Findings No.2 COA Annual Audit Report 2004
July 26, 2008
2. Accounts Receivable of P1.57 Million remained outstanding for more than five (5) years, mostly have no support listings of creditors, thus, its collection is remote. The status has adversely affected the presentation of the financial condition of the Provincial Government.
COA Resolution No. 2003-002 dated January 20,2002 provides the delegation of authority of the Commission to approve the request for write off dormant and uncollected accounts of government agencies, the existence of which in the books continue to affect the true financial condition of the government.
Verification of the trial balance showed that the Province had an outstanding accounts receivable in the General and Special Education Fund in the total amount of P1.57 Million, which were dormant for more than five (5) years. Also, the Accounting Office had no records of the specific creditors. ( HYPERLINK “MisamisOrientalProv04_Annexes.xls” \l “AnnexC” \o “Annex C” Annex C) These accounts receivable were due from government employees, national and corporate agencies and local government units.
Verification of the account disclosed that it consists of overtime pay of COMELEC employees, travel chargeable against municipal funds, infrastructure projects, and salaries of teachers, which the provincial government temporarily paid. It was agreed that the provincial government would bill the other government offices concerned for the amount paid. However, the province did not receive refunds.
Records revealed that the Accounting Division did not maintain listings of creditors. Every year they always carry over the balances of the account in the subsidiary ledgers, some of which could no longer be traced to its origin.
The Provincial Accountant justified that these doubtful account receivables have been existing prior to here assumption in the office.
Due to such condition, the accounts receivables which were dormant and outstanding and still carried on the books of the Province affected its true financial condition.
An Audit Observation Memorandum had been sent to management calling their attention on the deficiency. However, no response was received from them.
Seek from the members of the Sangguniang Panglungsod authority to write off the doubtful accounts. Once the legislative body approves, submit the listing of the doubtful accounts together with the resolution of the members of the legislative body to the Commission on Audit and request authority for its writing off.
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