8.3 Moreover, Section 6.2.2 of the Commission on Audit (COA), Department of
Budget and Management (DBM), Department of the Interior and Local
Government (DILG), Governance Commission for GOCCs (GCG) and
Department of National Defense (DND) Joint Circular (JC) No. 2015-01 dated
January 8, 2015, requires the liquidation of all cash advances for confidential and
intelligence fund within 30 days after every quarter, or from the target date of
completion of the project/ activity, or after the cash advance had been fully utilized,
whichever comes first. The Liquidation Report (LR) (Annex E), duly signed by the
Head of Agency (HoA) of the Special Disbursing Officer approved by the HoA,
shall be submitted together with the supporting documents under Sec. 6.2.3 hereof
and listed in the covering transmittal letter of the LR. These shall be submitted
directly to the Intelligence and Confidential Fund Unit (ICFAU) in a sealed
envelope with a visible label reading “CONFIDENTIAL – For ICFAU Only” via
registered mail, courier, or an authorized liaison officer.
8.4 Our review of the financial statements and the schedule of unliquidated cash
advances submitted by Management as of December 31, 2024, revealed the
existence of unliquidated cash advances totaling ₱3,379,262.99 in Advances to
Officers and Employees for the following purposes:
Purpose Amount
Confidential Expense ₱ 2,534,101.77
Traveling Expense 845,161.22
Total ₱ 3,379,262.99
8.5 The unliquidated balance under Advances to Officers and Employees represents
cash advances for travel expenses incurred by 41 officials and employees.
Additionally, the confidential expenses have remained unliquidated for over three
years by the former Municipal Mayor, whose term ended in 2022.
8.6 Our review of the subsidiary accounts and schedules showed that ₱724,685.22 of
the cash advances for travel have remained unliquidated for over three years.
Meanwhile, ₱2,534,101.77 pertained to cash advances for intelligence purposes,
which have been outstanding for more than three years. Thus, ₱3,258,786.99 of the
total unliquidated cash advances have been outstanding for over three years.
8.7 It is important to note, however, that the Office of the Municipal Accountant had
already sent demand letters to some of the concerned officials and employees, as
most of them remained in active service. Of the 42 officials and employees with
outstanding cash advances, only 12 have separated/retired. Despite management
efforts to demand settlement by sending demand letters, unliquidated balances still
exist as of December 31, 2024.
8.8 We would like to refer Management to Section 5.9 of the same COA Circular,
which states that when no liquidation of the previous cash advance is received on
or before January 20 of the ensuing year, the Accountant shall cause the
withholding of the AO’s salary.
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