7.14. Moreover, we recommended that the CAO comply with the following:
7.14.1. Assign personnel to prepare and maintain the supplies ledger cards;
7.14.2. Prepare the JEV to recognize the appropriate inventory accounts in the
books; and
7.14.3. Record expenses only upon receipt of the weekly SSMI from the CGSO
based on RIS with supporting documents submitted by the requisitioning
offices, computing the cost of supplies issued and ending inventory using
the moving average method.
7.15. Finally, we recommended that the City establish a storage facility for proper
storage, accounting, and monitoring of all supplies, materials, and inventory
items.
7.16. Management commented as follows:
7.16.1. The City Mayor had directed the CGSO and CAO to comply with the audit
recommendations.
7.16.2. As to the suggestion that the City establish a storage facility, it is worth
mentioning that the City already has a warehouse under the CGSO but will
endeavor to provide additional facilities to fully cater the needs of the City.
Erroneous charging of communication expenses - ₱528,054.00
8. Communication expenses totaling ₱528,054.00 were erroneously charged against the
appropriation for Office Supplies Expenses instead of Telephone Expenses, deviating
from COA Circular No. 2015-009 and IPSAS No. 1, thus, affecting the fair
presentation of the aforementioned accounts in the financial statements as at
December 31, 2024. Moreover, of this amount, ₱301,229.28 was incurred in excess of
the available appropriations for Telephone Expenses, contrary to Section 85 of P.D.
No. 1445, thus, resulting in illegal expenditures considered as personal liability of the
approving officers per Section 87 thereof.
8.1. COA Circular No. 2015-009 dated December 1, 2025 prescribes the use of the
Revised Chart of Accounts (RCA) in recording and reporting financial transactions
of LGUs. The RCA is designed to permit agency heads to review their activities
according to selected areas of responsibility, allowing for a clearer definition of
obligation accounting that leads to more precise budgetary control. Annex C of the
said circular provides the description on the next page of the Office Supplies
Expenses and Telephone Expenses accounts:
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