3. Cash advances totaling ₱3,379,262.99, of which ₱3,258,786.99 has been
outstanding for over three years, remain unliquidated as of December 31, 2024,
despite management’s efforts to compel the concerned officials and employees to
effect settlement, thus the related receivable and expense accounts in the financial
statements are still not fairly presented. Moreover, the unutilized government
funds in the possession of the accountable persons are exposed to the risk of loss
or unauthorized use.
We recommended that the Municipal Accountant issue final demand letters directing
the individuals involved to immediately liquidate all outstanding cash advances. If no
liquidation is made, we recommend that the Municipal Accountant impose the sanction
of withholding the salaries of those who still fail to settle their accounts after receiving
notice. We further recommended that Management take aggressive measures to compel
all accountable officers to settle their accounts, including the filing of appropriate
administrative proceedings.
4. Procurement contracts entered into by the Municipal Government, and
disbursements related thereto, amounting to at least ₱3,456,340.65, were incurred
without the required Certificate of Availability of Funds (CAF) from the Chief
Accountant, contrary to Section 86 of Presidential Decree (PD) No. 1445, thereby
rendering the validity and legality of the transactions questionable.
We recommended that Management, henceforth, secure the Certificate of Availability
of Funds (CAF) from the Municipal Accountant, prior to entering into any contract and
before making any disbursement or obligations charged to any authorized
appropriation.
5. The Municipal Government incurred costs for meals and snacks served during
regular and administrative meetings, budget and public hearings, social pension
payouts, courtesy calls, and similar events, totaling ₱1,164,842.50, and
inappropriately charged these costs to Other Supplies and Materials Expenses,
leading to unnecessary expenditures and excessive disbursements beyond the
allowable limit for discretionary spending.
We recommended that Management, henceforth, ensure that annual appropriations and
disbursements for discretionary purposes or those relating to Extraordinary and
Miscellaneous Expenses do not exceed the statutory threshold. We further
recommended that meals and snacks served during regular and administrative meetings
of local officials and employees be charged to the appropriations for EME, to the extent
of its threshold, and representation allowances of officials concerned.
All other audit observations and recommendations are discussed in detail in Part II of this
Report.
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