inaccurate and unreliable representations of cash inflows and outflows under
the Municipality’s operating activities.
4. Subsidies from the National Government, in the form of fund transfers totaling
₱50,286,760.00, along with associated expenses, were not recorded in the
books of accounts, resulting in an understatement of both the net financial
subsidy and current operating expenses by the same amount.
5. Transfer of cash for the unexpended balances of the LDRRMF- Quick
Response Fund (QRF) and the Maintenance and Other Operating Expenses
(MOOE) of the Mitigation Fund (MF) from CYs 2020 to 2024 totaling
₱17,559,915.03 had not been completed as of December 31, 2024, resulting
in a negative balance of ₱1,163,479.09 in the Cash in Bank account in the
Subsidiary Ledger (SL) of the Trust Fund (TF) books.
6. Completed infrastructure projects totaling ₱12,111,182.21 were not
reclassified from the Construction in Progress (CIP) account to the appropriate
PPE accounts upon completion, thereby omitting the recognition of
depreciation and misstating the balances of affected accounts in the financial
statements.
Significant Observations and Recommendations
In addition to the above-noted deficiencies, below are the significant observations
and recommendations noted in the course of the audit:
1. The Real Property Tax (RPT) and Special Education Tax (SET)
Receivables were not established at the beginning of the year, thus,
understating the RPT and SET Receivables by ₱4,940,371.90.
We recommended that the Municipal Treasurer provide the Municipal
Accountant with a copy of the RPT records for CY 2024 and previous years to
establish the beginning balance for CY 2025.
We further recommended that, henceforth, the Municipal Treasurer provide
the Municipal Accountant at the beginning of each year with a certified list of
taxpayers with their amounts due and collectible for the current year, to serve
as her basis for recording the RPT and SET Receivables.
2. Biological Assets totaling ₱2,196,314.50 as of December 31, 2024, were not
reported at fair value less costs to sell, rendering the reported amount in
the financial statements unreliable.
We recommended that the Municipal Agriculturist provide the Municipal
Accountant with an inventory of biological assets, along with the prevailing
market price for each item as of the reporting date and details regarding the
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