limitations, including the accessibility of the project location and availability
of equipment and materials, during the planning stage.
8.10 Management explained that the City Engineer, in coordination with the City
Planning Coordinator, has already evaluated and considered the feasibility of each
project. In fact, they have recommended projects for closure and reversion. They
have also addressed issues related to the implementation of the 20 percent DF and
other projects during the CY 2025 budget planning.
Funds that are not considered idle were placed into time deposit accounts – ₱366 million
9. The City Government placed a total of ₱385 million into four time deposit
accounts, of which ₱366 million represents the cash back-up of its current and
continuing capital outlay appropriations under the General Fund, leaving only
₱19 million as idle funds, contrary to Section 22 of COA Circular 92-382, thus
tying up funds necessary for the timely implementation of projects and activities.
9.1 Accounting and Auditing Rules and Regulations designed to implement the
provisions of the Local Government Code of 1991 under COA Circular No. 92-
382 dated July 3, 1992, provides specific guidelines regarding bank depository
accounts such as time deposit of funds. Section 22 thereof, defines “idle funds” as
those which are in excess of normal operating requirements, which means the level
of funds which an entity can freely invest in government securities and/or fixed
term deposits after considering provisions for coverage of regular and recurring
expenses. Unremitted national collections and funds set aside for payment of
obligations to government corporations/cooperatives shall not form part of idle
funds.
9.2 Moreover, the Department of Finance (DOF) clarified the definition of idle funds
in DOF Department Order No. 071-2018 dated December 13, 2018, stating that
“idle funds in excess of normal operating requirements” shall generally mean the
level of funds which the can be freely invested after considering provisions for
coverage of the following: regular and recurring expenses and local counterpart
commitments for capital expenditures with the current fiscal year. In the case of
LGUs, it also includes those excess funds, after considering unremitted national
collections and funds set aside for payments of obligations.
9.3 A perusal of the cash deposit accounts of the City Government showed that it
placed ₱385,128,697.95 into four time deposit accounts during CY 2024, shown
as follows:
Bank Account Term Amount
Number
Development Bank of the 0740-026xxx-xxx Semi- ₱ 163,516,759.51
Philippines annually
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