Water Supply Systems, and Buildings were understated by ₱6,699,125.51,
₱1,988,213.14, and ₱1,095,241.44, respectively, totaling ₱9,782,580.09.
5.12. Moreover, the non-recording of the asset accounts in the GF books resulted in the
non-recognition of related Depreciation Expenses. Thus, the corresponding
Accumulated Depreciation accounts were understated while the surplus account
was overstated by an estimated amount totaling ₱7,794,223.89 for the period.
Collectively, these deficiencies have adversely affected the accuracy and fair
presentation of these account balances in the financial statements.
5.13. This observation was communicated to Management through Audit Observation
Memorandum No. 2025-03(2024)-Manjuyod dated April 25, 2025.
5.14. We recommended and Management agreed that the Municipal Accountant
prepare the following entries in the Trust Fund and General Fund books as
follows:
5.13.1. Trust Fund Books:
5.13.1.1. To record the transfer of the cost of the six completed projects
from CIP accounts to the respective PPE accounts:
Account Name Account Debit Credit
Code
Road Networks 1-07-03-010 6,699,125.51
Water Supply System 1-07-03-040 1,988,213.14
Buildings 1-07-04-010 1,095,241.44
CIP – Infrastructure
1-07-10-020 8,687,338.65
Assets
CIP – Buildings and
1-07-10-030 1,095,241.44
Other Structures
5.13.1.2. To record the transfer of the PPE accounts to the GF:
Account Name Account Debit Credit
Code
Government Equity 3-01-01-010 9,782,580.09
Road Networks 1-07-03-010 6,699,125.51
Water Supply System 1-07-03-040 1,988,213.14
Buildings 1-07-04-010 1,095,241.44
5.13.2. General Fund Books:
5.13.2.1. To record the receipt of the six completed projects from TF:
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