Republic of the Philippines

COMMISSION ON AUDIT
Office of the Regional Supervising Auditor
National Government Sector
Cluster 5, Education and Employment
Regional Office No. IX, Zamboanga City

__________________________________________________________________
(Date)____________
Head of Auditee____
_________________
_________________
Dear __________:
Management Letter on the Audit of the
(Name of Auditee)
for the period January 1 to December 31, 20xx_
1.
Pursuant to Section 2, Article IX-D of the Constitution of the Philippines and
Section 43 of the Government Auditing Code of the Philippines (PD 1445), we have
audited the accounts and operations of the (Name of the Agency) for the period ended
December 31, 20XX. The audit was conducted in accordance with applicable legal and
regulatory requirements, and generally accepted auditing standards. Those standards
require that we plan and perform the audit to obtain a reasonable basis for our
conclusions.
2.
The audit was conducted to: (a) verify the level of assurance that may be placed on
managements assertions on the financial statements; (b) recommend measures to
improve the efficiency and effectiveness of the agencys operations; and (c) determine the
extent of implementation of prior years audit recommendations.
3.
The Agencys financial conditions and results of operations for calendar year XX
compared with that of preceding year are shown in the attached audited financial
statements (Annexes A-F). The accounting errors and deficiencies affecting the fair
presentation of the financial statements are summarized in Annex G.
4.
Deficiencies observed in the course of the audit were earlier communicated
through Audit Observation Memoranda (AOMs) and discussed in an exit conference
conducted on (Date of Exit Conference) with concerned (Name of Agency) officials and
employees. Deficiencies corrected during the year are no longer included in this report
(if applicable). Their comments were incorporated in this letter, where appropriate. The
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significant audit observations and recommendations shall be incorporated in the

Consolidated Annual Audit Report (CAAR) of the Department of Xxx for CY 20XX.

A. Summary of Recommendations
5.
For the significant deficiencies observed in the course of the audit, we
recommended that Management:
a.

Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxxxxxxxxxxxxxxxxxx (para.---);

b.

Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx (para.---);

c.

Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx(para.---)
and

d.

Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
(para.---).

B. Detailed Observations and Recommendations

Financial and Compliance Audit
Caption
Topic Sentence
6.
(In discussing the audit observation, observe its elements: condition, criteria,
cause and effect.)
7.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx.
8.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxx.
9.

Management explained/commented that .

10.
We maintain, however, that or We believe, however,
that, or We are of the opinion, however, that. or, etc.
2

11.
We recommend that Management require/direct the (official or employee
responsible for implementing the recommendation) to ..

Value for Money Audit

Caption
Topic Sentence
12.
(In discussing the audit observation, observe its elements: condition, criteria,
cause and effect.)
13. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx.
14. xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
xxxx.
15.

Management explained/commented that

16.
We maintain, however, that or We believe, however,
that, or We are of the opinion, however, that. or, etc.
17.
We recommend that Management require/direct the (official or employee
responsible for implementing the recommendation) to ---------------.

OTHERS
Gender and Development
18. Joint Circular No. 2004-1 of DBM, National Economic Development Authority
and National Commission on the Role of Filipino Women dated April 5, 2004 provides
the following:

Section 3.2 (e) - The GAD Focal Point shall advocate for, coordinate, guide and
monitor the development and implementation of the agencys GAD plan and
GAD-related programs, activities and projects.

Section 4.4 - At least five percent (5%) of the total agency budget appropriations
as authorized under the annual General Appropriations Act shall correspond to
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activities supporting GAD. Agency heads shall be responsible for ensuring that
GAD activities are provided with adequate resources.
19. The agency did not designate any GAD Focal Point Officer to catalyze and
facilitate the institutionalization of gender mainstreaming and womens empowerment
since 20XX, hence, no report was submitted on GAD.
20. For CY 20--, the agency prepared its Annual Gender and Development (GAD)
Plan with an estimated budget of P----------- or --- percent of the CY 20-- total budget
appropriation of P-------------- or a deficiency of P------------- from the required
P-------------- or at least five percent of the total appropriation.
21. Of the programmed budget of P--------------, a total amount of P---------------- or --percent was actually incurred with accomplishments, as follows:
GAD Activities Conducted

No. of
Participants

Amount

1.
2.
3.
4.
5.
6.
7.
Total
22.

We recommend that Management:

designate a GAD Focal Point Officer for the DOH-CO; and
direct the GAD Focal Point Person to prepare an annual GAD plan and
budget following the policy guidelines set forth by DBM, NEDA and
NCRFW Joint Circular No. 2004-1 and allocate funds for GAD Plans
activities of at least five percent of the total agency budget
appropriations.

Senior Citizen and Differently-Abled Program

23. Section -- of the General Provision of the 20-- GAA, provides that plans, programs
and projects intended to address the concerns of senior citizens and differently-abled
persons shall be integrated in the regular activities of the agencies.
24. Furthermore, Section 34 provides that all government facilities, including
infrastructure, non-infrastructure and civil works projects of the government, as well as
office buildings, streets and highways, shall provide architectural facilities or structural
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features and designs that shall reasonably enhance the mobility, safety and welfare of
differently-abled persons pursuant to B.P. Blg. 344 and R.A. No. 7277.
25. For the year 20--, the agency allocated --- percent (--%) of its budget or a total
amount of P--------------- for plans, programs and projects intended to address the
concerns of senior citizens and differently-abled persons, of which -- percent or
P-------------- was actually spent for the following activities:
Training/Seminar Conducted and
Activity Attended

No. of
Participants

Amount

1.
2.
3.
4.
5.
6.
7.
8.
Total
26. In compliance with Section --- of the 20-- GAA, the (Agency Name) has provided
ramps which enhance the mobility, safety and welfare of differently-abled persons who
visit the office.
27.
We recommend that Management give importance to the implementation of
the program/ project/activities, particularly the provision of facilities which will
reasonably enhance the mobility, safety and welfare of the senior citizens and the
differently-abled persons.:

Enforcement of Settlement of Accounts

28. The total audit suspensions, disallowances and charges found in the audit of
various transactions as of December 31, 20XX, based on the Notice of Suspension
(NS)/Notice of Disallowance (ND)/Notice of Charge (NC)/Notice of Settlement of
Suspensions and Disallowances/charges (NSSDC) issued by this Commission, is
summarized below:

Particulars

NS

Beginning
Balance
(As of
12/31/20XX)
P

0.00

This period
January 1 to December 31, 20XX
P

NS/ND/NC
1,453,852.31
5

NSSDC
P496,095.14

Ending Balance
(As of
12/31/20XX)
P 957,757.17

ND
NC
Total

29.

73,156.57
P 73,156.57

223,979.34
1,677,831.65

158,356.03
P 54,451.17

138,779.88
P 1,096,537.05

Please discuss here the nature of suspensions and disallowances issued in 2013.

30.
The Hospital again incurred an overpayment of P77,608.64 hazard pay benefit in
2014 to its officials and employees with Salary Grades 20 and above which were
disallowed in audit in 2015, broken down as follows:
ND No.
2014-001-(14)
2014-002-(14)
2014-003-(14)
2014-004-(14)
2014-005-(14)

Date
2/14/15
2/14/15
2/14/15
2/14/15
4/2/15

Period Covered
January, 2013
February & March, 2013
April to June, 2013
July to September, 2013
October to December, 2013

Amount
6,058.02
12,116.03
18,386.68
18,386.68
22,661.23
P
77,608.64

31.
ND/NC/NS issued prior to effectivity of the 2009 Rules and Regulations on the
Settlement of Accounts (RRSA) are not included in the reflected balance but are deemed
disallowances/charges which shall continue to be enforced in accordance with these
Rules as provided under Sec. 28 thereof.

Compliance with tax laws

32. For CY 20XX, the agency (withheld/did not withhold) taxes from salaries and
wages, suppliers/contractors and remitted the same to the Bureau of Internal Revenue
through Tax Remittance Advices per Revenue Regulation No. 14-2002 dated September
9, 2002 and Revenue Memorandum Circular No. 5-2006 dated November 2, 2005.

Compliance with GSIS Act of 1997

33. The agency remitted directly to the GSIS the employees and government agencys
contributions within the first Ten (10) days of the calendar month following the month to
which the contributions apply, pursuant to RA 8291.

Hiring of Job Orders

34. Explain the authority to hire, purpose, how many were hired, and compliance with
minimum wage law (to include non-cash benefits).

C. Status of Implementation of Prior Years Audit Recommendations

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35. We made a follow-up on the action taken by the (Auditee) to implement the
recommendations of prior years and noted the following:
Status of Implementation

No. of
Recommendations

Fully Implemented
Partially Implemented/Ongoing
Not Implemented
Total
36. The results of the validation of the implementation of prior years
recommendations are presented in Annex H.
37. Audit observations and recommendations with impact on the financial statements
and compliance issues which are continuously monitored are reiterated with modification
in Part B of this report.

D. Acknowledgment
38. We wish to express our appreciation to the Management and staff of (Agency
Name) for the cooperation and assistance extended to our audit team during the audit.
39. We request a status report (in hard and soft copy) on the actions taken on the
audit recommendations within sixty (60) days from the date of receipt hereof,
pursuant to Section --- of the General Provisions of the General Appropriations Act of
20-- (RA No. --------), using the attached Agency Action Plan and Status of
Implementations (Annex I).

Very truly yours,

________________
Supervising Auditor
Copy furnished:
The DOH Secretary
The Director, Cluster 6, NGS
The Supervising Auditor, DOH Audit Group
The ATL, Agency
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Annexes:
A - Statement of Management Responsibility on the Financial Statements
B - Statement of Financial Position
C - Statement of Financial Performance
D - Cash Flow Statement
E - Statement of Changes in Net Assets/Equity
F - Notes to Financial Statements
G - Matrix of Accounting Errors and Deficiencies
H - Validation of Implementation of Prior Years Recommendations
I - Agency Action Plan and Status of Implementation

Annex _____
(Name of Auditee)
Validation of Implementation of Prior Years Audit Recommendations
As of (Last Day of Fieldwork)
OBSERVATIONS AND
RECOMMENDATIONS

REF
.

STATUS OF
IMPLEMENTATION
(Full, Partial,
Ongoing or Non-Imp)

MANAGEMENT
ACTION

Note: Partial Not fully implemented and no further action was taken by the Management
(Name of the Agency and Address)
AGENCY ACTION PLAN AND STATUS OF IMPLEMENTATION
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RESULTS OF
VALIDATION

Audit Observations and Recommendations

For the Calendar Year 20XX
As of _______________
Agency Action Plan
Ref.

Audit
Observations

Audit
Recommendations

Action Plan

Person/Office
Responsible

Agency Sign-off:

Target
Implementation Date
From

Status of
Implementation

To

Reason for
Partial/ Delay/
Nonimplementation,
if applicable

Date:

_____________________________________
Name, Position and Signature of Agency Head

__________________________

Status of Implementation may be either (a) Fully Implemented; (b) Ongoing; (c) Not-Implemented; (d) Partially Implemented; or (e) Delayed

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Action
Taken/Acti
n to be
Taken