Non-recording in the Trust Fund books of the transfer of unexpended balance of the LDRRMF-
QRF and MF-MOOE - ₱5,512,645.49
3. The transfer of the unexpended balance of the LDRRMF- Quick Response Fund
(QRF) and the Maintenance and Other Operating Expenses (MOOE) of the
Mitigation Fund (MF) was not recorded in the Trust Fund books during the year,
contrary to Items 5.1.10 and 5.1.12 of COA Circular No. 2012-02 dated September
12, 2012, resulting in the understatement of the receivable and trust liability
accounts by ₱5,512,645.49.
3.1 COA Circular No. 2012-02 dated September 12, 2012, provides guidelines on the
accounting and reporting of LDRRMF of Local Government Units (LGUs). Item
5.1.10 thereof states that all unexpended/unobligated balance of the QRF and the
DRRMF-MOOE shall be transferred to the Special Trust Fund under the account
“Trust Liability- DRRMF”. Furthermore, Item 5.1.12 of the same circular requires
that the account Trust Liability- DRRMF shall be used to record transfers of the
agency’s unutilized QRF and the LDRRMF-MOOE under the MF. Annex C of the
circular provides the illustrative accounting entries for the transfer of the
unexpended QRF and MOOE of the MF.
3.2 A review of Journal Entry Voucher (JEV) No. 2024-12-006798 dated December
27, 2024, under the General Fund (GF) books disclosed that ₱5,512,645.49 was
recorded to transfer the unexpended QRF and MOOE for the LDRRMF of CY
2024. The Other Payables account was used to obligate the amount in the GF at
the end of the year.
3.3 An examination of the General Ledger for Trust Liabilities—DRRMF under the
Trust Fund (TF) books from December 27, 2024, to January 15, 2025, revealed
that a journal entry to record the transfer of the unexpended QRF and MF-MOOE
of the LDRRMF 2024 was made only on January 15, 2025. Under JEV No. 2024-
1-000022, dated January 15, 2025, the Municipality debited “Other Receivables”
and credited “Trust Liabilities—DRRMF.” On the same date, the actual transfer
of cash from the General Fund (GF) to the Trust Fund (TF) was executed, as
documented in Disbursement Voucher (DV) No. 101-01-0148, recorded under
JEV No. 2025-01-000164.
3.4 As previously discussed, the amount of ₱5,512,645.49 had not yet been recorded
as Trust Liabilities—DRRMF in the Trust Fund (TF) as of December 31, 2024. In
an interview, the Municipal Accountant stated that his staff may have overlooked
the transaction and forgotten to record an entry in the TF books as of December
27, 2024. Consequently, the assets and liabilities under the TF were understated
by the same amount.
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