Findings No. 3 COA Annual Audit Report 2004

July 25, 2008

3. An appropriation provided for the insurance and registration of Motor Vehicles was not spent which resulted to the non-registration of the motor vehicles with the Land Transportation Office.

Existing laws require that motor vehicles shall be registered with the Land Transportation Office annually. Pursuant to pertinent provisions of Republic Act No. 656, otherwise known as the Property Insurance Law, said vehicles shall be insured with the Government Insurance Service System.

The procedure on the registration of motor vehicles is as follows:

The CGSO thru the Land, Building and Property and Inventory and Disposal Section informs in writing the respective Department where the motor vehicle subject for registration belongs. The Department Head will retrieve the original registration documents including the insurance coverage on file with the CGSO and proceed for the processing of the payment for insurance and registration by filling up the corresponding application with pre-computation of the GSIS and LTO. After the release of the money by the City Treasurer, the Department Head will proceed for the payment of insurance and registration with the respective offices concerned. After the registration is completed, the original copy of all the registration documents as well as the insurance cover should be filed with the CGSO. Only the Xerox copy of the LTO registration and the corresponding stickers will remain with the Department Head for use by the driver of the motor vehicle.

During the physical inventory conducted, it was found that registration and insurance of various motor vehicles used for operation were not renewed.On January 21, 2005 we received from CGSO the complete list of unrenewed and unregistered service vehicle of the City Government of Cagayan de Oro after we requested for the same based on our observation during the physical inventory.

The list discloses that 311 units of service motor vehicles were either unregistered since the time of their acquisition or no renewal of the registration was made.

Among the unregistered are 10 units Kasaki motorcycles donated by Kasaki Motors because there are manufacturing documents required for submission by the LTO before it will be registered; one unit Kawasaki motorcycle; one unit Kia Ceres; one unit Jialing Motorcycle; one unit Honda Motorcycle TMS-125 and one unit Caterpillar Model 816 BL, because no plate number was presented to the CGSO.

Of the 311 units, 296 units of various kinds of vehicles were listed as unregistered because the registrations were not renewed with the Land Transportation Office.

It was also disclosed that the cause of non-renewal of registration was either due to the fact the vehicle is under repair or the payment for the insurance and registration was not released by the City Treasurer’s Office.

The appropriation, therefore, for the insurance and registration of the unregistered vehicles was not spent resulting to the improper use of the same, being in violation of LTO regulations. In the event of damage to or loss of these properties, the city stands to loss any or equivalent amount of indemnification.

Further, the original copy of all the registration documents as well as the insurance coverage of the subjected vehicles were not submitted to the CGSO for monitoring and safe keeping purposes.

“The findings are noted. However, it is to be informed that the CGSO as a matter of procedure has consistently been aware of their responsibilities such that regularly, the office sends a letter reminder to the Department Heads one month before the date of renewal of registration with LTO to ascertain that service vehicles of the city government are registered with LTO and insurance paid for. The departments are also required to furnish a copy of the registration or renewal thereof, to the CGSO except that the departments at times fails to do so. There are also instances when the service vehicles acquired lack the necessary documents when it was transferred to the city government. Hence, the availability of the copy of the said renewal when the inventory was made. Appropriate instructions, however, shall be made to the CGSO and the City Accounting Department by the City Mayor to act on the above recommendation.” (Annex C)

Recommendation:

The Chief Executive shall issue a directive to all Department Heads prohibiting the use of all unregistered service vehicles and authorizing the CGSO to impound the unregistered vehicles until the same are registered.

Require Department Heads concerned to prioritize the processing of the insurance and registration of their assigned motor vehicles and to report immediately to the LTO for storage purposes any motor vehicle which is not used in operation.

Further, all concerned Department Heads are enjoined to submit to the CGSO all original copies of the insurance and registration papers of their service motor vehicles for filing purposes.

CLICK HERE for the latest 2nd Hand Laptops, Mobile Phones, SMART/ GLOBE /TALK 'N TEXT/ TOUCH MOBILE / SUN CELLULAR Postpaid, Pre-paid and International Roaming PROMOS, Philippine Airlines (PAL) and Cebu Pacific Airlines Airline AIRFARE DISCOUNT tickets for sale!

Check out our Updated/Latest List of GOVERNMENT JOBS AND OTHER GOVERNMENT VACANT POSITIONS, PRIVATE JOBS, PRIVATE FULL-TIME JOBS, PRIVATE PART-TIME JOBS and OTHER ONLINE JOBS in this link!

Written by admin · Filed Under Cagayan de Oro, Commission on Audit