Department of Education

Division of Zamboanga del Norte

Zamboanga del Norte

Summary of Audit Observations and Recommendations (SAOR)

(Additional Audit Observation Memurandoms)

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Audit Observations
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AOM 2016
– 002 (15) DepEd DO of ZdN continuously
maintained current bank accounts
with the Development Bank of the
Philippines (DBP) with a total
balance of P149,528,017.13 as of
December 31, 2015 without legal
basis and failed to remit to the
Bureau of Treasury income from
collections from registrations of
trainings and seminars, refund of
excess cash advance, excess funds
for completed programs, activities
and projects, fund transfers from
Cash in Bank, National Treasury
MDS accounts and other collections
in violation to Executive Order
(EO) No. 338, s. 1996 dated May 17,
1996, and Section 3 of Republic Act
No. 10651 precluding the maximum
Recommendations
We recommend that DepEd DO- account.
ZdN should be more prudent in
managing the cash of the If isara siya advantageous sa among part.
government by: Pamafinalized katong payroll fund account,
a. discontinuing the practice of
transferring of funds to avoid
reversion to BTr, using the
accounts as conduit account for
ADA purposes, depositing
income and other collections
under any of its current account
except expressly authorized by
law and other regulations;
b. instructing the Accountant to
analyze the Cash in Bank -
Local Currency, Current
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Management’s Comments
Hindi lahat ng mga prooflist napapasok sa
kung unsa ako gisulod sir mao fud akng gi-
credit.
Mam isis asking.
Everytime we submit inventory of bank
accounts, magsubmit man me.
The accountant will abide the
recommendation of auditor to analyze the
Cash in Bank – LCCA
Auditor’s Rejoinder
We have the standing order to
close the current account;
We have live with the laws and
regulations;
Analyze ung accounts kung sure
nato;
Mam asking for timeline,
The government having difficult
time
Referenc
Audit Observations Recommendations Management’s Comments Auditor’s Rejoinder
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utilization of the scarce resources of Account (1-01-02-020) and
the government. resolve the unreconciled items
with a timeline;

c. directing the
Accountant and Cashier to
immediately remit/revert all
the collections and excess
funds to the Bureau of
Treasury in accordance with
EO No. 338 and Section 3 of
the General Provisions of
Republic Act No. 10651 or
the General Appropriations
Act of 2015 or to source
agency such as the DepEd
Regional Office; and

d. obtain for an
authority from the BTr to
maintain the DBP current
accounts, otherwise, close the
account.

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Audit Observations
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The electronic accounting report
generating system of DepEd
Division Office of Zamboanga del
Norte known as the Government
Accounting and Financial Report
(GAFR) was found to be
unauthorized and non-compliant
with the National Government
Accounting System (NGAS) in
violation of COA Circular No.
2002-002 and 2003-005 dated June
20, 2002 and July 30, 2003,
AOM 2016 respectively.
– 009 (15)
Recommendations Management’s Comments Auditor’s Rejoinder
We are not asking to cease the
Having in mind the good After the AOM, the Regional Office is asking using of GAFR,
intention of management in the for authority. Be critical kung Makita kayo,
procurement of an electronic Status quo sa; inform the regional office.
accounting report generating Maganda naman
system, we recommend that
management to:
Management acknowledged this deficiency
a. secure the and admitted that prior authority was not
approval/authority of the secured by management. This software was
Commission on Audit on the introduced by DepEd Regional Office for used
use of the software; by all DOs and IUs in Region IX. To facilitate
the preparation of financial reports,
b. offer an explanation management adopted GAFR in their system.
on the inconsistencies of the
Despite the above mentioned deficiency and
dates of documents;
all others issues that GAFR failed to address,
management is positive on the benefits
c. submit the lacking
brought by the system in the preparation of
documents mentioned in this
their financial reports. Though GAFR is not yet
AOM and the Annual
perfect accounting software for the
Procurement Plan (APP) government, nevertheless, its benefits to
containing the procurement management justifies its cost.
of the database programs;
and Management, however, is ready to abide to
whatever is the recommendation of COA.
d. disburse funds in
accordance with laws, rules
and regulations.
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Audit Observations Recommendations Management’s Comments Auditor’s Rejoinder
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Schedule of Advances to Contractors We therefore recommend that Ang presentation sa schedule when the
(1990201000) account totaling management: accountant assume in office is the same.
₱1,579,646.77 is deficient with
critical information such as name of a. Instruct the Accountant to
the contractor(s), project create a comprehensive
title/name, date when advances analysis and monitoring
were granted, check number, report on the Advances to
contract time, date started, Contractors and submit the
estimated date of completion and same to COA;
age of each amount advanced as a
result of management's inadequate b. Require the Physical
effort to monitor and initiate Facilities Coordinator (PFC)
recoupment of advances which is to review/inspect overdue
AOM 2016 not in keeping with Section 111 of projects; and
– 010 (15) Presidential Decree (PD) No. 1445.
c. Identify and evaluate
problems of the
uncompleted projects and
inform the Accounting
Section and other concerned
offices on the status for
appropriate action.

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Audit Observations Recommendations Management’s Comments Auditor’s Rejoinder
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A total of P6,097,725.00 We therefore recommend
representing fund transfers to management: Accountant said pag-assume niya sa office no
National Government Agencies movement sa amount.
(NGAs) for project implementation a. send demand letters
remained outstanding for over 3 (confirmation letter) to the I cannot determine the office.
years as of December 31, 2015 in DPWH, requiring the
violation of COA Circular Nos. 94- agency to immediately BO – baka project ni Labadlabad
013 and. 96-003 resulting to liquidate or account the
overstatement of Accumulated funds transferred to it. The accountant said they will have a meeting
Surplus account. Funds which were not fully with the DPWH and he will try raise these
utilized should be reverted issues to the DPWH.
to the Division Office for
proper accounting thereof; The Management committed to abide with the
and audit recommendations.
AOM No.
2016-011
b. should closely monitor the The accountant explained the closure of bank
implementation of the accounts
projects funded by the
agency to ensure that these
are
accomplished/implemented
in accordance with the
MOA and specifications of
the project.

AOM No. The accuracy and validity of the We therefore recommend that Kumulang
2016 - 012 balance of Due from Regional DepEd Division Office of Dapat ma-analyze and due to
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Referenc
Audit Observations Recommendations Management’s Comments Auditor’s Rejoinder
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Offices account totaling Zamboanga del Norte direct the Management committed to abide with the regional operationg units
P83,377,267.52 as of December 31, Accounting Section to: audit recommendations.
2015 is doubtful due to non-
submission of the Schedule/Aging of a. verify and analyze records; I never mentioned this to bestsy, kasi sa kanila
Receivable which is not in ung control.
consonance with Sections 4.d and b. come about with an SL and
75 of the Manual on the New aging/schedule of the Off records kasi may control siya
Government Accounting System account to support the
(MNGAS), Volume I. balance sheet and facilitate
audit; and

c. communicate with the

Regional Office and request
to immediately liquidate or
account the funds
transferred to it. Funds
which were not fully
utilized should be reverted
to the Division Office for
proper accounting thereof.

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Audit Observations Recommendations Management’s Comments Auditor’s Rejoinder
e

The validity, accuracy, and We recommend that regular
existence of the reported balances physical count of inventory be
of Property, Plant and Equipment conducted annually, and the
(PPE) accounts in the agency’s corresponding Reports, certified
financial statements as of correct by the Inventory Committee
December 31, 2015 with a book and approved by the Head of
value amounting to Agency, be immediately reconciled
P999,827,979.44 cannot be fully with the accounting records so that
relied upon due to the absence of any differences in PPE valuation
physical inventory reports for PPE are timely resolved. Submission of
accounts and the non- RPCPPE should be made within
maintenance of complete prescribed period to support the
AOM No. perpetual inventory records validity and reliability of the
2016-013 which are not in keeping with the reported account balances.
applicable provisions of the Furthermore, we recommend that
Government Accounting and management instruct the
Auditing Manual (GAAM) and the Property/Supply Unit and the
Manual on the New Government Accounting Section to maintain the
Accounting System (MNGAS). PC and PPELC, respectively, for all
types of PPE indicating therein the
critical information necessary for
effective management, tracking and
accounting.
The incumbent/current supply officer
commented that she just assumed in office on
March 2015. She further manifested that,
during her assumption in officer, there were
no proper turn-over to the previous Supply
Officer.
Supply Officer and Accounting admitted non-
maintenance of stock card.
The accountant tried to made confirmation
with the Regional Office with regards to the
supplies transferred.
To resolve this matter, start with
physical count during your time.
All we have to do is to await with
the relief of accountability.
However, take a chance to
reconstruct the reports
considering the documents were
exited.
She further said that, the stock
card and property card of the
supply officer should be reconcile
with the supplies ledger card and
property ledger card maintained
by the accounting office.

AOM No. The validity, accuracy, and We recommend that regular

2016- 014 existence of the reported balances physical count of inventory be Kasi sa s ATL –

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 Referenc
Audit Observations
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of Inventory accounts in the
agency’s financial statements as
of December 31, 2015 totaling
P117,491,358.51 cannot be fully
relied upon due to the absence of
physical inventory reports for
Inventory accounts and the non-
maintenance of complete
perpetual inventory records
which are not in keeping with the
applicable provisions of the
Government Accounting and
Auditing Manual (GAAM) and the
Manual on the New Government
Accounting System (MNGAS).
Recommendations
conducted every six (6) months, and
the corresponding Reports, certified
correct by the Inventory Committee
and approved by the Head of
Agency, be immediately reconciled
with the accounting records so that
any differences in inventory
valuation are timely resolved.
Submission of RPCI should be
made within prescribed period to
support the validity and reliability
of the reported account balances.
Furthermore, we recommend that
management instruct the
Property/Supply Unit and the
Accounting Section to maintain the
SC and SLC, respectively, for all
types of inventories indicating
therein the critical information
necessary for effective management,
tracking and accounting.
Management’s Comments Auditor’s Rejoinder
The SDS advised the supply officer that the Should submit monthly
costing of the supplies should be done by the
accounting office. Hence, the accounting
office prepared the costing of inventory.
That’s why, the supply officer was not making
the RSMI as instructed by the SDS.
The accountant commented that they cannot
be able to abide the preparation of RSMI,
considering the volume of their work.
Both supply officer and the accountant
admitted the non-maintenance of supplies
card and property card and supplies ledger
card and property ledger card.

Prepared by:

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ENRIQUE A. FRANCISCO, JR.
State Auditor IV
Audit Team Leader