Particulars Amount
General Fund
1. Community-Based Resource Management Project of
Ayungon (CBRMP) ₱1,457,590.00
Trust Fund
2. Various Recipients of KKK Loans ₱ 43,100.35
3. Ayungon Environmental Multipurpose Cooperative
(AEMPACO) 444,308.46
4. Sustainable Hilly-Land Agricultural Development Project
(SHADE) 516,185.00
Subtotal ₱1,003,593.81
Total ₱2,461,183.81
4.2. The funds were disbursed to various groups of individuals to support livelihood and
agricultural improvement initiatives. These loans were granted over a decade ago,
and the remaining book balances represent the unpaid portions. When we interviewed
the current Municipal Accountant regarding the history of these loans, she informed
the audit team that when she assumed her position in CY 2012, she discovered that
these loan receivables had already been recorded in the books since CY 2007;
therefore, these loans have been outstanding for eighteen years as of December 31,
2024.
4.3. The Municipal Accountant further explained that significant challenges were faced
in collecting these receivables due to the inability to identify most of the loan
borrowers, except for those under the CBRMP. This problem occurred because the
former municipal accountant did not maintain subsidiary records for the KKK,
AEMPACO, and SHADE loans under the Trust Fund, which made it difficult for the
Municipality to pursue claims against the debtors.
4.4. Additionally, the current Municipal Accountant stated that she has no information
about the status or whereabouts of the borrowers, nor could she locate any records of
a Memorandum of Agreement (MOA) or any other documents related to the
aforementioned loans in the Trust Fund.
4.5. The Municipal Accountant, however, informed the audit team that, aside from issuing
demand letters for the CBRMP borrowers in Calendar Year 2019, which received no
response and did not result in any payments from the debtors, no additional measures
had been taken. She clarified that this was unintentional and attributed it to her heavy
workload, which prevented her from sending follow-up demand letters this year.
4.6. Our inquiry with the Municipal Treasurer also revealed that he was aware of the
CBRMP and AEMPACO loans. However, since assuming office in December 2023,
he has inadvertently failed to assess the collectability of these loans or initiate
collection efforts from the borrowers.
4.7. The presence of outstanding loans receivable, in this case almost eighteen (18) years
old, affects the municipality's financial stability and operations. Failure to collect may
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