2. The existence, validity, and correctness of the Inventory accounts totalling ₱3,013,247.40
as of December 31, 2024, have not been established due to (a) non-conduct of the year-end
physical count, (b) non-compliance with the Perpetual Inventory Method, and (c) non-
maintenance of supplies ledger cards and stock cards by the Offices of the Municipal
Accountant and Municipal Treasurer, respectively, thereby, affecting the fairness of the
presentation of these accounts in the FS.
3. Biological Assets valued at ₱457,500.00 that have been in the books for more than five
years, were not stated at fair value as of the reporting date due to the non-submission of the
Inventory Report of Breeding Stocks and the prevailing market price for each item by the
Municipal Agriculturist to the Municipal Accountant, thus, rendering the existence and
valuation of the account presented in the FS doubtful and unreliable.
Significant Audit Observations and Recommendations
In addition to the above-noted deficiencies, below are the significant audit observations and
recommendations noted in the course of the audit:
1. The unexpended balances of the LDRRMF from prior years amounting to ₱25,522,828.72
which were transferred to the Special Trust Fund (STF) were not considered and integrated
into the LDRRMFIP for CY 2024 and may result in inefficiencies in allocating and
utilizing funds for disaster risk reduction and management efforts, as well as missed
opportunities for disaster resilience and preparedness initiatives.
We recommended that the LDRRMO and the MDRRMC:
a. Include PPAs that are chargeable against the prior years’ unexpended LDRRMF in the
annual LDRRMFIP of the current year, in accordance with the format prescribed under
Annex A of COA Circular No. 2012-002; and
b. Establish an efficient review and monitoring system to ensure that the LDRRMFIP
complies with the requirements outlined in COA Circular No. 2012-002.
2. Purchases of medicines and animal bite vaccines for RHU and infirmary totaling
₱4,994,218.25 and honoraria for volunteer rescue responders totaling ₱910,798.21 were
improperly charged to the LDRRMF, hence reducing the funds available for disaster risk
reduction and management activities.
We recommended that Management:
a. Desist from charging the cost of medicines and animal bite vaccines for the RHU and
honoraria for volunteer rescue responders to the LDRRMF;
b. Reimburse the LDRRMF from the General Fund for the cost of honoraria for volunteer
rescue responders and medicines and animal bite vaccines used for purposes other than
those related to disaster risk reduction and management; and
iii
