No Receivables for RPT and SET reported in FS - ₱54,931,515.89
4. Due to the non-submission of the Certified List of Taxpayers and Amounts Due
and Collectible for the Year by the Municipal Treasurer to the Municipal
Accountant, as mandated by Section 20 of the NGAS Manual, Volume I for LGUs,
along with the lack of coordination between the two offices, no receivables for RPT
and SET were reported in the financial statements, resulting in the
understatement of receivables by ₱54,931,515.89.
4.1 Sec. 111(2) of PD No. 1445, also known as the “Government Auditing Code of the
Philippines,” mandates that the highest standards of honesty, objectivity and
consistency shall be observed in the keeping of accounts to safeguard against
inaccurate or misleading information.
4.2 Section 20 of the Manual on the New Government Accounting System (NGAS),
Volume I for Local Government Units (LGUs) requires the RPT and SET
receivables to be established by the Municipal Accountant at the beginning of the
year, based on the Real Property Tax Account Register or Taxpayer’s index card.
Thus, the Municipal Treasurer must provide the Municipal Accountant with a duly
certified list showing the name of taxpayers and the amount due and collectible for
the period. Based on this list, the Municipal Accountant shall prepare a JEV to
record the debit to RPT Receivable/SET Receivable and credit the corresponding
Deferred RPT Income/SET Income. Upon collection of RPT from taxpayers, the
account Deferred RPT Income/SET Income shall be debited, while the RPT
Income due to the municipality is recognized/credited. The corresponding share of
the province and barangay shall also be credited to Due to LGUs.
4.3 Pursuant to the above regulation, the Municipal Treasurer prepares, at the
beginning of each year, a list of taxpayers and the amount due and collectible for
the year. This is supposed to have been previously updated to include all new
assessments and reassessments as reported by the Municipal Assessor to the
treasurer on or before December 31 (Sec. 248, R.A. 7160). The certified list of
taxpayers and amounts due is based on the Real Property Tax Account
Register/Taxpayer’s Index Card maintained by the treasurer.
4.4 A review of the General Fund and Special Education Fund trial balances as of
December 31, 2024, showed that no receivables were recorded for real property
taxes (RPT) and special education taxes (SET).
4.5 Our interview with the Municipal Accountant revealed that no receivables
pertaining to RPT and SET were recorded because his office had no basis for the
figures to be reported in the financial statements. He explained that his office had
not received the duly certified list of taxpayers and the corresponding amounts due
and collectible for CY 2024 from the Office of the Municipal Treasurer.
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