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Tagum City 2008 COA Audit 1

July 4, 2010

Detailed Findings and Recommendations

A.   Financial and Compliance Audit

1.  The failure of the Assistant City Treasurer to remit her collections on time required under Section 29 of the Manual on the New Government Accounting System exposed government funds amounting to P161,296.75 to possible loss through theft, misappropriation and/or misapplication.

            The aforecited Section of the NGAS states that:

“Reporting for Collections and Deposits. – Collectors/tellers shall issue a receipt to acknowledge collections made.  The receipt maybe in the form of pre-numbered Official Receipts, or cash tickets and the like.  At the close of each business day, these collectors/tellers shall accomplish the Report of Collections and Deposits (RCD) in four copies.  The original and two copies, together with the duplicates of the official receipts issued shall be submitted to the treasurer/cashier to whom the cash collected shall be turned over. The fourth copy of the RCD shall be retained by the collector/teller concerned”.

   x  x. x. x. x.
          An examination was conducted on the cash and accounts of Mr. Edgar C. de Guzman, City Treasurer, on June 18, 2007.  Actual cash count and verification of unissued accountable forms was made on all the collectors, disbursing officers and other accountable officers of the Office of the City Treasurer.
          One of the Accountable Officers su
          bjected to cash count was Ms. Dolores W. Fiesta, Assistant City Treasurer. Upon demand, she presented no cash/collections during that time and informed the Auditor that she had no unissued accountable forms in her possession.  She then signed the Certification on the General Forms 74(A), Report of Cash Examination.
          Verification made on the Report of Accountability for Accountable Forms as of cash count, June 18, 2007, revealed that Accountable Forms No. 51 with Serial Nos. 0237801-850 and 0207722-0207750 were included in the balances of unissued accountable forms as of that date.  Further verification showed that AF 51 SN 0237801-850 and SN 0207701-750 were issued to Ms. Dolores W. Fiesta, on July 12, 2005 and July 20, 2005, respectively.  Her latest Report of Collections and Deposits (RCD) was dated December 2, 2005 when she turned over the amount of P141,160.79 representing her collections for AF 51 SN 0207716-721.  Thus, as of June 18, 2007, her accountability for these accountable forms, was as follows:
        AF 51     SN 0237801-850       50 pcs.                           0207722-750       29 pcs.
           —–
                                   Total                     79 pcs.
                                                            ===

          In view hereof, a Demand Letter dated June 21, 2007 was issued to her demanding that she produce immediately the missing accountable forms and to submit a written explanation on the reason/s for her failure to turn-over said official receipts.

          In her reply, Ms. Fiesta stated that she had allowed a casual clerk, Ms. Mona Garcia, to liquidate her collections and that she could not locate anymore the missing accountable forms.  She further stated that all of these issued accountable forms were for bidder’s bond and that she is willing to pay whatever amount due for those lost accountable forms.
      
          Verification of the records of the City Accountant’s Office revealed that 44 of the 79 accountable forms which were declared missing had been  presented to the City Treasure’s Office for refund, totaling P161,296.75 (Annex 5).  The other 35 pieces remained unlocated and not presented for refund.
     
          On June 27, 2007, we issued a second Demand Letter to Ms. Fiesta.  But it was only on July 12, 2007 when we received her reply, wherein she promised to pay in installment basis, at least P5,000.00 a month starting July 2007 and also to withhold one-half of the bonus due her.  However, that same date, she again wrote us to inform that she will not be paying in installment but in lumpsum from the loan proceeds of  her parcel of land.
         
          A month after her reply dated July 12, 2007, our office followed up on whether Ms. Fiesta has already made the payment. It was learned that no payment was made.
         
          Such being the scenario, Ms. Fiesta can be liable for malversation of public funds pursuant to provisions of Article 217 of the Revised Penal Code  hereby quoted as follows:
     
          “Any public officer who, by reason of the duties of his office, is accountable for public funds or property, shall appropriate the same, or shall take or misappropriate or shall consent, or through abandonment or negligence, shall permit any other person to take such public funds, or property, wholly/partially, shall otherwise be guilty of the misappropriation or malversation of such funds or property.”
        
          However, during the exit conference, the City Treasurer stated that Ms.  Fiesta had made partial payments and also promised to pay in installments the balance of her accountability.
     
          We informed him and the other department heads who were present during the exit conference that we can not allow the mode of repayment that Ms. Fiesta desired. Ms. Fiesta has to remit all her remaining accountability sooner to avoid legal complications bearing this issue.

Recommendation for Tagum City Government: 

          Require Ms. Dolores W. Fiesta, Assistant  City  Treasurer, to immediately restitute the amount of  P161,296.75.

          Direct the Treasurer to monitor the liquidation of daily collections and deposit the same to authorized depository banks in the manner and within a period prescribed by Section 29, 32 and 33 of the Manual on the New Government Accounting System, Volume I.
         
          The City Treasurer should take action against those collectors assigned in the office who had always been delayed in turning-over their collections. He should see to it that collections are promptly turned-over as required.

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