SanVicente Palawan ES09 AAR

EXECUTIVE SUMMARY
HIGHLIGHTS OF FINANCIAL OPERATION
For the CY 2009, the Municipality generated a total income of P 155,913,584.31 from
local taxes, permits and licenses, service and business income and internal revenue allotment.
The total funds utilized for the year amounted to P 146,093,222.07 out of the total appropriation
of P 161,065,502.79.
SCOPE OF AUDIT
A financial and compliance audit was conducted on the accounts and operations of the
Municipality of San Vicente, Palawan for Calendar Year 2009. The audit was conducted to
ascertain the fairness of the presentation of the financial statements and compliance of the
agency to laws, rules and regulations as well as the economical, efficient and effective utilization
of resources.
AUDIT OPINION ON THE FINANCIAL STATEMENTS
The Auditor rendered a qualified opinion on the fairness of the presentation of the
financial statements of the Municipality of San Vicente due to the reasons stated in the Audit
Certificate.
SUMMARY OF SIGNIFICANT FINDINGS AND RECOMMENDATIONS
The following are the summary of significant audit findings and recommendations in the
audit of the Municipal Government of San Vicente for the year 2009:
1. Physical existence, accuracy, and reliability of the account Plant, Property and Equipment
could not be ascertained due to the failure of the municipality to conduct the required
physical count and the failure of the Municipal Accountant and Treasurer to maintain the
property ledger cards and property cards, respectively.
a) Local Chief Executive (LCE) shall create a committee of three (3) consisting of the
representative of the local chief executive as chairman the general services officer,
and the accounting office as members. The inventory report shall be submitted to the
local chief executive and copy furnished the provincial, city or municipal auditor
concerned.”
b) Require each department head to conduct inventory of all properties under their office
and submit the inventory report to the committee for validation and verification of the
correctness and existence of the property.
c) The Municipal Treasurer is advised to see to it that the property is physically counted
and completely reported in the Inventory Report and reviewed before submission to
the Auditor’s Office.
d) Advise the Accountant to continue updating and maintaining PPE ledger cards as an
alternative basis in the reconciliation of the property ledger cards and the records
maintained by the Municipal Treasurer Office to establish the validity and existence
of property.
2. Due from Officers and Employees and Cash Disbursing Officers accounts for all funds
amounting to P3,020,616.00 and P6,701,670.05 respectively remained unliquidated as of
December 31, 2009 due to the inability of management to monitor or enforce the prompt
liquidation of cash advances contrary to Sections 4 and 5 of COA Circular No. 97-002
dated February 10, 1997.
The Audit Team still recommends that the Local Chief Executive should instruct
the Municipal Accountant to monitor the strict and proper implementation of the
provisions of COA Circular No. 97-002 on the granting, utilization and liquidation of
cash advances. This is made to ensure settlement of cash advances at year-end.
3 The accuracy and correctness of the Cash in Vault account balance of P6,837,248.97
could not be ascertained due to the failure of the Municipal Accountant and Treasurer to
reconcile their records. Likewise, it includes prior year’s vouchers and cash items paid
without appropriation amounting to P1,617,593.40 that could misinform the reader of the
financial statement.
It is further recommended that the Municipal Treasurer should see to it that all
transactions regarding the collections and deposits of the municipality are posted in the
cashbooks daily or as necessary in compliance with Section 26, Volume II of NGAS for
LGU’s.
4. Gasoline, Oil and Lubricants consumption amounting to P 7,832,486.13 for the General
Fund increased by P 3,908,642.68 or almost 100 % compared to last year’s amount of P
3,923,843.45 which showed that it was not effectively controlled in violation of COA
Circular No. 77-61 dated September 26, 1977 and COA Circular No. 2002-003 dated
June 20, 2002.
The audit team recommended that officials and employees concerned should
comply with the COA rules and regulations on fuel consumption and strictly implement
it in order to effectively and efficiently control the utilization of the same.
5. The accuracy and reliability of the Real Property Tax(RPT) and Special Education Tax
(SET) Receivables set-up at the beginning of the year could not be ascertained because
the amount were based on schedule submitted by the Municipal Assessor’s Office and
not on certified list of taxpayers showing the amount due and collectible for the year, as
required under Section 20, Volume I of the New Government Accounting
System(NGAS) Manual.
The audit team recommended that the Municipal Treasurer coordinate with the
Municipal Assessor by updating the Real Property Tax Account Register so that the
amount due and collectible for the current year can be generated. This list should be
certified by the Municipal Treasurer and forwarded to the Municipal Accountant to serve
as basis in setting up the accurate RPT/SET Receivables in compliance with Section 20,
Volume I of the NGAS Manual.
6. The Annual Budget for Gender and Development of the Municipality for CY 2009 was
below the minimum 5% of the total appropriations as mandated under Section 4.4 of the
DBM/NEDA/NCRFW Joint Circular No. 2004-1, thereby limiting the programs, projects
and activities that promote gender-responsive governance, protect and fulfill women’s
human rights, and promote women’s economic empowerment.
Management is enjoined to comply with the provisions of

DBM/NEDA/NCRFW Joint Circular N0. 2004-1 in the implementation of Gender and
Development Program in the ensuing year.
The Audit Team recommended that henceforth the Municipal Government should
prepare a GAD Plan and provide the required budget for its activities, implementation
and monitoring and report on the same to concerned oversight offices
7. Some of the projects implemented and charged to the 20% Development fund were not in
accordance with the guidelines provided for under Joint Memorandum Circular No.1, s.
2005 of the Department of Interior and Local Governments (DILG) and the Department
of Budget and Management (DBM) dated September 20, 2005.
We recommended that management should faithfully carry out the developmental

objectives by which the 20% Development Fund has been created. Projects under this
fund should be geared towards the pursuance of development objectives that would lead
to the attainment of a truly developed community.
The above together with other findings and recommendations contained in the
report were discussed with concerned municipal officials and staff. Management’s view
and reactions were considered in the report, where appropriate.
STATUS OF IMPLEMENTATION OF PRIOR YEAR’S AUDIT
RECOMMENDATIONS
Of the five (5) audit findings and recommendations in last year’s report, (1) was
implemented, (2) were partially implemented and the other (2) were not implemented.

SanVicente Palawan ES09 AAR

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EXECUTIVE SUMMARY

HIGHLIGHTS OF FINANCIAL OPERATION

AUDIT OPINION ON THE FINANCIAL STATEMENTS

SUMMARY OF SIGNIFICANT FINDINGS AND RECOMMENDATIONS

Management is enjoined to comply with the provisions of

We recommended that management should faithfully carry out the developmental

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