Findings No.5 COA Annual Audit Report 2005

July 25, 2008

5. The City General Services Office failed to completely and promptly submit to the Office of the Audit Team Leader the necessary detailed engineering documents for timely review and verification of the contract for the City Rural Telephone System, (Telepono sa Barangay) Cagayan de Oro City amounting to P50,000,000.00.

COA Circular No. 76-34 dated July 15, 1976 states thus: “within five (5) days from the execution of a contract by the government or any of its subdivisions, agencies or instrumentalities, including government-owned or controlled corporations, for a public works of major repairs, improvement or construction, as well as those for public service and or furnishing of supplies, materials and equipment, a copy of said contract and each of all the documents forming part thereof of reference or incorporation, if any, such as the Advertisement for Bids, Instruction to Bidders, Abstract of Bids, Award General Conditions, Specifications, Proposal and Contract Book, Certificate of Availability of Funds, etc. shall be furnished the unit or agency auditor irrespective of amount”.

The management is required by law and/or rules and regulations to furnish the head of the auditing unit with copies of contracts/ orders and supporting documents. This is designed to enable the auditing unit to perform its duties relating to the post-audit of the transactions at the most appropriate time and manner without in any way delaying or obstructing the implementation or prosecution of the project.

It is the task of the City General Services Office (CGSO) being the procurement office to notify the Office of the Auditor for the purpose of giving information with regards to the procurement activities of the city.

Review and analysis of contracts submitted by the agency disclosed that the CGSO failed to completely and promptly submit to the Office of the Auditor the contracts, the supporting documents forming part of the City Rural Telephone System, (Telepono sa Barangay) Cagayan de Oro City amounting to P50,000,000.00.

On our 1st Indorsement dated June 10, 2003 we returned to the Office of the City General Services, City General Services Department, this city, the documents we received relative to above-mentioned project with the information that the desired contract review can not be extended unless the documents enumerated therein will be submitted to our office.

Review and verification of the records showed that the City appropriated the amount of P50,000,000.00 for the Telepono sa Barangay Project in Calendar Year 2003. Further verification of the disbursements disclosed that out of the P50,000,000.00 appropriation a total of P31,544,261.24 as of December 31, 2005 was already paid to the Contractor, the Supplier Contractor and Networking Telecommunication, Inc. (SCANTEL).

Audit action on the disbursements will be held in abeyance pending receipts of the compliance as required under the aforementioned indorsement.

In compliance to the Audit Observation No. 2006-01-05(100) sent by this Office, the management submitted partial compliance of the contract documents and requesting for a time extension in the submission of the following remaining documents for evaluation, viz:

Approved Budget of Contract/Agency Estimate;

Legible Copy of duly approved Program of Work with detailed back-up computation;

Original copy of duly approved color coded Plans and Specifications;

Certification issued by CIAP as required under Sec. 14.3.3 of IRR of EO 40;

DPWH Registry of Civil Works Contractors.

Recommendation

Require the City General Services Officer to hasten the submission of the documents required for review and evaluation purposes.

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