Accountable Forms (AF). Additionally, he did not prepare a semester-end inventory
of supplies. Instead, he had been regularly submitting the Consolidated Report of
Accountability for Accountable Forms to the audit team, detailing the AF issued and
those remaining at the end of each month.
2.9. The Municipal Treasurer's failure to properly report the utilization of AF has
prevented the Municipal Accountant from accurately recording their usage. As a
result, the Accountable Forms, Plates, and Stickers inventory account was overstated
by ₱889,767.22, while the related expense account was understated by the same
amount, thereby affecting the fair presentation of the financial statements as of year-
end.
2.10. This observation was communicated to Management through Audit Observation
Memorandum (AOM) No. 2025-04(2024)-Ayungon dated April 4, 2025.
2.11. We recommended that the Municipal Mayor issue a directive to ensure proper
inventory management and accurate financial reporting by requiring the
following actions:
2.11.1. The Municipal Treasurer shall conduct a physical count of inventories
every semester and submit a corresponding report to the Municipal
Accountant and the Auditor no later than July 31 for the first semester
and January 31 for the second semester.
2.11.2. The Municipal Treasurer shall submit the Summary of Supplies and
Materials Issued (SSMI) to the Municipal Accountant on a weekly
basis, duly supported by Requisition and Issue Slips (RIS), to serve as
the basis for recording utilized inventory items in the books.
2.11.3. The Municipal Accountant and the Municipal Treasurer shall
regularly reconcile accounting and inventory records and implement
the necessary adjustments to ensure the fair presentation of accounts
in the financial statements.
2.12. During the exit conference, the Audit Team commended the prompt submission of
the Monthly RAAF by the Municipal Treasurer. However, he was unaware that the
same report must be furnished to the Municipal Accountant’s Office, thus, no entries
had been made upon issuance of the accountable forms.
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