gandara (1), San Jorge (2)
and Sta. Margarita (2), Samar. In coordination with the
Provincial Engineering Office, these projects had been
awarded and bidded. As per December 2021 reporting, no
billing has been made on the said projects;
ii. Provision of PPEs, safety gears and other equipment, the

office has available PPEs, safety gears and equipment.
However, the above-mentioned PPA was included in the plan
in preparation for the recruitment of additional Samar
Emergency Response Team (SERT) members;
iii. Conduct of Provincial Research and Rescue Jamboree. The

target participants were the different accredited
Response/Rescue Teams within the Province. However, they
were still pre-occupied with the COVID-19 operations at
their respective localities;
iv. Forecast-Based Resiliency Program is in partnership with

Philippine Red Cross Western Samar Chapter and will serve
as the counterpart of the province. The implementation of the
said project will only take place upon the activation of alert
status or if there is a trigger warning. During the untoward
events last CY 2021, the PRC did not request for any
augmentation; and
v. Logistic Support to Operations Center. The office admittedly

was not able to utilize the fund of the said program. Rest
assured that we will implement this program in the future.
78
However, we will consult the finance departments on what
activities would be allowed to utilize the said funding.
c. Under Disaster Response Program, as mandated by RA 10121,

the government must practice a bottom-up approach in disaster
risk reduction and management. With this, the role of the
province is to augment and compliment the needs of the different
LGUs in the province during or immediately after disaster.
Hence, cities and municipalities have respectively allocated
funds for the conduct of mandatory pre-emptive and forced
evacuations and activation of EOC, IMT, and Response Teams at
their level.
d. Programs under Disaster Rehabilitation and Recovery (Build

Back Better) was included in the plan based on the needs of the
communities in the previous disasters. This will only be given or
distributed to affected families after a disaster and must be
supported with a validated damage and needs assessment from
the local DRRM offices.
e. Under the DRRM CCA Capacity Development Program:
i. Conduct of Emergency Operations Center (EOC) Training

Course was not implemented due to unavailability of
resource speakers who happen to be coming outside the
region;
ii. Conduct/Updating of Contingency Plan on applicable

Hazards and Conduct of ICS Ladderized Training was not
executed due to the directives from the Department of
National Defense to Regional OCD offices to only allow
blended or virtual trainings. Hence, the province was not
able to utilize said funds and just sent participants to blended
trainings given by OCD RO8;
iii. Conduct of Formulation of Provincial Public Service

Continuity Plan, the Province only conducted orientations
for the abovementioned planning-workshop though online
meetings and data gathering with the use of cloud
technology; and
iv. Trainings for Barangay Officials and Youth Organizations

in DRR-CCA Programs and Activities including WASH;
Training on Basic Life Support (BLS) and Water and
Hygiene Sanitation (WASH) for PO, CSOs, Rescue
79
Volunteers, and Youth Organizations; Training and
Orientation on the roles of the POs, CSOs, and Youth
Organizations on Disaster Preparedness Activities; and Fire
Prevention Awareness through Conducting of Provincial
Fire Square Roadshows for Primary School Students
Provincewide. These capacity development training into
consideration that most of the participants for the identified
trainings are part of the vulnerable sectors such as elderly,
PWD, women (from POs and CSOs) and youth. In addition,
the province has been vigilant on the new variants of
COVID-19 such as Delta and Omicron which had escalated
on August and November of the said year respectively.
f. Under DRR Equipment and Tools Program:
i. Water Rescue Vessel (1), as per validation of the office, such

equipment has been bidded and obligated;
ii. Rescue Vehicles (4), the said equipment was bidded on the
later part of 4th quarter of 2021. As per monitoring, the
transaction for the payment was set as accounts payable for
CY 2021;
iii. Wheelbarrow (1), Hand Truck (1), Tents (24), Flashlights

(2), Rescue Ropes (100m), and Cadaver bags (40), was
included in the plan in preparation if ever the current
supplies would not suffice when need arises; and
iv. Fire Extinguishers (10), upon checking, all units distributed

within the provincial offices are still usable and is not yet
near its expiration date, so the office opted not to utilize the
said fund for the said activity.
X x x we are very much willing to indicate specific target schedule of

implementation to the PPAs which can be implemented without any
delay or hindrances except those under the Disaster Response
Program and Disaster Rehabilitation and Recovery (Build Back
Better) Program which are case to case basis and may be
implemented any time of the year.
8. Accreditation of twenty (20) non-governmental organizations/people’s

organizations (NGOs/POs) as project partners for the implementation of
Office of the Presidential Adviser on the Peace Process (OPAPP)-Payapa and
Masaganang Pamayanan (PAMANA) projects worth ₱150,344,969.00 was not
80
adherent to COA Circular No. 2007-001 dated October 25, 2007, thus
undermining the technical and financial capability, as well as qualifications of
the beneficiaries to receive government funds and to undertake the projects.
8.1 COA Circular No. 2007-001 dated October 25, 2007(Revised Guidelines in the
Granting, Utilization, Accounting and Auditing of the Funds Released to
NGOs/POs), states:
3.0 SCOPE
These guidelines shall apply to all funds granted to

NGOs/POs for the implementation of projects x x x.
8.2 The Province entered into a Memorandum of Agreement (MOA) with the OPAPP
on December 27, 2017 for the grant and implementation of thirteen PAMANA
projects with a total project cost of ₱179,542,769.00 (Appendix N), of which ten
projects with a total cost of ₱150,344,969.00 were partnered with NGOs/POs.
8.3 Table 12 provides the list of twenty project partners in the form of people’s
organizations as program beneficiaries for the subprojects.
Table 12 – Project Partners for OPAPP-PAMANA Subprojects
No. Subproject Name Amount No. Project Partner

1 Spark Samar Hybrid Rice ₱49,742,769.00 1 Barobaybay Farmers Association
Model Farm with 2 Basey Alliance for Rural Farmers
Marketing Care (800 Association, Inc.
Hectares) Project 3 Basey Farmers Rainfeed
Producer Association
4 Bayo Pilar Roxas Irrigators
Association, Inc.
5 Hincarnas Irrigators Association,
Inc.
6 La Paz San Jorge Irrigators
Service Association, Inc.
7 Marabut Irrigators Association,
Inc.
8 Nagbac Irrigators Association,
Inc.
9 Napuro Sta. Margarita Irrigators
Association, Inc.
10 Old Manunca Farmers
Association
11 Parina-Macabitas Irrigators
Association, Inc.
2 Spark Samar Hybrid Rice 10,110,860.00 *Bayo Pilar Roxas Irrigators
Model Farm with Association, Inc.
Marketing Care (150 *Hincarnas Irrigators
Hectares) Project Association, Inc.
81
No. Subproject Name Amount No. Project Partner
*La Paz San Jorge Irrigators
Service Association, Inc.
*Parina-Macabitas Irrigators
Association, Inc.
12 Pizarro Farmers Association
3 Enhanced Ubi Production 24,515,775.00 13 Borong Active Farmers
and Powder Processing Association (BAFA)
4 Climate Change 26,731,420.00 14 Solid Dapdap Farmers and
Adaptation in Water Fishermen Association (SDFFA)
Resources thru Bamboo
Production
5 Cacao Intercropping 20,000,000.00 15 Apolonia Samahan ng
Livelihood Project Magsasakang Nagkakaisa
(APOSAMANA)
6 Enhanced Ginger 7,365,400.00 16 San Ignacio Rice Farmers
Production Association (SIRFLA)
7 Karlang “Yautia” 4,500,000.00 17 Sta. Rita Food Processor
Production Association (SRFPA)
8 Organic Banana (Saba) 4,500,000.00 18 Brgy. Malabal Lowland Farmers
Production and Banana Association (MLFA)
Chips Processing
9 Enhanced Peanut 1,511,345.00 19 Basaranan nga Organisasyon han
Production San Isidro (BOSIS)
10 Tikog “Fimbrestyle” 1,367,400.00 20 Basiao Native Weavers
Production Association (BANWA)
Total ₱150,344,969.00
*Project partners for Spark Samar Hybrid Rice Model (both 150 and 800 hectares)
8.4 Records show that the foregoing proponent groups were made beneficiaries of
OPAPP-PAMANA funds by virtue of the Certificate of Accreditation issued by the
Sangguniang Panlalawigan of the Province pursuant to and on the basis of their
purported compliance with the accreditation requirements under DILG
Memorandum Circular No. 2016-97 dated July 19, 2016, entitled as “2016
Accreditation of Civil Society Organizations, and Selection of Representatives to
the Local Special Bodies”.
8.5 DILG Memorandum Circular No. 2016-97 embodies the rules on accreditation
process for the purpose of representation to the local special bodies. This is clearly
emphasized in the following provisions:
1.0 Background
1.1 x x x This Memorandum Circular contains the rules

on accreditation process for the purpose of
representation to the Local Special Bodies.
1.2 This policy shall cover all provinces, cities and

municipalities, and all civil society organizations
82
intending to apply for accreditation and to seek
representation in the local special bodies. x x x
2.0 Purpose
To reiterate the provisions of the Local Government Code

and its Implementing Rules and Regulations and to provide
other clarificatory guidelines relative to the accreditation of
CSOs, and in the selection of their representatives to the
local special bodies, and to strengthen their participation in
local governance and development processes.
8.6 For clarification purposes, “accreditation” and “local special bodies” are even
defined under this Memorandum Circular as:
Accreditation – refers to the process of granting authorization,

within 60 days from the organization of the newly elected
Sanggunian, to an organization for purposes of representation to a
local special body. x x x
Local Special Bodies – refer to the Local Development Council,

Local Health Board, Local School Board and Local Peace and Order
Council.
8.7 The Province must have misinterpreted DILG Memorandum Circular No. 2016-97
in accrediting the NGOs/POs in terms of their technical and financial capability to
qualify or entitle them as recipients of government funds. The applicable and
prevailing guidelines on accreditation should have been COA Circular No. 2007-
001 dated October 25, 2007. The comparison between DILG Memorandum
Circular No. 2016-97 and COA Circular No. 2007-001 is shown in Table 13.
Table 13 – Comparative Documentary Requirements for Accreditation
Under DILG Memo Circular Under COA Circular No. 2007-001

No. 2016-97
• Letter of Application • Proposal or application for funding
• Duly accomplished Application Form • Certificate of registration with the Securities
for Accreditation and Exchange Commission (SEC), and/or either
• Board Resolution signifying intention the Cooperative Development Authority (CDA)
for accreditation for the purpose of or the Department of Labor and Employment
representation in the local special body (DOLE) as the case may be x x x
• Certificate of Registration (or in the • Authenticated copy of the latest Articles of
case of IPOs, certification must be Incorporation, or the Articles of Cooperation as
issued by NCIP) the case may be, showing the original
• List of current officers and members incorporators/organizers and the Secretary’s
• Annual Accomplishment Report for certificate for incumbent officers, together with
the immediately preceding year the Certificate of Filing with the SEC/Certificate
of Approval by the CDA
83
Under DILG Memo Circular Under COA Circular No. 2007-001
No. 2016-97
• Financial Statement, at the minimum, • Financial reports, audited by an independent
signed by the executive officers of the Certified Public Accountant, for the past three
organization, also of the immediately years preceding the date of project
preceding year, and indicating therein implementation x x x. For NGO/PO which has
other information such as the source(s) been in operation for less than three (3) years,
of funds report of accomplishment or any equivalent
proof certified by its President and Secretary that
it had previously implemented similar projects
shall be required, in addition to financial reports
for the years it has been in operation
• disclosure by the NGO/PO of other related
business, if any, and extent of ownership therein
• WFP, and Sources and Details of Proponents
Equity Participation in the Project
• Complete project proposal approved/signed by
its officers which shall include the objectives,
target beneficiaries, feasibility studies, risk
assessment, designs, plans, blueprints, charts,
etc.
• List and/or photographs of similar projects
previously completed by the NGO/PO, if any,
indicating the source of funds for their
implementation
• A sworn affidavit of the Secretary of the
NGO/PO that none of its incorporators,
organizers, directors or officials is an agent of or
related by consanguinity or affinity up to the
fourth civil degree to the officials of the GO
authorized to process and/or approve the
proposal, the MOA and the release of funds. x x
x
8.8 As gleaned from the documentary requirements under COA Circular No. 2007-001,
the purpose for accreditation of project partners or proponent groups is to ensure
that the NGO/PO can satisfactorily undertake and sustain the project because of
their capability and capacity. In order to achieve this, the organization must have
a legal personality and a stable financial condition; must not be financially
dependent on the project alone; and there must be no conflict of interest between
the NGO/PO and the source agency that would cast doubt on the regularity of the
transactions.
8.9 These parameters are necessary to ensure that the fund goes to eligible recipients,
and the desired objectives of the project such as the much-needed progress in the
agricultural sector and the projected income growth on the part of the beneficiaries
are achieved and realized.
8.10 As a result of the erroneous application of guidelines, all the NGOs/POs were not
able to comply with the complete requirements for entitlement to government funds
84
as shown below:
Documentary Requirements Not

Compliant
Letter of Proposal or Application for funding 9
Financial Reports 12
Disclosure of NGO/PO of related business, if any 20
Similar projects previously implemented by NGO/PO 15
Sworn affidavit of NGO/PO Secretary that none of its 1
members is an agent of or related by consanguinity or
affinity up to the 4th civil degree to the officials of the
Government Organization
8.11 The erroneous accreditation process applied by the Province in determining the
eligibility of project beneficiaries undermined the technical and financial capability
of the NGOs/POs identified as partners for the OPAPP-PAMANA subprojects, and
negated assurance that the latter were indeed qualified or entitled to receive
government funds.
8.12 We recommended and Management agreed to comply with the guidelines laid
down in COA Circular No. 2007-001 with respect to the accreditation of
NGOs/POs.
8.13 During the exit conference, the Provincial Legal Officer (PLO) assured that
henceforth, the COA Circular No. 2007-001 shall be complied with in accreditation
of NGOs/POs.
9. Courses of action, in case of default and material violations of the provisions

of the MOA were not incorporated in the MOA between the Province and the
NGO/PO project partners for the OPAPP-PAMANA subprojects, totaling
₱123,342,600.00, contrary to Section 4.5.3 of COA Circular No. 2007-001
dated October 25, 2007, hence the defaulting NGOs/POs are not sanctioned.
9.1 COA Circular No. 2007-001 dated October 2007-001 dated October 25, 2007
provides, among others, the following guidelines:
4.0 GUIDELINES
xxx
4.5.3 x x x The project shall be covered by a MOA which shall

embody the terms of reference such as:
xxx
85
j) Institution of legal action by the GO against the
defaulting NGO/PO which fails to complete a project
covered by the MOA, or for a material violation of
the provisions of the MOA or of this Circular, and in
any of these cases, its subsequent disqualification
from applying for another project in any other GO;
9.2 The Province and the twenty NGO/PO project partners entered into various MOA
for the implementation of OPAPP-PAMANA subprojects totaling
₱123,342,600.00 (Appendix O).
9.3 Perusal of the MOA revealed that the provisions on the institution of legal action
by the Province against the defaulting NGO/PO which fails to complete a project
covered by the MOA, or for a material violation of the provisions of the MOA or
of COA Circular No. 2007-001; and in any of these cases, its subsequent
disqualification from applying for another project in any other government agency,
were wanting.
9.4 Provisions on the courses of action to be undertaken in case of default and material
violation of the provisions of the MOA and of the aforesaid Circular are essential
to safeguard the interest of the Province against the NGO/PO project partners’
evasion and breach in the implementation of the project. Absence of this provision
exposes the Province to uncompensated losses that may be sustained in case of the
NGOs/POs’ remiss of its duties, responsibilities, and obligations stipulated in the
MOA.
9.5 We recommended and Management agreed to make representation with the

OPPAP to incorporate courses of actions and sanctions in the MOA against
the defaulting NGOs/POs.
9.6 During the exit conference, the PLO stressed that the MOA is a proforma document
of the OPPAP and that legal sanctions were not included therein. Nevertheless, in
future agreements, they commit to recommend to OPAPP its inclusion in the MOA.
On the other hand, the Provincial Agriculturist stated that she has not seen any legal
sanctions in MOA. While it was the provincial government’s desire to have it
incorporated, the OPPAP representative allegedly does not agree with it as it will
defeat the purpose of the fund to allow the rebel returnees to be integrated back to
the community. The PLO brought into discussion the reality that the targeted
beneficiaries – the rebel returnees may not participate in this program if penal
sanctions will be imposed.
9.7 The Audit Team stressed the importance of incorporation of legal sanctions in
MOA to ensure sustainability of the projects, and to evade the possibility of the
fund becoming purely a dole-out assistance which would entirely defeat the purpose
86
on attaining progress and development in the agri-sector of the Province, as well as
instilling in the beneficiaries the value of self-reliance. The key and vital role of
the intended beneficiaries toward the success of same projects in the future should
thus be emphasized during social preparation in the pre-implementation stage.
10. OPAPP-PAMANA funds totaling ₱18,921,294.80 were granted to

affiliates/associate members despite the lack of accreditation and MOA, not
adherent to Section 2 of PD No. 1445, thus casting doubt on the regularity of
the transactions.

10.2 Records show that the twelve NGOs/POs identified as project partners or proponent
groups beneficiaries of OPAPP-PAMANA Subprojects – Spark Samar Hybrid Rice
Model Farm with Marketing Care (150 and 800 hectares) with whom the Province
executed a MOA, received funds consisting of labor component and marketing care
support in the total amount of ₱29,362,600.00. Audit further disclosed that funds
totaling ₱18,921,294.80 were granted to alleged affiliates and associates who are
not bona fide members of the accredited NGO/PO project partners, as shown in
Appendix P.
10.3 Affiliates/affiliate organizations and associates/associate members, who are yet to

integrate themselves to form an organization, sought affiliation or membership with
the lead proponent groups identified as project partners for OPAPP-PAMANA by
mere submission of their respective resolutions and letters to the accredited
NGOs/POs. Thereupon, these accredited NGOs/POs issued resolutions confirming
the affiliation/membership of the individual affiliate organizations/associate
members.
10.4 Without delving into the validity of the affiliation and associate membership, these
affiliates and associate members were never accredited by the Province to warrant
their entitlement to government funds. Neither was there a MOA executed between
the Province and these affiliates and associate members to make the latter privies
to the stipulations on the implementation of OPAPP-PAMANA subprojects.
87
10.5 Being non-accredited entities, and in view of the absence of MOA, these affiliates
and associate members should have not received government funds until they
become bona fide members of the accredited NGO/PO project partners.
10.6 By allowing non-accredited affiliates and associate members to partake in the

implementation of the projects could lead to:
a. Previously disqualified organizations or individuals benefiting from

these projects despite their ineligibility;
b. Assurance that the project objectives to be achieved being negated
as the capability of these entities to implement the project was not
assessed due to lack of screening process;
c. Duplicity of claiming benefits from other government projects;
d. The terms and conditions embodied in the MOA not strictly adhered
to; and
e. These affiliates and associate members escaping from liability in
case of their breach or default.
10.7 We recommended and Management agreed to ensure that the beneficiaries

are bona fide members of the accredited NGO/PO project partners before they
could be granted funds.
10.8 Management committed to comply with the audit recommendation.
11. Lack of acknowledgement receipt or its equivalent from the NGO/PO project
partners cast doubt on the delivery of the farm inputs, farm tools, and other
assets to recipients/beneficiaries, not adherent to Section 123, Volume 1 of the
New Government Accounting System (NGAS) Manual for LGUs and Section
1.1 of their respective MOA, thus actual receipt by the intended beneficiaries
was not assured.
11.1 Section 1.1 of the respective MOAs entered by the Province and the NGO/PO
project partners states that the former shall deliver to the latter farm inputs with
equivalent monetary value to be distributed to their member-beneficiaries. A
sample of the provision in the MOA is as follows:
Section 1. The PLGU-Samar shall:
1.1 Deliver to (Name of NGOs/POs) the farm inputs

(such as: hybrid rice seeds, fertilizers, insecticides,
other related supplies and crop insurance) under
Spark Samar Hybrid Rice Model Farm with
Marketing Care (150 Hectares) and Spark Samar
Hybrid Rice Model Farm with Marketing Care (800
88
Hectares) Projects that is equivalent to
Php643,590.00 and Php2,574,360.00, respectively;
to be distributed to member beneficiaries; x x x
11.2 Section 123, Volume 1 of the NGAS Manual for LGUs provides:
Sec. 123. Receipts of Issuance. – All issuances of supplies or

property shall be properly receipted using the forms prescribed
under applicable rules and regulations on supply and property
management in local government units.
xxx
11.3 The Province committed itself to provide funds to its NGO/PO project partners for
the establishment/implementation of the OPAPP-PAMANA subprojects. Pursuant
to this commitment, the respective parties agreed that the Province shall deliver to
the NGO/PO project partners the farm inputs, farm tools, and other assets in behalf
of their member-beneficiaries.
11.4 Records show that the Province facilitated the procurement of farm inputs, farm
tools, and other assets needed by the NGOs/POs. Audit of sample disbursement
vouchers and the supporting documents, with the total amount of ₱38,243,519.89,
revealed the following:
Table 14 – Results of Audit of Sample Disbursement Vouchers
Project Code Check Date Check Particulars Amount Value of Assets and Inventories
No. Not Directly No Proof of
Received by Receipt by
the NGOs/POs NGOs/POs
Farm Inputs and Tools
Rice (800 ha) 08/22/2019 1487957 Empty Sacks ₱2,107,256.00 ₱2,107,256.00
Rice (800 ha) 02/19/2019 1479244 Fertilizers 7,595,600.00 2,183,735.00
Rice (150 ha) 02/19/2019 1479247 Fertilizers 1,424,175.00 569,670.00
Rice (150 ha) 04/08/2020 1488451 Empty Sacks 383,683.50 306,946.80
Organic Banana 04/06/2020 1488444 Pesticides 159,120.00 119,340.00
(Saba)
Organic Banana 12/04/2018 1478882 Fertilizers 499,800.00 374,850.00
(Saba)
Organic Banana 02/20/2019 1479252 Farm Tools 322,788.00 ₱322,788.00
(Saba)
Cacao 12/28/2018 1478994 Grafted Cacao 4,875,000.00 2,925,000.00
Cacao 01/22/2019 1479074 Fertilizers 5,478,300.00 4,382,640.00
Cacao 04/17/2019 1479582 Farm Tools 1,251,150.00 1,251,150.00
Ginger 10/24/2019 1488160 Rhizomes 1,856,250.00 928,125.00
Ginger 12/14/2018 1478880 Fertilizers 1,211,700.00 605,850.00
Bamboo 04/12/2019 1479541 Farm Tools 2,631,544.00 817,772.00
Ubi 11/09/2019 1488018 Farm Tools 719,022.00 239,674.00
Ubi 03/16/2020 1488408 Fertilizers 2,265,463.20 2,265,463.20
Subtotal ₱32,780,851.70 ₱19,077,472.00 ₱322,788.00
Building and Equipment
Bamboo 04/29/2021/ 1489066/ Nursery 3,968,948.19 3,968,948.19
(Nursery Bldg.) 07/06/2021 1489142 Building
Ubi 05/29/2019 1479681 Truck 1,493,720.00 1,493,720.00
Subtotal ₱5,462,668.19 0.00 ₱5,462,668.19
89
Project Code Check Date Check Particulars Amount Value of Assets and Inventories
No. Not Directly No Proof of
Received by Receipt by
the NGOs/POs NGOs/POs
Total ₱38,243,519.89 ₱19,077,472.00 ₱5,785,456.19
a. Farm inputs and farm tools totaling ₱19,077,472.00 were merely received
by the Agri-Technicians or individuals from the Office of the Municipal
Agriculturist of the municipality where the NGO/PO is located, per
reference to the attached Requisition and Issue Slips (RIS) and Certificates
of Acceptance, while no proof of receipt by the NGOs/POs was presented
for farm inputs and tools for Organic Banana (Saba) amounting to
₱322,788.00.
No letter of authority was attached to attest to the recipients’ right to receive

these items in behalf of the NGO/PO project partners and their member-
beneficiaries. Likewise, no other data was made available that the member-
beneficiaries of the NGO/PO project partners actually received the farm
inputs and farm tools.
b. The purported transfer of ownership and custody over the Nursery Building
and Truck to the NGO/PO, with total amount of ₱5,462,668.19, was not
substantiated with duly executed deed of donation or its equivalent.
11.5 In the absence, or due to insufficiency, of supporting documents, it could not be

established whether the farm inputs, tools, and other assets were delivered to or
received by the intended member-beneficiaries.
11.6 We recommended that the Local Chief Executive (LCE) direct the personnel
concerned to submit the supporting documents to prove that the NGO/PO
directly received the subject farm inputs and tools.
11.7 We likewise recommended that the undelivered farm inputs and tools be
immediately delivered, and that proofs of receipt thereof by the NGOs/POs
concerned be submitted to the Audit Team.
11.8 During the exit conference the Provincial Agriculturist submitted the following
documents: Certificates of Acceptance of Insecticides distributed to the Farmer
Beneficiaries under Spark Samar Hybrid Rice Model Farms (800 & 150 has.) with
Marketing Care, specifically for (1) Lapaz San Jorge Irrigators Service Association,
Inc., Napuro Sta. Margarita Irrigators Association Inc., (2) Basey Farmers Rainfed
Association, Inc., (3) Bago Pilar Roxas Irrigators Association Inc. Calbayog and
(4) Hincarnas Irrigators Association, Inc., Parina-Macabetas Irrigators Service
Association, Inc., Pizarro Farmers Association, Bayo Pilar Roxas Irrigators
Association, Inc.
90
11.9 While the Audit Team appreciates the submission of the foregoing documents, the
same are still subject for audit to ascertain the validity and completeness thereof.
11.10 With regard to the transfer of assets such as the Nursery Building and Truck,
Management agreed to execute deeds of donation therefor.
12. The Province delegated the implementation of the Construction of Peace

House and the Integrated Farming and Skills Training projects totaling
₱10,322,000.00 to the 8th Infantry Division, Philippine Army (8ID, PA) without
MOA, thus not adherent to Section 2 of PD No. 1445.

12.2 Incorporated in Article I, Section 1 of the MOA entered into by the Province and
OPAPP are the projects: Construction of Peace House in Brgy. Maulong,
Catbalogan City, Samar; and Integrated Farming with Skills Training in Brgy.
Fatima, Hinabangan, Samar, amounting to ₱4,500,000.00 and ₱5,822,000.00,
respectively, or an aggregate amount of ₱10,322,000.00; while Article II, Section
24 of the MOA provides that the Province may “(p)artner with other local, national
and international organizations/agencies, non-government organizations, civil
society organizations and people’s organizations in the project implementation, as
deemed necessary.”
12.3 Pursuant thereto, the Province partnered with various NGOs/POs and other
government institutions for the implementation of the projects, one of which was
the 8ID, PA located in Catbalogan City, Samar.
12.4 However, the partnership between the 8ID, PA and the Province was not in writing.
The former was allowed to undertake the implementation of two OPAPP-
PAMANA subprojects: the Construction of Peace House and the Integrated
Farming and Skills Training totaling ₱10,322,000.00 without MOA executed by
the parties.
12.5 As of December 31, 2021, the amounts of ₱4,422,861.00 for the Construction of
Peace House and ₱2,555,755.68 for the Integrated Farming and Skills Training
91
were disbursed by the Province for the procurement of various construction
materials and supplies, which were then delivered to the personnel of the 8ID, PA
at the project sites.
12.6 No further data were made available to determine the subsequent transactions of
the implementing entity and as to the status of implementation of the projects.
12.7 The absence of MOA made it difficult to evaluate the state of compliance by the
parties and to ascertain if their courses of actions are well within their respective
terms.
12.8 We recommended and Management agreed to submit the MOA or manual of

operations, embodying the terms of reference relative to the implementation
of the Construction of Peace House and the Integrated Farming and Skills
Training projects.
12.9 During the exit conference, the Provincial Agriculturist asserted that the projects
proposal was actually initiated by the Armed Forces of the Philippines (AFP), and
the only role of the Province was on the procurement of materials, while it was the
AFP that will undertake the labor component of the projects.
12.10 The Audit Team maintained that inasmuch as the implementation of the
abovementioned projects was conferred to the Province by the OPAPP through the
MOA, the delegation of which to the 8ID, PA should likewise be made through a
MOA, or at the least, the shared responsibilities of the Province and the 8ID, PA be
stated in a manual of operations.
12.11 Management agreed to formulate the manual of operations, and to submit the same
to COA for evaluation.
13. Original locations of four OPAPP-PAMANA FY 2017 sub-projects totaling

₱98,729,429.00 as stipulated in the MOA dated December 27, 2017 entered
into by and between the OPAPP and the Province were not strictly adhered
to, thus depriving the intended beneficiaries of the benefits from the projects.
13.1 Section 1, Article I of the MOA executed by the OPAPP and the Province dated
December 27, 2017 identifies the original locations involving four projects for
implementation, as shown in Table 15.
92
Table 15 – Original Locations of OPAPP-PAMANA Subprojects
MUNICIPALITY/CITY BARANGAY PROJECT PROJECT

TITLE COST
Motiong, Cacao ₱20,000,000.00
Pinabacdao, Intercropping
Paranas, and Livelihood
San Jose De Buan Project
Calbayog All of District 1 of Spark Samar 10,110,860.00
City/Municipalities of Calbayog Hybrid Rice
Gandara, City/Municipalities Model Farm
San Jorge, of Gandara and San with Marketing
Jiabong, Jorge; All of Care (150
Motiong, District 2 of Basey hectares)
Pinabacdao, and and Pinabacdao;
Basey Brgy. Calapi in
Motiong; Brgy.
Camarubo-an,
Jiabong
Almagro, PTCA 18,875,800.00
Gandara, Sustainable
Pagsanghan, Organic
Sta. Margarita, Vegetable
Sto. Niño, Production and
Jiabong, Processing in 16
Motiong, Public District
San Sebastian, Schools with
Sta. Rita, High Incidence
Villareal, of Malnutrition
Talolora,
San Jose De Buan,
Wright (Paranas), and
Zumarraga
All Municipalities in All Barangays in Spark Samar 49,742,769.00
Districts 1 and 2 of Samar the Municipalities Hybrid Rice
under Districts 1 Model Farm
and 2 of Samar that with Marketing
are not covered Care (800
under the prior hectares)
program
Total ₱98,729,429.00
13.2 Audit of the supporting documents disclosed deviations from the original locations
identified in the MOA, as shown in Table 16.
93
Table 16 – Deviations in the Project’s Identified Locations
MUNICIPALITY/CITY BARANGAY PROJECT DEVIATIONS

TITLE
Motiong, Cacao LGU Gandara was
Pinabacdao, Intercropping included as location in
Paranas, and Livelihood the implementation of
San Jose De Buan Project the project.
Calbayog All of District 1 of Spark Samar LGU Pinabacdao and
City/Municipalities of Calbayog Hybrid Rice Basey were excluded
Gandara, City/Municipalities Model Farm with as locations in the
San Jorge, of Gandara and San Marketing Care implementation of the
Jiabong, Jorge; All of (150 hectares) project; while Brgys.
Motiong, District 2 of Basey Parina and Jia-an,
Pinabacdao, and and Pinabacdao; Jiabong Samar; Brgy.
Basey Brgy. Calapi in Hinica-an, Motiong,
Motiong; Brgy. Samar; Brgy.
Camarubo-an, Pangpang, Villareal,
Jiabong Samar; and Brgys. San
Luis, Caloloma, and
Villahermosa,
Pagsanghan, Samar
were included as
locations in the
implementation of the
project.
Almagro, PTCA Sustainable Public District Schools
Gandara, Organic from LGU Villareal
Pagsanghan, Vegetable and Talolora were
Sta. Margarita, Production and excluded locations in
Sto. Niño, Processing in 16 the implementation of
Jiabong, Public District the project; while two
Motiong, Schools with High Public District Schools
San Sebastian, Incidence of from LGU Gandara
Sta. Rita, Malnutrition and Pagsanghan were
Villareal, included as locations in
Talolora, the implementation of
San Jose De Buan, the project.
Wright (Paranas), and
Zumarraga
All Municipalities in All Barangays in Spark Samar Brgys. Begaho,
Districts 1 and 2 of the Municipalities Hybrid Rice Nabang, Panoypoy,
Samar under Districts 1 Model Farm with Sinidman, Calbayog
and 2 of Samar that Marketing Care City, Samar; Brgys. La
are not covered (800 hectares) Paz, Mombon, Erenas,
under the prior San Jorge, Samar; and
program Brgy. Calapi, Motiong,
Samar were included
as locations in the
implementation of the
project but should have
been covered by the
Spark Samar Hybrid
Rice Model Farm with
94
MUNICIPALITY/CITY BARANGAY PROJECT DEVIATIONS
TITLE
Marketing Care (150
hectares)
13.3 There were no other attachments, such as authority or approval from the OPPAP
for the change of locations, or for the deviations.
13.4 Project locations were identified based on careful planning and selection, and any
changes will be prejudicial to the recipients because they will be deprived of the
benefits that could be derived from the OPAPP-PAMANA projects.
13.5 We recommended that the LCE justify the deviations noted above.
13.6 The Provincial Agriculturist averred that the project proposals used for the request
of OPPAP-PAMANA funds were actually proposals to be submitted originally to
the Department of Agriculture (DA). Allegedly, while the identified locations in
the project proposals for DA were implementation-ready, the same is not true with
respect to OPAPP-PAMANA subprojects. A request for the revision of the
identified locations was thus subsequently made by the Province, but to which, no
reply or action was made by OPAPP. The said inaction by OPAPP was allegedly
presumed by the Province as approval, hence they proceeded with the
implementation of the OPAPP subprojects, but in locations where said projects are
implementation-ready or could be implemented, hence the noted deviations.
13.7 The Audit Team stressed that Management ask for the approval or concurrence of
OPAPP with the deviations from original locations with regard to project
implementation.
14. The lack of necessary documents supporting the financial assistance under the
Assistance to Individuals in Crisis Situation (AICS) program totaling
₱30,353,100.00; and the deficiencies noted in the implementation of this
program, not in adherence to PD No. 1445 and Sangguniang Panlalawigan
Ordinance No. 16-293-21 dated April 20, 2021, cast doubt on the validity and
propriety of the financial assistance.
14.1 Pertinent provisions of PD No. 1445 are as follows:

95

xxx

xxx
14.2 The salient provisions of Sangguniang Panlalawigan Ordinance No. 16-293-21

[Revised Guidelines to Strengthen the Implementation of Assistance to Individuals
in Crisis Situation (AICS) by the Province of Samar] are as follows:
ARTICLE II
IMPLEMENTING PROCEDURES/GUIDELINES
Section 1. The form and amount of the financial assistance to

be provided to the beneficiaries shall be based on
the assessment and recommendation of the
PSWDO social workers and other authorized
personnel duly approved by the authorized officials
of the PLGU of Samar. Appropriate documentation
shall support all disbursements of funds based on
the Social Case Study Report or Case Findings of
each beneficiary.
xxx
ARTICLE III
DOCUMENTARY REQUIREMENTS
xxx
6. The client will be assessed based on the assistance

requested and documents presented. x x x The client
will be requested to complete necessary
requirements as basis of assessment and
recommendation of the social worker.
96
14.3 The Province maintains a revolving fund of AICS in the amount of ₱500,000.00,
intended for assistance with minimal amount of ₱5,000.00 and below, subject for
replenishment, through which, a total of ₱30,353,100.00 was expended in CY 2021.
14.4 This revolving fund is conferred in the person of the Provincial Social Welfare and
Development Officer (PSWDO), who is likewise tasked with the assessment and
recommendation of client-beneficiaries of AICS.
14.5 This condition signifies that the functions of assessment and review of the
qualifications of client-beneficiaries, and the release of AICS to qualified recipients
were fused or vested in one office or in the person of the PSWDO, thus undermining
the requirement of segregation of duties, especially in respect of incompatible
functions.
14.6 The documents attached to the sample disbursement vouchers for the replenishment
of the fund are as follows:
a) One Certificate of Eligibility for ten beneficiaries which also served as cash
payroll of the recipients;
b) General Intake Sheet (GIS) signed by the client, Social Worker Officer and
PSWDO;
c) Certificate of Indigency signed by the Punong Barangay;
d) Proof of assistance needed for medical assistance, such as doctor’s
prescription of medicines and doctor’s request;
e) Photocopy of identification of the client; and
f) Solicitation letter signed by the client.
14.7 Audit of the foregoing attachments revealed the following:
a. Only one undated Certificate of Eligibility was issued for ten persons
despite that evaluation or interview was conducted on separate various dates
by the PSWDO.
Also, the fact that the certificate likewise served as payroll only emphasizes
the fusion of two incompatible duties in one office or in one person, thus
negating the requirement of control in the management of the fund.
b. The portion or section in the GIS on “problems presented by the client” and
the “social workers’ assessment” have the same contents on all the client-
beneficiaries. This created doubt if interview or assessment of the needs of
the client was actually conducted.
Moreover, there were field items on the GIS that were necessary for the
assessment to be complete that were left unfilled, such as client category; the
recommendation of services and assistance to be provided; the mode of
97
financial assistance; the source of financial assistance; the amount of
financial assistance to be extended; the name of payee; and the witness of
the payee. These data are essential for a valid assessment of the needs of the
client, the determination of the amount to be given, and the basis for the
payment of assistance.
The incomplete GIS, implying that the same might not have been actually
conducted or might have been conducted in haste, is therefore a matter of
concern how the needs of the purported clients were assessed, and the
amount to be given was determined.
Inquiry with the PSWDO disclosed that the amount of AICS to be given was
determined by the approving authority or by the LCE. This method rendered
useless both the assessment that was purportedly conducted by the PSWDO
and the recommendation embodied in the GIS. The release of AICS has
become a matter of discretion on the part of the LCE.
c. The certificates of indigency supposedly issued by the Punong Barangay did

not bear the official seal of the barangay concerned, and some were mere
photocopies. The same is true with respect to doctors’ prescription and
physicians’ requests, thus casting doubt on the validity of the certificates, the
doctor’s prescriptions and requests, thereby raising concern that these
documents might be used for shopping of assistance.
d. The solicitation letters likewise appeared to have been made by one person
only, though signed by the purported clients, thus casting doubt on the
propriety thereof.
14.8 We recommended and Management agreed to:
a) Properly fill out the field items in the GIS;
b) Require the issuance of Certificate of Eligibility to each qualified client-

beneficiary;
c) Direct the submission of original copies of the related documentary

requirements on AICS; and
d) Ensure that the release of AICS be based on the assessment and

recommendation of the PSWDO.
14.9 We likewise recommended and Management agreed that the PSWDO be

relieved of her functions as Special Disbursing Officer on the release of AICS
and such tasks be made through the Provincial Treasurer’s Office.
98
14.10 The PSWDO noted the adverse observations found in audit, and committed to
resolve the deficiencies. Management likewise committed to remove the function
of disbursement of AICS from PSWDO.
15. Weak management of Department of Transportation (DOTr) funds arising

from late payment of taxes relative to site acquisition for the Catbalogan
Airport Development Project resulted in penalties incurred by the Province
amounting to ₱710,469.10, contrary to pertinent provisions of PD No. 1445.
15.1 Pertinent provisions of PD No. 1445 state:


xxx
(3) Trust funds shall be available and may be spent only for
the specific purpose for which the trust was created or the
funds received.
xxx
15.2 Review of the Province’s report on the utilization of funds received from DOTr for
the Catbalogan Airport Development – Site Acquisition amounting to
₱90,000,000.00, equivalent to 90% of the 1st tranche, disclosed several payments
to the Bureau of Internal Revenue (BIR) for capital gains taxes (CGT) and
documentary stamp taxes (DST) relative to the acquisition of the affected lots in
the project site.
15.3 Audit, however, revealed that a number of payment transactions to BIR included
penalties in the form of surcharges, interest, and compromise in the total amount of
₱710,469.10 due to late filing and payment of tax due, as shown in Table 17.
99
Table 17- List of Penalties Paid in the Filing and Payment of CGT/DST
Date Check Taxes Paid Amount of Penalties Reference/ BIR

No. Check Paid Form No.
8/3/2020 70664379 Capital gains tax ₱395,304.82 ₱95,779.82 BIR Form 1706
8/10/2020 70664380 Capital gains tax 297,180.49 76,495.39 BIR Form 1706
8/3/2020 70664383 Documentary 106,948.50 33,973.50 Form 2000-OT
stamp tax
stamp tax
stamp tax
8/20/2020 70664396 Documentary 17,340.00 17,340.00 BIR Form 0605
stamp tax
8/20/2020 1530919 Documentary 124.83 124.83 BIR Form 0605
stamp tax
stamp tax
10/8/2020 70664410 Documentary 3,408.27 1,818.27 BIR Form
stamp tax 0605/ONETT
Computation
Sheet
10/8/2020 70664411 Capital gains tax 14,347.46 7,974.59 BIR Form
0605/ONETT
Computation
Sheet
stamp tax
4/12/2021 73615448 Documentary 41,946.85 17,181.85 BIR Form 2000-
stamp tax OT
stamp tax OT
stamp tax OT
stamp tax
stamp tax OT
Total Penalties ₱710,469.10
15.4 Pursuant to BIR regulations, the CGT Return (BIR Form No. 1706) shall be filed
and paid within thirty days following the sale, exchange, or disposition of real
property, with any Authorized Agent Bank or Revenue Collection Officer of the
Revenue District Office having jurisdiction over the place where the property being
transferred is located. On the other hand, BIR Form No. 2000-OT or the DST
100
Declaration/Return (One-Time Transaction) shall be filed and the tax paid within
five days after the close of the month when the taxable document was made, signed,
issued, accepted or transferred.
15.5 The Province’s non-adherence to the prescribed period to file and pay the CGT and
DST resulted in the imposition of penalties due to the delay of tax payments ranging
from 28 to 318 days, as provided in Appendix Q.
15.6 While the DOTr funds can be validly utilized for the payment of CGT and DST, as
these are inherent obligations relative to the acquisition of lots for site development
of the intended project, the same is not true with regard to penalties as these are
preventable losses had timely payments been done.
15.7 The unnecessary penalties charged against the DOTr funds indisputably established
that these funds held in trust by the Province were inappropriately expended for
purposes other than that intended, and manifested the Province’s failure to manage,
expend or utilize the scarce resources of the government resulting in wastage and
losses.
15.8 We recommended that the LCE conduct an inquiry to determine the cause of,
or who caused, the delay and require the refund of the penalties to the trust
fund account of DOTr.
15.9 This recommendation is without prejudice to the issuance of the Notice of

Disallowance.
15.10 In a Letter dated March 7, 2022, Management, through the Provincial Accountant,
avers:
With regards to the penalties cited in this Audit

Memorandum which was paid by this province to BIR, such
transactions were all processed by the Assessor’s Office being in
charge and primary office to facilitate and accommodate processing
to BIR until to its payment processing. This office had processed the
payment of such transaction despite having received the
computation of penalties with a consideration that the payment to
BIR of the taxes is deemed necessary for the implementation of this
project, otherwise would hamper the sale of lot to the owner and
would cause delay for the Construction of the Catbalogan Airport
project which such lot acquisition as integral requirement by the
DOTr for the downgrading of Funds.
Before the office had process the same, we had secured

reasons for the cause of such delay, and as far we had remember,
the main reason was due to constraint result from the Pandemic
101
Covid 19 which during those days, travel are all restricted and even
office works in both national and local, had some restrictions and
office hour arrangements. Such reasons were identified reasonable
during that time which triggered to consider the payment.
Furthermore, relative to reasons or justification of such

delay, we conducted a meeting with Assessor’s office and to other
office concern that on a separate reply to this AOM by the
Assessor’s office will showcase and elaborate the reason and facts
in details about the reasons for such delay, with the belief that they
are the most technical person to justify the reasons of delay and
bottlenecks for the said cause.
Moreover, considering that such transaction has been

disbursed and consummated, the undersigned would like to make an
appeal for consideration and be allowed in audit. Hence, the
undersigned will ensure to secure such requirements and install
control to comply the same in the recent and succeeding related
transaction.
15.11 During the exit conference, the provincial officials concerned emphasized that the
constraints brought about by the pandemic, such as closed offices; the
unavailability of BIR personnel on account of alternative work arrangement; and
transportation dilemma, were the primary causes of delay. Allegedly, the Province
requested with the BIR for an extension on the filing and payment of taxes, in which
the BIR purportedly concurred but without the written approval. The Province was
likewise said to have requested for waiver of the penalties, but no reply has yet been
received from the BIR.
15.12 The Province committed to secure the approval of the requests as herein mentioned.
15.13 The Audit Team stated that in the meantime, no Notice of Disallowance will be
issued pending the outcome of those requests with the BIR.
102
Status of Audit Suspensions, Disallowances and Charges
The audit suspensions, disallowances and charges in various transactions of the

Province of Samar as of December 31, 2021 are summarized as follows:
Issued This Settled This

Beginning Ending Balance
Period Period
Balance (As of (As of
Particulars (January 1 to (January 1 to
December 31, December 31,
December 31, December 31,
2020) 2021)
2021) 2021)
Notice of
Suspension ₱30,414,577.28 ₱0.00 *(₱27,647.00) ₱30,442,224.28
Notice of
Disallowance 116,591,285.74 0.00 0.00 116,591,285.74
Notice of Charge 0.00 0.00 0.00 0.00
*NS No. 2020-10-101(2019) amounting to ₱27,647.00 was settled twice in NSSDC No. 2020-044 dated
November 11, 2020 and NSSDC No. 2020-076 dated December 15, 2020 hence, the adjustment.
103
PART III
STATUS OF IMPLEMENTATION OF PRIOR YEARS’

UNIMPLEMENTED AUDIT RECOMMENDATIONS
Of the 42 audit recommendations contained in the CY 2020 and prior years’ Annual
Audit Reports, 16 were fully implemented, while 26 were not acted upon by Management.
Reason for
Audit Status of
Ref. Recommendations Partial/Non-
Observations Implementation
Implementation
AAR Out of We recommended that
CY ₱390,571,625.43 cash the Provincial Governor
2020-1 advances granted to direct the Provincial
officials and Accountant and all
employees of the officials and employees
Province of Samar in concerned to:
CY 2020,
₱185,889,140.08 were (a) submit to the Audit Fully Implemented
recorded as liquidated Team the lacking
notwithstanding the Reports of
absence of relevant Disbursements
records; while (ROD) or
₱27,327,603.27 Liquidation Reports
remained unliquidated (LRs) and their
for a period of 331 supporting
days as of year-end, documents for the
contrary to existing cash advances
law and regulations, totaling
thus undermining ₱185,889,140.08;
accountability and and
exposing government
funds to possible (b) strictly observe Not Implemented A number of 53
losses due to theft or compliance with the cash advances were
misappropriation, and pertinent provisions noted to remain
casting doubt on the of PD No. 1445 and unliquidated on
reliability of the year- COA Circular No. account of non-
end balances of 97-002 on the grant, submission of the
Advances for Payroll, utilization and related Reports of
Advances to Special liquidation of cash Disbursements or
Disbursing Officer, advances. Liquidation
Advances to Officers Reports and their
and Employees, and supporting
Petty Cash accounts. documents. Please
refer to Finding No.
1, Part II of this
Report.
104
Reason for
Audit Status of
Implementation
AAR The accuracy and We recommended that a) The preparation
CY existence of the year- the Governor: of supply ledger
2020-2 end balances of the cards is on-going.
Inventories Held for a) direct the Provincial Not Implemented
Distribution and the Accountant to b) Not yet
Inventories Held for prepare and implemented, but
Consumption maintain the SLCs; the Province
accounts, totaling conducted seminar
₱1,019,880,376.77, b) require the GSO and Not Implemented for the orientation
could not be the supply units of of inventory
ascertained because: the hospitals process flow and
a) Supplies Ledger concerned to keep discussion of the
Cards (SLCs) were and maintain SCs; forms to be used
not prepared and like SSMI, stock
m ain t ain ed b y th e c) create an Inventory Fully Implemented cards and RSMI.
Pr o v in cia l Committee;
Acco u n tan t ; b) c) Inventory
Stock Cards (SCs) d) order the Inventory Not Implemented committee had
were not kept and Committee to already been
maintained by the conduct physical created.
General Services count of inventories,
Office (GSO) and th e and to prepare and d) The physical
su p p ly o f f icer s o f submit the RPCI; inventory is yet to
th e h o sp ita l s; c) and be implemented
physical count of due to constraints
inventories was not e) require the GSO and Not Implemented related to COVID-
conducted and the the supply officers 19.
Report on the Physical of the hospitals the
Count of Inventories timely reporting of e) The reporting of
(RPCI) was not issuances and issuances and
prepared and distributions of distributions of
submitted; and d) inventories. inventories is still
improper and delayed.
prolonged delay in
recording issuances
and distribution as
only ₱483,689,302.39
or 32% of the total
inventories were
recorded as issued or
distributed, all
contrary to Chapter 7
of the Manual on the
New Government
Accounting System
(MNGAS) for Local
Government Units
(LGUs), Volume 1.
105
Reason for
Audit Status of
Implementation
AAR The accuracy and We recommended that a. The preparation
CY existence of PPE with the Governor: of property
2020-3 account balance, net ledger cards is
of accumulated a) direct the Provincial Not Implemented on-going.
depreciation, totaling Accountant to prepare
₱4,757,156,846.78 and maintain the b. Property cards
co u ld not be PPELCs; are yet to be
asc er t ain ed maintained by
b ecau se : a) PPE b) require the GSO to Not Implemented the GSO.
Ledger Cards keep and maintain
(PPELCs) were not PCs; c. Inventory
prepared and Committee had
maintained by the c) create an Inventory Fully Implemented already been
Provincial Committee; created.
Accountant; b)
Property Cards (PCs) d) order the Inventory Not Implemented d. The Province
were not maintained Committee to conduct was not able to
by the GSO; c) physical count of prepare and
complete physical PPEs, and to prepare submit the
count of properties of and submit the RPCPPE
the Province was not RPCPPE; and; because no
conducted and the physical count
Report on the Physical e) direct the Provincial Not Implemented was conducted
Count of Property, Accountant to on PPEs.
Plant and Equipment recognize
(PRCPPE) was depreciation on all e. No schedule of
incomplete; and d) properties of the depreciation of
depreciation for CY Province, duly PPEs was
2020 totaling supported with submitted by the
₱51,484,085.33 was schedules of Accounting
inadequate as several depreciation. Office.
properties totaling
₱277,411,852.98 were
not depreciated during
the year, contrary to
the pertinent
provisions of
MNGAS for LGUs,
Volume 1.
AAR The Province entered We recommended that Fully Implemented

CY into two contracts of the Governor require
2020-4 loan with the the Provincial
Development Bank of Accountant to,
the Philippines (DBP) henceforth, observe
totaling compliance with the
₱2,073,000,000.00 requirement on the
but these contracts disclosure of loans or
were not fully financial liabilities in
disclosed in the Notes the preparation of the
to the Financial succeeding financial
106
Reason for
Audit Status of
Implementation
Statements for the statements of the
year ended December Province, pursuant to
31, 2020 under the IPSAS 15.
Loans Payable-
Domestic account
inconsistent with the
International Public
Sector Accounting
Standards (IPSAS)
15, thus depriving the
stakeholders and
other users of
information on the
significance and
possible effects of the
loans on the
Province’s financial
position, performance
and cash flows.
AAR The distribution, We recommended that a) The Accounting

CY issuance and the Governor: Office is
2020-5 utilization of items undertaking the
and goods intended a) direct all personnel Not Implemented necessary
for COVID-19 relief concerned to submit checking and
operations charged the report on the coordination with
against the Provincial distribution, the focal persons
Disaster Risk consumption, or departments
Reduction and issuance and for the
Management Fund utilization of welfare submission of the
(PDRRMF) and goods, drugs and reports and other
Bayanihan Grant to medicines, medical supporting
Provinces (BGP) and other supplies documents.
totaling and fuel, complete
₱70,373,275.60 were with the relevant b) No submission
not sufficiently supporting has been made
documented and documents; and yet on the
reported, defeating the required
control mechanisms b) require the GSO to Not Implemented documents.
set under existing issue the related ICSs
laws, rules and and ARE to end-users
regulations to of small tangible
safeguard government items and PPEs,
resources from loss or respectively.
wastage.
AAR Deficiencies and We recommended that a) The Province

CY lapses were noted in the Governor: is still on the
2020-6 the payment of process of
financial assistance a) direct the submission Not Implemented validation and
totaling of duly signed coordination
107
Reason for
Audit Status of
Implementation
₱40,207,500.00 to payrolls, certificates with the
38,747 payees/ of service of all concerned
beneficiaries of 947 payees/beneficiaries, offices and
barangays of the attestation employees for
Province, contrary to documents/statement the
pertinent provisions of showing the lack of compliance of
PD No. 1445, thus, writing and reading the lacking
there was no abilities of some documents to
assurance that the payees who only be submitted.
exact amount of affixed their
financial assistance thumbmarks, and b) No
was actually received valid authority to explanation
by the intended claim specific was provided
beneficiaries who amount, for the yet by the
rendered service to proper documentation accountable
contain the spread of of the grant of officer.
COVID-19. financial assistance;
and
b) order the accountable Not Implemented

officer concerned to
provide explanation
on the deficiencies
noted in the payment
of financial
assistance.
AAR The Province’s poor We recommended that Fully Implemented

CY monitoring and the Governor direct the
2020-7 accounting of the PDRRM Officer to
distribution of 30,400 conduct an inquiry
sacks of rice, in the about the unaccounted,
total amount of lost or missing sacks of
₱38,000,000.00, to rice, and to render a
553 barangays or report thereon and
120,712 submit the same,
families/beneficiaries, together with additional
contrary to pertinent pertinent documents, to
provisions of PD No. COA for further
1445, resulted in evaluation and
unaccounted, lost or validation.
missing 589.65 sacks
of rice with equivalent
amount of
₱737,062.50.
AAR Lack of supporting We recommended that Fully Implemented

CY documents to the the Governor: a) direct
2020-8 payment of COVID- the submission of
19 Hazard Pay, relevant and necessary
totaling documents, mentioned
108
Reason for
Audit Status of
Implementation
₱4,163,000.00, to 907 in paragraph 8.4 of this
medical personnel Report, to support the
and job order validity and propriety of
workers, 114 of the p ay m en t of
whom received or CO VI D - 1 9 H aza rd
accepted payouts in Pay ; an d b ) require
the total amount of the accountable officer
₱470,000.00 without to explain the manner of
authorizations, payment of COVID-19
contrary to pertinent Hazard Pay and the
provisions of PD No. payment to individuals
1445, thus casting other than the intended
doubt on the propriety recipients without the
and validity of the valid authorization.
payments.
AAR Five hospitals of the We recommended that a) The Province

CY Province failed to the Governor: has coordinated
2020-9 fully report and duly with the
support the issuances a) direct the Chiefs of Not Implemented concerned
and distribution of Hospitals concerned hospitals to fast
medical supplies to submit their track the
totaling respective reports of preparation of
₱6,541,920.00 requisitioned and said reports and
charged against the issued items; and documents.
BGP contrary to
existing law, rules and b) henceforth, enforce Not Implemented b) The timely
regulations, thus the timely submission submission of
negating of SSMIs, RIS and the related
accountability and necessary documents. reports is yet to
casting doubt on the be complied
efficient utilization of with.
the government
resources.
AAR Lack of proper control We recommended that Fully Implemented

CY and review of the Governor: a) remind
2020- disbursements by the the Accounting Office
10 Accounting Office as regards the conduct
resulted in over- of control and review
remittance of taxes over disbursements; and
totaling b) cause the filing of
₱5,568,306.53, while claims for refund or tax
the corresponding credits with the Bureau
claims for refund or of Internal Revenue for
tax credit are yet to be the recovery of the over-
filed with the Bureau remitted taxes.
of Internal Revenue
(BIR) pursuant to
Section 229 of
Republic Act (RA)
109
Reason for
Audit Status of
Implementation
No. 8424.
AAR Two completed We recommended that a) The Provincial
CY infrastructure projects the Provincial Engineering
2019-1 totaling Governor: Office provided
P206,259,738.00 an initial list of
under the Conditional a) Require the Not Implemented CMGP road
Matching Grant to Provincial asset
Provinces were not Engineering Office to components.
properly recorded and provide the Provincial
reported as required Accountant and the b) The required
under Appendices 3 General Services reports were not
and 5 of the Office with the prepared and
Department of the complete description provided by the
Interior and Local and segregation of the GSO.
Government (DILG)- road components for
Department of Budget all road projects c) Pending
and Management undertaken by the submission of
(DBM) Joint Province; other reports
Memorandum from the offices
Circular; Appendix 4 b) Require the General Not Implemented concerned to
of the DILG-DBM Services Office to vouch for the
Joint Memorandum prepare a Report on completeness
Circular No. 2017-2; Road Inventory and and
Section 524 of Road Map reconciled reasonableness
Republic Act (RA) with the Registry of of records so as
No. 7160, as well as Public Infrastructure to effect JEV
COA Circulars No. and maintain a preparation and
2015-008 and No. complete Local Road update on
2015-009, thereby Network Property subsidiary
affecting the Card; ledger.
reliability of the Road
Network account. c) Require the Not Implemented d) Inventory
Accounting Office to Committee had
prepare the Journal already been
Entry Vouchers to created but the
take up each of the physical
local road networks inventory is yet
owned by the to be conducted.
Province and to
prepare the subsidiary
ledgers by Road
Network and by
component;
d) Organize an Not Implemented

Inventory Committee
to conduct an
inventory of the local
roads under the
Province’s
jurisdiction using the
110
Reason for
Audit Status of
Implementation
form specified under
Annex C of COA
Circular No. 2015-
008, and providing
the original report
thereof to the
Commission on
Audit.
AAR Infrastructure We recommended that c) Personnel
CY projects funded by the the Provincial Governor concerned had
2019-6 Conditional Matching require the CMGP attended seminars
Grant to Provinces for Focal Persons to: with DILG on the
Road Repair, uploading of
Rehabilitation and a) submit copies of the Fully Implemented geotagged photos/
Improvement plans and videos and
Program for Fiscal specifications for the updating of website
Years (FYs) 2017- completed projects to with the project
2018 amounting to facilitate the final information.
P317,121,382.47, inspection thereof by Collated copies of
lacked the proper the COA Technical geotagged photos/
documentation Audit Specialist; videos will be
required in DILG- uploaded after.
DBM Joint b) submit the lacking Fully Implemented
Memorandum basic supporting
Circular (JMC) No. documents which d) The Province of
2017-2 for FY 2017 form part of the Samar does not
and unnumbered JMC contract for FY 2018 have an official
for FY 2018-2019, projects; website.
while, the intended
projects for FY 2019 c) upload geo-tagged Not Implemented
releases totaling videos/photos of all
P71,558,610.00 were CMGP projects taken
not disclosed in the before the
Notes to Financial construction, during
Statements, thus and for the completed
affecting its projects in
transparency. compliance with the
guidelines set forth by
DILG-DBM Joint
Memorandum
Circular No. 2017-2
in uploading to Open
Roads Portal
(www.openroads.gov
.ph) a geo-tagged
“kml” video or route-
shoot video for all
CMGP provincial
road projects;
d) report/publish in the Not Implemented
111
Reason for
Audit Status of
Implementation
official website of the
Province of Samar
detailing the CMGP
projects including:
geo-tagged photos,
the name of the
contractor, location of
the project, project
cost, start date,
intended completion
date, description of
the project, source of
fund, implementing
office, responsible
official and contact
number and email
address,
completion/physical
accomplishment rate,
and in case of delays -
reasons for such
delays; and
e) update regularly the Fully Implemented

required information
relative to the project
in the billboard
provided for each
project.
We also recommended Fully Implemented

that the Accountant be
required to prepare the
appropriate disclosures
in the Notes to Financial
Statements on the
receipt and intended
projects for the FY 2019
CMGP Fund.
AAR The completion of We recommended that Fully Implemented
CY five infrastructure the Provincial
2019-7 projects as of Governor, through the
December 31, 2019 Provincial Engineer and
totaling the CMGP Focal
P317,121,382.47 Persons, investigate the
under CMGP Fund underlying causes of
for FY 2017-2018 delays in the completion
was delayed by 138 to of the projects, identify
293 days despite the solutions to stop any
approved contract further delay and
time extension demand from the
112
Reason for
Audit Status of
Implementation
ranging from 60 to contractor to complete
285 days and without the projects
the imposition of immediately.
liquidated damages,
due to laxity in the Henceforth, we
implementation of the recommended that
specific provisions of Management strictly
the unnumbered enforce the provisions
DILG-DBM Joint of the unnumbered
Memorandum DILG-DBM Joint
Circular, thereby Memorandum Circular
depriving the public on the implementation
of the immediate of CMGP projects.
benefits of these
projects.
AAR The Provincial We recommended that Not Implemented Impracticability and
CY Assessor’s Office the Provincial Governor not legally feasible
2019-9 failed to revise the require the Provincial to conduct appraisal
Schedule of Fair Assessor to undertake a and assessment of
Market Values of general revision of real FMV of real
Real Property Units, property assessments properties, and
and to conduct a and to follow the revision of the
general revision of appraisal/assessment schedule of FMV
real property calendar in compliance pursuant to the
assessment every with RA No. 7160 and provisions of
three years as required the Local Assessment Bayanihan to Heal
under Section 219 of Regulation No. 1-04. as One Act.
RA No. 7160 and
Local Assessment
Regulations No. 1-04
dated October 01,
2004, thus, the basis
for computing real
property taxes is not
updated.
AAR The year-end We recommend that the Not Implemented The Accounting
CY balances of the three Provincial Governor Office is still in the
2018-2 reciprocal accounts, instruct the Provincial process of review of
namely: Due from Accountant to reconcile accounts and
Other Funds and Due all reciprocal accounts documents so as to
to Other Funds; Real and make appropriate have adjusting
Property Tax adjusting entries to entries in the books
Receivable and correct the account of accounts to
Deferred Real balances in the financial establish the correct
Property Tax; and statements. balance of the
Special Education reciprocal accounts.
Tax Receivable and
Deferred Special
Education Tax, with
reported material
differences of
113
Reason for
Audit Status of
Implementation
P2,585,673.74;
P3,504,443.20; and
P1,356,609.58,
respectively were
unreliable, thereby
affecting the fair
presentation of these
accounts in the
financial statements.
AAR Balances reported in We recommended that Fully Implemented

CY the Statement of the Provincial Governor
2018-3 Financial Position do instruct the Provincial
not tally with the Accountant to properly
balances in the GLs identify and reconcile
and SLs as of the balances of accounts
December 31, 2018 in the financial
thereby affecting their statements against their
fair presentation in the respective GLs and SLs.
Financial Statements. Moreover, the
Accountant should
maintain the necessary
GLs and SLs for all
accounts.
AAR Balances of several We recommended that Fully Implemented

CY accounts in the Notes the Provincial Governor
2018-4 to Financial require the Provincial
Statements do not Accountant to provide
tally with the balances appropriate and
in the Financial sufficient disclosures in
Statements, while the Notes to Financial
other accounts are Statements,
inappropriately and particularly, those
insufficiently accounts which have
disclosed thereby undergone substantial
affecting the fair changes so that all users
presentation of the of the financial
accounts in the statements can better
Financial Statements. understand the
operations of the
Province.
AAR Cash Advances We recommended that a) Several cash
CY totaling the Provincial Governor: advances were
2018-5 P23,717,847.16 as of still granted
December 31, 2018 a) refrain from approving Not Implemented despite the non-
were not liquidated the grant of additional liquidation of
within the prescribed cash advances to previous ones.
period and additional officials and
cash advances were employees with b) Several cash
granted to the unsettled cash advances were
114
Reason for
Audit Status of
Implementation
Accountable Officer advances; and liquidated beyond
(AO) even when the the prescribed
previous cash b) require all AOs to Not Implemented period, and
advances were not submit immediately several others
liquidated, contrary to the liquidation of their remained
COA Circular No. 97- cash advances and to unliquidated at
002, thus exposing refund to the yearend.
government funds to Collecting Officer any
possible misuse unspent balances; and c) The Accounting
and/or loss. Office has issued
Moreover, the AOs c) instruct the Accountant Not Implemented demand letters to
were not adequately to monitor closely the employees
bonded, contrary to liquidation of cash concerned, but
Treasury Circular No. advances granted to several cash
02-2009 dated August AOs and to prepare advances
6, 2009 demand letters to AOs remained
concerned with outstanding at
unsettled/unliquidated year end.
cash advances.
It was alleged that
We also recommended the delay was due
that management strictly to unknown
adhere to the relevant whereabouts of
provisions of COA several individuals
Circular No. 97-002 in who have already
granting, utilization and retired or resigned,
liquidation of cash and the lack of
advances as well as the information on the
proper recording of heirs of the said
transactions in their personnel.
appropriate accounts and
ensure that balances are
supported with complete
records.
AAR Funds received by the We recommended that Fully Implemented

CY Province of Samar for Province comply with
2018-15 the DOH Health the provisions stipulated
Facilities in the Memorandum of
Enhancement Agreement covering the
Program (DOH- Department of Health-
HFEP) totaling Health Facilities
P116,155,385.96 Enhancement Program
were not separately (DOH-HFEP) for FY
accounted for, and 2017 such as ensuring
copies of the contract that projects are
and other essential undertaken and
documents were not completed within the
submitted to facilitate stipulated deadlines so
contract review in that beneficiaries are
compliance with the assured of the enjoyment
115
Reason for
Audit Status of
Implementation
stipulations contained of such projects the Fully Implemented
in the Memorandum soonest time possible.
of Agreement
between the Province We also recommended
of Samar and the that the Provincial
DOH Region VIII. Engineer’s Office submit
the contract documents
and their attachments to
facilitate the contract
review.
116
PART IV – APPENDICES
Contents
A. General Fund
A.1 Statement of Financial Position 118
A.2 Statement of Changes in Net Assets/Equity 119
A.3 Statement of Financial Performance 120
A.4 Statement of Cash Flow 121
B. Special Education Fund
B.1 Statement of Financial Position 122
B.2 Statement of Changes in Net Assets/Equity 123
B.3 Statement of Financial Performance 124
B.4 Statement of Cash Flow 125
C. Trust Fund
C.1 Statement of Financial Position 126
C.2 Statement of Changes in Net Assets/Equity 127
C.3 Statement of Financial Performance 128
C.4 Statement of Cash Flow 128
D. Comparison Statement of Budget and Actual Amounts 130
E. Advances for Payroll 131
F. Advances for Special Disbursing Officer 132
G. Schedule of Goods for Distribution and Inventories Recorded as Accounts 133-135
132Payable
H. Schedule of (AP) at Year
Property, End
Plant and Equipment Recorded as AP at Year End 136-138
I. Schedule of Construction in Progress Recorded as AP at Year End 139
J. Schedule of Expenses Recorded as AP at Year End 140-143
K. Schedule of Repairs & Maintenance Recorded as AP at Year End 144
L. Schedule of Donations for Reimbursement Recorded as AP Year End 145-146
M. Unimplemented Projects Charged to 20% 147
N. List of OPAPP-PAMANA Subprojects 148
O. Contract Amount of Deliverables as Incorporated in the MOA 149
P. Distribution of Labor Component and Marketing Care for Spark Samar 150
Projectin the Remittance of Capital Gains Tax & Documentary Stamp Tax
Q. Delay 151-152
117

Samar Executive Summary 2021

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

Samar Executive Summary 2021

Uploaded by

Copyright:

Available Formats

Republic of the Philippines

ANNUAL AUDIT REPORT

For the Year Ended December 31, 2021

March 30, 2022

Hon. REYNOLDS MICHAEL T. TAN

Very truly yours,

FOR THE COMMISSION ON AUDIT:

ATTY. LITA A. ESTIL-DIEZ

March 30, 2022

The Honorable Presiding Officer

Ladies and Gentlemen:

Very truly yours,

FOR THE COMMISSION ON AUDIT

ATTY. LITA A. ESTIL-DIEZ

The Province of Samar (the Province) is composed of 24 municipalities and two

• Provide accessibility to all basic needs and services requirements of the

To determine the extent of implementation of the programs and projects, compliance

Financial Position and Performance

Appropriations, Allotments, and Obligations

While the succeeding graphical presentations details the changes in the

The increase in appropriations and allotment in CY 2021 is due to the increase in

No. Project Amount

In addition, the following significant accomplishments of the Province for CY 2021

• Vaccination of a total of 317,747 individuals as of December 31, 2021;

The Provincial Government is also a recipient of various awards, citations and

• Certificate of Appreciation presented to Samar Provincial Hospital (SPH) by

• 2021 Outstanding Social Worker of the Philippines in the field of Social

Independent Auditor’s Report on the Financial Statements

The Auditor rendered a qualified opinion on the combined financial statements of

Summary of Significant Observations and Recommendations

In addition to the exceptions cited, the significant observations and the

We recommended and Management agreed to simultaneously submit to COA

We recommended and Management agreed to make the necessary

We recommended and Management agreed to make the necessary

We recommended and Management agreed to submit the complete supporting

5. Deficiencies were noted in the implementation of Tulong Panghanapbuhay Para Sa

We recommended that Management:

a) Submit an explanation on the non-inclusion of other city and municipalities

b) Require the submission of complete supporting documents on the payment

6. The current appropriations of ₱449,890,459.76 and continuing appropriations of

We recommended and Management agreed to:

a) Optimally utilize the 20% DF;

b) Expedite the procurement and implementation process to realize the

c) Ensure that development projects are well-planned and are procurement-

We recommended and Management agreed to direct the Provincial DRRM

b) Provide justification for the non-implementation of these PPAs; and

Status of Implementation of Prior Years’ Unimplemented Audit Recommendations

Part I – Audited Financial Statements Page No.

Independent Auditor’s Report 1

Statement of Management’s Responsibility for Financial 4

• Combined Statement of Financial Position 5

• Combined Statement of Changes in Net Assets/ Equity 6

• Combined Statement of Financial Performance 7

• Combined Statement of Cash Flows 8

• Statement of Comparison of Budget and Actual Amounts 9

• Notes to Combined Financial Statements 11

Part II – Detailed Audit Observations and Recommendations 45

Part III – Status of Implementation of Prior Years’ Unimplemented 104

Part IV – Appendices 117

AUDITED FINANCIAL STATEMENTS

INDEPENDENT AUDITOR’S REPORT

Hon. REYNOLDS MICHAEL T. TAN