Findings No.3 COA Annual Audit Report 2005

July 26, 2008

3. Non-reconciliation between the accounting records and the treasurer’s cashbook on Cash Accounts casts doubts on the validity and existence of the declared balances.

Chapter l of the Cash Examination Manual (4) requires the Accountable Officer to reconcile her/his cashbook entries with the accounting records at least quarterly.

Verification of records disclosed that the accounting records do not reconcile with the cashbook balances, to wit:

TreasuryAccountingDiscrepancyCash Disbursing Officer

2,245,741.12

1,696,534.60

549,206.52Cash in Bank 320,436,606.13444,903,469.14(124,466,863.01)TOTAL P322,682,347.25P446,600,003.74(P123,917,656.49)

An interview with the incumbent OIC-Provincial Accountant disclosed that Cash Disbursing Officer composed of unliquidated cash advances by disbursing officers.

Verification of Cash in Bank and Cash Disbursing Officer balances as of December 31, 2004 disclosed total discrepancies of P123,917,656.49 (Annex D and E) between accounting records and cashbook balances analyzed as follows:

Per Ledger/Accounting Records - P 446,600,003.74

Per Treasurer’s Cashbooks - 322,682,347.25

Difference - P 123,917,656.49

=============

Compared to last year’s discrepancy of P131,025,664.77 it has decreased by P5,296,435.60 or 4%, presented as follows:

This is a prior year audit finding but is hereby reiterated due to the materiality of the amount.

Further verification disclosed that the discrepancies for the non-reconciliation of the records are as follows:

Some checks issued by the Provincial Treasurer within the month but not yet received by the claimant were not recorded in the journal of checks issued; thus Monthly Reports of Checks Issued is overstated against the Journal of Check Issued

Preparation and submission of the monthly Bank Reconciliation Statement is not updated

Some dormant and doubtful accounts were not corrected/adjusted.

The accounting and treasury personnel failed to reconcile their balances at least every quarter.

Had there been proper coordination between the Accounting Division and Treasury Division, any discrepancy noted could be immediately adjusted and corrected.

In effect, the cash accounts carried in the books are unreliable and doubtful as these do not reflect the actual cash position of the agency as of the year end.

The Provincial Administrator and the OIC-Provincial Accountant alleged that due to lack of personnel and non-availability of supporting documents, this problem was not attended to. However, the management alleged that a committee is created who will focus on the matter.

RECOMMENDATION

Require the OIC-Provincial Accountant to record all checks issued during the month in the Monthly Reports of checks Issued with the Journal of checks issued to reconcile the account balances.

Instruct the OIC Provincial Accountant to coordinate with Provincial Treasurer and make necessary adjustment and corrections at least every quarter for reconciliation purposes in order to present the true and correct cash position of the Provincial Government.

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 Commission on Audit, Lanao del Norte