THE

COMMISSION
ON AUDIT
Atty. BATO S. ALI, JR.
Regional Director
COA-ARMM
ARMM LGUs Development Summit
Davao City, December 1, 2016

What I wish to
Discuss
State Policy on Fiscal
Responsibility
Fundamental Principles on
Financial Transactions and
Operations
Recommended Areas for
Improvements
SESSION 1.1 UNDERSTANDING THE ORGANIZATION

Recommended Areas for

Improvements most
important.
Most
A. Maintenance
of Complete
of Books
significant
of Accounts
B. Submission of Transaction
Financial Reports
C. Observance of the Government
Procurement Reform Act (RA 9184)
D.Liquidation of Cash Advances
E. Liquidation of Fund Transfers

A. Maintenance of complete book of

accounts

Recommendations:

Require the Accountants

to maintain complete Journals, General
Ledgers and Subsidiary Ledgers
to consistently update the journals and
ledgers by timely recording of
transactions
to prepare and submit the monthly,
quarterly & yearly Trial Balances to the
Auditors within the prescribed periods

A. Maintenance of complete book of

accounts

Recommendations:

Require the Accountants

The Year-End Trial Balance shall be
supported by the SAAOB, Subsidiary
Schedule of GL balances, Summary of
Public Infrastructure.
to submit the Year-End six (6) Financial
Statements (Statements of Financial
Position, Financial Performance, Changes in
Net Assets, Cash Flows, Comparative PreBudget & Actual Amounts, and Notes to FS)

A. Maintenance of complete book of

accounts

Recommendations:

Require the Accountants to

submit these Year-End Trial
Balances and Financial
Statements not later than the
14th day of February of the
ensuing year.

B. Submission of Transactions Financial Reports

Recommendation
s

Require the Accountable Officers

and Disbursing Officers to submit
the Report of Disbursements (ROD) to
the Accountant within the prescribed
period;
Require the Cashiers and Disbursing
Officers to submit the Report of
Checks Issued (RCI) to the Accountant
daily

B. Submission of Transactions Financial Reports

Recommendation
s

Require the Collecting Officers and

the Treasurers to submit the Report
of Collections and Deposits (RCD) and
the Report of Accountability for
Accountable Forms (RAAF) to the
Accountant on a monthly basis;

Require the Accountants to submit to

the Auditor the ROD, RCI, RCD and
RAAF every monthly not later than the
20th day of the ensuing month.

B. Submission of Transactions Financial Reports

Recommendation
s

The Report of Collections and Deposits

(RCD) should be supported with the
copies of the Official Receipts (OR)
issued and Deposit Slips (DS);

The ROD and RCI should be supported

by complete paid disbursement
vouchers and supporting documents.
COA Circular No. 2012-001 provides the
documentary requirements for common
government transactions (as amended by COA
Circ. No. 2016-002)

C. Observance of Government
Procurement Reform Act (RA 9184)
Recommendations:
Faithful observance in the procurement of
Goods, Infrastructure Projects and
Consultancy Services;
General rule, competitive bidding
Alternative Methods of Procurement (Limited
Source Bidding; Direct Contracting; repeat
Order; Shopping; Negotiated Procurement)
Presence of Conditions as provided by
law
Documentary requirements
SESSION 1.1 UNDERSTANDING THE ORGANIZATION

D. Liquidation Cash Advances

Recommendations
Require the accountable officers to
liquidate their cash advances within
the prescribed period
Refrain or stop granting additional cash
advances unless the previous cash advance
is liquidated (Sec.89, PD 1445)
Hold the payment of salaries of AOs who
failed to liquidate their outstanding cash
advances for unreasonable length of time
SESSION 1.1 UNDERSTANDING THE ORGANIZATION

D. Liquidation of Cash Advances

Recommendations

Refrain granting cash

advances for the payment
of supplies, materials,
repairs and maintenance

SESSION 1.1 UNDERSTANDING THE ORGANIZATION

E. Liquidation of Fund Transfers

Recommendations Reduce Multiple Fund Transfers
Complete the basic provisions in the MOA
Require the DOs to submit within 10 days
after the end of each month/ end of the
agreed period ROD, together with paid
vouchers and complete supporting
documents, to the Accountant, thereafter to
the Auditors

SESSION 1.1 UNDERSTANDING THE ORGANIZATION

E. Liquidation of Fund Transfers

The auditors need time to
conduct the post-audit of the
transactions, including review of
the MOA, documents, physical
inspections, among others.

SESSION 1.1 UNDERSTANDING THE ORGANIZATION

Thank you,
Sukran!
SESSION 1.1 UNDERSTANDING THE ORGANIZATION

Declared State Policy

Section 2, Government Auditing Code (PD
1445)

All resources of the government

shall be managed or used in
accordance with law & regulations,
and safeguard against loss or
wastage through illegal or improper
disposition, with a view to ensuring
efficiency, economy and effectiveness
in the operations of government.

Declared State Policy

Section 2, Government Auditing Code (PD
1445)

continuation

The responsibility to take care

that such policy is faithfully
adhered to rests directly with
the head of the government
agency concerned.

Fundamental Principles on
Financial Transactions and
Section 4, Operations
Government Auditing
Code
1. No money shall be paid out of any public treasury
of depository except in pursuance of an
appropriation law or other specific statutory
authority.
2. Government funds or property shall be spent or
used solely for public purposes.
3. Trust funds shall be available and may be spent
only for the specific purpose for which the trust
was created or the funds received.

Fundamental Principles on
Financial Transactions and
Operations

4. Fiscal responsibility shall, to the

greatest extent, be shared by all
those exercising authority over
the financial affairs, transactions,
and operations of the government
agency.

Fundamental Principles on
Financial Transactions and
Operations

5. Disbursements or disposition of
government funds or property shall
invariably bear the approval of the proper
officials.

6. Claims against government

funds shall be supported with

complete documentation.

Fundamental Principles on
Financial Transactions and
Operations

7. All laws and regulations

applicable to financial transactions
shall be faithfully adhered to.
8. Generally accepted principles and practices
of accounting as well as of sound
management and fiscal administration shall
be observed, provided that they do not
contravene existing laws and regulations.