5.2 Our review of the Schedule of Due to Other Funds under the General Fund (GF)
revealed the following unexpended QRF and MOOE for the LDRRMF for CYs
2020-2024.
Year Amount
2020 ₱ 3,630,417.41
2021 1,256,521.40
2022 4,888,270.05
2023 3,393,624.25
2024 4,391,081.92
Total ₱ 17,559,915.03
5.3 A review of the Subsidiary Ledger (SL) for the Cash in Bank – Local Currency
Current Account (LCCA) under the Trust Fund (TF) books revealed a negative
balance of ₱1,163,479.09 in the Development Bank of the Philippines (DBP)
Account No. 0740-012618-032. According to the Municipal Accountant, this
negative balance pertains to the Special Trust Fund (STF) account, which holds
the unexpended balance of the Local Disaster Risk Reduction and Management
Fund (LDRRMF) transferred from the General Fund (GF). She explained that the
deficit resulted from expenditures charged to the STF despite the absence of
sufficient cash in the account. The Municipal Accountant further admitted that
the shortfall occurred because she did not coordinate with the Municipal
Treasurer to facilitate the actual transfer of funds to the STF.
5.4 The inability of the Municipal Accountant to coordinate with the Municipal
Treasurer for the actual transfer of the unexpended balances of the LDRRMF–
QRF and the MOOE of the Mitigation Fund for CYs 2020 to 2024, amounting to
₱17,559,915.03, constitutes non-compliance with Item No. 5.1.10 of COA
Circular No. 2012-002. As a result, expenditures were charged against the Special
Trust Fund (STF) despite the absence of actual cash transfers, leading to a
negative cash balance of ₱1,163,479.09 in the Subsidiary Ledger of the Cash in
Bank account under the Trust Fund books. This affects the accuracy and
reliability of fund balances and exposes the municipality to risks of fund
mismanagement.
5.5 We recommended and the Municipal Accountant agreed to coordinate with
the Municipal Treasurer and provide the necessary records of unexpended
balances of LDRRMF-QRF and MOOE of MF for CYs 2020 to 2024, to
facilitate the transfer of cash totaling ₱17,559,915.03 from the General Fund
to the Special Trust Fund (STF) account, in accordance with Item 5.1.10 of
the said Circular.
5.6 We further recommended and the Municipal Accountant agreed to prepare
and record the appropriate journal entries to reflect the actual transfer of
funds and to correct the existing negative balance in the Cash in Bank –
LCCA account under the Trust Fund books.
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