Findings No.9 COA Annual Audit Report 2006

July 26, 2008

9. Library books purchased totaling P1,053,765.00 were directly charged to expense account which is not in conformity to COA Circular No. 98-001. This omission caused the overstatement of total expenses incurred by P1,053,765.00, and understatement of Plant, Property & Equipment account by same amount.

Item 2.0 of COA Circular No. 98-001 dated February 3, 1998, states that: “Purchases of library books and materials costing P10, 000.00 and above per copy set, irrespective of economic or serviceable life shall be charged against allotment for Capital Outlay”.

Our review revealed that during CY 2006, the city had purchased various Library Books for public elementary and secondary schools totaling P1,053,765.00, but were directly recorded in the books to expense account “Textbooks and Instructional Materials”. The correct entry should have been as asset, that is, to Library books (223) under Plant, Property and Equipment account. Details thereof are as follows:

DateParticularsReferenceAmount10/16/06Purchase of Library BooksJEV-2006-10-01615P552,205.0011-21-06Purchase of Library BooksJEV-2006-10-01806 498,500.00TotalP1,053,765.00

The omission resulted to the overstatement of total expenses incurred by P1, 053,765.00, and the corresponding understatement of Library Books account under Property, Plant and Equipment account by same amount.

Recommendation:

Direct the City Accounting Office to draw a Journal Entry Voucher to correct the erroneous entry made by debiting Library books under Plant, Property & Equipment account of P1, 053,765.00 and crediting Prior Year’s Adjustment account of same amount.

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, Iligan City