Republic of the Philippines
COMMISSION ON AUDIT
Summary of Updates and Revisions for CY2021 RO9 Review Checklist
A. Review Checklist
Particulars
1 Audited Financial Statements as
Part I of AAR and Appendices in
ML
2 Annexes in SAORs - Include
information on financial
performance of the agency (E.g.
collections, cash advances) duly
certified by the concerned
personnel and validated by the
auditor.
3 Letterhead of transmittal of audit
report from ATL to RSA/SA and
RSA/SA to ORD
Signatory portion of IAR,
particularly initial of ATL in
duplicate of IAR
4 Transmittal Letter vis a vis listing of Where will the list of persons to be copy Revised transmittal letter and transfer list
persons/entities to be provided with furnished reports be indicated? In the
copies of reports (FOR MLs)
5 Copies of the report shall be
furnished the following:
Regional Director
6 Financial Highlights and Tables in
Executive Summary
Regional Office IX
as of October 22, 2021
Clarifications
Are we going to strictly require the
Teams to provide these data in the
SAORs?
transmittal letter or in the last page of the ML to the transmittal letter.
ML proper and immediately after the
signatory to the ML
Pursuant to current guidelines, the copy Proposed addition of ",thru RAEMU"
of the reports are to be provided to the
RAEMU. Will the Regioanl Director now
be revised to RAEMU? or just add "thru
RAEMU?"
Disposition/Proposed Revision
Updated FS titles, as appropriate per
sector and in accordance with relevant
COA Circulars
Added the statement as necessary or
required in the SAI.
Basis for revision: Not all sectors require
disclosure of these additional
information.
Added clarificatory statements on the
use of letterheads.
Basis: COA IX FB group post of Maam
Bess on April 28, 2020 discussing the
letterhead of the AAR/CML
Added:
",as applicable (ie. AARs of SUCs, WDs,
Cities and Provinces"
of person to be copy furnished from the
Or
Retain current presentation.
Proposed that rounding off is dependent
on relevant basis of the audit team (ie.
Relative size of agecny, agreement of
audit group or explicitly stated in the
SAI/GAI of the Audit Group (AG)) for FS,
NFS and tables.
Added:
Rounding off is dependent on relevant
basis of the audit team (ie. Relative size
of agecny, agreement of audit group or
explicitly stated in the SAI/GAI of the
Audit Group (AG))
 Summary of Updates and Revisions for CY2021 RO9 Review Checklist
7 Letterhead of IAR Added clarificatory statement that the
letterhead of the RO will be used in the
IAR.

Basis: COA IX FB group post of Maam

Bess on April 28, 2020 discussing the
letterhead of the AAR/CML

8 Figures in the FS and NFS should Proposed for revision:

be in thousands of pesos.
>The level of rounding (state whether in
thousand, pesos, absolute figures) in
presentation of figures in the FS and the
NFS is based on ______ (Indicate basis
- example: a. relative size of the entity,
b. agreements among the audit group, c.
stated in the SAI)

>The level of rounding in presentation of

figures in the FS, including the NFS are
disclosed.

Basis: IPSAS requirement on disclosure

of level of rounding in the FS and may
be impractical for smaller agencies. It
may also be additional work for
Management especially when
Management is not Excel-savvy.

9 The following format for signatories For clarification on format of SMR for FS Added and updated based on GAM/PAG
of SMR for FS should be followed: for WDs and CGS (CPSE and Non- 2 of IPSAS 14
CPSE) pursuant to Annex M of COA
Accountant Head of Agency Circular No. 2017-004, which includes
Date Signed Date Signed the Chairman of the Board as signatory.

10 Statements on verification of Applicability of these statements is

SCNAE in rows 294 to 321 dependent on the assessment of the
respective RSA/SA when accomplishing
the Checklist.
11 Collection of Income can be traced Proposed for deletion since these cannot
and reconciled with the Statement be verified without the provision of
of Financial Performance and FAR additional docuemnts
No. 5, as applicable;

12 Remittances of collections Proposed for deletion since these cannot

(revenues and other receipts) can be verified without the provision of
be traced and reconciled with the additional docuemnts
Pre-Closing Trial Balances,
SCNA/E and FAR No. 5, as
applicable;

13 Prepayments during the year How to determine presentation of this

should be net of amount item in the cash flows?
utilized/expended during the year;
14 NFS disclosure requirements of Added disclosure requirements for
PPE Inventory.
 Summary of Updates and Revisions for CY2021 RO9 Review Checklist
15 NFS disclosure requirement on Added:
Accounting Policies
Section 35 of IPSAS 3 on Accounting
Policies, Changes in Accounting
Estimates and Errors require disclosure
of standards that has not yet been
applied that has been issued but is not
yet effective. (Pertaining to the 4 IPSAS
(IPSAS 18, 22, 39 and 40) adopted in
COA Res. 2021-019 dated Jul 21, 2021)
*for CGS - Non-CPSEs

16 Audit Observations and
Recommendations are presented in audit report since FAM is only for
the order of significance with
priority for the reasons for
modification of opinion on the
financial statements.
1. Financial
2. Compliance
3. Value for Money
For clarification if VFM will be included in Proposed to add ",if applicable" after
Value for Money.
financial and compliance audit. Also,
audit objectives in the EL only state:
"Recommend measures to improve the
economy and efficiency of the agency's
operations"

17 Other mandatory areas (Shall Proposed uniform captions/headings and

include comments only. If with full
blown audit findings, present the
audit observations under
Compliance Audit.)
18 Comments on Fire Safety
19 Topic sentence is a one-liner
caption of the main audit issue duly
quantified, if possible (Bold)
arrangement of presentation for these
other mandatory areas as shown in the
checklist
Still part of audit focus in 2021?
Proposed to revise to:
"Present a one-liner caption before the
topic sentence of the main audit issue
duly quantified, if possible/applicable
(italicized) "

20 Guidelines on figures and rounding Proposed addition of note:

off of amounts:
This portion of the checklist does not
§ The word “million” is used after apply to the amounts presented in the
figures instead of the letter “M” and Audited FS (inlcuding NFS) and all
observe the following for figures in tables in the AAR/ML/CML.
the text of the observation:

a. Less than P500,000 use the

whole amount ex. P455,555

etc..

21 Quotation: Added:

§ If quotations include acronyms which

have not yet been spelled out first,
spellout the word after the acronymn in
brackets [ ].

Basis: Square brackets in a quote are

assumed to not be a part of the quote.
 Summary of Updates and Revisions for CY2021 RO9 Review Checklist
22 Acronyms Added statement on consistent use of
acronyms of laws:
23 Presentation of Recommendation For CMLs, is there a prescribed
for CMLs presentation for the recommendations?
Some are using tabular presentation
while some are in paragraph forms.
24 Arrangement of AO, Mgt Comment,
Auditor's Reqjoinder
25 Paragraph 2 in Acknowledgement Although this is the standard wording,
could we tweak this a bit to include the
audit recommendations in the SIPYAR
as well? Based on experience, the
agencies only include in the AAPSI the
recommendations in Part A.
26 Status of Implementation of Prior For CMLs, what is the prescribed
Years’ Audit Recommendations (for presentation of the audit findings?
CMLs) Should it be by Provincial Office/Division
Office/Branch (based on the individual
MLs) or should the Part A of the PY
CMLs be copied/followed in the
presentation?
§ When using acronyms, ensure that
the form of the acronym will be used
consistently throughout (ex. for Republic
Act No. 9184, either RA 9184 or RA No.
9184 is acceptable, provided that the
specific form is used consistently
throughout)
Added:
in item b, (SMART - Specific,
Measurable, Assignable/Achievable,
Realistic,
Time-related/Timely/Timebound)
Added statement on use of the phrase,
"We recommended and management
agreed to.."
d. When the Management Comment is
in agreement with the recommendation
and without any further details as to how
they will specifically implement the
recommendation, the use of the phrase
"We recommended and Management
agreed to.. " is appropriate. Otherwise,
replies to the AOM by Management
should be integrated and summarized in
the Management Comment portion of
the AAR/ML.
Basis: FAM Agreements
AND
Manner of presenting labels for
Recommendations, Management
Comments and Auditor's Rejoinder
iv. Audit Recommendation
("Recommendation")
v. Management Comment
("Management Comment")
vi. Auditor's Rejoinder ("Auditor's
Rejoinder")
Suggested revision:
We request a status report (in hard and
soft copy) on the actions taken on the
audit recommendations (contained in
Part A and Appendix H) within.
Updated statement below Part B.
"Audit observations and
recommendations with impact on the
financial statements and compliance
issues which are continuously monitored
are either reiterated or revised (with
modification) in Part A of this report."
 Summary of Updates and Revisions for CY2021 RO9 Review Checklist
27 SIPYAR descriptions/ statements For clarification: Added:
Will the reference only pertain to the
latest report reference or all report
references? (ie. 2020 AAR, AO No. __,
page __
vs
2020 AAR, AO No. ___, page ___
2019 AAR AO No. ___. Page ____
Will continuous numbering also be
applicable in Recommendations?
28 "§ reason for non-implementation"
29 Submission of RTS and timelines
30 Audit recommendations reported as
“Fully Implemented” in Part III of PY
AAR should be removed in Part III
of CY AAR.
a. Clarificatory notes on:
1. (Sample assessments and
presentation of status of
recommendations as lifted from the FAM
webinar are shown in Sheet SIPYAR)
2. What portion of the SIPYAR
eiterated, revised/restated and closed
recommendations are presented.
3. Statement reference when
recommendation is reiterated.
b. Definitions/description of reiterated,
revised/restated and closed
recommendations
c. Updated opening paragraph -
removed December 31, 20xx
d. For uniformity, the reference column
provisions were revised such that the
arrangement of references was already
made mandatory.
Basis - Agreements during the FAM
Webinar
Proposed for deletion, based on FAM
forum agreements
Added:
a. Reference to ORD Memo and
submission agreement of RTS from the
said Memo
b. All audit recommendations in Part II
and III of PY AAR and Part A and
SIPYAR of the CML/ML must be listed in
the RTS to show the auditor's
assessment of the status of the
recommendations
(Implemented/Unimplemented) and
his/her corresponding action (Reiterated,
Revised/Restated or Closed)
c. Updated statements to also included
CML/ML
Proposed revision from "Fully
Implemented" to "Implemented
and updated to include CML/ML
 Summary of Updates and Revisions for CY2021 RO9 Review Checklist
31 Attachments/Working Papers For purpose of review of the AAR, these
documents must be submitted to the
Review Committee:
a. Copy of AOMs
b. SAOR (FAM format, previously
IRBBA)
c. RTs
d. Softcoy of PY AAR/ML/CML (Add in
list of attachments)

Revised and listed part of new SAOR (ie.

A. Financial Audit Observations and
Recommendations, B. Summary of
Uncorrected Misstatements and C. Other
Compliance Observations)

For CCC - Proposed only up to RSA/SA

portion of CCC.

Added AAPSI and APMT in Other

documents which the SA may require in
his/her review.
 CMLs Complied with? Remarks
Particulars
NGS YES NO NA
3a Margins used, except for Transmittal Letter (see below for ü
TL) :
§ left “1 1/4”,
§ right “1”,
§ top and bottom “1”, except if with letterhead “1/2” top
margin
7 Presentation of the report
– semi block format (numbered sub-paragraphs in x
observations are indented (.25) while all headings/titles,
sub-headings and paragraphs to start on the left margin)

ex.
AUDIT OBSERVATIONS AND RECOMMENDATIONS

FINANCIAL AUDIT

Misstatements in Cash Accounts - P1.2 million

1. The balance of Cash accounts...

1.1 COA Circular No. 123-45 provides...

Page 7 of
– full block format (all headings/titles, sub-headings and ü
paragraphs to start on the left margin)

example:
A. DETAILED OBSERVATIONS AND
RECOMMENDATIONS

FINANCIAL AUDIT

Misstatements in Cash Accounts - P1.2 million

The balance of cash accounts…

1. COA Circular No. 123-45 provides...

Page 8 of
V. Audit Observations and Recommendations
1 The observations should include only residual issues not ü
addressed after (a) issuance of the AOM and (b) conduct
of exit conference.

2 Significant deficiencies, discussed in the portion “Audit ü

Observations and Recommendations”, warranted inclusion
in the AAR/CML/ML/SAOR
3 Unacted/unimplemented prior years’ recommendations ü
reiterated/revised/included as current year observations, as
may be appropriate.
4 Audit Observations and Recommendations are presented ü
in the order of significance with priority for the reasons for
modification of opinion on the financial statements.

The following arrangement should be followed:

1. Financial Audit (in the order of significance of findings

and not in order presentation of the accounts in the FS)
2. Compliance Audit
3. Value for Money Audit, if applicable

(If applicable, the same should also be included/stated in

the Audit Objective portion in the Executive Summary)

4. Other mandatory areas (Shall include comments only. If

with full blown audit findings, present the audit
observations under Compliance Audit.)
*If there is no AO on an audit thrust area, the working
papers should reflect work done to validate the same, with
a statement thereon that no findings were noted for the
particular area.
Enforcement of COA Disallowances and Charges (COA û
Memo 2009-084 dated Nov 16, 2009)

Page 9 of
Compliance with Tax Laws (Tabular presentation with ü
narrative)

(Out of the ending balance, the total remitted amount and

the date of remittance [in January 2023] should be
disclosed)

Compliance with Government Service Insurance System ü

(GSIS) Act of 1997 (RA No. 8291)
-Deductions and Remittance of GSIS contributions
including remittance of Loans Repayments

(Out of the ending balance, the total remitted amount and

the date of remittance [in January 2023] should be
disclosed)

Compliance with Property Insurance Law (RA No. 656) ü

- General insurance of all insurable risks of government
agencies with the GSIS pursuant to RA No. 656, as
amended by Presidential Decree No. 245;
Compliance with Home Development Mutual Fund (HDMF) ü
Law of 2009 (RA No. 9769)
- on the Proper deduction of Pag-IBIG Fund Contribution
and Short-Term and Loan Amortization from the salaries of
employee and timely remittance of said deductions to the
HDMF

(Out of the ending balance, the total remitted amount and

the date of remittance in January 2023 should be
disclosed)

Page 10 of
 Compliance with National Health Insurance Act of CY 2013
(RA No. 7875 as amended by RA No. 9241 and 10606)
-Deductions and Remittance of contributions to the
Philippine Health Insurance Corporation (PHIC)

(Out of the ending balance, the total remitted amount and

the date of remittance [in January 2023] should be
disclosed)

Comments on Programs and Projects related to Gender ü

and Development (GAD)
Comments on Programs Pertaining to Differently – Abled ü
Persons and Senior Citizens
Comments on Programs Pertaining to Local Council for x
Protection of Children (LCPC)
Comments on Payment to Casuals, Job orders, ü
contractuals and consultants regardless of fund source and
account charged (re: COA Memo 2012-010 dated Oct 17,
2012, COA-DBM JC No 01-2020 and JC No. 02-2020)

Compliance with the Fire Code of the Philippines (RA No. ü

9514) *Inclusion of this audit area is dependent on the SAI
of the Audit Group. Please indicate in Remarks, if still
applicable for CY 2021.

(Optional compliance)

Comments pertaining to Summary of Loans Payable. x

(If the NFS already includes Summary of Loans Payable,

there is no need to include comments of such as Other
Mandatory Areas)

Other SAI Audit Areas (ie. DOH Youth Development) that ü

are Sector Specific. Please indicate in remarks
5 Review whether annexes indicated correctly correspond to ü
annexes attached in the ML.

Page 11 of
6 Present a one-liner caption before the topic sentence of ü
the main audit issue duly quantified, if possible/applicable
(italicized)
example: Understatement in Accounts Payable - Pxxxx

7 Figures in table/graph should be cross referred to the text ü

in the report

(In presenting the Pesos sign, the use of either "P"or "₱"
are allowed as long as consistently used all throughout the
report. Not to use "PhP" anymore)

8 Support paragraphs of audit observation & ü

recommendations are written in a brief and concise
manner and contain statements of:

§ condition (what is wrong),

§ criteria (by what standard it is judged),
§ cause (why it happened) and
§ effects (on fair presentation of FS, operation/activity etc.)

o condition/deficiency is adequately supported by

competent and relevant audit evidence in the working
papers
o condition/deficiency reported is quantified
o cause of condition/deficiency is clearly stated
o effect of condition/deficiency is quantified, if possible
o effect of condition/deficiency is traced to the working
papers
o effect of condition/deficiency is traced to the audit
conclusions
o audit conclusions proceed logically from results of audit
procedures performed
o audit conclusions answer the objectives of the audit
§ findings with NS, ND or NC, do not include in Part II.

Page 12 of
 (The effect can be dispensed with if it involves violation of
law, regulation, etc unless such violation has financial
impact)
9 Do not use words like ‘implicit’ ‘clearly’ ‘obvious’ ‘tirelessly’ ü
‘failure’ – avoid words expressing an extreme situation
whether positive or negative

(The use of "clearly" and "failure" can be on a case-to-case

basis)

10 It should not be subjective, judgmental, conclusive and ü

wordy.

11 Do not use names of suppliers or individuals in reports or ü

tables, such that they can be traced unless extremely
necessary

(The use of names of suppliers or individuals is on a case-

to-case basis if extremely necessary or if the findings can
be substantiated, the name of the suppliers or individuals
may be named)

12 Tables ü

§ Align all tables as much as possible to the width of the

paragraph text

§ Amounts in tables should be right aligned, all texts

should be left aligned or centered, as appropriate.

§ Provide analysis all tables and graphs presented

(The presentation of the tables in the observation should

be 2 pages maximum. If there are lenghty supporting
tables, the same should be placed as a separate annex.)

Page 13 of
13 Review mathematical accuracy of tables/schedules. ü

14 Figures (Does not apply to amounts presented in the ü

Audited FS (including the NFS) and all tables in the
AAR/ML/CML) If presenting in absolute figures, indicate
basis in the remarks portion of this checklist - (ie Relative
size of agency, agreement of audit group or explicitly
stated in the SAI/GAI of the Audit Group (AG))

§ The word “million” is used after figures instead of the

letter “M” and observe the following for figures in the text of
the observation:

a. Less than P500,000 use the whole amount ex.

P455,555

b. P500,000 or more round off as P0.500 million

c. Write amount as P373.752 million, P0.63 million,

P34.637 million

d. Write percentages as 25.1 per cent

e. Be consistent in presenting figures

15 Change all numbers less than 10 (1,2,3,…9) to words ü

(one, two, three,...nine)

16 Use “0” (right aligned) instead of a dash ü

17 Tenses/Grammar ü

Page 14 of
§ Past tense is used in introducing the recommendations
followed by the action taken by management in present
tense (e.g., We recommended that Management analyze
the account and adjust, as appropriate.)

Page 15 of
18 Quotations ü

§ As much as possible, quotations of rules and regulations

shall be avoided. If quotations cannot be avoided, quote
only pertinent portions of provisions of laws, rules and
regulations and present it with both sides short indented
and enclosed with quotation marks (Do not italicize).

§ Management’s comments shall not be quoted verbatim

but shall be summarized.
§ Carefully check accuracy of necessary quotations and
references
§ Review whether criteria cited and presented in audit
observations actually exist.
§ Check whether quoted criteria are faithful to/exact
copies of the original provisions.
§ If quotations include acronyms which have not yet been
spelled out first, spellout the word after the acronym in
brackets [ ].

19 Acronyms ü

§ For AARs, when using acronyms, spell out in full on the

first usage per section, as follows:

- Transmittal letter,
- Executive Summary,
- Part I, and
- Part II and Part III (As one)

§ For CMLs/MLs, when using acronyms, spell out in full on

the first usage per section, as follows:

- Body of ML
- SIPYAR

Page 16 of
 § Do not use acronyms without first using the full words

§ When using acronyms, ensure that the form of the

acronym will be used consistently throughout (ex. for
Republic Act No. 9184, either RA 9184 or RA No. 9184 is
acceptable, provided that the specific form is used
consistently throughout)

§ The acronym should be spelled out in full if used in the

beginning of a paragraph even if it was previously spelled
out in full in the same section.
20 Paragraphs ü

§ Align all paragraphs

§ For all lists (a,b,c or bullets), start each item with a

Capital letter, separate each item with a semi-colon ( ;) and
use an ‘and’ before the last item.

21 Recommendations ü

a. address real causes of deficiencies

b. are precise and doable (SMART - Specific, Measurable,

Assignable/Achievable, Realistic,
Time-related/Timely/Timebound)

c. do not use ‘should’ in recommendations

22 Management’s Comment/Auditor’s Rejoinder are properly ü

presented in the “Audit Observations and
Recommendation” portion

1. Arrangement per audit observation:

Page 17 of
a. With management comment, without auditor’s
rejoinder without any change in original observation and
recommendation:
i. Audit area
ii. Topic Sentence
iii. Body
iv. Audit Recommendation ("Recommendation" for
AARs)
v. Management Comment ("Management Comment"
for AARs)

b. With management comment and auditor’s rejoinder

without any change in original observation and
recommendation:
i. Audit area
ii. Topic Sentence
iii. Body
iv. Audit Recommendation ("Recommendation" for
AARs)
v. Management Comment ("Management Comment"
for AARs)
vi. Auditor's Rejoinder ("Auditor's Rejoinder" for
AARs)

c. With management comment and auditor’s rejoinder

with change in recommendation duly communicated to
management within 1 week from date of exit:
i. Audit area
ii. Topic Sentence
iii. Body incorporating management comment and
auditor's rejoinder
iv. Audit Recommendation ("Recommendation" for
AARs )

Page 18 of
 v. Management Comment ("Management Comment"
for AARs)

(if management comment refers to the discussion, it

should be presented before recommendation. If just
a comment on the recommendation but
recommendation stand/s, may be presented after
recommendation)

d. When the Management Comment is in agreement with

the recommendation and without any further details as to
how they will specifically implement the recommendation,
the use of the phrase "We recommended and
Management agreed to.. " is appropriate. Otherwise,
replies to the AOM by Management should be integrated
and summarized in the Management Comment portion of
the AAR/ML.

(FOR MLs ONLY) PART B. STATUS OF IMPLEMENTATION OF PRIOR YEARS’ AUDIT RECOMMENDATIONS
ü
1 Paragraph 1 should be stated this way:

“We made a follow-up on the action taken by the (Auditee)

to implement the recommendations of prior years and
noted the following:

1. Paragraph 2:

"Audit observations and recommendations with impact on

the financial statements and compliance issues which are
continuously monitored are either reiterated or revised
(with modification) in Part A of this report."

Page 19 of
 (FOR CML/MLs ONLY) C. ACKNOWLEDGMENT ü

1 Paragraph 1 under this should be worded in this way:

"We wish to express our appreciation to the Management

and staff of (Agency Name) for the cooperation and
assistance extended to our audit team during the audit."

2 Paragraph 2: ü

"We request a status report (in hard and soft copy) on the
actions taken on the audit recommendations (contained in
Part A and Annex H) within sixty (60) days from the date of
receipt hereof, pursuant to Section ___ of the General
Provisions of the General Appropriations Act of 20XX (RA
No. _______), using the attached Agency Action Plan and
Status of Implementations (Annex L)."

VI. Status of Implementation of Prior Years’ Audit ü

Recommendations
A Provide a statement on the quantity/number of prior years’
audit recommendations implemented and not implemented
in the current year (Note: Count recommendations
individually and not on a per observation basis). Pro forma
statement is as follows:

"Of the ____ prior years' recommendations ____ were

implemented and ____ were unimplemented as shown in
the results of validations presented below:"

This paragraph shall be followed by the Matrix of “Status of

Implementation Prior Years’ Audit Recommendations”
which contains the following columns:

Page 20 of
a) Column 1 is for “Reference” - pertains to the source
of the observation and should be placed in the following
order: latest year of the AAR where observation was
presented, observation number and page number (eg.
2020 AAR, AO no. ___, page ___ )
b) Column 2 is for “Observation” - presents all audit
observations of previous year. (continuous numbering)
c) Column 3 is for “Recommendations” – presents all
prior years’ audit recommendations.
d) Column 4 is for “Status of Implementation” which shall
indicate
d1) management’s action either – “Implemented”, or
“Unimplemented” only

o For unimplemented recommendations (Sample

assessments and presentation of status of
recommendations as lifted from the FAM webinar are
shown in Sheet SIPYAR):

a. Only “reiterated” recommendations appear both in

Parts II and III, as presented in the Table/Matrix in the
SIPYAR. (Reiterated recommendations pertain to
unimplemented recommendations without any changes in
amounts, where conditions still exist that affect the audit
opinion in the CY)

a2. Reference to the reiteration of the audit observation in

the current years’ AAR, as appropriate.

"This is reiterated in the audit of CY 2021 accounts as AO

(if already previously stated) No.___"

Page 21 of
b. Unimplemented recommendations which are
“restated/revised” only appear in Part II but will still be
presented in the paragraph following the Table/Matrix in
the SIPYAR.
(Revised/restated recommendations are unimplemented
recommendations where conditions still exist in the CY,
which the auditor may need to assess to determine if there
is a need to be revised or refocused. examples:
recommendations that are no longer doable or impractical)

c. Unimplemented recommendations which are “closed”

do not appear in Parts II and III of the current
AAR/CML/ML, but will still be presented in the paragraph
following the Table/Matrix in the SIPYAR.
(Closed recommendations pertain to audit issues intended
to be addressed by the unimplemented recommendations
which no longer exist due to, among others, closing of the
project, or adoption of new accounting system, or
implementation by management of control measures other
than the Audit Team’s recommendation. Closed
recommendations also pertain to observations with issued
NS/ND/NC).

In cases b and c, include a paragraph after the matrix

stating that:

"____(Quantity) audit recommendations appearing in the

PY AAR/CML/ML were revised and included in Paragraph
___, Part II/A of this report (State specific recommendation
paragraphs), while _____(Quantity) recommendations
which are no longer applicable, or addressed through other
audit action, have been closed and excluded from this
SIPYAR."

Page 22 of
B If audit observation (AO) appearing in Part III of PY AAR is
with material impact on the FS and/or falling under
paragraphs 76 to 82, page 108 of FAM, AO should be
reiterated in CY AAR.

C Par. 79, page 108 of FAM: All unimplemented

recommendations considered closed/closed for having
been revised shall be recommended by the SA/RSA for
approval of the CD/RD, and once approved, the same shall
be deleted from the SIPYAR of the succeeding year.

Pursuant to the above and the Unnumbered Memorandum

issued by the ORD dated October 20, 2021 on the
Agreements on the Preparation of the FAM Templates for
CY 2021, the RTS should be submitted to SA/RSA and
approval of RD, following these guidelines:

a. AAR/CML transmitted by RO - RTS to be submitted to

RO with the first draft of the AAR/CML
b. AAR transmitted by SA - RTS to be submitted to SA with
the first draft of the AAR/CML
c. MLs - RTS to be submitted to RSA after Exit Conference
but before final draft of MLs

2 All audit recommendations in Part II and III of PY AAR and

Part A and SIPYAR of the CML/ML must be listed in the
RTS to show the auditor's assessment of the status of the
recommendations (Implemented/Unimplemented) and
his/her corresponding action (Reiterated, Revised/Restated
or Closed)

3 Issue another AOM to reiterate and or restate/revise the

unimplemented recommendations.

Page 23 of
4 Part III of CY AAR shall include audit recommendations in
Parts II and III of PY AAR or Part A of the CY ML/CML
shall include audit recommendations in Part A and
unimplemented recommendations from the SIPYAR
Appendix of the PY ML/CML

5 Audit recommendations reported as “Implemented” in Part

III of PY AAR or SIPYAR of the PY CML/ML should be
removed in Part III of CY AAR or SIPYAR of the CY
CML/ML.

For AARs, List of Appendices is presented in the flyleaf for x

Part IV. Sample format see sheet "Appendix - AAR"

For CML/ML, list of appendices is presented in CML/ML, ü

presented continuously after signatory and copy furnished.

Page 24 of
 Republic of the Philippines
COMMISSION ON AUDIT
Regional Office IX

Checklist on the Preparation and Review of Year-End Reports (AARS, CMLs,MLs and SAORS) for Calendar Year 2021 Audit

Name of Government Entity Audit Team Leader

Type of Year End Report and Period Covered Supervising Auditor
Year-End Report Prepared and Submitted by: Date Prepared:
Year-End Report Received and Reviewed by: Date Received:
Year-End Report Review Completed by and on:

AARs CMLs MLs SAORs Complied with? Remarks

Particulars
LGS SUCs WDs NGS CGS NGS CGS NGS CGS YES NO NA

C. Transmittal/Submission (Hard and Soft Copies)

4 Copies of the report shall be furnished the following:
§ Vice President of the Republic of the Philippines, 11F, ü ü
Robinsons Cybergate Plaza, EDSA cor. Pioneer St.,
Mandaluyong, 1550, Metro Manila

II. Executive Summary (all caps, Arial 11, position at the left ü ü ü x x x x x x
margin)

2 Financial Highlights (in Totals, rounding off is dependent

on relevant basis of the audit team (ie. Relative size of
agency, agreement of audit group or explicitly stated in the
SAI/GAI of the Audit Group (AG))

- Statement of Financial Position with comparative figures

(assets, liabilities, equity, with Increase/Decrease)

Page 25 of
5 Summary of total suspension, disallowances and charges
as of yearend (rounding off is dependent on relevant basis
of the audit team (ie. Relative size of agency, agreement of
audit group or explicitly stated in the SAI/GAI of the Audit
Group (AG))

(The summary should not be showing a total at the bottom)

6 Statement on the quantity/number of prior years’ audit

recommendation/s implemented and unimplemented in the
current year

(The quantity/number of PYARs should be tallied with the

quantity/number in SIPYAR and RTS)

Page 26 of
IV Audited Financial Statements (AFS)
B. Statement of Changes in Net Assets/Equity /
Statement of Changes in Equity
Notes: Applicability of these statements is dependent on
the assessment of the respective ATL/RSA/SA when
accomplishing the Checklist.

Equity figures in SCNAE tallies with that in SFPos, taking ü ü ü ü ü ü ü x x

into consideration the following:

1 The amount of Accumulated Surplus/(Deficit)to be

presented in the beginning balance of the current year
column of the SCNAE shall be taken from the Balance at
December 31, 2021 which was carried forward as
beginning balance in the Books of Accounts/General
Ledger at January 1, 2022

2 The amount to be reflected in the Changes in Accounting

Policy in the SCNAE represents the difference between the
net amount of direct adjustments to “Accumulated
Surplus/(Deficit” account due to “Changes in Accounting
Policy”as reflected in the SCNA/E, Accumulated
Surplus/(Deficit) for CY 2021 as Restated and the amount
in the SCNA/E, Accumulated Surplus/(Deficit) at December
31, 2021

3 The amount to be reflected in the Prior Period

Adjustments/Unrecorded Income and Expenses in the
SCNAE represents the difference between the amount of
“Surplus/(Deficit) for the Period” reflected in the Statement
of Financial Performancefor CY 2021 as Restated and the
amount in the Statement of Financial Performance at
December 31, 2021.

Page 27 of
4 The amount to be reflected in the Other Adjustments
represents the difference between the net amount of direct
adjustments to “Accumulated Surplus/(Deficit” account due
to “Other Adjustments”(or adjustments pertaining to year/s
prior to CY 2021) as reflected in the SCNA/E (Accumulated
Surplus/(Deficit) for CY 2021 as Restated and the amount
in the SCNA/E (Accumulated Surplus/(Deficit) at December
31, 2021

5 The amount to be reflected in Restated Balances in the

SCNAE represents the sum of Beginning Balance at
December 31, 2021 and the net adjustments to
Accumulated Surplus/(Deficit) account due to:(1) Changes
in Accounting Policy, (2) Prior Period
Adjustments/Unrecorded Income and Expenses, and (3)
Other Adjustments, as shown above. This should tally with
the balance of the Accumulated Surplus/(Deficit) account in
the Statement of Financial Position and the SCNA/E,
Accumulated Surplus/(Deficit) both for CY 2021, as
Restated.

8 The amount to be reflected in Surplus/(Deficit) for the

Period of the SCNAE represents Surplus/(Deficit) as
presented in the Statement of Financial Performance for
the Year Ended December 31, 2022.

10 The amount to be reflected in "Others" row in the SCNAE

is the difference between the Restated Balance of account
“Accumulated Surplus/(Deficit” for CY 2021 and the
amount reflected in the Adjusted Pre-Closing Trial Balance
as of December 31, 2022

Page 28 of
11 The amount to be reflected in Balance at December 31,
2022 Carried Forward of the SCNAE represents the sum of
“Restated Balance” and “Changes in Net Assets/Equity for
Calendar Year” as shown above. This should tally with the
balance of Accumulated Surplus/(Deficit) account reflected
in the Statement of Financial Position as of December 31,
2022

C. Statement of Financial Performance/Statement of

Comprehensive Income
1 The amount of “Surplus/(Deficit) for the Period” should tally ü ü ü ü ü ü ü x x
with the amount of “Surplus/(Deficit) for the Period” as
reflected in the Statement of Changes in Net
Assets/Equity, Accumulated Surplus/(Deficit) for the Year
Ended December 31, 2022
D. Statement of Cash Flows/Cash Flows Statement
1 Cash and Cash Equivalents January 1, 2022 reported in ü ü ü ü ü ü ü x x
the Statement of Cash Flows should tally with the Total
Balance of Cash and Cash Equivalents in the Statement of
Financial Position as of December 31, 2021;

2 Cash and Cash Equivalents as of December 31, 2022 ü ü ü ü ü ü ü x x

reported in the Statement of Cash Flows should tally with
the Total Balance of Cash and Cash Equivalents in the
Statement of Financial Position as of December 31, 2022

V. Audit Observations and Recommendations

4 Audit Observations and Recommendations are presented ü ü ü ü ü ü ü ü ü
in the order of significance with priority for the reasons for
modification of opinion on the financial statements.

The following arrangement should be followed:

1. Financial Audit (in the order of significance of findings

and not by the presentation of the accounts in the FS)

Page 29 of
2. Compliance Audit
3. Value for Money Audit, if applicable

(If applicable, the same should also be included/stated in

the Audit Objective portion in the Executive Summary)
4. Other mandatory areas (Shall include comments only. If
with full blown audit findings, present the audit
observations under Compliance Audit.)
*If there is no AO on an audit thrust area, the working
papers should reflect work done to validate the same, with
a statement thereon that no findings were noted for the
particular area.
Compliance with Tax Laws (Tabular presentation with ü ü ü ü ü ü ü x x
narrative)

(Out of the ending balance, the total remitted amount and

the date of remittance should be stated at the bottom of the
table)

Compliance with Government Service Insurance System ü ü ü ü ü ü ü x x

(GSIS) Act of 1997 (RA No. 8291)
-Deductions and Remittance of GSIS contributions
including remittance of Loans Repayments

(Out of the ending balance, the total remitted amount and

the date of remittance should be stated at the bottom of the
table)

Compliance with Home Development Mutual Fund (HDMF) ü ü ü ü ü ü ü x x

Law of 2009 (RA No. 9769)
- on the Proper deduction of Pag-IBIG Fund Contribution
and Short-Term and Loan Amortization from the salaries of
employee and timely remittance of said deductions to the
HDMF

(Out of the ending balance, the total remitted amount and

the date of remittance should be stated at the bottom of the
table)

Page 30 of
 Compliance with National Health Insurance Act of CY 2013
(RA No. 7875 as amended by RA No. 9241 and 10606)
-Deductions and Remittance of contributions to the
Philippine Health Insurance Corporation (PHIC)

(Out of the ending balance, the total remitted amount and

the date of remittance should be stated at the bottom of the
table)

Compliance with the Fire Code of the Philippines (RA No. ü ü ü ü ü ü ü ü ü

9514) *Inclusion of this audit area is dependent on the SAI
of the Audit Group. Please indicate in Remarks, if still
applicable for CY 2021.

(Optional compliance)

Comments pertaining to Summary of Loans Payable. ü ü ü x x x x x x

(If the NFS already includes Summary of Loans Payable,

there is no need to include comments of such as Other
Mandatory Areas)

7 Figures in table/graph should be cross referred to the text ü ü ü ü ü ü ü ü ü

in the report

(In presenting the Pesos sign, the use of either "P","₱" or

"Php" are allowed as long as consistently used all
throughout the report.)

8 Support paragraphs of audit observation & ü ü ü ü ü ü ü ü ü

recommendations are written in a brief and concise
manner and contain statements of:

§ condition (what is wrong),

§ criteria (by what standard it is judged),
§ cause (why it happened) and

Page 31 of
 § effects (on fair presentation of FS, operation/activity etc.)

o condition/deficiency is adequately supported by

competent and relevant audit evidence in the working
papers
o condition/deficiency reported is quantified
o cause of condition/deficiency is clearly stated
o effect of condition/deficiency is quantified, if possible
o effect of condition/deficiency is traced to the working
papers
o effect of condition/deficiency is traced to the audit
conclusions
o audit conclusions proceed logically from results of audit
procedures performed
o audit conclusions answer the objectives of the audit
§ findings with NS, ND or NC, do not include in Part II.

(The effect can be dispensed with if it involves violation of

law, regulation, etc unless such violation has financial
impact)
9 Do not use words like ‘implicit’ ‘clearly’ ‘obvious’ ‘tirelessly’ ü ü ü ü ü ü ü ü ü
‘failure’ – avoid words expressing an extreme situation
whether positive or negative

(The use of "clearly" and "failure" can be on a case-to-case

basis)

11 Do not use names of suppliers or individuals in reports or ü ü ü ü ü ü ü ü ü

tables, such that they can be traced unless extremely
necessary

(The use of names of suppliers or individuals is on a case-

to-case basis. If the findings can be substantiated, the
name of the suppliers or individuals can be named.)

12 Tables ü ü ü ü ü ü ü ü ü

Page 32 of
 § Align all tables as much as possible to the width of the
paragraph text

§ Amounts in tables should be right aligned, all texts

should be left aligned or centered, as appropriate.

§ Provide analysis all tables and graphs presented

(The presentation of the tables in the observation should

be 2 pages maximum. If there are lenghty supporting
tables, the same should be placed as a separate annex.)

19 Acronyms ü ü ü ü ü ü ü ü ü

§ For AARs, when using acronyms, spell out in full on the

first usage per section, as follows:

- Transmittal letter,
- Executive Summary,
- Part I, and
- Part II and Part III (As one)

§ For CMLs/MLs, when using acronyms, spell out in full on

the first usage per section, as follows:

- Body of ML
- SIPYAR

§ Do not use acronyms without first using the full words

§ When using acronyms, ensure that the form of the

acronym will be used consistently throughout (ex. for
Republic Act No. 9184, either RA 9184 or RA No. 9184 is
acceptable, provided that the specific form is used
consistently throughout)

Page 33 of
 § The acronym should be spelled out in full if used in the
beginning of a paragraph even if it was previously spelled
out in full in the same section.
22 Management’s Comment/Auditor’s Rejoinder are properly ü ü ü ü ü ü ü ü ü
presented in the “Audit Observations and
Recommendation” portion

c. With management comment and auditor’s rejoinder

with change in recommendation duly communicated to
management within 1 week from date of exit:
i. Audit area
ii. Topic Sentence
iii. Body incorporating management comment and
auditor's rejoinder
iv. Audit Recommendation ("Recommendation" for
AARs )
v. Management Comment ("Management Comment"
for AARs)

(There is no hard and fast rule on the presentation)

VIII Attachments/Working Papers

Page 34 of
RTS Recapitulation Sample

Recapitulation:

AO Number (as
Assessment of Agency Action Auditors Action on Audit Recommendation presented
above)
Implemented Implemented 2 and 4
Closed – Change in Condition/Other Agency
Implemented 6
Action
TOTAL IMPLEMENTED
Unimplemented Not Reiterated 3
Unimplemented Reiterated 1,2,5 and 6
Unimplemented Restated 4 and 5
Unimplemented Closed – With Audit Action 7
TOTAL UNIMPLEMENTED
TOTAL
Qty

3
1
4
1
6
3
1
11
15
 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

ANNUAL AUDIT REPORT 26”

ON THE 20”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

MANAGEMENT LETTER 26”

ON THE AUDIT OF 20”

FUND NAME (If applicable) 26”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

MANAGEMENT LETTER 26”

ON THE AUDIT OF 20”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

CONSOLIDATED MANAGEMENT LETTER 26”

ON THE AUDIT OF 20”

FUND NAME 26”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

CONSOLIDATED MANAGEMENT LETTER 26”

ON THE AUDIT OF 20”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 [COA LOGO]

Republic of the Philippines 14”

COMMISSION ON AUDIT 14”
Regional Office No. IX 14”
Zamboanga City 14”

SUMMARY OF AUDIT OBSERVATIONS AND RECOMMENDATIONS 26”

ON THE 20”

(NAME OF AGENCY) 26”

For the Year Ended ______________ 20”

 PART IV

APPENDICES

I. Financial Statements by Fund

Statement of Financial Position as at December 31, 20XX A
Statement of Financial Performance For the Year Ended December 31, 20XX A-1
Statement of Cash Flows For the Year Ended December 31, 20XX A-2
Statement of Changes in Net Assets / Equity A-3
II. Summary of Statement of Appropriations, Allotments, Obligations and Balances-G B
III. Summary of Statement of Appropriations, Allotments, Obligations and Balances- C