Independent Auditor’s Report on the Financial Statements
We rendered a qualified opinion on the fairness of the presentation of the financial statements
for the year ended, taking exceptions to the effects of the following:
1. At least 38 completed projects in CY 2024 under the General Fund and Special Education
Fund, totaling ₱58,898,662.36, were erroneously retained under the Construction in
Progress (CIP) account instead of being transferred to the appropriate Property, Plant and
Equipment (PPE) accounts, due to insufficient monitoring and improper documentation,
resulting in an overstatement of the CIP account and an understatement of related PPE
and depreciation expense accounts.
2. The Accounts Payable balance of ₱25,680,544.86 was not fairly presented due to the
inclusion of undocumented unpaid obligations amounting to ₱2,084,423.19, of which
₱1,761,964.63 remained outstanding for more than two years and were neither reverted to
the unappropriated surplus, thus, may no longer represent valid claims.
Significant Findings and Recommendations
In addition to the above-noted deficiencies, the significant audit observations and
recommendations noted in the course of the audit are as follows:
1. The Real Property Tax (RPT) Receivable and Special Education Tax (SET)
Receivable for CY 2024, each amounting to ₱53,232,192.80, were recorded only in
November 2024 due to the unavailability of the assessment roll at the beginning of
the year, compromising the matching principle thus, collections may not align with
recorded receivables.
We recommended that Management coordinate with the iTax System Technician to
determine whether the amounts of RPT and SET Receivables established in November
2024, based on the assessment roll received by the Municipal Treasurer on November 12,
2024, would have been the same had the assessment roll been generated and made on or
before December 31, 2023.
We further recommended that the Municipal Accountant prepare the necessary adjusting
entries, if warranted.
We furthermore recommended that Management adhere to Sections 246 and 248 of
Republic Act (RA) No. 7160 and Section 20 of the Manual on the New Government
Accounting System (NGAS), Volume I, to ensure the timely and reliable establishment of
RPT and SET Receivables.
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