Republic of the Philippines

COMMISSION ON AUDIT
Regional Office No. VIII

AUDIT REPORT

ON

BARANGAY BARAYONG
(Barangay)

ABUYOG
(Municipality)

LEYTE
(Province)

For the Years Ended December 31, 2019 to December 31, 2022
 REPUBLIC OF THE PHILIPPINES
COMMISSION ON AUDIT
REGIONAL OFFICE NO. VIII
LGAS C – Leyte II and Biliran Province
Provincial Satellite Auditing Office (PSAO)
Baybay City, Leyte

November 17, 2023

HON. IMELDA A. DE VEYRA

Punong Barangay
Barangay Barayong
Abuyog, Leyte

Dear Punong Barangay De Veyra:

We are pleased to transmit the report of our Auditor on the results of her audit on
the accounts and operations of Barangay Barayong, Abuyog, Leyte, for the years ended
December 31, 2019, 2020, 2021 and December 2022 pursuant to Section 2, Article IX-D
of the Constitution of the Philippines, and Section 43(2) of Presidential Decree (PD) No.
1445, otherwise known as the Government Auditing Code of the Philippines.

The audit was conducted to ascertain the propriety of financial transactions and
compliance of the barangay to prescribed rules and regulations. It was also made to
ascertain the accuracy of the financial records and reports, as well as the fairness of the
presentation of the financial statements.

The Auditor render a qualified opinion on the fairness of the presentation of the
financial statements due to the audit exceptions noted as indicated in the Independent
Auditor’s Report.

We request that the recommendations contained in Part II and those which remain
unimplemented in Part III of the attached report be acted upon immediately. We will
appreciate being informed of the action(s) taken thereon by submitting the duly
accomplished Agency Action Plan and Status of Implementation report.
 We acknowledge the cooperation and support extended to the Audit Team during
the audit by the officials and staff of Barangay Barayong and the Municipal Accountant’s
Office of Abuyog, Leyte.

Very truly yours,

For the Commission On Audit

By:

SANTIAGO P. SEÑASE
State Auditor IV
OIC-Supervising Auditor

Copy furnished:

The Honorable Mayor, Abuyog, Leyte

The Sangguniang Bayan, Abuyog. Leyte
The Regional Director, COA, Region VIII, Candahug, Palo, Leyte
 Barangay Barayong
Municipality of Abuyog
Province of Leyte

AGENCY ACTION PLAN and STATUS OF IMPLEMENTATION

Audit Observations and Recommendations
For Calendar Year 2022 and Prior Years
As of ________________

Agency Action Plan Reason

Target for
Action
Implementation Status of Partial /
Audit Persons Taken /
Audit Date Imple Delay /
Ref Recommend- Action / Dept. Action
Observations ment- Non-
ations Plan Responsi To Be
ation Implem
-ble From To Taken
ent-
ation

Agency Signing Officer:

________________________________ Date __________________

Punong Barangay

Note: Status of Implementation may either be (a) Fully Implemented, (b) On-going, (c) Not Implemented,
(d) Partially Implemented, or (e) Delayed
 EXECUTIVE SUMMARY

Introduction

Barangay Barayong is situated at the Northwest portion of Abuyog, Leyte. It has

a total land area of 415.85 hectares. The barangay was created by virtue of Senate and
House of the Representative under RA 2565 on June 21, 1959.
An audit was conducted on the accounts and operations of Barangay Barayong,
Abuyog, Leyte, for CY 2019, 2020 to CY 2022 with particular emphasis on cash and
property, plant and equipment accounts, utilization of the 20% Development Fund, ,
Barangay DRRM Fund and Fund Transfers.
The audit was conducted in accordance with laws and applicable generally
accepted auditing standards. The audit included examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, as well as
evaluating the overall financial statements presentation. Verification, analysis of
accounts, and other procedures considered necessary were conducted by the team during
the audit.
Financial Highlights

The Barangay's assets, liabilities and equity as December 31, 2022 and income
and expense ,in comparison with that in CYs 2021, 2020 and 2019, are as follows :

Account 2022 2021 2020 2019

Assets 7,142,536.20 5,682,257.21 4,955,024.15 4,737,663.09
Liabilities 365,864.63 132,811.98 231,810.67 231,651.17
Equity 6,776,671.57 5,549,445.23 4,723,213.48 4,506,011.92
Income 3,424,165.47 2,538,924.73 2,367,646.91 2,136,451.47
Expenses 2,196,939.13 1,809,326.58 3,062,549.66 1,456,154.47

Appropriations, obligations and the remaining balances for calendar year 2022
in comparison with CYs 2021, 2020 and 2019 are tabulated hereunder :

Particulars 2022 2021 2020 2019

Appropriations 3,524,951.53 2,662,381.00 2,516,461.00 2,148,726.00
Allotments 3,524,951.53 2,662,381.00 2,516,461.00 2,148,726.00
Obligations 2,154,683.33 1,691,172.08 1,565,031.28 1,314,301.07
Balance 1,370,268.20 971,208.92 951,429.72 834,424.93
Funds Received from Other Agencies
MLGU's - - 7,000.00 -
PLGU's 150,000.00 - - -
Independent Auditor’s Report on the Financial Statements

The Auditor rendered a qualified opinion on the accompanying financial

statements of the Barangay Barayong, Abuyog, Leyte as of December 31, 2022 due to
the exceptions as stated in the Independent Auditor’s Report and as discussed in Part II of
the report.

Summary of Significant Observations and Recommendations:

In addition to the exceptions cited above, the significant audit observations with
the corresponding recommendations were as follows:

1. Only ₱455,399.32 out of ₱911,108.48 or 50% was utilized out of the

LDRRMF available appropriations in CYs 2019, 2020, 2021 and 2022.

We recommended that the Punong Barangay implement during the year the
projects in the LDRRMFIP for the year, in order to equip the Barangay Officials
and its constituents the skills and knowledge to prepare and manage disasters.

2. Only ₱1,922,900.00 or 65% of the ₱2,941,833.60 continuing and current

appropriations of the 20% Development Fund for CYs 2019 to 2022 was
utilized.

We recommended that the Punong Barangay implement all the projects

appropriated under 20% Development Fund so that funds are optimally utilized to
help achieve the desirable socio-economic development and environmental
outcomes of the Barangay.

3. No funds were appropriated in the CY 2019 to 2022 budget of the barangay

for the implementation of programs, projects and activities for the protection
of children.

We recommended that the Punong Barangay include in its annual budget an

appropriation equivalent to 1% of its IRA intended for the protection and welfare
of the children in the barangay, identify and implement the programs, projects and
activities using the said fund pursuant to RA 9344.

4. No funds were appropriated for programs and projects for Senior Citizens
and Persons with Disabilities (PWD) in CY 2019 to 2022 which should be 1%
of the barangay’s IRA.

We recommended that the Punong Barangay and its Council appropriate funds in
its annual budget for programs and projects benefitting Senior Citizens and
 Persons with Disabilities (PWDs) at an amount of no less than 1% of the annual
IRA as required by the Expanded Senior Citizen Act, R.A. No. 9994.

5. Appropriations and actual expenditures in CYs 2019 to CY 2022 on Personal

Services (PS) exceeded the 55% PS limitation.

We recommended that the Punong Barangay and Committee Chairman on

Appropriation limit the appropriations and expenditures for Personal Services of
the barangay strictly in accordance with Section 331 (b) of RA 7160 to avoid
disallowances on irregular and excessive PS disbursements.

We further recommended that the barangay council should strive to find ways to
improve collection of revenues from local sources so that the Personal Services
ceiling will correspondingly increase.

6. The Barangay Treasurer did not deposit her collections regularly, intact and
on time.

We recommended that the Barangay Treasurer deposit the full amount of

collections at the Barangay’s authorized government depository bank daily,
weekly or once the collections reach ₱5,000.00, whichever is applicable.

Summary of Total Suspensions, Disallowances and Charges

The Barangay has no unsettled suspension, disallowance and charges as of

December 31, 2022.

Status of Implementation of Prior Years’ Unimplemented Audit Recommendations

Of the 24 audit recommendations contained in the CY 2016-2018 and prior years’

Audit Report on Barangay, 8 were fully implemented while 16 remained not
implemented.
 TABLE OF CONTENTS

Page
No.
PART I - Audited Financial Statements

Independent Auditor’s Report 1

Statement of Management’s Responsibility for 3
Financial Statements
Statement of Financial Position 4
Statement of Changes in Net Assets/Equity 6
Statement of Financial Performance 7
Statement of Cash Flows 8
Statement of Comparison of Budget and Actual Amounts 10
Notes to Combined Financial Statements 13

PART II - Audit Observations and Recommendations 21

PART III - Status of Implementation of Prior Years’ Audit 37

Recommendations
 Republic of the Philippines
COMMISSION ON AUDIT
Regional Office No. VIII
Candahug, Palo, Leyte

INDEPENDENT AUDITOR’S REPORT

Hon. Imelda A. De Veyra

Punong Barangay
Barangay Barayong
Abuyog, Leyte

Qualified Opinion

We have audited the financial statements of Barangay Barayong, Abuyog, Leyte which
comprise the Statement of Financial Position as of December 31, 2019, December 31,
2020, December 31, 2021 and December 31, 2022 and the Statements of Financial
Performance, Statement of Changes in Net Assets/Equity, Statement of Cash Flows and
Statement of Comparison of Budget and Actual Amounts for the years then ended, and
notes to the financial statements including a summary of significant accounting policies.

Basis for Qualified Opinion

The accuracy of the Barangay’s reported Property, Plant and Equipment (PPE) accounts
aggregating ₱4,106,551.28 as of December 31, 2022 cannot be confirmed due to absence
of the required records and reports on property accounting and management. In addition,
the Trust Liabilities-Disaster Risk Reduction and Management Fund(DRRMF) was
understated by ₱422,934.58 since the unexpended balance of DRRMF on CY 2022
totaling ₱422,934.58 was not transferred to the Special Trust Fund.

We conducted our audit in accordance with the International Public Sector Standards of
Auditing (IPSSA). Our responsibility under those standards are further described in the
Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the agency in accordance with the ethical requirements that are
relevant to our audit of the financial statements, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.

Responsibilities of Management and those Charged with Governance for the Financial
Statements

Management is responsible for the preparation and fair presentation of these financial
statements in accordance with generally accepted accounting principles and for such
internal control as management determines is necessary to enable the preparation of

1
financial statements that are free from material misstatement, whether due to fraud or
error.

Those charged with governance are responsible for overseeing the barangay’s financial
reporting process.

Auditor’s Responsibilities for the Audit of Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements
as a whole are free of material misstatement, whether due to fraud or error, and to issue
an auditor’s report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with ISSAIs will
always detect a material misstatement when it exists. Misstatements can arise from fraud
or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.

For the Commission on Audit

By:

ARNE S. CABIGAS
State Auditor II
OIC- Audit Team Leader

November 17, 2023

2
3
 Republic of the Philippines
Municipality of Abuyog
Province of Leyte

BARANGAY BARAYONG

STATEMENT OF FINANCIAL POSITION

As at December 31, 2022
(with comparative figures of CY 2021, 2020 & 2019)

Not
ASSETS 2022 2021 2020 2019
e
Current Assets
Cash and Cash 3,022,060.9 2,947,450.1 2,201,036.2 3,242,847.3
4
Equivalents 8 9 3 7
10,000.0 10,000.0 10,000.0
Receivables 5 13,840.01
1 1 1
Inventories 6 84.00 - 26.40 428.40

Total Current Assets 3,035,984.99 2,957,450.20 2,211,062.64 3,253,275.78

Non-Current Assets
Investments - - - -
Receivables - - - -
Investment Property - - - -
Property, Plant and 4,106,551.2
7
Equipment 1 2,724,807.01 2,743,961.51 1,484,387.31
Intangible Assets - - - -
Total Non-Current 1,484,387.3
Assets 4,106,551.21 2,724,807.01 2,743,961.51 1

Total Assets 7,142,536.20 5,682,257.21 4,955,024.15 4,737,663.09

LIABILITIES
Current Liabilities
2,700.0
Financial Liabilities 8 -
0 630.00 4,231.85
128,652.2 229,720.9 225,959.5
Inter-Agency Payables 8 280,298.35
5 4 9
Trust Liabilities 8 84,106.55 - - -
Total Current 131,352.2 230,350.9
Liabilities 364,404.90 5 4 230,191.44

Non-Current Liabilities
Bidders Bond Payable 1,459.73
1,459.73 1,459.73 1,459.73
Other Payable - - - -

4
Total Non-Current
1,459.73
Liabilities 1,459.73 1,459.73 1,459.73
Total Liabilities
365,864.63 132,811.98 231,810.67 231,651.17
NET ASSETS/EQUITY
6,776,671.5
Government Equity
7 5,549,445.23 4,723,213.48 4,506,011.92
Total Liabilities and Net
Assets/Equity 7,142,536.20 5,682,257.21 4,955,024.15 4,737,663.09

5
 Republic of the Philippines
MUNICIPALITY OF ABUYOG
Province of Leyte

BARANGAY BARAYONG

STATEMENTS IN CHANGES IN NET ASSETS EQUITY

For the Year Ended December 31, 2022
(with comparative figures of CY 2021 ,2020 & 2019)

2022 2021 2020 2019

Balance at January 1, 2022 5,549,445.23 4,723,213.48 4,506,011.92 3,825,714.92

Add (Deduct)
Change in Accounting Policy
Prior Period Errors - (2,366.40) 1,241.85 -
Restated Balance 5,549,445.23 4,720,847.08 4,507,253.77 3,825,714.92
Add (Deduct) Changes in net
- - 910,862.46
assets/equity during the year
Adjustment of bet revenue
recognized directly in net
assets/equity
Transfer of PPE/completed
99,000.00
projects from Trust Fund
Transfer of Assets from
Registry of Public Infrastructure
Surplus (Deficit) for the Period 1,227,226.34 729,598.15 (694,902.75) 680,297.00
Total recognized revenue and
1,227,226.34 828,598.15 215,959.71 680,297.00
expenses for the period
Balance at December 31, 2022 6,776,671.57 5,549,445.23 4,723,213.48 4,506,011.92

6
 Republic of the Philippines
Municipality of Abuyog
Province of Leyte

BARANGAY BARAYONG

STATEMENT OF FINANCIAL PERFORMANCE

For the Year Ended December 31, 2022
(with comparative figures of CY 2021, 2020,& 2019)

Revenue Note 2022 2021 2020 2019

2,464.4 18,323.7 21,864.9 48,828.4
Tax Revenue 10 7 3 1 7
Share from Internal Revenue 3,407,136.0 2,496,111.0 2,330,492.0 2,070,938.0
10
Collections 0 0 0 0
10,680.0 24,490.0 13,445.0 15,685.0
Service & Business Income 11
0 0 0 0
3,885.0 1,845.0 1,000.0
Other Income 12
0 - 0 0
3,424,165.4 2,538,924.7 2,367,646.9 2,136,451.4
Total Revenue
7 3 1 7

Less: Current Operating Expenses

1,600,752.7
Personnel Services 14
3 1,453,225.72 1,259,395.36 1,127,095.12
Maintenance and Other Operating 446,550.6
15-20
Expenses 0 212,686.36 1,475,061.57 177,315.95
149,635.8
Non-cash Expenses 21
0 142,904.50 328,092.73 151,743.40
Financial Expenses - 510.00 - -
2,196,939.1 1,809,326.5 3,062,549.6 1,456,154.4
Current Operating Expenses
3 8 6 7

Surplus (Deficit) from Current 1,227,226.3 729,598.1 (694,902.7 680,297.0

Operation 4 5 5) 0
Add (Deduct):
Transfers, Assistance and
Subsidy From
Transfers, Assistance and
Subsidy To
1,227,226.3 729,598.1 (694,902.7 680,297.0
Surplus(Deficit) for the period
4 5 5) 0

7
 Republic of the Philippines
Municipality of Abuyog
Province of Leyte
BARANGAY BARAYONG
Statement of Condensed Cash Flows
For the Year Ended December 31, 2022
(with comparative figures of CY 2021, 2020 & 2019)

Cash Flows from Operating

Note 2022 2021 2020 2019
Activities
Cash Inflows
18,323.7 21,864.9
Collection from taxpayers 10
2,464.47 3 1 48,828.47
Share from Internal Revenue 3,407,136.0 2,496,111.0 2,330,492.0
10
Allotment 0 0 0 2,070,938.00
Receipts from business/service 10,680.0 24,490.0 13,445.0
11
income 0 0 0 15,685.00
1,845.0
Other Receipts 12
3,885.00 - 0 5,153.45
3,424,165.4 2,538,924.7 2,367,646.9 2,140,604.9
Total Cash Inflows
7 3 1 2
Cash Outflows
Payment of expenses
244,191.5 113,927.8 139,988.9
Payments to suppliers and creditors 15
5 6 2 104,492.75
1,600,752.7 1,453,225.7 1,259,395.3 1,127,095.1
Payments to employees 14
3 2 6 2
Interest Expense - - - -
(26,769.60 200,607.1 1,333,269.3
Other Expenses
) 9 0 73,039.20
1,818,174.6 1,767,760.7 2,732,653.5 1,304,627.0
Total Cash Outflows
8 7 8 7
Net Cash Flows from Operating 1,605,990.7 771,163.9 (365,006.6
Activities 9 6 7) 835,977.85
Cash Flows from Investing
Activities
Cash Inflows
Proceeds from Sale of Investment
- -
Property - -
Proceeds from Sale/Disposal of
- -
Property, Plant and Equipment - -
Proceeds from Sale of Non-
- -
Current Investments - -
Collection of Principal on loans to
- -
other entities - -
Total Cash Inflows - - - -

8
Cash Outflows
Purchase/Construction of
- -
Investment Property - -
Purchase/Construction of Property, 1,531,380.0 24,750.0 676,804.4
7
Plant and Equipment 0 0 7 19,890.00
Investment - - - -
Purchase of Bearer Biological
- -
Assets - -
Purchase of Intangible Assets - - - -
Grant of Loans - - - -
1,531,380.0 24,750.0 676,804.4
Total Cash Outflows
0 0 7 19,890.00
Net Cash Flows from Investing (1,531,380.0 (24,750.0 (676,804.4 (19,890.0
Activities 0) 0) 7) 0)
Total Cash Provided by Operating,
Investing and
74,610.7 746,413.9 1,041,811.1
Financing Activities
9 6 4 816,087.85
Add: Cash at the Beginning of the 2,947,450.1 2,201,036.2 3,242,847.3
year 9 3 7 2,462,759.52
Cash Balance at the End of the 3,022,060.9 2,947,450.1 2,201,036.2 3,242,847.3
Year 8 9 3 7

9
 Republic of the Philippines
MUNICIPALITY OF ABUYOG
Province of Leyte

STATEMENT OF COMPARISON OF BUDGET AND ACTUAL AMOUNTS

BARANGAY BARAYONG
For the Year Ended December 31, 2022
(In thousands of Pesos)

Budgeted Amounts Difference

Difference
Original Actual
Particulars Final Budget
Original Final and Final Amounts
and Actual
Budget
Revenue
A. Local Sources
1. Tax Revenue
5,000 5,000 2,464 (2,535.
a. Tax Revenue- Property
.00 .00 - .47 53)
b. Tax Revenue – Goods and
Services - - - - -

c. Other Local Taxes

- - - - -
5,000. 5,000. 2,464. (2,535.5
Total Tax Revenue
00 00 - 47 3)

2. Non-Tax Revenue
-
9,000 9,000 10,680 1,680.
a. Business and Service Income
.00 .00 .00 00

b. Other Income and Receipts

- -
9,000. 9,000. 10,680.0 1,680.0
Total Non-Tax Revenue
00 00 - 0 0

B. External Sources
-
1. Share from the National Internal 3,407,131 3,407,131 3,407,136 5.
Revenue Taxes (IRA) .00 .00 - .00 00

2. Share from PCSO

- - - - -
3. Other Shares from National Tax
Collections - - - - -

a. Share from Ecozone

- - - - -

b. Share from EVAT

- - - - -

c. Share from National Wealth

- - - - -

d. Share from Tobacco Excise Tax

- - - - -

4. Other Receipts
- - - - -

a. Grants and Donations

- - - - -
1,000 1,000 2,000 1,000.
b. Other Subsidy Income
.00 .00 - .00 00
1,885 1,885.
c. Miscellaneous income
- - - .00 00

10
 102,820 102,820.
5. Inter-local Transfer
- - - .53 53

6. Capital /Investment Receipts

- - - - -

a. Sale of Capital Assets

- - - - -

b. Sale of Investments
- - - - -
c. Proceeds from Collections of
Loans Receivable - - - - -

C. Receipts from Borrowings

- - - - -
3,408,131.0 3,408,131.0 3,513,841 105,710.
Sub-Total Revenues and Receipts
0 0 - .53 53
3,422,131.0 3,422,131.0 3,526,986.0 104,855.0
Total Revenues and Receipts
0 0 - 0 0
Expenditures
General Public Services
1,357,205 1,639,205 282,000. 1,600,752 38,452.
Personnel Services
.51 .51 00 .73 78
Maintenance and Other Operating 720,179 541,000 (179,179. 362,444 178,556.
Expenses .64 .17 47) .05 12
150,000 150,000 107,380 42,620.
Capital Outlay
.00 .00 - .00 00
Education

Personnel Services
- - - - -
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
Health, Nutrition and Population
Control

Personnel Services
- - - -
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
Labor and Employment

Personnel Services
- - - -
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
Housing and Community Development

Personnel Services
- - - -
Maintenance and Other Operating
Expenses - - -

Capital Outlay
- - -
Social Services and Social Welfare

Personnel Services
- - -
Maintenance and Other Operating

11
Expenses - - -

Capital Outlay
- - -
Economic Services

Personnel Services
- - -
Maintenance and Other Operating
Expenses - - -

Capital Outlay
- - -
Other Purposes:

Depreciation Expense
- - - - -

Financial Expense
- - - -
342,213 342,213 342,213.
10 SK Fund
.10 .10 - 10

LDRRMF
- -
Maintenance and Other Operating 84,106 84,106 84,106
Expenses .55 .55 - .55 -
87,000 87,000 87,000.
Capital Outlay
.00 .00 - 00

20% Development Fund

-
Maintenance and Other Operating
Expenses - - - -
681,426 681,426 681,426.
Capital Outlay
.20 .20 - - 20
Share from National Wealth
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
Allocation for Senior Citizens and PWD
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
Others

Personnel Services
- - -
Maintenance and Other Operating
Expenses - - - -

Capital Outlay
- - - -
3,422,131.0 3,524,951.5 102,820.5 2,154,683.3 1,370,268.2
Total
0 3 3 3 0
Continuing Appropriations (Capital
Outlay)
45,360 45,360 45,360.
General Public Service
.00 .00 - - 00

Education
- - - -
Health, Nutrition and Population
Control - - - -

12
 Labor and Employment
- - - -

Housing and Community Development

- - - -

Social Services and Social Welfare

- - - -

Economic Services
- - - -
20% Development Fund

MOOE
- - -
1,761,507 1,761,507 1,424,000 337,507.
Capital Outlay
.40 .40 - .00 40
295,934 295,934 295,934.
LDRRMF
.58 .58 - 58
40,000 40,000 40,000.
Capital Outlay
.00 .00 - 00
479,604 479,604 479,604.
10% SK FUND
.20 .20 - 20
2,622,406.1 2,622,406.1 1,424,000.0 1,198,406.1
Sub-Total
8 8 - 0 8
6,044,537.1 6,147,357.7 102,820.5 3,578,683.3 2,568,674.3
Total
8 1 3 3 8
(64,841.8
Surplus (Deficit) for the period
0)

Republic of the Philippines

MUNICIPALITY OF ABUYOG
Province of Leyte

BARANGAY BARAYONG

CONSOLIDATED NOTES TO CONDENSED FINANCIAL STATEMENT

December 31, 2022
(All amounts in Philippine Peso unless otherwise stated)

Note I - Profile
Long time ago,there was a place which had no name. It ia now the place of Barangay Barayong. People living in this place
foundout that many barayong threes were grown in the said area.
In the year 1880’s under the leadershipof Tenyente Ambrosio Agacci, he dedicated to give name to this place which was
derived from the neme of the trees “Barayong. He announced to the people that this place shall be called Barangay of Barayong, a four
(4) kilometers distance from town proper.

Note 2 - The consolidated financial statements of the LGU have been prepared in accordance with and comply with the Philippine Public
Sector Accounting Standards (PPSAS). The consolidated financial statements are presented in pesos, which is the
functional and reporting currency of the BLGU and all values are rounded to nearest thousand (P000). The accounting
policies have been applied starting this year.

Note 3 - Summary of significant accounting policies

3.1 Basis of accounting

The financial statement are prepared on an accrual basis in accordance with the Philippine Public Sector Accounting
Standards (PPSAS).

3.2 Property, Plant and Equipment

All property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Cost includes
expenditure that is directly attributable to the acquisition of the items. When significant parts of property, plant and equipment
are required to be replaced at intervals, the LGU recognizes such parts as individual assets with specific useful lives and
depreciates them accordingly.

13
 Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the plant and equipment as a
replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognized in surplus or deficit as
incurred. Where an asset is acquired in a non-exchange transaction for nil or nominal consideration the asset is initially
measured at its fair value.
Depreciation on assets is charged on a straight-line basis over the useful life of the asset.
Depreciation is charged at rates calculated to allocate cost or valuation of the asset less any estimated residual value over its
remaining useful life:

Account Title Years Account Title Years

Electrification, Power & Energy Structures 10 Agricultural, Fishery & Forestry Equipment 10
Office Buildings 30 Communication Equipment 10
School Buildings 20 Construction & Heavy Equipment 10
Hospitals & Health Centers 30 Disaster Response & Rescue Equipment 10
Markets & Slaughterhouses 30 Hospital Equipment 10
Other Structures 30 Medical, Dental & Laboratory Equipment 10
Office Equipment 5 Military & Police Equipment 10
Furniture & Fixtures 10 Sports Equipment 10
IT Equipment & Software 5 Technical & Scientific Equipment 10
Library Books 5 Other Machineries & Equipment 10
Machineries 10

The BLGU derecognizes items of property, plant and equipment and/or any significant part of an asset upon disposal or when
no future economic benefits or service potential is expected from its continuing use. Any gain or loss arising on derecognition
of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included
in the surplus or deficit when the asset is derecognized.

3.3 Budget information

The annual budget is prepared on the modified cash basis, that is, all planned costs and income are presented in a single
statement to determine the needs of the BLGU. As a result of the adoption of the Modified cash basis for budgeting
purposes, there are basis, timing or entity differences that would require reconciliation between the actual comparable
amounts and the amounts presented as a separate additional financial statement in the statement of comparison of budget
and actual amounts.

Reconciliation for expense accounts between actual amounts provided in the Statement of Financial Performance and
Statement of Comparison of budget and actual amounts are presented in the tables below. Each table reflects specific
differences with substantial explanation on how to come up with the disparity.

14
 Reconciliation of Comparison of Budget and Actual Amounts and the Statement of Financial Performance for the Year Ended December
31, 2022
Personal Financial
Income MOOE Expenses Capital Outlay
Services

Comparison Statements of Budget and Actual 3,526,986.00 1,600,446.50 446,550.50 - 1,531,380.00

Entity Differences
Basis Differences

Income not considered Budgetary items

(102,820.53)
Non-cash income
Gain on Sale of Assets
Receipts not considered as income
Sales of capital assets
Borrowing
Non-cash expenses:

Depreciation 149,635.80
Impairment Loss
Losses
Debt Service (Loan Amortization) -
Interest Expenses capitalized -
Capital Expenditure (1,531,380.00)
Timing Differences:
Prepayments charged to current appropriations
-
Unconsumed Inventories charged to current appropriations
-
Consumed Inventories and deferred charges to
prior period appropriations

Per Statements of Financial Performance 3,424,165.47 1,600,446.50 596,186.30 - -

Note 4- Cash and Cash Equivalents
Cash on Hand 2022 2021 2020 2019
Cash in Local Treasury 23,196.93 7,392.46 8,587.46 7,602.45
Petty Cash 1,000.00 1,000.00 1,000.00 0.01
Cash in Bank 2,997,864.05 2,939,057.73 2,191,448.77 3,235,244.92
Total Cash in Hand and Cash Equivalent 3,022,060.98 2,947,450.19 2,201,036.23 3,242,847.38

Note 5 - Receivables

Other Receivable 2022 2021 2020 2019

Advances for Payrolls 0.01 0.01 0.01 0.01
Advances for Officers & Employees 13,840.00 10,000.00 10,000.00 10,000.00
Other Receivables -

Note- 6 Inventories

2022 2021 2020 2019

Accountable forms inventory 84.00 - 26.40 428.40

Note 7 - Property, Plant and Equipment

15
 Balance December 31, 2021 Net addition/deduction Balance December 31, 2022

Land 150,000.00 150,000.00

Other Land Improvement 798,904.73 798,904.73

Road Networks 1,508,762.73 1,424,000.00 2,932,762.73

Power Supply System

Other Infrastructure Assets

Building 1,666,038.00 1,666,038.00

Hospital & Health Center

Office Equipment 252,964.86 21,000.00 273,964.86

Information & Communication Technology Equipment 82,558.00 86,380.00 168,938.00

Communication Equipment 29,990.00 29,990.00

Disaster Response & Rescue Equipment 127,904.47 127,904.47

Sports Equipment 14,530.00 14,530.00

Other Macheneries & Rescue Equipment 25,303.00 25,303.00

Motor Vehicles 64,510.00 64,510.00

Furniture & Fixture 32,877.00 32,877.00

Other Property, Plant & Equipment 46,564.00 46,564.00

Total 4,800,906.79 1,531,380.00 6,332,286.79

Accummulated Depreciation Expense 2,076,099.71 149,635.80 2,225,735.51

Net Amount 2,724,807.08 4,106,551.28

Note 8 – Liabilities

Financial Liabilities 2022 2021 2020 2019

Accounts Payable - 2,700.00 630.00 4,231.85
Due to Officers and employees - - -
Other Payables - - -
Bonds Payable - - -
Total - 2,700.00 630.00 4,231.85

Inter Agency Payables 2022 2021 2020 2019

Due to BIR 23,292.86 23,646.76 23,715.43 19,954.08
Due to PHILHEALTH 2,000.00 - - -
Due to NGAs - - - -
Due to LGUs 255,005.49 105,005.49 206,005.51 206,005.51
Total 280,298.35 128,652.25 229,720.94 225,959.59

Trust Liabilities 2022 2021 2020 2019

Trust Liabilities-Disaster Risk Reduction &
Management Fund 84,106.55 - - -
Bail Bond Payable 1,459.73 1,459.73 1,459.73 1,459.73
Guarantee/Security/Deposits Payable - - - -

Note 9– Other Payables

16
 2022 2021 2020 2019
Other Payables - - - -
Total - - - -

Note 10 – Tax Revenue

Tax Revenue-Property 2022

Real Property Tax-Basic 2,464.47
Tax Revenue-Goods & Services 2,464.47
Business Tax -
Tax on Sand,Gravel & other Quarry -
Note 11– Service and Business Income

Service Income 2022 2021 2020 2019

Permit Fees 3,420.00 580.00 590.00 4,260.00
Clearance & Certificate Fees 7,260.00 23,350.00 12,855.00 11,425.00
Other Service Income - 560.00 -
Business Income 10,680.00 24,490.00 13,445.00 15,685.00
Other Business Income - - - -
Miscellaneous Income 1,885.00 - 845.00
Total 12,565.00 24,490.00 14,290.00 15,685.00

Note 12 - Transfers, Assistance and Subsidy

Assistance and Subsidy 2022 2021 2020 2019

Subsidy from Local Government Units 2,000.00 - 1,000.00 1,000.00

Subsidy from Other Funds - - - -
Subsidy to LGUs - - - -
Subsidy to other Funds - - - -
Total 2,000.00 - 1,000.00 1,000.00
Note 13– Share, Grants and Donation

Share 2022 2021 2020 2019

Share from PAGCOR - - - -
Share from PCSO - - - -
Grants and Donation
Grants and Donation in Cash - - - -
Grants and Donation in Kind - - - -

17
Note 14 - Employee Costs

Personnel Services 2022 2021 2020 2019

Salaraies and Wages - - -
Other Compensation
Productivity Incentive Allowance 55,000.00 55,000.00 52,000.00 -
Honoraria 1,249,510.00 1,141,175.72 1,017,395.36 926,595.12
Year End Bunos 7,000.00 74,800.00 7,000.00 7,000.00
Cash Gift 55,000.00 55,000.00 55,000.00 55,000.00
Other Bonuses & Allowances 220,000.00 110,000.00 110,000.00 110,000.00
Personnel Benefit Contribution
Philhealth Contribution 14,242.73 17,250.00 18,000.00 28,500.00
Total 1,600,752.73 1,453,225.72 1,259,395.36 1,127,095.12

Note 15 – Maintenance and Other Operating Expenses

2022 2021 2020 2019

Travelling Expenses 55,780.00 31,260.00 20,290.00 29,436.20
Training Expense 18,000.00 1,300.00 - 6,000.00
Supplies & Material Expense
Office Supplies Expense 43,934.00 6,641.00 11,378.94 7,903.48
Accountable Forms Expense 1,316.00 2,630.00 1,302.00 1,584.00
Utility Expenses
Water Expense
Electricity Expense 162,841.55 104,656.86 71,657.98 83,755.27
Other Supplies & Material Expense 55,650.00
Communication Expense
Internet Subscription Expense - - - -
Awards/Rewards and Prices
Prizes - - - -
Total 281,871.55 146,487.86 160,278.92 128,678.95

Note 16 – Contracted Services

Professional Services 2022 2021 2020 2019

Legal Services - - -
Auditing Services 500.00 500.00 500.00 500.00
Consultancy Services - - - -
Other Professional Services - - - -
Total 500.00 500.00 500.00 500.00
Note 17 – Repairs and Maintenance

18
 2022 2021 2020 2019

Repair & Maintenance-Land Improvement - - - -

Repair & Maintenance-Infrastructure Assets 36,100.00 - 68,250.00 11,250.00

Repair & Maintenance-Building and Other Structure - - - -

Repair & Maintenance-Machinery & Equipment - - - -
Repair & Maintenance-Transportation Equipment - - - -
Repair & Maintenance-Furniture, Fixture - - - -
Repair & Maintenance-Other Property,Plant & Equipment - - - -
Total 36,100.00 - 68,250.00 11,250.00

Note 18- Financial Assistance/Subsidy

2022 2021 2020 2019

Subsidies to Local Government Units 10,000.00 10,000.00 10,000.00 10,000.00
Subsidies to other fuds - - - 10,000.00
Total 10,000.00 10,000.00 10,000.00 20,000.00
Note 19 - Taxes, Insurance Premiums and Other Fees

2022 2021 2020 2019

Taxes,Duties and Licenses - - - -
Fedility Bond Premiums 4,972.50 3,343.50 3,955.00 3,537.00
Insurance Expense - 2,400.00 2,100.00 2,100.00
Total 4,972.50 5,743.50 6,055.00 5,637.00

Note 20 – Other Maintenance and Operating Expenses

2022 2021 2020 2019

Transfer of unspent DRRMF to trust fund 84,106.55 - - -
Membership Dues & Contributions to organizations 4,000.00 2,000.00 4,000.00 4,000.00
Transfer for project Equity share/SK Fund 898,200.80 -
Other Maintenance and Operating Expenses 25,000.00 47,955.00 327,776.85 7,250.00
113,106.55 49,955.00 1,229,977.65 11,250.00
Financial Expenses
Bank Charge - 510.00 -
Total 113,106.55 50,465.00 1,229,977.65 11,250.00

Note 21– Non-Cash Expense

19
 2022 2021 2020 2019

Depreciation-Land Improvement - 7,990.61 71,901.42 71,901.42

Depreciation-Infrastructure Assets 60,350.54 56,390.49 182,172.45 -
Depreciation-Building & Other Structure 49,981.14 49,981.14 49,981.14 49,981.14
Depreciation-Machinery & Equipment 18,746.14 16,485.40 13,944.12 19,767.24
Depreciation-Transportation Equipment 8,294.14 8,294.14 8,294.14 8,294.14
Depreciation-Furniture,Fixtures and Book 1,919.06 1,799.46 1,799.46 1,799.46
Depreciation-Other Property,plant and Equipment 10,344.78 1,963.26 - -
Total 149,635.80 142,904.50 328,092.73 151,743.40

Note 22 - Reconciliation of Net Cash Flows from Operating Activities to Surplus/(Deficit)

2022 2021 2020 2019

Surplus/(Deficit) 1,227,226.34 729,598.15 (694,902.75) 680,297.00

Non-cash transactions
Depreciation 149,635.80 142,904.50 328,092.73 151,743.40
Impairment Loss
Increase in payables 233,052.65 (98,998.69) 159.50 4,153.45
(Gain) Losses on Sale of PPE
(Gains) Losses on Sale of Investments
Increase in current assets (84.00) 402.00 (216.00)
Increase in investments due to revaluation
Increase in Receivables (3,840.00) 26.40 -
Prior Year Adjustment (2,366.40) 1,241.85
Net Cash from Operating Activities 1,605,990.79 771,163.96 (365,006.67) 835,977.85

Note 23. Local Disaster Risk Reduction Management Fund ( LDRRMF)

20
 The LDRRMF represents the amount set aside by the LGU to support its disaster risk management activities
pursuant to R.A. No. 10121 otherwise known as the “Philippines Disaster Risk Reduction and Management Act of 2010.”
The amount available and utilized during the year totaled ₱ 507,041.13 and ₱ 84,106.55 respectively, broken down as
follows:

Amount
Particular
Available UtIlized Balance
Current Year Appropriation:
Quick Response Fund (QRF) 51,331.97 51,331.97 -

Mitigation Fund(MF)
MOOE 32,774.58 32,774.58 -
Capital Outlay 87,000.00 87,000.00
Total 171,106.55 84,106.55 87,000.00

Continuing Appropriation:
MOOE 295,934.58 - 295,934.58
Capital Outlay 40,000.00 40,000.00
Total 335,934.58 - 335,934.58

TOTAL 507,041.13 84,106.55 422,934.58

PART II

21
 AUDIT OBSERVATIONS AND RECOMMENDATIONS

A.Financial Audit

Property, Plant and Equipment

1. The accuracy of the Barangay’s reported Property, Plant and Equipment

(PPE) accounts aggregating ₱4,106,551.28 as of December 31, 2022 cannot be
confirmed due to absence of the required records and reports on property
accounting and management contrary to Section 111 of PD 1445 and
pertinent provisions of the Manual on the Financial Management of
Barangays, affecting the fair presentation of the accounts in the financial
statements.

1.1. Section 111 of PD 1445 states that:

“(1) The accounts of an agency shall be kept in such detail as is necessary to

meet the needs of the agency and at the same time be adequate to furnish the
information needed by fiscal or control agencies of the government.

(2) The highest standards of honesty, objectivity and consistency shall be

observed in the keeping of accounts to safeguard against inaccurate or
misleading information.”

1.2. Pertinent provisions in Chapter VII of the Manual on the Barangay Financial
Management of Barangays provide:

7.1 Specific Policies

Property, Plant and Equipment/Infrastructure Assets

xxx

7.1.6 Property/Equipment Card (PEC), see Annex 26.1, shall be maintained

for all property and equipment of the barangay by the BT.

7.1.7 Property/Equipment Ledger Card (PELC), see Annex 26.2, shall be

maintained by the C/M Accountant as subsidiary ledgers for all
property and equipment of the barangay.

7.1.18 The barangay shall conduct an annual physical inventory of all

supplies, property and equipment of the barangay.

7.1.19 Report on the results of physical inventory of property/equipment shall

be reconciled with the accounting records.

22
 xxx

7.2.5 Inventory Taking and Reconciliation

The Inventory Committee headed by the PB or his authorized representative and

the BT as his member shall conduct a physical count of all property and
equipment of the barangay at least once a year.

The Inventory Committee, upon the completion of the physical count, shall
prepare three copies of Report on Inventory of Property and Equipment (RIPE),
as shown in Annex 30 and shall be approved by the PB. The RIPE shall be
distributed as follows:

Original- to COA Auditor through C/M Accountant

Duplicate copy- to the C/M Accountant
Triplicate copy- to the BT

The RIPE shall be the basis of the C/M Accountant for reconciling the results of
inventory with the PPE accounts.

The RIPE shall be the basis of the BT for reconciling the equipment covered by
PAR and the PECs on file and the ICS for the small items considered as
inventories.

1.3. As of December 31, 2022, the Barangay’s financial statements showed the total,
PPE account of ₱4,106,551.28 representing 57% of its total assets of
₱7,142,536.20 The details of the total PPE account are presented in Table 1.

Table 1. Property, Plant and Equipment

PPE Amount
Land ₱ 150,000.00
Other Land Improvement 798,904.73
Road Networks 2,932,762.73
Building 1,666,038.00
Office Equipment 273,964.86
Information and Communication Technology Equipment 168,938.00
Communication Equipment 29,990.00
Disaster Response & Rescue Equipment 127,904.47
Sports Equipment 14,530.00
Other Machineries and Equipment 25,303.00
Motor Vehicles 64,510.00
Furniture and Fixture 32,877.00
Other Property, Plant and Equipment 46,564.00
Total ₱ 6,332,286.79
Less: Accumulated Depreciation 2,225,735.51

23
 PPE Amount
Net Amount ₱ 4,106,551.28

1.4. The required Subsidiary Ledgers or the PPE Ledger Cards and
Property/Equipment Cards were not maintained by the Municipal Accountant and
the Barangay Treasurer, respectively. The absence of the PPE Ledger Cards made
the confirmation of the balance of the PPE account impossible. Likewise, without
the Property/Equipment Cards, the Barangay Treasurer will have difficulty in
filling-out columns 1 to 6 of the RIPE which will be the basis of the Inventory
Team in the conduct of the physical count.

1.5. Due to the aforementioned deficiencies, the valuation of the properties that
constitute the Property, Plant and Equipment account amounting to ₱4,106,551.28
could not be established, thus affecting the fair presentation of the account in the
FS.

1.6. We recommended that the Municipal Accountant maintain and update the
prescribed PPELC and reconcile these with property records of the
Barangay Treasurer.

1.3 We also recommended that the Barangay Treasurer maintain

Property/Equipment Cards for each kind of PPE owned by the Barangay
and reconcile the same with the accounting records.

1.4 The Municipal Accountant and the Barangay agreed with the audit
recommendations.

Non-Transfer to Special Trust Fund of unexpended DRRMF

2.0. Unexpended balance of DRRMF on CY 2022 totaling ₱422,934.58 was not

transferred to the Special Trust Fund contrary to Section 4.4 an of COA
Circular 2012-002, thus, the Trust Liabilities-Disaster Risk Reduction and
Management Fund(DRRMF) was understated by the same amount at year-
end.

2.1. Section 4.4 of COA Circular 2012-002 states “The unexpended LDRRMF shall
accrue to a special trust fund solely for the purpose of supporting disaster risk
reduction and management activities of the Local Disaster Risk Reduction
Management Council (LDRRMC) within the next five years.

2.3. In CY 2022, the barangay appropriated a total of ₱171,106.55 for its LDRRMF.
In addition, it has a balance of ₱335,934.58 from previous year’s unexpended
balance, while there was no disbursements made during the year charged to the
fund. Details are shown in table 2.

Table 2. Balance of BDRRMF

PPA Appropriation Disbursements Balance

24
 Current 30%QRF 51,331.97 - 51,331.97
Year 70% NO LDRRMFIP 119,774.58 - 119,774.58
Subtotal Current Year 171,106.55 - 171,106.55
Previous Years Unexpended 335,934.58 - 335,934.58
Total 507,041.13 - 507,041.13

2.4. However, review of the Trust Liabilities-DRRMF account as of year-end

disclosed that only the amount of ₱84,106.55 was transferred to the Special Trust
Fund instead of the balance of ₱507,041.13 thus an understatement in transfer
amounting ₱422,934.58.

2.5. Due to non-transfer of the unexpended balance of DRRMF as of CY 2022

amounting ₱422,934.58, the Trust Liabilities-DRRMF account was understated
by the same amount at year-end.

2.6. We recommended that the Municipal Accountant thru her Designated

Bookkeeper transfer and record the unexpended BDRRM Fund amounting
₱422,934.58 as Trust Liabilities-DRRMF under Special Trust Fund and
maintain subsidiary ledgers by year of transfer.

2.7. The Municipal Accountant and the designated Barangay Bookkeeper agreed with
the audit recommendation.

5% DRRMF Utilization

3.0. Only ₱455,399.32 out of ₱911,108.48 or 50% was utilized out of the
LDRRMF available appropriations in CYs 2019, 2020, 2021 and 2022,
contrary to COA Circular No. 2012-002, Section 21 of RA No. 10211 and
Local Budget Circular 124, thereby limiting the capacity and readiness of the
Barangay in responding to disasters and in assisting the constituents in times
of calamity and COVID-19 pandemic.

3.1. COA Circular No. 2012-002 dated September 12, 2012 on Accounting and
Reporting Guidelines of the Local Disaster Risk Reduction and Management
Fund (LDRRMF) of Local Government Units provides:

5.1.2 A LDRRMFIP for the DRRM program shall be prepared annually. It

shall present the 30% allocation for QRF in lump-sum and the
allocation for disaster mitigation, prevention and preparedness with
details as to projects and activities to be funded. The LDRRMFIP
shall also include under a separate caption, the list of projects and
activities charged to the unexpended LDRRMF of previous years.
Xxx.

3.2. Section 21 of Republic Act No. 10211 provides, “The present Local Calamity
Fund shall henceforth be known as the Local Disaster Risk Reduction and
Management Fund. Not less than five percent (5%) of the estimated revenue from

25
 regular sources shall be set aside as the LDRRMF to support disaster risk
management activities such as, but not limited to, pre-disaster preparedness
programs including training, purchasing life-saving rescue equipment, supplies
and medicines, for post-disaster activities, and for payment of premiums on
calamity insurance. The LDRRMC shall monitor and evaluate the use and
disbursement of the LDRRMF based on the LDRRMP as incorporated in the local
development plans and annual work and financial plan. …”

3.3. DILG Memorandum Circular No. 2012-73was issued to provide the list of early
warning systems, preparedness equipment and other equipage which may be
procured by the LGUs from the 70% Mitigation Fund of its LDRRMF, depending
on the kind of disaster. Among these the following items:

Flooding Earthquake
* Rubber boats with live vests, rescue * Fork lift
whistles and megaphones * Grader
* Inflatable Rafts/ Boats * Hack Saw
* Rain Gauges * Backhoe
* Breathing Apparatus * Chisel
* Portable Generator Set * Electric Drill
* Illuminated Jackets (Night Light) * Chain Saw Electric
* Warning Bella * Concrete Cutter
* Bolt Cutters * Jack Hammer
* Life Buoys * Megaphone w/ siren & rescue
whistle
* Pulling and Lifting Machine * Flashlight with batteries
* Chain Saw Electric * Work Gloves
* Portable Tower Light * Ax- weighing at least 6 lbs
* Hand Gloves * Shovel-both flat head& pointed
* Hydraulic Cutter Hydraulic * Coils of rope and wire
Spreader
* Power Pack Pump * Compass
* Core Hose Pipe 20 m. long * crow bar/claw tool- 36'' or longer
* Foldable Stretcher Search Lights * Safety Full Body Harness
* Hi-power Torches * Tent- Family Sized
* Emergency Torches * Sleeping Bags
* Emergency Lights Rain Coat * Bolt Cutters
* Grapnel with Poly propylene rope * 10 ton chain pulley block
* Body Bags * Pulling and Lifting Machine
* Aluminum Ladder 24 ft. * 1" Manila rope 100 meters roll
* Electric Drill * Portable Tower Light
* Snap Link * Hard hat
* Eye Googles * Search, emergency light
* Water Proof Tents * Foldable Stretcher
* First Aid Boxes Fire Extinguisher * First Aid Boxes (50pax/ per box)

26
 Flooding Earthquake
* Fire Extinguisher * Chain Saw

Volcanic Eruption Landslide

* Grader * Dump Truck
* Backhoe * Grader
* Megaphone * Back hoe
* Rescue Whistle * Megaphone with serene
Rescue Whistle Search Foldable
* Warning Bells * Stretcher
* Forklift * Forklift
* Pulling and Lifting Machine * Pulling and Lifting Machine
* 10 Ton Chain Pulley Block * Electric Drill
* Crowbar/ Pickaxe/ Shovel * Shovel
* Portable Generator Set * 10 Ton Chain Pulley Block
* Inflatable Flood Light AIT 4500 * Search Lights
* Grapnel with Poly propylene Rope * Hi power Torches
* Hard Hat * Emergency Lights
* Breathing Apparatus * Body Bag
* Safety Full body Harness * Compass
Search Camera set/ victim
* Search Lights * location unit
* Hi-power Torches * Foldable Stretchers
* Emergency Lights * Snap link safety
Search Camera Set/ Victim *
* Location Unit Full body Harness First Aid
* Ascending and Descending Device Boxes (50 persons per box)
* Snap Link * Safe line Rescue Ropes

3.4. Also, the Department of Budget and Management issued Local Budget Circular
(LBC) No. 124 dated March 26, 2020 set the policy guidelines on the provision of
funds by the Local Government Units for PPAs to address the Corona Virus
Disease 2019 (COVID-19) situation.

3.5. Section 2.5.5 and 2.5.6 of the said LBC states:

2.5.5 In view of the foregoing legal bases, LGUs are authorized to utilize
the LDRRMF, beyond the 30% QRF, to address the disaster
response requirements of the COVID-19 emergency, among the
other purposes sanctioned by the law (i.e., disaster prevention and
mitigation, preparedness, and rehabilitation and recovery), provided
that the same is consistent with the approved LDRRMP as
incorporated in the AIP.

2.5.6 Further, the unexpended balances of the LDRRMF that accrued to the
special trust fund pursuant to Section 21 of RA No. 10121 may be
27
 used to address the disaster response requirements of the COVID-19
emergency, among the other purposes sanctioned by the law (i.e.,
disaster prevention and mitigation, preparedness, and rehabilitation
and recovery), provided that the same is consistent with the approved
LDRRMP as incorporated in the AIP, and following the procedures
under COA Circular No. 2012-002 and NDRRMC-DBM-DILG JMC
No. 2013-1.

3.6. During the review of Barangay’s appropriation and utilization of the 5% BDRRM
Fund, the Audit Team noted that Barangay Barayong appropriated a total amount
of ₱516,879.95 under DRRM Fund during the 4-year period under audit, as
presented in Table 3.

Table 3. BDRRMF balance

Amount
Particulars Total
2019 2020 2021 2022
Beginning Balance ₱445,560.50 ₱548,396.80 ₱210,370.53 ₱335,934.58 ₱445,560.50
Current Appropriation 102,836.30 117,373.05 125,564.05 171,106.55 516,879.95
Utilization - 455,399.32 - - 455,399.32
Balance as of year-end ₱548,396.80 ₱210,370.53 ₱335,934.58 ₱507,041.13 ₱507,041.13

3.7. Based on existing regulations, the 30% QRF shall be used only when there is a
declaration of a State of Calamity. If unused, the amount shall be transferred to a
Special Trust Fund on the succeeding year and such amount can be utilized for
other disaster-mitigation purposes. From the appropriations in Table 3, only the
30% QRF appropriation for CY 2022 cannot be used by the Barangay unless there
is a declaration of a State of Calamity on that year. Thus, the total LDRRMF
which the Barangay could have utilized for the 4-year period amounted to
₱911,108.48, computed as follows:

Prior years Unexpended LDRRMF- as of January

1, 2019 ₱ 445,560.50
LDRRMF CY 2019 to CY 2022 516,879.95
Less: CY 2022 QRF 51,331.97
Total Available LDRRMF ₱ 911,108.48

3.8. Based on the submitted report of utilization provided by the Barangay through the
Barangay Bookkeeper, no utilization was made out of LDRRMF in CY 2019,
2021 and 2022 while utilizations in CY 20202 only amounted to ₱455,399.32, as
can be seen in Table 4.

Table 4. DRRMF Utilization in CYs 2020

Check Check Gross
Payee Particulars
Date No. Amount
03/03/2020 69582840 Washington Enterprises 1 UNIT GENERATOR ₱ 48,500.00
03/03/2020 69582841 Electronics City & Service 1 unit amplifier, 4 set 33,600.00
Center, Inc. trumpa
03/03/2020 69582842 Berovan Marketing Inc. First Aid Kit 6,000.00

28
 Check Check Gross
Payee Particulars
Date No. Amount
03/16/2020 69582857 Prinsayas Corporation Relief Goods 63,844.85
03/16/2020 69582860 N and N Rice Mill and Palay Relief Goods 208,000.00
Buyer
11/27/2020 72877150 Electronics City & Service Handheld Radio 45,804.47
Center, Inc.
11/27/2020 72877151 Washington Enterprises 10 pair rainboots, 9 pair 49,650.00
raincoats, 2 pcs. Spine
board, 6 units water
resistant flashlight
TOTAL ₱455,399.32

3.9. As can be seen in Table 4, the barangay only utilized the total amount of
₱455,399.32 out of the total available LDRRMF appropriation amounting
₱911,108.48, hence, the fund was not fully maximized while the capability of the
Barangay to respond effectively during disasters was not greatly improved.

3.10. The occurrence of several typhoons, earthquake and flooding for the past years
and the crisis brought by the COVID-19 pandemic should have been enough
reason for the Barangay Officials to actively perform their various responsibilities
and initiate the implementation of disaster-prevention and mitigation activities.

3.11. The non-implementation of the planned LDRRM activities per LDRRMFIP did
not improve the capability of the Barangay and its Officials to prepare, manage
and respond to disasters as well as its ability assist the constituents in times of
calamity.

3.12. We recommended that the Punong Barangay implement during the year the
projects in the LDRRMFIP for the year, in order to equip the Barangay
Officials and its constituents the skills and knowledge to prepare and manage
disasters.

3.13. The Barangay agreed with the recommendation.

Minimal 20% Development Fund Utilization

4.0. Only ₱1,922,900.00 or 65% of the ₱2,941,833.60 continuing and current

appropriations of the 20% Development Fund for CYs 2019 to 2022 was
utilized, contrary to Section 3.2.3 of DBM-DOF-DILG JMC No. 1 dated
November 24, 2020 hence, optimal utilization of the fund was not achieved
and the constituents were deprived from enjoying its benefits.

4.1. DBM-DOF-DILG Joint Memorandum Circular No. 1 dated November 24, 2020
provides the revised guidelines on the appropriation and utilization of the 20% of
the annual internal revenue allotment for development projects. The JMC was
issued to increase the responsiveness of the guidelines and promote greater
autonomy, transparency and accountability in the LGUs’ appropriation and

29
utilization of their respective 20% DF. Pertinent sections of the subject
Memorandum Circular are as follows:

a) Section 3.1 – In accordance with Section 287 of RA No. 7160, each LGU
shall appropriate in its annual budget no less than twenty
percent (20%) of its annual IRA for development projects.

b) Section 3.2 – The LGUs are enjoined to observe the following policies and
guidelines in the appropriation and utilization of the 20% DF:

3.2.1 The 20% DF shall be utilized to finance the LGUs'

priority development projects, as embodied in their
respective duly approved local development plans,
and medium-term and annual investment programs,
which should be harmonized with the Regional
Development Plan and the Philippine Development
Plan.

3.2.2 The development projects that may be included under

the 20% DF shall be those that are necessary,
appropriate, or incidental to efficient and effective
local governance, and those which are essential to the
promotion of the general welfare of the people.

3.2.3 The LGUs shall ensure that the development

projects to be funded out of the 20% DF are well-
planned and procurement-and-implementation-
ready.

3.2.4 Technical assistance may be sought from National

Government Agencies (NGAs), such as, but not
limited to, the Department of Agriculture, DBM,
Department of Education, Department of
Environment and Natural Resources, DOF,
Department of Health, DILG, Department of Public
Works and Highways, Department of Social Welfare
and Development, and National Economic and
Development Authority, for the determination of the
more relevant and responsive development projects
that may be included under the 20% DF and to ensure
compliance with the standards prescribed by the
NGAs concerned.

3.2.5 The following expenditure items shall not be allowed

to be charged against the 20% DF:

30
 3.2.5.1 Personal Services expenditures, such as
salaries, wages, overtime pay, and other
personnel benefits.
3.2.5.2 Administrative expenses, such as supplies,
meals, representation, communication, water
and electricity, petroleum products, and the
like;
3.2.5.3 Traveling expenses, whether domestic or
foreign;
3.2.5.4 Registration fees and other expenses related to
the conduct of and participation to trainings,
seminars, conferences or conventions;
3.2.5.5 Purchase, maintenance or repair of
administrative office' furniture, fixtures,
equipment or appliances; and
3.2.5.6 Purchase, maintenance or repair of motor
vehicles used for administrative purposes.

4.2. During the CYs 2019, 2020, 2021 and 2022, the amount set aside by the Barangay
as 20% Development Fund, based on the approved Annual Budgets totaled
₱2,056,819.80. This amount was appropriated based on the Internal Revenue
Allotment (IRA) of the Barangay. Moreover, the Barangay still has a balance of
₱885,013.80 as of December 31, 2018 as continuing appropriations. Thus, the
20% Development Fund of the Barangay totaled to ₱2,941,833.60. Table 4
presents the programs, projects and activities funded from 20% Development with
their corresponding appropriations based on the Annual Investment Plans
submitted.

Table 5. 20% BDF CY 2019 to 2022 PPAs

CY Project/Title Appropriation
2018 and prev. years Unidentified Projects ₱ 885,013.80
2019 Road Construction 409,645.20
2020 Const/Installation of Solar Street Light 466,492.20
2021 Const. of Pathway 249,628.10
Improvement of MP Bldg. 249,628.10
2022 Construction of Brgy. Road/Pathway 681,426.20
TOTAL ₱2,941,833.60

4.3. Review of utilization revealed that out of the available appropriations the
barangay disbursed 65% or a total amount of ₱1,922,900.00 to implement the
projects funded under 20% Development Fund from CYs 2019 to 2022 and prior
years continuing appropriations as follows.

Table 6. Disbursements paid out of 20% Development Fund

Check Gross
Check No. Payee PPA
Date Amount
06/01/20 69582884 5 Star J Enterprises Const. of Pathway ₱ 498,900.00

31
 Check Gross
Check No. Payee PPA
Date Amount
03/16/22 80759809 5 Star J Enterprises Construction of Concrete 1,424,000.0
Pathway 0
Total ₱1,922,900.00

4.4. Since not all of the identified projects were implemented, the fund was not
optimally utilized hence the constituents were deprived of the benefits from the
noted projects.

4.5. We recommended that the Punong Barangay implement all the projects
appropriated under 20% Development Fund so that funds are optimally
utilized to help achieve the desirable socio-economic development and
environmental outcomes of the Barangay.

4.6. The Barangay agreed with the recommendation.

Lack of Appropriation for LCPC

5.0. No funds were appropriated in the CY 2019 to 2022 budget of the barangay
for the implementation of programs, projects and activities for the protection
of children, contrary to Republic Act No. 9344, thus protection of children’s
rights within the barangay is not strengthened.

5.1. Republic Act No. 9344 (Juvenile Justice and Welfare Act of 2006) adopts as a
policy the protection of the interests of children and promotes their physical,
moral, spiritual, intellectual and social well-being. The Act also recognizes the
rights of children to assistance, proper care and nutrition and special protection
from all forms of neglect, abuse, cruelty and exploitation, and other conditions
prejudicial to their development.

5.2. Section 15 of the said Act mandates the creation of Local Councils for the
Protection of Children (LCPC) in all levels of local government. It provides
further that 1% of the internal revenue allotment (IRA) of barangays,
municipalities and cities, shall be allocated for the strengthening and
implementation of the LCPC.

5.3. Our perusal of the Annual Budget of the barangay disclosed that no funds were
appropriated for the implementation of programs, projects and activities (PPA)
intended for the Council for the protection and well-being of children although the
barangay has established and created their own LCPC. Based on the estimated
IRA for the noted budget years, the following could have been appropriated for
LCPC programs and activities:

Table 7. Available Funds for LCPC

Particulars CY 2022 CY 2021 CY 2020 CY 2019
Estimated IRA 3,407,131.00 2,496,281.00 2,332,461.00 2,048,226.00

32
 SHOULD BE - 1% of IRA 34,071.31 24,962.81 23,324.61 20,482.26
ACTUAL Appropriation - - - -
Lacking Appropriation 34,071.31 24,962.81 23,324.61 20,482.26

5.4. Without the necessary budget and plan, the rights, interest and well-being of the
children in the barangay will not be protected, established and strengthened.

5.5. We recommended that the Punong Barangay include in its annual budget an
appropriation equivalent to 1% of its IRA intended for the protection and
welfare of the children in the barangay, identify and implement the
programs, projects and activities using the said fund pursuant to RA 9344.

5.6. The Barangay agreed with the recommendation.

1% Allocation for Senior Citizen and PWD

6.0. No funds were appropriated for programs and projects for Senior Citizens
and Persons with Disabilities (PWD) in CY 2019 to 2022 which should be 1%
of the barangay’s IRA, contrary to DBM and DSWD Joint Circular No.
2003-01 dated April 28, 2003, thus depriving the elderly citizens in the
barangay the full benefits of the programs due them.

6.1. DBM-DSWD Joint Circular No. 2003-001 dated April 28, 2003 was issued to
prescribe guidelines for the implementation of Section 29 of the General
Appropriations Act of 2003 which states that the plans, programs and projects
intended to address the concerns of senior citizens and persons with disability
shall be integrated in the regular activities of the agencies. Sections 4.2 and 4.3
thereof directs all government agencies, departments, bureaus, offices,
commissions and state universities and colleges to allocate at least one percent
(1%) of their respective budget to be utilized in the implementation of
programs/projects/activities/services which will address the needs of older persons
and persons with disabilities (PWDs).

6.2. Our perusal of the Annual Budgets of the barangay disclosed that no funds were
appropriated for Senior Citizens and PWDs programs and activities for the
periods CY 2019, CY 2020, 2021 & CY 2022 as shown in Table 8.
Table 8. Fund for Senior Citizens and PWDs Programs/Projects
Particulars CY 2022 CY 2021 CY 2020 CY 2019
Estimated IRA 3,407,131.00 2,496,281.00 2,332,461.00 2,048,226.00
SHOULD BE - 1% of IRA 34,071.31 24,962.81 23,324.61 20,482.26
ACTUAL Appropriation - - - -
Lacking Appropriation 34,071.31 24,962.81 23,324.61 20,482.26

33
6.3. Without the necessary appropriation sanctioned by law, the elderly citizens and
PWDs of the barangay are deprived of the benefits of the programs, which could
have been financed from the said amount.

6.4. We recommended that the Punong Barangay and its Council appropriate
funds in its annual budget for programs and projects benefitting Senior
Citizens and Persons with Disabilities (PWDs) at an amount of no less than
1% of the annual IRA as required by the Expanded Senior Citizen Act, R.A.
No. 9994.

6.5. The Barangay agreed with the recommendation.

PS limitation

7.0. Appropriations and actual expenditures in CYs 2019 to CY 2022 on Personal

Services (PS) exceeded the 55% PS limitation contrary to Section 331 (b) of
Republic Act No. 7160, thereby incurring illegal disbursements and reducing
the funds that could have been allocated for other beneficial programs and
development projects.

7.1. Section 331 (b) of Republic Act (RA) No. 7160 otherwise known as the Local
Government Code of 1991, states that “The total annual appropriations for
personal services of a barangay for one (1) fiscal year shall not exceed fifty-five
percent (55%) of the total annual income actually realized from local sources
during the next preceding fiscal year.”

7.2. DBM Local Budget Circular No. 98 issued on October 14, 2011, prescribed the
guidelines in determining compliance to the personal services (PS) limitation on
local government budgets. Section 4.2 thereof defines Personal Services (PS)
Limitation as the prohibition under Section 331 (b) of the Local Government
Code against appropriating funds for PS in excess of the limits set therein. It
provides further that PS Limitation refers to the amount beyond which no
additional appropriation for PS items is allowed.

7.3. Section 4.6 of the same Circular defines next preceding fiscal year as the fiscal
year that is two (2) years before a budget year. For example, if FY 2011 is the
budget year, the next preceding fiscal year is FY 2009.

7.4. Section 4.3 of the same Circular on the other hand provides items which are
waived in the determination of compliance to the PS limitation in LGU PS
budgets which includes payment of minimum Year-end Bonus of ₱1,000.00 for
the Punong Barangay and P600.00 for other mandatory barangay officials, and
their Cash Gifts.

7.5. Review of the annual budget of the barangay disclosed that appropriations for
Personal Services in CY 2022, 2021, 2020 and CY 2019 exceeded fifty-five
34
 percent (55%) of the total annual income actually realized from local sources
during the next preceding fiscal year. The excess amount is computed in Table 9.

Table 9. Excess of Appropriation over PS Limitation

Particulars 2022 2021 2020 2019
Total Actual Income (Next 2,367,646.91 2,136,451.47 1,915,246.43 1,745,299.00
Preceding Year)
2020/2019/2018/2017
PS Limitation 55% 1,302,205.80 1,175,048.31 1,053,385.54 959,914.45
Less: Appropriations
Annual Budget 1,357,205.51 1,229,795.55 1,108,395.58 960,096.40
Supplemental Budget No.1 172,000.00 239,800.00 59,000.00 62,000.00
Supplemental Budget No.2 110,000.00 110,000.00 110,000.00
Total Appropriations 1,639,205.51 1,469,595.55 1,277,395.58 1,132,096.40
Excess (336,999.71) (294,547.24) (224,010.04) (172,181.95)

7.6. In addition, actual expenditures for CYs 2022, 2021, 2020 and 2019 on personal
services also exceeded the ceiling for the reason that the budget itself for CY 2019
to CY 2022 provided a greater PS appropriation than what was required. Details
on table 10.
Table 10. Excess of Actual PS Expenditure over PS Limitation
2022 2021 2020 2019
PS Limitation 55% 1,302,205.80 1,175,048.31 1,053,385.54 959,914.45
Less: Actual PS Expenditures 1,600,752.73 1,453,225.72 1,259,395.36 1,127,095.12
Difference (298,546.93) (278,177.41) (206,009.82) (167,180.67)
Total PS cost for waived items 62,000.00 62,000.00 62,000.00 62,000.00
Excess (Difference less waived (236,546.93) (216,177.41) (144,009.82) (105,180.67)
items)

7.7. The Barangay officials were under the notion that since the budget of the
barangay was already reviewed by the Budget Officer and approved by the
Sangguniang Bayan, their budget was already in consonance with the regulations.

7.8. Failure to observe the mandatory limit on PS resulted in illegal disbursements

totaling ₱701,914.83 and impaired the delivery of some basic services of the
barangay because the excess funds spent for Personal Services could have been
allocated for other beneficial programs and development projects. This is without
prejudice to the issuance of Notice of Disallowance.

7.9. We recommended that the Punong Barangay and Committee Chairman on

Appropriation limit the appropriations and expenditures for Personal
Services of the barangay strictly in accordance with Section 331 (b) of RA
7160 to avoid disallowances on irregular and excessive PS disbursements.

7.10. We further recommended that the barangay council should strive to find
ways to improve collection of revenues from local sources so that the
Personal Services ceiling will correspondingly increase.

35
7.11. The Barangay agreed with the recommendations.

Delayed and Partial Deposit of Collections

8.0. The Barangay Treasurer did not deposit her collections regularly, intact and
on time, contrary to Section 69(1) of PD 1445, COA Circular No. 92-382
dated July 3, 1992 and Section 2.1 of COA Circular No. 97-002 dated
February 10, 1997 and the Manual on Financial Management of Barangays,
thus exposing barangay funds to the risk of loss, through misuse and/or
misappropriation.

8.1. Section 69(1) of PD 1445 provides: “Public officers authorized to receive and
collect moneys arising from taxes, revenues, or receipts of any kind shall remit or
deposit intact the full amounts so received and collected by them to the treasury of
the agency concerned and credited to the particular accounts to which the said
moneys belong. The amount of the collections ultimately payable to other
agencies of the government shall thereafter be remitted to the respective
treasuries of these agencies.”

8.2. Section 8 of COA Circular No. 92-382 dated July 3, 1992 issued to implement the
provisions of Republic Act No. 7160 states that all collections shall be deposited
intact with authorized depositories. The practice of retaining part of the
collections as a cash reserve for cash disbursements shall be discontinued.

8.3. Section 2.1 of COA Circular No. 97-002 dated February 10, 1997 also requires
that daily receipts of collections must be deposited intact with the proper bank.

8.4. Section 4.1.13 of the Manual on Financial Management of Barangays states that:

4.1.13 Collections received by the BT as deputized collector of the

city/municipality shall be remitted intact to the treasurer of the
city/municipality concerned daily or once the collections reach
P5,000.00.

8.5. During the conduct of cash examination, it was noted that for the period August
2021 to December 31, 2022, the Barangay Treasurer did not deposit her
collections regularly. Moreover, comparison of the actual collections and
deposits disclosed that the collections were not deposited intact, as can be seen in
Table 11.

Table 11. Collections Which Were Not Deposited Intact

Amount
Collections
Total Cash on Amount Retained by
Date during the
Hand Deposited Brgy.
Month
Treasurer
August 2021 2,310.00 2,310.00
September 2021 1,800.00 4,110.00 2,310.00 1,800.00
October 2021 1,540.00 3,340.00 1,800.00 1,540.00

36
 Amount
Collections
Total Cash on Amount Retained by
Date during the
Hand Deposited Brgy.
Month
Treasurer
November 2021 19,403.73 20,943.73 19,848.73 1,095.00
December 2021 - 1,095.00 1,080.00 15.00
January 2022 - 15.00 - 15.00
February 2022 - 15.00 - 15.00
March 2022 151,665.00 151,680.00 150,000.00 1,680.00
April 2022 8,054.47 9,734.47 1,665.00 8,069.47
May 2022 2,560.00 10,629.47 1,890.00 8,739.47
June 2022 2,060.00 10,799.47 - 10,799.47
July 2022 2,360.00 13,159.47 3,000.00 10,159.47
August 2022 1,960.00 12,119.47 - 12,119.47
September 2022 2,340.00 14,459.47 - 14,459.47
October 2022 400.00 14,859.47 - 14,859.47
November 2022 - 14,859.47 - 14,859.47
December 2022 1,860.00 16,719.47 1,000.00 15,719.47

8.6. It can be seen in Table 11 that for most of the time, there is always a variance or
an amount retained in the custody of the Barangay Treasurer at the end of each
month. Also, for the months of August 2021, June 2022, August 2022, September
2022, October 2022 and December 2022 no deposits were made by the Barangay
Treasurer despite existence of cash on hand. This practice exposes government
funds to the risk of loss, misuse or misappropriation.

8.7. We recommended that the Barangay Treasurer deposit the full amount of
collections at the Barangay’s authorized government depository bank daily,
weekly or once the collections reach ₱5,000.00, whichever is applicable.

8.8. The Barangay Treasurer agreed with the recommendation.

37
 PART III
STATUS OF IMPLEMENTATION OF PRIOR YEARS’ AUDIT
RECOMMENDATIONS
Of the 24 audit recommendations embodied in the previous Audit Reports of the
Barangay, 8 were fully implemented while 16 remained not implemented.

Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
CY The existence and We recommended that
2016 accuracy of the the Punong Barangay
-2018 Property, Plant and request the Barangay
ARB Equipment (PPE) Bookkeeper and the
Findin account valued at Municipal Accountant to:
g #1 Php1,616,240.71 (1) provide the Inventory
as of December 31, Committee with the (1)Not
2018 could not be detailed list of properties Implemented
ascertained due to recorded in the books so
ureconciled difference that the latter can
of Php586,855.08 reconcile the same with
between the RPCPPE their RPCPPE. (2) Any
and accounting records variance that will remain
and absence of property should be located, (2)Not
records, contrary to otherwise, the barangay Implemented
COA Accounting officials shall be held
Circular No.2006-002 liable for losses of
and Section 4 of NGAS properties.
Manual Volume 1. (3)maintain Property
Ledger Cards and
reconcile the same with (3)Not
the PCs of the designated Implemented
Barangay Custodian; and
(4)prepare and update
Property Ledger Cards
based on the RPCPPE
and reconcile the same (4)Not
with the PCs of the Implemented
designated Barangay
Property Custodian.

(5) We also
recommended that the
designated Barangay

38
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
Property Custodian (5)Not
prepare and maintain Implemented
Property Cards (PCs) of
all PPEs to include data
on the quantity,
condition, date of
acquisition and
acquisition cost.
CY The Barangay Treasurer (6) We recommended (6)Not
2016- did not deposit the full that the Barangay Implemented
2018 amount of her Treasurer deposit the full
ARB collections and on time, amount of her collections
Findin contrary to Section 334 at the Barangay’s
g #2 (a) of RA No. 7160 and authorized government
other existing rules and depository bank within
CY regulations, thus five (5) days receipt
2014- exposing barangay thereof to avoid
2015 funds to risk of loss administrative sanctions.
ARB thru misuse or
Part II misappropriation.
No.2

CY
2011-
2013
ARB
Part II
No.2

CY The balance of Cash in (7) We recommended (7) Not

2016 Vault account as of that the Barangay Implemented
-2018 December 31, 2018 in Treasurer and the
ARB the books of the Municipal Accountant
Findin Municipal Accountant reconcile their respective
g #3 was not reconciled with records in order to detect
the records of the errors and (8) effect the
Barangay Treasurer, necessary corrections to (8) Not
contrary to Section 111 arrive at a reliable and Implemented
(2) of PD 1445, thus correct balance of the

39
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
errors were not detected said account.
and the accuracy of the
reported balance is
unreliable.

CY Remittances to the BIR We recommended that

2016- were not tallied and the Barangay Treasurer:
2018 verified with the taxes (9) remit the amount of (9) Fully
ARB withheld from creditors Php17,022.25 Implemented
Findin such that taxes withheld immediately and present
g #4 totalling Php17,022.25 to the Audit Team proof
was under remitted, of such remittance; and
contrary to BIR (10) remit succeeding
Revenue Memorandum taxes withheld strictly (10) Fully
Circular No. 23-2012 within the prescribed due Implemented
and Revenue date and in exact amount
Regulation No. 1093, of the Bureau of Internal
thus depriving the Revenue (BIR) to avoid
National Government penalties.
of the available
resources for basic
services to the public.
CY No utilization was (11) We recommended (11) Not
2016- made from the 70% that the Punong Implemented
2018 Mitigation Fund of the Barangay identify the
ARB Local Disaster Risk programs and projects to
Findin Reduction Management be undertaken under the
g #5 Fund (LDRRMF) LDRRM Fund, prepare
despite of the the LDRRMFIP/ Work
Php181,985.02 Financial Plan and (12)
appropriations for implement the programs (12)Not
Calendar Years 2016 to and activities related to Implemented-
2018, contrary to DILG disaster preparedness in only minimal
Memorandum Circular order to equip the utilization was
No.2012-73, thereby Barangay Officials and made.
limiting the capacity its constituents the skill
and readiness of the and knowledge to
Barangay in responding prepare and manage
to disasters and in disasters.
assisting the

40
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
constituents in times of
calamity.
CY The utilization of 10% (13) We recommended (13) Fully
2016- Sangguniang Kabataan that the SK Chairperson Implemented
2018 Fund for Calendar prepare a comprehensive
ARB Years 2016, 2017 and list of activities/
Findin 2018 amounted only to programs for the
g #6 Php16,300.00 or 3% of development of the youth
the total appropriations and submit the same to
of Php519,957.20 the Barangay Council
which directed mainly appropriation of the SK
on sports development Fund. (14) Also, we
and leadership training, recommend that the (14) Fully
contrary to Section 1 Barangay Council Implemented
and 2 of Rule 5, appropriate the SK Fund
Implementing Rules for the programs
and Regulations of RA identified by the SK
No. 10632 and RA No. Chairperson.
9340, thereby other
equally important youth
development programs
and projects were not
given equal priority.

41
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
CY Minimal utilization was We recommended that
2016- made from the 20% the Punong Barangay
2018 Development Fund (15) identify the
ARB despite of the programs and projects to (15) Fully
Findin Php1,028,914.40 be undertaken under the Implemented
g #7 appropriations for 20% Development Fund;
Calendar Years 2016 to and (16) prepare and
2018, contrary to DBM- implement fully the 20% (16) Not
DILG Joint Development Fund Implemented
Memorandum Circular Investment Plan/ Work
No. 2017-01, thus, Financial Plan.
socio-economic and
environmental progress
in the Barangay were
not fully attained.

CY Programs for Gender (17) We recommended (17) Fully

2016- and Development were that the Barangay Implemented
2018 not implemented by the Council attribute funds
ARB Barangay since funds for GAD programs and
Findin equivalent to the activities which must be
g #8 required attribution of at least five percent (5%)
at least 5% of the of the Barangay’s Annual
Annual Budget were Budget and (18) the (18) Fully
not allocated for such Punong Barangay to Implemented
purpose in Calendar implement the programs
Years 2016, 2017 and and activities in the
2018, contrary to PCW- Barangay’s GAD Plan
DILG-DBM-NEDA during the year.
Joint Memorandum
Circular (JMC)2016-01,
thus, gender issues in
the Barangay were not
resolved.

42
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
CY The lot purchased (19) We recommended (19) Not
2016- amounting to that the Punong Implemented
2018 Php150,000.00 for Barangay and Barangay
ARB Barangay Health Center Treasurer to immediately
Findin is not supported with complete the necessary
g #9 the necessary supporting documents for
documents as called for the lot purchase and
in Section 13 of COA submit to the audit team
Circular 2012-001 after completion.
dated June 14, 2012,
thus regularity and
legality of the
transactions cannot be
confirmed.

CY The Barangay’s local (20) We recommended (20) Not

2016- income barely increased that the Punong Implemented
2018 in Calendar Years 2016 Barangay and other
ARB to 2018 due to inaction Barangay Officials enact
Findin of the officials to enact ordinances that will
g #10 ordinances to maximize increase barangay
their revenue raising revenues and monitor its
power as mandated in implementation in order
the Republic Act No. to collect more funds for
7160, thus, funds to the Barangay.
finance various
activities/programs for
development of the
Barangay and its
operational needs were
not enhanced.

43
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
The Bids and Awards (21) We recommended (21) Fully
CY Committee (BAC) did that the established Bids Implemented
2016- not diligently perform and Awards Committee
2018 its functions in the diligently perform the
ARB conduct of procurement functions provided in
Findin activities of the Section 12 of RA 9184 to
g #11 Barangay, contrary to ensure transparency in
Section 12 of RA 9184, the procedure and
otherwise known as the manner of procurement.
Governent Procurement
Reform Act, hence,
forming doubt on the
transparency of
procedure and manner
of procurement.

CY Physical count of We recommended that

2014- barangay properties was the Punong Barangay of
2015 not conduced and the Barangay Barayong:
ARB required Report on the (22)constitute an (22) Not
Part II Physical Count of Inventory Committee Implemented
No.1 Property, Plant and headed by the Barangay
Equipment was not Treasurer to conduct a
prepared and submitted thorough inventory of all
CY contrary to pertinent its properties; and
2011- provisions of the (23)submit the report to
2013 Accounting System, the BRK for
ARB Manual for Barangay, reconciliation with the
Part II Volume IV, records of the Municipal (23) Not
No.3 circularized under COA Accountant Office of Implemented
Accounting Circular Abuyog, Leyte.
No. 2006-002 dated
December 19, 2006,
thus, the existence and
accuracy of the
Property, Plant and
Equipment account
with a total amount of
Php1,782,216.25 as of

44
 Status of
Managem Implementation
Ref. Audit Observations
Recommendations ent and Reasons for
Action Non-
Implementation
December 31, 2015
could not be
ascertained.
CY Purchase of three (3) We recommended that
2011- units portable handheld the Puniong Barangay
2013 radio communication (24) secure a copy of the (24) Fully
ARB equipment aggregating purchasers’ and dealers’ Implemented
Part II Php21,600.00 were permit of the supplier
No.4 made and failed to from the NTC to
attach or present a consider the transaction
purchasers’ and dealer’s on the purchase of
permit from the handheld radio
National communication
Telecommunication equipment as valid and
Commission (NTC) in legitimate expenditure.
violation of Act.No. Such supporting
3846 and its document is necessary to
amendments, otherwise prevent transaction from
known as “Radio being questioned in
Control Law”, thus, audit.
rendering the
transactions as illegal
expenditures.

45