include the following: (a) preliminary activities before the conduct of inventory
taking, (b) inventory taking, and (c) reconciliation of inventory count per Report
on the Physical Count of Property, Plant, and Equipment (RPCPPE) with property
and accounting records.
2.5 Our inquiry with Management revealed that the Inventory Committee was created
in CY 2020. However, the one-time cleansing was not initiated and the Committee
was also unable to prepare the Physical Inventory Plan (PIP).
2.6 It has come to our attention that the Inventory Committee members had varying
schedules and workloads, which hindered them from effectively executing and
completing the one-time cleansing procedures. It is crucial that the committee
prioritizes conducting the physical inventory until it is completed, as required in
Section 5.3 of the said Circular, which emphasizes that the members of the
Inventory Committee shall be temporarily relieved of all their regular duties to
devote full time to the completion of the said procedures.
2.7 We also observed that the uniform numbering system required was not adopted
accordingly by the Municipal Government.
2.8 With regard to the numbering system for the properties of government agencies,
Section 5.6 of the aforementioned Circular requires that a unique Property Number
be assigned to each PPE item, using the following numbering system:
0000 – 00 – 00 – 0000 – 00
Year Purchased
PPE sub-major account group
General Ledger account
Serial Number (one series per PPE category/type/location)
Location / Office
2.9 The codes for the PPE sub-major account group and General Ledger account
correspond to those provided in the Revised Chart of Accounts prescribed under
the Accounting Manuals of the respective Sectors (National, Local, and
Corporate). Additional digits may be used for serial numbers and location/office,
as necessary.
2.10 Moreover, Section 5.7 thereof provides that for easy identification, the Property
Number shall be prominently displayed in the property sticker, along with the
following vital information on the PPE item: (a) description of the property, (b)
mode number, (c) serial number, (d) acquisition date/cost, (e) person accountable,
and (f) space for the validation/signature of the Inventory Committee.
2.11 It is emphasized that the Property Number indicated on the property sticker serves
as a control mechanism to secure the inventoried PPE for easier identification by
the LGU, which will provide a readily available source of information for the
Inventory Committee in its subsequent physical inventory count.
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