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Findings No.3 COA Annual Audit Report 2006

July 28, 2008

3. Unserviceable but valuable construction and heavy equipment valued in the books at P1,821,099.43 remained undisposed, hence exposing the property to further deterioration and destruction.

Section 162 of COA Circular 92-386 provides that when supplies or property of any local government unit have become unserviceable for any cause or are no longer needed, the same shall be disposed of in accordance with the procedures prescribed in the rules and regulations.

The City General Services Office shall be responsible for the disposal of supplies or property of the local government unit.

Section 165 of the same Circular also provides that supplies or property which have become unserviceable or are no longer needed shall be sold, whenever applicable, at public auction, subject to applicable rules and regulations.

In addition, Section 145 of said circular mentioned that the person in actual physical possession of or entrusted with the custody or control of the property shall be responsible for the proper use and care of the same and shall exercise due diligence in the utilization and safekeeping thereof.

Verification of property records disclose that there were unserviceable construction and heavy equipment in the City Engineering compound and in the rock crushing plant. These equipment were kept in the open space, exposed to sun, rain and other elements which contributed to their fast deterioration. These properties which were acquired as far back as Calendar Years 1979 and the 1980’s are found to be still valuable but remained undisposed. These were valued in the books at acquisition cost totaling P1,821,099.43 (Annex 3)

Further verification revealed that the General Services Officer and the City Engineer had already filed the application for disposal of these equipment. A request for technical inspection and appraisal of these properties dated September 13, 2004 of the City Mayor was forwarded to the Director, Commission on Audit, Region X, Cagayan de Oro City. To facilitate the inspection and appraisal of the subject properties, the Regional Cluster Director of Technical Service and Management Office in his 2nd Indorsement dated October 20, 2004 had required to submit the following documents, to wit:

Submit copies of checklist of unserviceable equipment (Please refer to “Annex A” COA Memo. No. 98-569-A for proper guidance), and

Submit current photograph of these properties taken at two different angles.

An inquiry from the City Engineer revealed that these requirements were not complied with.

Management concurred to our finding and assured us to comply with the above-cited requirements.

Instead of allowing these equipment to remain idle for many years in their stations and exposed to wear and tear the same could have generated additional revenue had these been disposed of appropriately.

Recommendation

Direct the General Services Officer and the City Engineer to comply with all the required documents enumerated in the 2nd Indorsement letter of the Regional Cluster Director, Technical Service and Management Office so that disposal of these properties could be facilitated.


Written by admin · Filed Under Commission on Audit, Tangub City 

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