2.7 Recording RPT and SET receivables is essential because they serve as references
for decision-makers and financial statement users in determining the amounts still
collectible and assessing the collection efficiency of the Municipal Treasurer.
This information also enables the Local Chief Executive (LCE) to develop
effective strategies to enhance RPT and collections. Additionally, it aids in
reconciling records between the Treasurer, Assessor, and Accounting Offices.
2.8 Consequently, the financial statements did not accurately reflect the correct
balances of the RPT/SET Receivables.
2.9 We recommended and the Municipal Treasurer agreed to provide the
Municipal Accountant with a copy of the RPT records for CY 2024 and prior
years to establish the beginning balance for CY 2025. The Municipal
Treasurer also agreed to henceforth, furnish the Municipal Accountant at
the beginning of each year with a certified list of taxpayers with amounts due
and collectible for the current year as their basis for recording the RPT and
SET Receivables in compliance with Sections 19(b) and 20 of the NGAS
Manual for LGUs, Volume 1.
Biological Assets’ year-end balances were not reported at fair value less costs to sell -
₱3,311,219.14
3. Biological Assets totaling ₱3,311,219.14 as of December 31, 2024, were not reported
at fair value less costs to sell, which is inconsistent with Paragraph 17 of
International Public Sector Accounting Standards (IPSAS) 27, rendering the
reported account in the financial statements unreliable.
3.1 Paragraph 16 of IPSAS 27 requires that a biological asset be measured at its fair
value less costs to sell upon initial recognition and at each reporting date.
Furthermore, paragraph 30 of the same IPSAS states that a gain or loss arising on
initial recognition of a biological asset at fair value less costs to sell as well as
from a change in fair value less costs to sell of a biological asset shall be included
in surplus or deficit for the period in which it arises.
3.2 In relation to this, COA Circular No. 2016-004 dated September 30, 2016,
provides guidelines for the preparation of financial statements in line with the
adoption of the International Public Sector Accounting Standards (IPSAS) by
Local Government Units (LGUs). Section 4.5 of the circular specifies that the
Municipal Agriculturist is responsible for providing the Municipal Accountant
with an inventory of breeding stocks and other biological assets, along with the
prevailing market price for each item as of the reporting date and information on
the prevailing costs to sell these biological assets.
3.3 However, our examination of the General Ledger and the Schedule of Biological
Assets as of December 31, 2024, revealed the following Biological Assets
purchased by the Municipality on various dates were still recorded at acquisition
cost:
40
