3.11. This observation was communicated to Management through Audit Observation
Memorandum (AOM) No. 2025-02(2024)-Ayungon dated March 19, 2025.
3.12. We recommended that the Municipal Mayor direct:
3.12.1. The Municipal Accountant and Municipal Treasurer to reconcile the
difference between the RPT and SET Receivables account balances
totaling ₱8,907,556.24 and henceforth, conduct periodic reconciliation,
together with the Municipal Assessor, of the total collectibles from the
Basic and Special Education Tax with the RPT and SET Receivables
account balances to prevent the accumulation of unreconciled
differences;
3.12.2. The Municipal Treasurer to furnish the Municipal Accountant a duly
certified list of taxpayers with the amount due and collectible for the
current year as basis for recording the RPT and SET Receivable
accounts in compliance with Chapter 3, Section 20 of the NGAS Manual
for LGUs, Volume I; and
3.12.3. The Municipal Accountant to maintain subsidiary ledgers for RPT and
SET receivables to support the general account in the financial
statements.
3.13. During the exit conference, the Audit Team added that any unreconciled difference
be disclosed in the Notes to the financial statements.
Loans Receivable
4. Loans totaling ₱2,461,183.81 granted to individuals and people’s organizations have
remained outstanding for over 10 years due to the inaction of the LGU to demand
and strictly enforce the collection of the loans which is not consistent with Section 2
of Presidential Decree 1445, depriving the government of funds that could have been
used for expanding the program or implementing other priority projects.
4.1. Section 2 of Presidential Decree (PD) 1445, states that, “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 of ensuring efficiency, economy
and effectiveness in the operations of the government. x x x”
4.2. Our review of the Municipality’s financial statements as of December 31, 2024,
revealed that the Loans Receivable – Others account had a balance of ₱4,206,183.81.
Of this amount, ₱2,461,183.81 has remained outstanding for over 10 years and
consists of the following loans:
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